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In order to take benefit of sec 68 of receive of amount from relative exempt under sec 56(1) the definition of relative should be fulfilled

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Court :
INCOME TAX APPELLATE TRIBUNAL

Brief :
The short issue in the present appeal by the assessee is with reference to addition of Rs.9,45,000/-, a gift received from the sister of the assessee brought to tax under section 68 of the Income Tax Act. The Assessing Officer was of the view that the assessee did not furnish any creditworthiness of the donor, assessee’s sister who is claimed to be a Dentist in the United Kingdom. The assessee filed additional evidences before the CIT (A) which were not admitted and the CIT (A) confirmed the addition. Before us, the learned Counsel submitted that the Assessing Officer wrongly invoked the provisions of section 68 whereas the amount received from her sister being a relative is exempt under the provisions of section 56(1)(v) which is applicable to the assessment year under consideration. Since the Assessing Officer wrongly invoked the provisions of section 68 on the amount which was not taxable under section 56(1)(v), the addition per se cannot be sustained. It was further submitted that the assessee furnished the relevant evidence with reference to creditworthiness of the donor by an audit certificate dated 28.5.2009 by way of additional evidence which was not admitted by the CIT (A) and therefore, the assessee has no objection if the matter is re-examined by the Assessing Officer. The learned Departmental Representative relied on the orders of the CIT (A).

Citation :
Anita S. Katara 1205 C Wing, Rajeja Sherwood, Near NSE Ground,Goregaon (E)Mumbai PAN – AHBPK 0947 N (Appellant) Vs Income Tax Officer 19(3)(1)Mumbai(Respondent)

 

IN THE INCOME TAX APPELLATE TRIBUNAL

"A" Bench, Mumbai

 

Before Shri D. Manmohan, Vice-President and

Shri B. Ramakotaiah, Accountant Member

 

ITA No. 3294/Mum/2011

(Assessment Year: 2006-07)

 

Anita S. Katara

1205 C Wing,

Rajeja Sherwood, Near

NSE Ground,Goregaon (E)

Mumbai

PAN – AHBPK 0947 N

(Appellant)

 

Vs

 

Income Tax Officer

19(3)(1)

Mumbai

(Respondent)

 

Appellant by: Shri Prakash Jotwani

Respondent by: Shri P.K.B. Menon, Sr.DR

 

Date of Hearing: 21/02/2012

Date of Pronouncement: 21/02/2012

 

O R D E R

Per D. Manmohan, Vice President.

 

The short issue in the present appeal by the assessee is with reference to addition of Rs.9,45,000/-, a gift received from the sister of the assessee brought to tax under section 68 of the Income Tax Act. The Assessing Officer was of the view that the assessee did not furnish any creditworthiness of the donor, assessee’s sister who is claimed to be a Dentist in the United Kingdom. The assessee filed additional evidences before the CIT (A) which were not admitted and the CIT (A) confirmed the addition.

 

2. Before us, the learned Counsel submitted that the Assessing Officer wrongly invoked the provisions of section 68 whereas the amount received from her sister being a relative is exempt under the provisions of section 56(1)(v) which is applicable to the assessment year under consideration. Since the Assessing Officer wrongly invoked the provisions of section 68 on the amount which was not taxable under section 56(1)(v), the addition per se cannot be sustained. It was further submitted that the assessee furnished the relevant evidence with reference to creditworthiness of the donor by an audit certificate dated 28.5.2009 by way of additional evidence which was not admitted by the CIT (A) and therefore, the assessee has no objection if the matter is re-examined by the Assessing Officer. The learned Departmental Representative relied on the orders of the CIT (A).

 

3. We have considered the issue and are of the opinion that the matter is to be re-examined by the Assessing Officer afresh. The contention that the provisions of section 56(1)(v) regarding the amount received from the relative was not there before Revenue authorities. Moreover it is to be established that the person who gifted money is assessee’s sister as claimed. It was also to be  established that the said sister is working as Dentist in U.K. The audit certificate placed before the CIT (A) with reference to the creditworthiness should have been admitted and examined by the CIT (A) which was not done. Therefore, without going to the merits of various claims, we restore the issue to the file of the Assessing Officer to consider the additional evidence filed before the CIT (A) and also examine other contentions afresh. The assessee is directed to furnish the necessary evidence to the Assessing Officer to substantiate the claims. Needless to state that adequate opportunity should be given to assessee in the consequential assessment proceedings. With these directions the issue of gift is restored to the file of the Assessing Officer to examine afresh on the basis of facts and law.

 

4. In the result, assessee’s appeal is considered allowed for statistical purposes.

 

Order pronounced in the open court on 21st February, 2012.

 

Sd/-                           Sd/-

(B. Ramakotaiah)         (D. Manmohan)

                                             Accountant Member       Vice-President

 

Mumbai, dated 21st February, 2012.

Vnodan/sps

 

Copy to:

 

1. The Appellant

2. The Respondent

3. The concerned CIT(A)

4. The concerned CIT

5. The DR, “A“ Bench, ITAT, Mumbai

 

 

 

By Order

 

Assistant Registrar

Income Tax Appellate Tribunal,

Mumbai Benches, MUMBAI

 

 

CS Bijoy
on 25 February 2012
Published in Income Tax
Views : 1654
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