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2022 (11) TMI 665 - AT - Income TaxAddition of gift u/s 56(2)(vii) - gift been received by the assessee directly from the uncle - HELD THAT:- The gift received from such relatives is considered exempt for recipient for the simple reason that such gifts could normally be received by a person out of natural love and affection. Such eventualities are made an exception u/s 56(2)(vii). In the present case, the assessee’s uncle falls within the term ‘relative’ and it is clear that the gift has happened on instruction of the uncle. The uncle has, unequivocally, confirmed the grant of gift to the assessee. The uncle is assessed to tax in India. The only reason to treat the same as the income of the assessee is that the amount has been transferred from bank account of uncle’s son and his daughter-in-law who are residing abroad as non-resident. Under such circumstances, the gift so received by the assessee could not be considered as income of the assessee. The son and daughter-in-law are not alien to the uncle but very close relatives and it could be construed that the gift was given by the son and daughter-in-law first to uncle and thereafter, it was remitted by uncle to the assessee. The gifts so received could be construed as constructive gift from uncle. On the given facts and circumstances, the addition so made could not be considered to be income of the assessee and the same is liable to be deleted.
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