The ITO, Ward-1(1),, Bhavnagar v. Shri Sureshbhai Vallabhbhai Patel, Bhavnagar

ITA 849/AHD/2008 | 2004-2005
Pronouncement Date: 19-08-2010 | Result: Dismissed

Appeal Details

RSA Number 84920514 RSA 2008
Assessee PAN ACSPK7559C
Bench Ahmedabad
Appeal Number ITA 849/AHD/2008
Duration Of Justice 2 year(s) 5 month(s) 12 day(s)
Appellant The ITO, Ward-1(1),, Bhavnagar
Respondent Shri Sureshbhai Vallabhbhai Patel, Bhavnagar
Appeal Type Income Tax Appeal
Pronouncement Date 19-08-2010
Appeal Filed By Department
Order Result Dismissed
Bench Allotted C
Tribunal Order Date 19-08-2010
Date Of Final Hearing 29-07-2010
Next Hearing Date 29-07-2010
Assessment Year 2004-2005
Appeal Filed On 07-03-2008
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCH 'C' BEFORE SHRI BHAVNESH SAINI JM & SHRI A N PAHUJA AM ITA NO.849/AHD/2008 (ASSESSMENT YEAR:-2004-05) INCOME-TAX OFFICER (OSD) RANGE-1 BHAVNAGAR V/S SHRI SURESHBHAI VALLABHBHAI PATEL 28 VIJAYRAJNAGAR BHAVNAGAR [PAN: ACSPK 7559 C] [APPELLANT] [RESPONDENT] REVENUE BY :- SHRI SHELLEY JINDAL DR ASSESSEE BY:- SHRI TUSHAR HEMANI. AR O R D E R A N PAHUJA: THIS APPEAL BY THE REVENUE AGAINST AN ORDER DATE D 5- 11-2007 OF THE LD. CIT(APPEALS)-XX AHMEDABAD RAIS ES GROUND NOS. 1 & 2 RELATING TO AN ADDITION OF RS.1 90 00 000/- O N ACCOUNT OF UNEXPLAINED INVESTMENT U/S 69 OF THE INCOME-TAX ACT 1961 [HEREINAFTER REFERRED TO AS THE ACT]. 2 FACTS IN BRIEF AS PER RELEVANT ORDERS ARE THAT RETURN DECLARING NIL INCOME FILED ON 13-1-2005 BY THE ASSESSEE DER IVING INCOME BY WAY OF INTEREST AND DIVIDEND AFTER BEING PROCESSED U/S 143(1) OF THE ACT WAS SELECTED FOR SCRUTINY WITH THE SERVICE OF A NOTICE U/S 143(2) OF THE ACT ON 06-06-05. DURING THE COURSE OF ASSESS MENT PROCEEDINGS THE ASSESSING OFFICER[AO IN SHORT] NOT ICED THAT THE ASSESSEE CREDITED AN AMOUNT OF RS.95 00 000/- AS G IFT RECEIVED FROM HIS FATHER BEING SHARE IN A FLAT IN RADHAKR ISHNA CO-OPERATIVE HOUSING SOCIETY (VALKESHWAR FLAT) MUMBAI WHILE AN E NTRY OF RS.1 30 50 000/- WAS REFLECTED ON ASSET SIDE IN T HE BALANCE SHEET AS ON 31-3-2004. IN RESPONSE TO A SHOW CAUSE NOTICE DATED 7-12- 2006 THE ASSESSEE DID NOT FURNISH ANY EVIDENCE OF RECEIPT OF GIFT NOR ANY EXPLANATION FOR THE ENTRY OF RS. 1 30 50 000/- . ACCORDINGLY THE AO ADDED AN AMOUNT OF RS.1 90 00 000/- U/S 69 OF THE ACT. ITA NO.849/AHD/2008 2 3. ON APPEAL THE ASSESSEE SUBMITTED THAT HE HAS F URNISHED THE NAME ADDRESS PAN AND CONFIRMATION OF THE DONOR AL ONG WITH A COPY OF HIS RETURN BESIDES THE RELEVANT EXTRACT FROM THE BOOKS OF ACCOUNTS OF THE DONOR DURING THE COURSE OF THE ASSESSMENT PROCEEDINGS. SI NCE THE ASSESSEE CLAIMED TO HAVE ESTABLISHED THE GENUINENESS OF THE TRANSACT ION IDENTITY AND CREDIT WORTHINESS OF THE