SHRI JAYANTKUMAR PARSHOTTAMBHAI VADODARIYA,GONDAL, DIST. RAJKOT vs. THE ITO, WARD-2 (3) (5), RAJKOT

The present appeal has been filed by the assessee against order passed by the Commissioner of Income Tax(A)-2, Rajkot (in short referred to as ld.CIT(A) under section 250(6)of the Income Tax Act, 1961 ("the Act" for short), dated 17.1.2020 pertaining to the Asst.Year 2012-13.

At the time of hearing, neither the assessee nor anybody on his behalf remained presentin the Court despite service of notice. No application seeking adjournment has been filed. On several occasions in the past also the assessee has remained unrepresented

The grounds of the appeal raised by the assessee are as under:

Facts in brief are that the original assessment order passed in the case of the assessee u/s 143(3) of the Act was found to be erroneous and prejudicial to the interest of the Revenue and accordingly vide order passed u/s 263 of the Act the assessment

The assessee was asked to produce cogent documentary evidences to explain identity and creditworthiness of the persons from whom the assessee had claimed receipts of loans and gifts as well as genuineness of such transaction. The assessee was also 4 asked to produce all the persons from whom the assessee has taken loans/gifts. However, the assessee could not produce any documentary evidences in support of credit-worthiness of the lender/donors, nor could produce them before the AO for cross- verification. The assessee was also unable to explain the occasion on which the assessee had received gifts from the donors. Copies of acknowledgement of income returns of Shri Mahesh P. Vaodariya and his sister Smt.Kantaben M. Vadodariya showed only a meager income of Rs.1,27,790/- and Rs.1,59,240/- respectively for 2012-13. However, there was no evidence regarding their source of income and their savings or estate had been produced to demonstrate financial capacity and credit-worthiness of the said lenders/donors to make advances/gifts to the tune of Rs.20,00,000/- and Rs.6,90,000/-. Further, the documents in respect of land holding by the lenders/donors, the same did not pertain to the period and therefore were found not relevant for the period under consideration. The ld.AO further noted that even confirmation of gifts on stamp paper of Rs.20/- was issued to the assessee in December 2015 and January 2016 i.e. after lapse of more than three years from the receipt of gifts, which he held showed the entire impugned transactions were mala fide and after-thought. Even in the deed there was no mention of date of giving gift to the assessee by the donors. Thereafter, relying on various case laws, the ld.AO made total addition of Rs.26,90,000/- under section 69 of the Act. This addition was challenged before the ld.CIT(A).

Before the ld.CIT(A) reiterated submissions made during the assessment proceedings, and submitted all the relevant documents in support of identity, genuineness and credit-worthiness of the transactions. The ld.CIT(A) considered the submissions of the 5 assessee in the light of various details furnished by the assessee during assessment and appellate proceedings. The ld.CIT(A) also considered agriculture land holding documents particularly 7/12 and other record evidencing ownership of the land held by the donors, viz. Shri Purshotambhai Vadodaria (father of the assessee) and Smt. Kanchanaben Vadodaria (mother of the assessee). The ld.CIT(A) observed that both these donors are agriculturists and holding 32.3 bihas of land. Besides, assessee’s uncle Chhaganbhai, who also gifted an amount of Rs.4.00 lakhs was also holding agricultural land of 22 bighas. The ld.CIT(A) thereafter considered decision of the ITAT, Rajkot in the case of Kajalben Gondaliya, dated 13.2.2019 and held that in the case of agriculturists who do not maintain any books of accounts, the agricultural income and the capacity of such persons should be judged with reference to the quantum of his land holdings. He further relied on the decision of ITAT, Ahmedabad Bench in the case of Manoj Kothari dated 6.1.2017 in ITA No.1053/Ahd/2014 wherein the Tribunal adopted yardstick of net agriculture income of Rs.30,000/- per bigha as reasonable. Basing these two decisions of the Tribunal, the ld.CIT(A) made an estimation of agricultural income that could be reasonably expected to be earned by the assessee, i.e. in the case of Purshotambhai Vadodara and Smt.Kanchanben Vadodara of Rs.4.80 lakhs each and Rs.4.00 lakhs in the hands of Chhagabhai (uncle of the assessee). Thus, the ld.CIT(A) restricted the total addition on account of gifts received by the assessee to the extent of Rs.6,40,000/- as unexplained and the balance amount of Rs.13,60,000/- was deleted as being held to be explained.

The assessee, on being not satisfied with order of the ld.CIT(A) in not giving the entire relief under section 69 of the Act, has come in appeal before the Tribunal.

Before us none remained present behalf of the assessee. The ld.DR supported the order of the ld.CIT(A) by stating that the ld.CIT(A) has already given substantial relief to the assessee, and therefore, his order should be confirmed.

We have heard ld.DR and gone through impugned orders of the Revenue authorities. The factual appreciation of the facts and finding of the ld.CIT(A) on these issues are given at para-6 of the impugned order following manner:

On perusal of the above order, we find that the ld.CIT(A) based his decision on factual appreciation of the case after considering the documents placed by the assessee during the assessment and appellate proceedings. He has examined the issue in the right perspective, relying on the decisions of the ITAT cited (supra), and estimating the agricultural income that could be reasonably earned by the donors of gifts from their respective agricultural land holding, thereby given substantial relief to the assessee accepting gifts to the tune of Rs. 13.60 lacs as genuine out of total gifts of Rs.20 lacs received by the assessee from his parents and uncle.

So far as loans/advances received by the assessee from two lenders are concerned, the details submitted by the assessee did not establish or demonstrate the credit-worthiness or capacity of the lenders to give loans to the assessee as interest free, and therefore, the ld.CIT(A) confirmed the addition made by the assessee on this count.

Before us there is no contest on behalf of the assessee to controvert this finding of the ld.CIT(A). We find no reason therefore to depart from the conclusions arrived at by the ld.CIT(A) on this aspect, since no credible submissions have been made before us,

In the result, appeal of the assessee is dismissed.