SRI SABYASACHI ROY,NADIA vs. ITO, WARD 41(2), NADIA

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ITA 2010/KOL/2019Status: DisposedITAT Kolkata19 February 2020AY 2010-112 pages

In favour of the assessee: the assessee's appeal was allowed. From the AI summary of this appeal.

AI SummaryAllowed

What did the Tribunal hold?

The Tribunal found that the assessee had discharged the burden of proof regarding the genuineness of the gift. The addition of ₹5 lakhs made under Section 68 of the Act was deleted.

What were the facts?

The assessee received a gift of ₹5 lakhs from his mother, which was declared by the mother as being sourced from premature withdrawal of her STDRs. The assessee explained these were personal transactions not reflected in business accounts.

What were the issues?

The primary issues were the validity of the reopening of assessment and the addition of a gift amount as unexplained cash credit.

Which sections of the Income-tax Act were involved?

Section 68,Section 147

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, KOLKATA ‘SMC’ BENCH, KOLKATA

Before: Shri J. Sudhakar Reddy]

order

: February 19th, 2020 ORDER

Per J. Sudhakar Reddy, AM:

1.

This is an appeal filed by the assessee directed against the order of the Commissioner of Income Tax (Appeals)-12, Kolkata [‘CIT(A)’ for short] dated 30.04.2019 u/s 250 of the Income Tax Act, 1961 (‘the Act’ for short) for AY 2010-11.

2.

The assessee is an individual and is a trader. The issues that arise for my adjudication is validity of the re-opening of assessment u/s 147 of the Act and the addition of ₹5 lakhs to the income of the assessee on the ground that is clear that this claim of gift taken from his mother could not be proved. 3. After hearing rival contentions, I find that the assessee had made detailed submissions on the source of the money for which the mother of the assessee had made the gift dated 21.12.2016. This reads as follows: “I, Smt. Sucharita Roy w/o Lt. Hirendra Nath Roy, do hereby declare that I received the sum of Rs.6,75,182.00 on premature witndrawal of the following STDRs and I gifted the sum of Rs.5,00,000.00, out of the said amount, on 08.03.2010 in cash to my Son Shri Sabya Sachi Roy out of love and affection. I do also declare that this declaration is given to the best of my knowledge and in sound mind. STDR No. Amount (Face value) Rs. 072088 80,398.00 072087 80,398.00 072086 80,398.00 624079 53,796.00

Assessment Years: 2010-11 Sabyasachi Roy. 623679 80,000.00 624082 67,244.00 624081 67,244.00 624080 67,244.00 Total 5,76,722.00

4.

This declaration is supported by a certificate issued by State Bank of India, a copy of which is file before me. The assessee’s explanation before the ld. CIT(A) was that, the mother had prematurely withdrawn the STDR nos. on 21.12.2016 and had received an amount of 6,75,182/- which consists of face value of 5,76,722/- and the balance interest of ₹98460/- and that this amount was given to the assessee as gift by her and the assessee had made three FDRs from out of the receipt of gift from the mother. The assessee further explained that these were personal transactions and not connected with the business and hence they were not reflected in the business account. In my view the assessee has discharged the burden of proof that lay on him that this is a genuine gift. The addition of ₹5 lakhs made u/s 68 of the Act is hereby deleted and that the appeal of the assessee is allowed.

5.

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

Kolkata, the 19th February, 2020.

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