KAMBALA NOOKALAMMA,,GAJUWAKA vs. THE ITO,, VISAKHAPATNAM

Ground Nos. 1,2 and 7 are general in nature which does not require specific adjudication and the ld.AR did not make any arguments on these grounds. Hence these grounds are dismissed.

Ground No.3(a) is relating to the gift received from the husband of the assessee during the financial year 2011-12. The assessee stated that she has received gift of Rs.10,00,000/- during the financial year 2011-12 from her husband Sri Kambala Nookaraju. The Assessing Officer(AO) did not believe the receipt of gift as the same is not supported by any evidence. The AO observed that Sri Nookaraju is working as employee in RINL and the bank account of Sri Nookaraju did not support the cash gift from the withdrawals. The assessee also did not furnish any evidence with regard to the sources. Sri Nookaraju has not made any huge withdrawals and the AO also observed that Sri Nookaraju has taken a loan from Thrift and Credit Society of M/s RINL for performing the marriage of his daughter, hence, rejected the claim of the assessee with regard to the cash gift from her husband and added back to the income.

Aggrieved by the order of the AO, the assessee went on appeal before the CIT(A). The Ld.CIT(A) perused the statement of State Bank of Hyderabad relating to the husband of the assessee, from where the assessee has drawn his salaries and observed that her husband has no source to give such gift to his wife and the same is not supported by the entries in the above referred bank statements. Accordingly confirmed the addition made by the AO. Aggrieved by the order of the CIT(A), the assessee is in appeal before this Tribunal.

We have heard both the parties and perused the material placed on record. Both the Ld.CIT(A) and the AO held that husband of the assessee, Sri Nookaraju has no financial capacity to give gift of Rs.10 lakhs during the financial year 2011-12. We have gone through the CIT(A) order, wherein the deposits and withdrawals are tabulated in the CIT(A) order. As per the detailed analysis made by the CIT(A), there are no huge withdrawals to support the gift of Rs.10 lakhs given to the assessee. As per the order of the Ld.AO, the assessee had taken a loan from the Cooperative Credit Society to perform the marriage. During the appeal hearing, the Ld.AR did not bring any evidence to controvert the findings given by the Ld.CIT(A). The Ld.AR made an argument that the gift was received from her husband in the F.Y.

Ground No.3(b) is related to the assessee’s claim of accumulated savings of Rs.30,00,000/- from money lending business which includes cash gift of Rs.10 lakhs from the husband of the assessee. In ground No.3(a), we have held that the assessee’s husband has no source to give the gift of Rs.10 lakhs and confirmed the addition, hence the balance remained is Rs.20 lakhs. The assessee claimed to have accumulated the savings of Rs.20 lakhs which was used in money lending business to various fishermen in the locality for interest. During the assessment proceedings the assessee has furnished the names of the persons to whom the monies

During the appeal hearing, the Ld.AR referred to page No.42 of the paper book and submitted that by the end of March 2012, the assessee had accumulated savings of Rs.20,00,000/- which was utilized for giving loans to fishermen for interest ranging from 12 to 15% through money lending business. She has also given names and addresses of the persons to whom the amounts were advanced and their Aadhar numbers along with Aadhar card photo copies. The Ld.AR argued that the AO without making any enquiry made the addition, hence requested to remit the matter back to the file of the AO.

On the other hand, the Ld.DR relied on the orders of the CIT(A).

We have heard both the parties and perused the material on record. The assessee’s case is that she had accumulated savings of Rs.20 lakhs

Ground No.4 is related to the addition of Rs.5,00,000/- by the AO. The AO made the addition of Rs.39,97,065/- in the assessment and the contention of the Ld.AR is that out of the above addition, a sum of Rs.5,00,000/- was added by the AO twice, once in payments and second time in deposits made in the bank account. The Ld.AR brought to our attention to the licence fee account, wherein the assessee had made payment of Rs.5,00,000/- as licence fee on 25.06.2012 for which the AO made the addition for lack of source. The assessee furnished the details of licence fee account in page No.28 of the paper book. The assessee also enclosed bank account copy of Indian Bank, Gajuwaka Branch, wherein, it is shown that a sum of Rs.5,00,000/- was transferred to licence fee account on 25.06.2012. Therefore, the Ld.AR contended that the AO made the addition of Rs.5,00,000/- twice, once in payments made for licence fee to State Excise Department and second time in the cash deposits made in the

We have heard both the parties and perused the material placed on record. The assessee is required to explain the total source for the investments made in wine business. Prima facie, it appears that, there was merit in the argument of the assessee. As per page No.28 of the paper book in the licence fee account, the assessee made the payment of Rs.5,00,000/- which was included in the licence fee to Excise Department to the tune of Rs. 21,33,334/-. Similarly, the assessee has made the cash deposit of Rs.5,26,500/- which was used for payment of licence fee. Therefore, it appears that the AO has considered the sum of Rs.5,00,000/- twice. Hence this issue requires verification at the end of the AO. Therefore, we set aside this issue to the file of the AO and direct the AO to verify the transaction with the books of accounts and the amounts deposited in bank account and decide the issue afresh on merits.

The Ld.AR did not make any argument on ground No.5, hence ground No.5 is dismissed as not pressed.

In the result, appeal of the assessee is partly allowed.