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Before: SHRI S.V. MEHROTRA & MS. SUCHITRA KAMBLE
ORDER PER SUCHITRA KAMBLE, JM (Assessment year 2006-07) This appeal is filed against the order dated 7/4/2015 passed by Ld. CIT(A)’s Rohtak.
The grounds of appeal are as follows:-
1. That the order of the Hon’ble CIT (Appeals) is contrary to law and the facts of the appellant’s cases.
2. That the Hon’ble CIT (Appeals) erred in not holding that the issue of the notice under section 148 was barred by limitation and all the proceedings there under were wrong and illegal.
3. That the Hon’ble CIT (Appeals) erred in not considering as genuine the gift of Rs.100000/- received by the assessee from his father and in ignoring the confirmation of gift given by his father, the bank pass book of the father which showed the payment made to the assessee, the affidavit of Shri Subh Ram Yadav son of Late Shri Ram Lal Yadav who witnessed the gift and the statement of the witness of the gift.
4. That the Hon’ble CIT (Appeals) erred in rejecting the confirmation of the gift on the ground that it was not registered.
3. The assessee Lal Singh Yadav is a Government employee since 1981 and presently working in the office of District Industries Centre Rewari. During Assessment Year 2006-07, he received salary of Rs.1,24,354/- and filed his income tax return accordingly. Thereafter, the Department issued a notice u/s 148 dated 14/10/2013 later on decided the case u/s 148, 143 by making an addition of Rs.97,400/- on account of investment in a Flat allotted by SIDCO Society Manesar. Whereas during the year under consideration the assessee received a gift of Rs. 1 Lac from his father Shri Ram Yadav and out of these funds the above investment of Rs.97,500/- was made. In support of above gift confirmation of gift deed duly signed by the donor along with bank pass book was submitted by the Assessee along with the affidavit of Sh Subh Ram Yadav s/o Sh. Ram Yadav and brother of the assessee who was a witness in respect of the gifts given by their father to the assessee, but the Assessing Officer overlooked these documents and made the addition of Rs.97,500/-.
The Ld. CIT(A) confirmed the order of the Assessing Officer. The CIT(A) held that by producing a witness at the remand stage who is the brother of the assessee is just a self serving mechanism to suit the claims of the assessee.
The AR submitted that all the confirmations of the gift deed was produced before the A.O as well as Ld. CIT(A). The AR further submitted that the confirmation of the gift deed by his father i.e. the donor has been submitted to the Assessing Officer. The assessee has not been able to produce his father i.e. the donor for statement before the Assessing Officer as his father died on 03.06.2011.
The DR relied on A.O’s order and Ld. CIT(A) order.
We have perused the records and heard both the parties. The Ld. CIT(A) has ignored the fact that the assessee produced the confirmation of gift deed duly signed by the donor as well as the affidavit of the Shri Subrao Yadav who is a brother of assessee and witness to the gift deed before the A.O.. Since the father of the assessee died on 3/6/2011, the insistence of statement of the deceased father is not proper on part of the Assessing Officer. The affidavit/statement of brother of the assessee is sufficient material to show that the gift was from his father. In view of this, the addition made by the assessing Officer is not proper and Ld. CIT(A)’s order is set aside.
In result, the appeal of the assessee is allowed.
Assessment Year 2007-08
The grounds of appeal are as follows:-
1. That the order of the Hon’ble CIT (Appeals) is contrary to law and the facts of the appellant’s case.
2. That the Hon’ble CIT (Appeals) erred in not considering as genuine the gift of Rs.150000/- received by the assessee from his father and in ignoring the confirmation of gift given his father, the bank pass book of the father which showed the payment made to the assessee, the affidavit of Shri. Subh Ram Yadav son on late Shri Ram Lal Yadav who witnessed the gift and the statement of the witness of the gift.
3. That the Hon’ble CIT (Appeals) erred in not considering as genuine the gift of Rs.430000/- received by the assessee from Smt. Santra Devi, his real aunty (Chachi) and in ignoring the confirmation of gift given by Smt. Santra Devi, the bank pass book of Smt. Santra Devi which showed the payment made to the assessee, and the affidavit of the assessee that because of typhoid he was unable to produce the donor before the Ld. A.O on 26/10/2012.
4. That the Hon’ble Ld. CIT(Appeals) erred in rejecting the confirmations of the gifts on the ground that they were not registered.
During the A.Y 2007-08, the assessee received salary of Rs.1,36,032/- and filed his I.T return accordingly. Thereafter, the department issued a notice u/s 148 dated 13/10/2011, and decided the case u/s 148, 143(3) the I. Tax Act, by making addition of Rs.5,87,400/- and created an addition demand of Rs.2,65,880/-.
During this year he had purchased a plot for Rs.5,57,400/- in the name of his wife Smt. Rama Devi, at Saraswati Vihar, Rewari, and the source of this investment was as under:
Gift of Rs.4,30,000/- received from his real Aunty (Chachi) Smt. Santra Devi.
Gift of Rs. 1,50,000/- received from his father Sh. Siri Ram Yadav.
Smt. Santra Devi (Chachi of the assessee) had sold a land situated at Village Majra Gurdas Distt. Rewari for Rs. 4,31,250/- on 13/6/2006, and the said sale proceed was deposited in the OBC Bank A/C. NO. 0962010116730. Thereafter, she had gifted a sum of Rs.4,30,000/- to the assessee on 16/6/2006 after withdrawing the same from her Bank account, for which a Confirmation of Gift Deed was also executed, which was also produced before the A.O during assessment proceedings. But unfortunately due to illness (“TYPHOID”) of the assessee, he could not produce Smt. Santra Devi, the donor, before the A.O on the fixed date during assessment proceedings, and the case was decided without recording the statement of Smt. Santra Devi and in the absence of her statement the said gift amount of Rs.4,30,000/- used for purchase of above said plot has been disallowed by the Assessing Officer. The balance amount of Rs.1,27,400/- (5,57,500/- - 4,30,000/-) was invested out of the gift amount of Rs.1,50,000/- received from the father of the assessee Sh. Siri Ram Yadav, who unfortunately expired in 3/6/2011, so due to his death he could not be produced before the A.O. However, copy of confirmation of Gift Deed executed by the Sh. Siri Ram Yadav, in his life time, along with copy of Bank Pass Book were produced before the A.O. But in the absence of statement of donor the A.O ignored the submitted documents and made the addition of Rs.5,57,400/- towards the income of the assessee.
