Gujarat High Court
Commissioner Of Income Tax V vs Mahendra A on 28 February, 2013
Author: Akil Kureshi
Bench: Akil Kureshi
COMMISSIONER OF INCOME TAX V....Appellant(s)V/SMAHENDRA A PATEL....Opponent(s) O/TAXAP/817/2012 ORDER IN THE HIGH COURT OF GUJARAT AT AHMEDABAD TAX APPEAL NO. 817 of 2012 TO TAX APPEAL NO. 821 of 2012 ================================================================ COMMISSIONER OF INCOME TAX V....Appellant(s) Versus MAHENDRA A PATEL....Opponent(s) ================================================================ Appearance: MRS MAUNA M BHATT, ADVOCATE for the Appellant(s) No. 1 ================================================================ CORAM: HONOURABLE MR.JUSTICE AKIL KURESHI and HONOURABLE MS JUSTICE SONIA GOKANI Date : 28/02/2013 ORAL ORDER
(PER : HONOURABLE MR.JUSTICE AKIL KURESHI) Revenue is in appeal against the judgement of the Income Tax Appellate Tribunal dated 30.04.2012. For the purpose of this order, we may notice facts as arising in Tax Appeal No. 817 of 2012. In such appeal, the Tribunal has framed following questions for our consideration:
[A] Whether the Appellate Tribunal has substantially erred in not appreciating that no documentary evidences were furnished by the assessee before the Assessing Officer to substantiate the creditworthiness of Shri Biral M. Patel and thus not discharged the onus cast upon the assessee?
[B] Whether the Appellate Tribunal has substantially erred in upholding the decision of the CIT(A) by confirming deletion of the addition on account of cash credit in the name of assessee s son Shri Biral M. Patel without calling for Shri Biral M. Patel and corroborating evidence of his source of income during the relevant years by CIT(A) and without giving an opportunity to Revenue by calling for Remand report from Assessing Officer?
The Assessing Officer made additions under Section 68 of the Act disbelieving a gift received by the assessee from his son. However, CIT(A) deleted such addition. On further appeal, the Tribunal confirmed the view of CIT(A), in particular, the Tribunal held and observed as under:
15. We have heard both the sides at some length. Undisputedly, a confirmation letter of Shri Biral M. Patel is on record, though undated. His copy of passport is also on record. At the outset, it was clarified before us that the AO has wrongly presumed that the income declared by the assessee in India for A.Y. 1998-99 of Rs.
40,690/- was the only income of the said son. It was clarified that the return was filed in India in respect of the interest income earned in India. In addition tot he said income earned in India, the son is subjected to tax in USA. An information about a tax debt with the Florida Department of Revenue and therefore a Notice for collection by AMO Recoveries is placed on record. In respect of the source of funds, it was claimed that the assessee has sold a Convenient Store, therefore stated to be in possession of sufficient funds. Even Ld. CIT(A) has noted that the impugned amount was received by a cheque No. 858287 of NRE Account No. 10372 with Punjab National Bank. On account of these facts and the corroborative evidences, we hereby hold that such issue was dealt with by the Hon ble Gujarat High Court in the case of Murlidhar Lahorimal (supra), wherein it was opined that the donor having confirmed the gift and explained the source therefore, the onus on the donor, i.e. the assessee u/s. 68 was discharged. Further, in the case of Nemichand Kothari (surpa) the Hon ble Gauhati High court has opined that the burden of the assessee to prove the genuineness of a transaction, as well as creditworthiness of the credit is confined to the transactions which have taken place between the assessee and the creditor and it is not the burden of the assessee to show the source of the creditor or to prove the creditworthiness of the sources of the sub-creditors. As far as the decision of Dinesh Babulal Thakkar (supra) as cited by the Ld. DR is concerned, the issue was about the gift where the relationship could not be established. It was found that the gift was without occasion, without any relationship and there was no family connection with the donor. In the absence of non-availability of the details and the activities of the donor in USA the view taken by the Tribunal was upheld. As far as the present case is concerned, the Hon ble Gujarat High Court s view is worth to record that the genuineness of the transaction is established having the transaction been made through bank and if revenue not satisfied with the sufficiency of funds of the donor, it was up to the revenue to take appropriate action and at best those could be the factors to be called upon from the donor, but that could not be a ground for disbelieving a gift. Respectfully following the verdict, we therefore hold that the ld. CIT(A) has rightly deleted the addition, hence this ground of the Revenue is hereby dismissed.
Having heard learned counsel for the revenue, we are of the view that the issue is based on appreciation of facts. Commissioner (Appeals) as well as the Tribunal concurrently found that the factum of gift was established. The genuineness of transaction was also proved on record; even creditworthiness of the donor was not possible to doubt. In fact, the gift was received by the assessee from his own son, who was residing in USA. Assessing Officer s stand, that the donor had earned income of only Rs. 40,690/- during the assessment year 1998-99, was rebutted by pointing out that such return was filed for interest income earned in India whereas the assessee is based in USA and is subjected to tax there. The donor, in fact, contended that not only his income tax return, but, all such returns are regularly scrutinized by the authority in USA. The gift was received through bank transaction genuineness thereof was thus suitably established. In view of such facts, no question of law arises. Tax appeals are dismissed.
(AKIL KURESHI, J.) (MS SONIA GOKANI, J.) Jyoti Page 4 of 4