ANJU JOSHI,RAJASTHAN vs. ITO 14(2)(3), MUMBAI

None appeared on behalf of the assessee even though the appeal was adjourned on the earlier occasion at the request of the counsel of the assessee. Hence, we proceed to dispose of the appeal ex-parte, without presence of the assessee.

Solitary issue urged in this appeal relates to assessment of ` 32,98,265/- u/s 68 of the Act, being gift of RIB Bonds received by the assessee from non-resident Indian.

We heard learned Departmental Representative and perused the record. The assessee received RIB bonds from Mr. Mahendra Durlabhi Desai and she encashed the same prematurely in October 2002. The Assessing Officer assessed the same u/s. 68 of the Act. The learned CIT(A) noticed that the assessee had claimed intially that the donor was her maternal uncle, but later on changed her stand by stating that the donor was her friend. It was noticed that the assessee has not proved the creditworthiness of the donor and hence the learned CIT(A) confirmed the addition

On going through the order passed by the learned CIT(A), we noticed that the assessee has relied upon the Rules and Regulations relating to RIB bonds, wherein it has been stated that the bonds can be gifted to a resident Indian. It was also contended that the State Bank of India, which issued the bonds, has stated at the time of issuing the bonds that the same shall be free from income tax, wealth tax and gift tax. We noticed that the learned CIT(A) has not addressed this contention of the assessee and he has not made any reference to the scheme under which RIB Bonds was issued. Under these set of facts, we are of the view that this issue requires fresh examination at the end of the learned CIT(A). Accordingly, we set aside his order and restore the same to his file for examining the issue afresh after affording adequate opportunity of being heard to the assessee.

In the result, appeal filed by the assessee is treated as allowed for statistical purposes. Order has been pronounced in the Court on 16.5.2017.