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Facts
The assessee received Rs.61 lacs as a gift from his father, Shri Ashok Kumar Doda, and a loan of Rs.9 lacs from Shri Jaspal Singh, totaling Rs.70 lacs. The Assessing Officer and CIT(A) made/confirmed an addition of Rs.70 lacs to the assessee's income, doubting the genuineness, identity, and creditworthiness of these credits, despite the assessee furnishing explanations, affidavits, cash book entries, and confirmations.
Held
The Tribunal ruled that the identity and genuineness of the donors were established, particularly since the gift was from the assessee's father, whose cash book showed sufficient balance that was accepted in his own scrutiny assessment. It emphasized that a father's gift to his son for necessity does not require a specific "occasion" and that a cash gift, while raising suspicion, cannot be dismissed if genuineness and creditworthiness are proven. Therefore, the addition of Rs.70 lacs was unsustainable and deleted.
Key Issues
Whether the addition of Rs.70 lacs, comprising a gift from the father and a loan from another individual, on grounds of doubted genuineness, identity, and creditworthiness was justified.
Sections Cited
143(2)
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, DIVISION BENCH, ‘A’ CHANDIGARH
Before: SHRI RAJPAL YADAV & SHRI KRINWANT SAHAY
O R D E R PER RAJPAL YADAV, VP
The assessee is in appeal before the Tribunal against the order of the ld. Commissioner of Income Tax (Appeals) [in short ‘the CIT (A)’] dated 29.08.2025 passed for assessment year 2017-18.
The assessee has taken six grounds of appeal
but his grievance revolves around a single issue, namely, ld.CIT A.Y.2017-18
2. (Appeals) has erred in confirming the addition of Rs.70 lacs to the total income of the assessee by the AO.
3. The brief facts of the case are that assessee has filed his return of income electronically on 22.12.2017 declaring total income of Rs.2,91,420/-. The case of the assessee was selected for scrutiny assessment and a notice u/s 143(2) was issued and served upon the assessee. It revealed to the AO that assessee has shown credit of Rs.61 lacs from Shri Ashok Kumar Doda and Rs.9 lacs from Shri Jaspal Singh S/o Shri Gurdev Singh. He directed the assessee to explain the above credits. It was contended by the assessee that Shri Ashok Kumar Doda is his father. He has given gift of Rs.61 lacs. He was having sufficient funds in his Cash Books. Similarly, with regard to the loans taken from Shri Jaspal Singh, assessee has filed confirmation and other details for discharging the onus but the AO was not satisfied with the explanation of the assessee and made addition of Rs.70 lacs.
Appeal to the ld. CIT (Appeals) did not bring any relief to the assessee.
ITA No.1333/CHD/2025 A.Y.2017-18 3
The ld. counsel for the assessee, at the very outset submitted that Shri Ashok Kumar Doda is the father of the assessee and has given gift to the assessee. Affidavit of the father is available on page No. 45 of the Paper Book. He further took us through the Cash Book of Shri Ashok Kumar Doda. He took us through page Nos. 31 to 43 of the Paper Book and submitted that cash balance in M/s Tirupati Seeds, concern of Shri Ashok Kumar Doda as on 19.10.2016 was Rs.1,46,23,520/-. A gift of Rs.5 lacs has been given to the assessee on 28.10.2016 and Rs.20 lacs on 22.10.2016. Thus, before the date of gifts, he was having sufficient cash balance in his Cash Book. The AO of the assessee has also passed the scrutiny assessment of Shri Ashok Kumar Doda. He has not made any addition on account of unexplained credit in the hands of Shri Ashok Kumar Doda. He took us through scrutiny assessment order of this assessment year in the case of the donor. Similarly, assessment order of Shri Jaspal Singh has also been placed on the record, who has given loan of Rs.9 lacs. The assessee has returned the money.
ITA No.1333/CHD/2025 A.Y.2017-18 4
The ld. DR, on the other hand relied upon finding of ld.CIT (Appeals) recorded in paragraph No. 7.3 to 7.7 of the impugned order. He submitted that basically ld.CIT (Appeals) has held that there was no occasion to give gift to the assessee. Similarly, gift could have been given through Account Payee Cheque and the credit worthiness of Shri Ashok Kumar Doda is doubtful. Similarly, with regard to the loan of Rs.9 lacs, he relied upon order of ld.CIT (Appeals).
We have duly considered the rival contentions and gone through the record carefully. The ld. AO of the assessee has passed a brief assessment order in the case of his father Shri Ashok Kumar Doda, which has been placed before us by the ld. counsel for the assessee. He did not make any addition on account of unexplained credit in the hands of Shri Ashok Kumar Doda i.e. father of the assessee. In his Cash Book, sufficient cash balance was available. On each entry of gift, he has reduced the cash balance. The father has given an affidavit deposing therein that he has given gift to the assessee. Therefore, if these details are being perused, then identity is not in dispute. The donor is a related person, i.e. A.Y.2017-18 5 father of the assessee. The scrutiny assessment in his case was passed by the same AO who has passed the impugned assessment order. Thus, genuineness and identity cannot be doubted because donor and donee are father and son and they are deposing about giving the gift and receipt of gift. As far as credit worthiness is concerned, it has been demonstrated that in the proprietary concern of Shri Ashok Kumar Doda, M/s Tirupati Sales, sufficient cash balance was available in the Cash Book. The AO has not doubted that cash balance while scrutinizing return of the donor. Therefore, it is to be accepted that cash balance was available in the hands of the donor. As far as the loan of Rs.9 lacs is concerned, assessee has filed confirmation and other supporting details. He has also placed on record copy of the scrutiny assessment passed in his case.
7.1 As far as the finding of the ld.CIT (Appeals) is concerned, we find that for giving a donation by a father, no occasion is required. On account of necessity of funds at the end of the assessee, father has given gift to the assessee. Therefore, ld.CIT (Appeals) has failed to appreciate that gift A.Y.2017-18 6 has been received in relationship of father and son. It has to be appreciated in right perspective. The availability of funds is not in dispute because in the Cash Book, sufficient funds have been shown which has not been doubted while scrutinizing the return of the donor. The ld.CIT (Appeals) has raised suspicion as to why gift has been taken in cash and not through banking channel. It can be a valid suspicion but on that account only, gift cannot be disbelieved. Therefore, we are of the view that addition of Rs. 70 lacs is not sustainable. It is deleted. Accordingly, appeal of the assessee is allowed.
In the result, appeal is allowed.
Order pronounced on 10.03.2026.