DONOR IT WAS CONTENDED WHILE RE LYING UPON DECISIONS IN THE CASE OF MURLIDHAR LAHORIMAL VS. CIT 280ITR 512 (GU J) CIT VS. PRAGATI CO.OP. BANK LTD. 278 ITR 170 (GUJ) COMMISSIONER OF INCOME- TAX V. ORISSA CORPORATION P: LTD. 1986 159 ITR 78 (SC) NEMI CHAND KOTHARI V. CIT AND ANOTHER 264 ITR 254(GAU ) DCIT V. ROHINI BUILDERS. (2002) 256 ITR 3 60(GUJ) ROHINI BUILDERS V. DICT (2002) 76 TTJ 521 (AHD) ADDITIONAL CIT V. HANU MAN AGARWAL 151ITR150 (PAT) ADDL. CIT V. BAHRI BROS. P. LTD. 154 ITR 244(PAT) AND SAROGI CREDIT CORPORATION V. CIT 103ITR344(PAT ) THAT FLAT WAS PURCHASED BY THE FATHER OF THE ASSESSEEE IN HIS NAME AS ALSO IN THE NAME OF HIS COUSIN SHRI DHIRAJLAL GANESHBHAI WHO ACCOUNTED FOR THE S AID FLAT IN HIS BOOKS OF ACCOUNTS AS GIFT. THE DEPARTMENT HAVE ACCEPTED THE GIFT TO BE GENUINE IN HIS CASE. IN FACT AN AMOUNT OF RS.95 LACS WAS INVEST ED BY HIS FATHER IN HIS NAME WHILE THE ASSESSEE MADE FURTHER PAYMENT OF RS.35.50 LACS IT WAS SUBMITTED . IN THE LIGHT OF THESE SUBMISSIONS AND AFTER HAVING A R EMAND REPORT FROM THE AO AND COMMENTS OF THE ASSESSEEE THEREON THE LEARNED CIT (A) DELETED THE ADDITION IN THE FOLLOWING TERMS:- 3.8 I HAVE CAREFULLY CONSIDERED THE ASSESSMENT ORD ER REMAND REPORT RECEIVED FROM THE AO SUBMISSIONS OF THE APPELLANT AND THE CASE LAWS RELIED UPON. THE ADMITTED POSITION IS THAT THE APPE LLANT HAS RECEIVED A GIFT OF RS.95.00 LACS FROM HIS FATHER WHO PAID THE SAID AMOUNT DIRECTLY TO THE VENDOR OF THE FLAT AND TRANSFERRED THE SAME TO THE APPELLANT BY PASSING A JOURNAL ENTRY DURING THE YEAR UNDER CONSIDERATION. THE FATHER OF THE APPELLANT IS AN EXISTING INCOME TAX ASSESSEE BEING ASSESSED IN THE SAME RANGE AS THE APPELLANT. IN THE BALANCE SHEET OF THE APPELLANT AS ALSO THAT OF THE FATHER OF THE APPELLANT THE PAYMENTS TO THE BUI LDER OF THE FLAT ARE DULY REFLECTED AND THE SAME ARE MADE FROM THE REGULAR BA NK BOOKS. IN THE HANDS OF THE CO-OWNER OF THE FLAT WHO IS ALSO ASSE SSED IN THE SAME RANGE THIS TRANSACTION OF GIFT STOOD ACCEPTED. IN CASE OF ANY TRANSACTION OF GIFT THE FOLLOWING THREE INGREDIENTS ARE TO BE PROVED: ITA NO.849/AHD/2008 3 1) THE GENUINENESS OF THE TRANSACTION 2) IDENTITY OF THE DONOR; AND 3) CREDITWORTHINESS AND CAPACITY OF THE DONOR. IN THE FACTS OF THE PRESENT CASE THE APPELLANT HAS PROVED ALL THESE THREE CONDITIONS IN AS MUCH AS NAME AND ADDRESS PROVED TH E IDENTITY CLOSE RELATIONSHIP PROVED THE GENUINENESS OF THE TRANSACT ION AND COPY OF THE PAN RETURN OF INCOME AND THE RELEVANT EXTRACT FROM THE BOOKS OF ACCOUNTS OF THE DONOR PROVED THE CREDITWORTHINESS. ONCE THES E THREE INGREDIENTS ARE PROVED TRANSACTION OF GIFT HAS TO BE TAKEN AS GENU INE AND THEREFORE IN THE FACTS OF THE PRESENT CASE GIFT RECEIVED BY THE APPE LLANT IS TREATED AS GENUINE AND ADDITION MADE ON THAT COUNT IS DIRECTED TO BE DELETED. THIS GROUND IS .THEREFORE ALLOWED. 