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2013 (12) TMI 868 - AT - Income TaxDisallowance of Gifts on account of personal user of business assets - Various additions made are not justified being outside the purview of s. 153A of the Act Held that:- The assessee had already submitted his returns prior to search which had also attained finality - no document or incriminating evidence was found during the course of search which could be legally made a basis for disturbing the already settled issues The documents submitted clearly prove the identify, creditworthiness of the donor and genuineness of the gift - Following Jai Steels (India) vs. Asstt. CIT [2013 (6) TMI 161 - RAJASTHAN HIGH COURT] - In an assessment under s. 153A, it is not open to the assessee to seek deduction or claim relief not claimed by it in the original assessment which already stands completed before the date of initiation of the search or making of requisition - The gifts already disclosed by the assessee in the returns of income, which have attained finality, cannot be disturbed. Unexplained gifts - Genuineness of Gifts Held that:- After considering the proof regarding gifts, they are considered to be genuine gifts - The assessee has produced enough evidence to prove the identity of the donors, their creditworthiness and also the genuinity of the gift transactions - The gifts have been given through cheques and stand confirmed by the donors - The donors have also proved the sources of their respective gifts - No adverse materials was found during the course of search to even suspect the gifts the gifts are otherwise genuine and have already been disclosed by the assessee in the returns filed before the date of search and which have already become final Decided in favour of Assessee. Addition on account of unexplained personal expenses Held that:- The disallowance out of expenses claimed on account of personal or non-business user of the vehicles is not justified - The auditor has simply mentioned that some personal use of business assets is not denied by the assessee and the value of the same could not be ascertained by them - ad hoc and baseless additions cannot be encouraged Decided in favour of Assessee. Addition of gold ornaments Held that:- The finding of the CIT(A) is not justified being simply ad hoc and without any valid basis - the additions made are deleted. Justifiability of the additions - No unexplained asset(s)/expenditure has found during this search Held that:- There is no other unexplained asset or expenditure which can be said to have been found during the search - The additions made are not supported by any unexplained assets or expenditure - On the basis of assets and the expenditure theory the addition so made in the hands of the assessee is apparently uncalled for. Addition of unexplained expenditure on foreign travel Held that:- There is no reason as to why the receipts of monies from his parents should not be accepted when even the source thereof has been explained and the proof is enclosed in the papers the entire amount to be treated as explained.
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