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2009 (4) TMI 533 - AT - Income TaxAddition u/s 56(2)(v) or alternatively u/s 56(1) - land received as gift - assessee received 33.7 bigha of agriculture land from Smt. Navita Gupta, wife of Shri Ravi Kumar Gupta of Jaipur. The rights on this land were relinquished by Smt. Gupta without any consideration and the same was registered with the Sub-Registrar who valued the land for valuation of stamp duty - reason given that as the land was received as a capital asset on relinquishment of rights, the same was not shown in the balance sheet - AO considered the gift as non-genuine as the donor had no capacity to give such a huge gift and there was no occasion to make such a gift - he therefore, made addition - CIT(A) deleted the addition. HELD THAT:- We concur with the views of the ld. CIT(A) whose order appears to be reasoned one and who has given finding that the ownership of the agriculture land gifted has not been doubted by AO. Relinquishment deed was executed and property has been registered by the Sub-Registrar in favour of donee and stamp duty has been paid. As such conditions laid down in sections 122 and 123 of Transfer of Property Act have been fulfilled. Thus it is a valid transfer of immovable asset in favour of the assessee donee. The Hon’ble Supreme Court in the case of Sirehmal Nawalakha [2001 (8) TMI 109 - SUPREME COURT] held that requirement of complying with the provisions of Transfer of Property Act and Registration Act had to be fulfilled in order that there could be valid gift. However, transfer of capital asset as a gift is not a transfer u/s 47 for the purpose of capital gain and, therefore, provisions of section 50C cannot be applied. An asset cannot be termed, as "any sum" as used in various sub-clauses of section 2(24) or an "income" and therefore, agriculture land which was gifted cannot be taxed as income. It is not covered by and heads of income given in section 14 and therefore, neither agriculture land nor agriculture income is chargeable to tax under any heads of income. The application of provisions of section 56(1) therefore, cannot be upheld in the present case. Once donor expressed her intention to give gift and by registering the land in favour of donee, executed her intention and by getting registered in his name, the donee accepted the gift and in absence of any material with AO to prove that any consideration was paid in lieu of the gift, all the ingredients of a gift are fulfilled. For her livelihood, she was not depending on the agriculture land gifted but only on her husband. As long she was not living alone and independent, capacity of her family cannot be ignored. Once capacity of the donor is proved and all other ingredients to make a gift complete also fulfilled, there is no reason to disbelieve the gift as agriculture land given, by Smt. Gupta to the assessee. Therefore, we find no infirmity in the order of the ld. CIT(A) who has rightly deleted the addition made by AO. Thus the solitary ground of the revenue is dismissed.
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