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Income Tax Appellate Tribunal, “SMC” BENCH : KOLKATA
Before: Hon’ble Sri N.V.Vasudevan, JM ]
ORDER This is an appeal by the assessee against the order dated 01.11.2013 of CIT(A)- XX, Kolkata, relating to AY 2006-07.
Grounds of appeal
raised by the assessee read as follows :- “1. THAT the Ld CIT(A) - XX, Kolkata erred in fact as well as in law in confirming the addition of Rs. 10,00,000/- made by the Ld AO on account of gift of shares received by the appellant from his son on the alleged grounds stated in assessment order dated 31/12/2008.
2. THAT the Ld CIT(A) - XX, Kolkata erred in fact as well as in law in confirming the addition of Rs. 12,500/- made by the Ld AO on account of cash gifts received by the appellant from his mother on various occasions on the alleged grounds stated in assessment order dated 31/12/2008
3. THAT alternatively, the said addition of totaling Rs. 10.12,500/- is no more sustainable in view of the fresh assessment of income being made in respect of the appellant under section I53C/143(3) dated 28/02/2014 of the Income Tax Act 1961 wherein in spite of the issue of receipt of said gift being considered during the course of the said assessment proceedings, no such additions were made by the Ld AO and as such the said addition of Rs. 10,12,500/- made in the original assessment be declared infructuous.
4. That the appellant crave to add, modify, amend and/or substitute any other ground before hearing of the appeal.”
2 Praveen Murarka A.Yr.2006-07 3. The Assessee is an individual. He carried on business of stock and share broking and trading in shares and securities. In the course of assessment proceedings, AO noticed that the assessee had to show receipt of gifts of Rs.12,500/- from his mother and another gift of Rs.10,00 000/-from his son by name Mr.Akshay Murarka. The gift by the assessee’s son was in the form of 1 lakh equity shares of Rs.10/- each of a company by name M/s. Chambal Fertiliser & Chemicals Ltd. The aforesaid sum were shown in the capital account of the assessee as addition to the capital.
Before the AO the assessee could not produce evidences with regard to the capacity of the donors for making the aforesaid gifts. As far as the gift of Rs.12,500/- received by the assessee from his mother is concerned, the assessee submitted that his mother passed away and therefore he was not in a position to prove the capacity of his mother who gave the aforesaid gift like filing of balance sheet and cash flow statement etc. In such circumstances the AO treated the aforesaid gifts as unexplained and added a sum of Rs.10,12,500/- to the total income of the assessee as unexplained cash credit. The CIT(A) confirmed the order of the AO.
4. The learned counsel for the assessee made a submission in respect of ground nos 1 and 2 before us. She filed an application for admission of the following additional evidences :- “A. Copy of Final Accounts for the A.Y.: 2006-07 of Akshay Maurarka B. Copy of Final Accounts for the AY.: 1993-94 of Master Akshay Maurarka C. Details of allotment of shares of Chambal Fertilizers and Chemicals Ltd. in the name of Master Akshay Murarka D. Letter from Zuari Investments Ltd for the change in status of Akshay Murarka from Minor to Major pursuant to shares of Chambal Fertilizers and Chemicals Ltd. E. Surrrender of original certificate of Akshay Murarka for dematerialization F Gift Deed G. Certificate of transfer of shares through off-market from Akshay Murarka to the assessee. H. Confirmation from Eureka Stock & Broking Services Ltd in regard to shares received from off-market 4.1. The prayer made by the learned counsel for the assessee was to admit the aforesaid documents as additional evidences under Rule 29 of the Appellate Tribunal Rules. It was also submitted that the additional evidences could not be filed before the lower authorities since the same were not available with the assessee. It was submitted that the assessee and his son were not in talking terms. With the intervention of the relatives and friends and consequent to the mediation between the assessee and his son, the assessee could get the aforesaid documents from his son which is now sought to be filed as additional evidences before the Tribunal. The learned DR opposed the prayer of the Assessee for admission of additional evidence and relied on the order of the CIT(A).
I have heard the submissions of the learned counsel for the assessee and I am of the view that the aforesaid evidence now placed before the Tribunal goes to the root of the matter and are necessary for deciding the dispute involved in this appeal. The additional evidence is therefore admitted for consideration as additional evidence.
5.1. Since the additional evidences now admitted by the Tribunal requires consideration by the AO, I am of the view that the issue raised by the assessee in ground no.1 has to be remanded to the AO for fresh consideration.
5.2. As far as the issue raised in ground no.2 is concerned I am of the view that keeping in mind the smallness of the amount involved and taking note of the fact that the gifts from near relatives like mother is quite natural, I delete the addition of Rs.12,500/- made u/s 68 of the Act. The other grounds were not argued and hence not adjudicated. AO shall give adequate opportunity of being heard to the assessee in the set aside proceedings.