SH. GAURAV MITTAL,DELHI vs. ITO, NEW DELHI

Assessee by : Shri R.S.Singhvi, CA Respondent by :Shri Robin Rawal, Sr. DR Date of Hearing 08/01/2016 Date of pronouncement 07/03/2016 O R D E R PER PRASHANT MAHARISHI, A. M. This appeal is preferred by the assessee against the order of learned 1. Commissioner of Income-tax (Appeals)-XXV, New Delhi dated 03.09.2013 for the Assessment Year 2010-11, raising following grounds of appeal:- 1 (i) That on the facts and circumstances of the case, the CIT(A) was not justified in confirming addition of Rs, 11 lacs in respect of gift received from his Mausi (Mother sister) as income from other sources without appreciating the fact that issue is fully and squarely covered by order of ITAT in assessee's own case for A.Y. 2009-10. (ii) That donor and donee being same and as such finding of ITAT is relevant in respect of source and genuineness of gift.

2. That CIT(A) has not properly appreciated the fact of the case and also not allowed proper and reasonable opportunity and impugned order is not sustainable.

3. That orders of the lower authorities are not justified on facts and same are bad in law.”

2. The only ground of appeal in the case of the assessee is a gift received of Rs.11 lac from sister of his mother which has been taxed as income of the assessee under the head ‘ Income from other Sources’. During the course of assessment it was noticed that there is a credit of Rs. 11 lacs in the bank account of the assessee maintained with Tamil Nadu Mercantile Bank of Rs.11 lacs. On enquiry the assessee submitted that this amount is received as gift from Ms. Usha Agarwal, sister of his mother who is residing in Nepal. The Page 2 of 4 above said amount is received through banking channel and during the course of assessment the assessee submitted an affidavit in support of gift from donor, copy of the passbook of the donor, the information about financial status of the donor. Further the assessee could not submit bank account/ return of income and wealth tax return of Ms. Usha Agarwal. However, the assessee submitted that Trilok Chandra Agarwal who is husband of Ms. Usha Agarwal are promoters of banks of Nepal and also engaged in various business activities in Nepal. The ld AO did not accept the explanation of the assessee and therefore made an addition of Rs.11 lacs as taxable income as income from other source. The assessee being aggrieved with the order of the AO has preferred an appeal before the learned Commissioner of Income-tax (Appeals) reiterating the facts stated before the AO. Before the learned Commissioner of Income-tax (Appeals) it was submitted that issue is covered in favour of the assessee in his own case for Assessment Year 2009-10, wherein the gift received from the same person was accepted as genuine and creditworthiness of the donor were accepted. The learned Commissioner of Income-tax (Appeals) rejected the submission of the assessee and confirmed the action of the AO. Therefore the assessee is in appeal before us.

3. The ld AR of the appellant has submitted that the issue is squarely covered by order of ITAT in assessee’s own case for Assessment Year 2009-10, wherein ITAT has accepted the gift of Rs. 11 lacs from the same person. He submitted that the addition in the case of the assessee is not made u/s 68 of the Act but as Income from other sources , he submitted that identity and genuineness of the transaction is not at all doubted by the lower authorities but only the creditworthiness of the donor who is relative of the assessee has not been accepted by the lower authorities. He further submitted that in support of the creditworthiness of the donor a. an affidavit of the donor stating the details of the bank account in which gift is received and certificates of the bank from which money is given by the donor i.e. Everest Bank Ltd., Nepal that the demand draft have been taken by the donor from that bank. b. A statement showing total income received by the donor for the year is approximately 45,81,750/- Nepali Rupees.

Page 3 of 4 c. Various balance sheets of various banks where the husband of the assessee is the chairman and major shareholders of the bank along with his family members. d. A certificate of Inland Revenue Department of Govt. of Nepal showing TDS transaction on such dividend in the name of the husband of the Donor. e. Joint income statement of the donor and her spouse, wherein the dividend income received is more than 1 crore in one year. In view of this it was submitted that the assessee has proved creditworthiness which was in question.