Aggrieved with the order of the A.O., the assessee has filed appeal before the CIT(A) and submitted some documents as additional evidence, under Rule 46 of the Income Tax Rules, which has been considered and in compliance to Remand Report proceedings the statement of the Smt. Santra Devi (Donor) of Rs.4,30,000/- and statement of Sh. Subh Ram Yadav S/o Late. Shri Siri Ram Yadav the witness of the gift of Rs.1,50,000/- received during the A. Y 2007-08 from Shri Siri Ram Yadav (Father of the assessee) were recorded by the A.O.
The AR submitted that all the confirmations of the gift deeds was produced before the A.O as well as Ld. CIT(A).
The DR relied on A.O’s order and Ld. CIT(A) order.
We have perused the records and heard both the parties. The Ld. CIT(A) has ignored the fact that the assessee produced the confirmation of gift deed duly signed by the donor as well as the affidavit of the Shri Subrao Yadav who is a brother of assessee and witness to the gift deed before the A.O.. Since the father of the assessee died on 3/6/2011, the insistence of statement of the deceased father is not proper on part of the Assessing Officer. The affidavit/statement of brother of the assessee is sufficient material to show that the gift was from his father. In view of this, the addition made by the assessing Officer is not proper in respect of gift received from father and Ld. CIT(A)’s order is set aside to that extent.
As relates to the amount received from Smt. Santra Devi i.e. Aunt of the assessee, the assessee, the assessee was given ample opportunity to produce her before the Assessing Officer. The assessee failed to do so. Thus the Assessing Officer has rightly rejected the said gift of Rs. 4,30,000/-. The CIT(A) has also rightly held that the financial status of the donor logically does not explain he generosity in making the gift and the creditworthiness of the donor remains unexplained. Therefore, Ground No. 2 of the assessee’s appeal is allowed and Ground No. 3 is dismissed.
In result, the appeal is partly allowed.
Assessment Year 2010-11
The grounds of appeal are as follows:-
1. That the order of the Hon’ble CIT (Appeals) is contrary to law and the facts of the appellant’s case.
2. That the Hon’ble CIT (Appeals) erred in not considering as genuine the gift of Rs.150000/- received by the assessee from his father and in ignoring the confirmation of gift given his father, the bank pass book of the father which showed the payment made to the assessee, the affidavit of Shri. Subh Ram Yadav son on late Shri Ram Lal Yadav who witnessed the gift and the statement of the witness of the gift.
3. That the Hon’ble CIT (Appeals) erred in rejecting the confirmations of the gifts on the ground that they were not registered.
20. The assessee Lal Singh Yadav is a Government employee since 1981 and presently working in the office of District Industries Centre Rewari. During Assessment Year 2010-11, he received salary of Rs.2,70,510/- and filed his income tax return accordingly. Thereafter, the Department issued a notice u/s 148 dated 13/10/2011 later on decided the case u/s 148, 143 by making an addition of Rs.2,14,000/- and created an additional demand of Rs. 43,450/-. During this year he had invested a sum of Rs. 6,05,000/- in construction of Residential House and the source of this investment was as under:
1,60,118/- House Loan Taken from UCO Bank Rewari 3,37,000/- withdrew from GPF A/C.
1,08,000/- out of gift of Rs. 1,50,000/- received from his father.
An investment of Rs.1,08,000/- was made out of the gift of Rs. 1,50,000/- received in February, 2010 from his father, Sh Siri Ram Yadav, for which the Donor had also executed a Confirmation of Gift Deed, which was submitted to the A.O. The said gift amount of Rs. 1,50,000/- was withdrawn by the donor from his K.C.C. Bank A/C. The father of the assessee died on 03.06.2011. Therefore, it was not possible for the assessee to produce the Donor for recording of statement before the A.O. Inspite of submission of death certificate of the donor, during the assessment proceedings the A.O. insisted for personal presence of the donor for recording of his statement and made addition of Rs. 1,50,000/-. The Assessee filed appeal before the CIT(A), but CIT(A) also confirmed the same.
The AR submitted that all the confirmations of the gift deed was produced before the A.O as well as Ld. CIT (A). The AR further submitted that the confirmation of the gift deed by his father i.e. the donor has been submitted to the Assessing Officer. The assessee has not been able to produce his father i.e. the donor for statement before the Assessing Officer as his father died on 03.06.2011.
The DR relied on A.O’s order and Ld. CIT (A) order.
We have perused the records and heard both the parties. The Ld. CIT(A) has ignored the fact that the assessee produced the confirmation of gift deed duly signed by the donor as well as the affidavit of the Shri Subrao Yadav who is a brother of assessee and witness to the gift deed before the A.O.. Since the father of the assessee died on 3/6/2011, the insistence of statement of the deceased father is not proper on part of the Assessing Officer. The affidavit/statement of brother of the assessee is sufficient material to show that the gift was from his father. In view of this, the addition made by the assessing Officer is not proper and Ld. CIT(A)’s order is set aside.
In result, the appeal of the assessee is allowed.
The order is pronounced in the open court on 29th of December 2015.