MRS. BHAVANA BHARAT PATODIA,MUMBAI vs. DY CIT CC-1(1), MUMBAI

The material facts are that pursuant to search action on Balaji Group on 28/01/2015, the premises of the assessee were also covered under the search. In response to notice u/s 153A, the assessee offered returned income of Rs.4.78 Lacs which was the same as offered u/s 139(1). The assessee was saddled with addition of gift for Rs.2.96 Lacs which are adjudicated as under: - 3. Gifts 3.1 The assessee received gifts of Rs.0.99 Lacs & Rs.0.97 Lacs from her brothers Shri Ramesh D. Gajera and Shri Kishore D. Gajera. Another gift of Rs.1 Lac was received from her mother-in-law. These gifts were added to assessee’s income for want of sufficient evidences. The addition, upon confirmation by Ld. CIT(A), is in further challenge before us. 3.2 We find that similar issue of gift from aforesaid donors has been decided by us in assessee’s favor in as follows:- 3.5 Upon perusal of documents on record, we find that the mother of the assessee has declared income of Rs.1.78 Lacs during the year as miscellaneous income. However, upon perusal of her Balance Sheet as on 31/03/2014, as placed on record, it could be seen that she has capital balance of Rs.1287.32 Lacs which 3 Mrs. Bhavana Bharat Patodia Assessment Years: 2014-15 & 2015-16 has been invested in various forms. This capital balance is arrived at after reducing Gifts of Rs.4.94 Lacs and withdrawals of Rs.10.47 Lacs. The source of gift, in our opinion, could not solely be the current year’s income particularly in view of the fact that the mother of the assessee was on old lady and living in a joint family. There is no adverse material to prove the gifts. Therefore, the conclusion drawn by Ld. CIT(A) could not be sustained and we are inclined to delete the addition of Rs.1 Lacs. 3.6 So far as the two other donors are concerned, we find that both of them are agriculturist which is supported by their land holdings. The amounts of gifts are less than Rs.1 Lacs in each of the cases which was below exemption limit of Rs.2 Lacs. Therefore, there would be no obligation on the donors to file the return of income. The gifts are duly supported by the affidavits of the donors. The details of agricultural land have been well enumerated in their respective affidavits. Regarding allegation of immediate cash deposit, the donors being agriculturist working in remote village would receive the proceeds of agriculture in cash. The cash deposit need not match with harvesting season since there is no such requirement under law. Therefore, these two additions would stand deleted. We order so.

AY 2015-16 4.1 The facts as well as issues are substantially the same in this year. The assessee was saddled with addition of gift received from her mother-in-law for Rs.0.97 Lacs. The addition was confirmed by Ld. CIT(A). Since we have deleted similar addition in AY 2014-15, taking the same view, the same stand deleted in this year also. 4.2 The last addition is u/s 41(1) for Rs.0.81 Lacs on account of sundry creditors. This issue stand covered in assessee’s favor by our adjudication in ITA No. 6012/Mum/2018 as follows: - 6.2 We find that in terms of Sec.44AD, the income is computed on presumptive basis and there is no need to maintain books of accounts. Therefore, the impugned addition, as made u/s 41(1), in our considered opinion, could not be sustained in the eyes of law. By deleting the same, we allow this ground of appeal.