4. THE REVENUE IS NOW IN APPEAL BEFORE US AGAINST THE AFORESAID FINDINGS OF THE LD. CIT(A). THE LEARNED DR WHILE SU PPORTING THE ORDER OF THE AO CONTENDED THAT THERE WAS NO EVIDENCE OF PAYMENT OF RS. 95 LACS BY FATHER OF THE ASSSESSEE NOR GENUINENESS OF TRANSACTION HAS BEEN ESTABLISHED. ON THE OTHER HAND THE LEARNE D AR ON BEHALF OF THE ASSESSEE CONTENDED THAT THERE WAS NO SUCH G IFT OF IMMOVABLE PROPERTY. IN FACT FATHER OF THE ASSESSEEE HAD PURC HASED THE FLAT IN THE JOINT NAME OF THE ASSESSEE AND SHRI DHIRAJBHA I GANESHBHAI AND PAYMENT WAS MADE IN THE EARLIER YEARS. SINCE THE LD . CIT(A) DELETED THE ADDITION AFTER HAVING A REMAND REPORT FROM THE AO THE LD. AR SUPPORTED THE IMPUGNED ORDER. 5. WE HAVE HEARD BOTH THE PARTIES AND GONE THROUGH THE FACTS OF THE CASE. UNDISPUTEDLY THE FATHER OF THE ASSESSEEE MADE INVESTMENT OF RS. 95 LACS EACH IN A FLAT IN THE JOINT NAME OF THE ASS EESSEE AND SHRI DHIRAJBHAI GANESHBHAI . THE PAYMENT FOR THIS FLAT IS STATED TO HAVE MADE FROM THE DENA BANK AND STATE BANK OF SAURASHTRA ACCOUNT OF M/S A RSHIT GEMS IN THE FY ENDING 31.3.2002 & 31.3.2003 AND IS REFLECTED IN T HE CAPITAL ACCOUNT OF FATHER OF THE ASSESSEE. APPARENTLY WHAT WAS TRANSFERRED WAS ONLY THE PAYMENT MADE FOR AND ON BEHALF OF THE ASSESSEE BY HIS FATHER .THE AS SESSEE FURNISHED THE NAME ADDRESS CONFIRMATION AND PERMANENT ACCOUNT NUMBER OF THE DONOR AND THUS AS CONCLUDED BY THE LD. CIT(A) THE ENTIRE INVESTMENT W AS DISCLOSED THROUGH THE ITA NO.849/AHD/2008 4 KNOWN SOURCES OF THE ASSESSEE AND HIS FATHER. THE LD. CIT(A) AFTER CONSIDERING THE FACTS OF THE CASE CONCLUDED THAT EVIDENCES IN THE FORM OF PAN RETURN OF INCOME AND THE RELEVANT EXTRACT FROM THE BOOKS OF A CCOUNTS OF THE DONOR AN EXISTING ASSESSEE ESTABLISHED HIS CREDITWORTHINESS AND GENUINENESS OF THE TRANSACTION. THE REVENUE HAVE NOT PLACED ANY MATERI AL BEFORE US IN ORDER TO CONTROVERT THESE FINDINGS OF FACTS RECORDED BY THE LD. CIT(A).IN THESE CIRCUMSTANCES WE ARE NOT INCLINED TO INTERFERE. T HEREFORE GROUND NOS. 1 & 2 ARE DISMISSED. 6. GROUND NOS. 3 & 4 BEING MERE PRAYER DO NOT RE QUIRE ANY SEPARATE ADJUDICATION AND ARE THEREFORE DISMISSED . 7. IN THE RESULT APPEAL IS DISMISSED. ORDER PRONOUNCED IN THE COURT TODAY ON 19-08-2010 SD/- SD/- (BHAVNESH SAINI) JUDICIAL MEMBER (A N PAHUJA) ACCOUNTANT MEMBER DATE : 19-08-2010 COPY OF THE ORDER FORWARDED TO: 1. SHRI SURESHBHAI VALLABHBHAI PATEL 28 VIJAYRAJNA GAR BHAVNAGAR 2. ITO (OSD) RANGE-1 BHAVNAGAR 3. CIT CONCERNED 4. CIT(A)-XX AHMEDABAD 5. DR BENCH-C ITAT AHMEDABAD 6. GUARD FILE BY ORDER DEPUTY REGISTRAR ASSISTANT REGISTRAR ITAT AHMEDABAD