TMI Blog2014 (12) TMI 306X X X X Extracts X X X X X X X X Extracts X X X X ..... ooks of the assessed in the previous year and the assessed offered no explanation about the nature and source or the explanation offered was in the opinion of the AO not satisfactory, the sums so credited could be charged to taxed as income of the assessed for the relevant previous year - creditworthiness of the donor would depend upon the income and earning of the donor and whether and did he have necessary funds - Rarely one finds a poor man giving gifts to a rich and powerful, out of natural love and affection – The test of perversity is whether a reasonable person conversant with the legal provisions would have reached to the conclusion or finding under challenge - the reasoning and the finding of the tribunal is plausible, thus, the order of the Tribunal is upheld – Decided against assessee. - ITA No. 137/2003 - - - Dated:- 27-11-2014 - Sanjiv Khanna And V. Kameswar Rao,JJ. For the Appellant : Mr. Mukul Gupta, Sr. Advocate with Mr. Vibhor Garg, Mr. Aseem Swaroop and Ms. Suvarna Kashyap, Advocates. For the Respondent : Mr. Akash Vajpai, Advocate for Mr. Rohit Madan, Sr. Standing Counsel. ORDER Sanjiv Khanna, J. (Oral) C.M. 59/2003 This is an appli ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... however, deleted the said addition observing that the aforesaid documents showed that the gift was made by Bhupinder Kumar and it was not necessary that the donor or the donee should have blood relationship. He referred to Section 5(1)(ii)(b) of the Gift Tax Act, 1958 to the effect that relationship was not a condition for making a gift by an non-resident Indian. Accordingly, the addition made by the Assessing Officer was deleted. 5. Revenue preferred an appeal before the Tribunal and has succeeded by the impugned order dated 17th September, 2002. The said order records that during the course of arguments, the authorized representative of the assessee had admitted categorically that there was no relationship between the assessee/Aushi Aggarwal and Bhupinder Kumar. Therefore, the Tribunal felt that the assessee in this case had created evidence to cloak his own undisclosed funds as a gift. The Commissioner of Income Tax (Appeals) had also expressed doubts, but had accepted the gift in view of the documents filed by the assessee. The Tribunal on the said aspect observed that the Commissioner of Income Tax (Appeals) had ignored the ground reality that gifts were exchanged between k ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the Income-tax Act; (iid) being a citizen of India or a person of Indian origin, who is not resident in India, to any relative of such person in India of property in the form of any foreign exchange asset as defined in clause (b) of section 115C of the Income-tax Act What was highlighted by the Senior Counsel is that in clause (iic) and (iid), the word relative , which is defined in explanation clause (c) has been used, whereas, in Section 5(1)(iid), the legislature conspicuously has not used the word relative . It is difficult to accept the said contention. Section 5 deals in exemption and stipulation that when gift tax would not be charged. The said provision is of no relevance and application when we examine the question whether the assessee has been able to prove and establish the genuineness of the transaction, i.e. the gift, and establish the source of the entry made in the books of accounts. Admittedly, in the present case the minor daughter of the appellant had made investment of ₹ 1 lac and when the assessee was called upon to explain the source of the deposit/income of her daughter, the assessee had submitted that Aushi Aggarwal had received a gift from ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ve been possible for the appellant assessee to procure, but the close relationship, not necessarily blood relationship, between the parties could have been asserted and fortified. Genuineness of the transaction has to be examined by not only taking into consideration the paper/documents, which were executed, but surrounding circumstances are also relevant. These aspects are of significance and importance, when genuineness of a transaction is in issue. A gift is a voluntary act, by a person who out of love and affection transfers of money, moveable or immoveable asset to another person. Element of personal and close relationship between the two is the motivating factor as the donor parts with and transfers what belongs to him to someone, whom he/she loves and cares. This mandates and requires a close association between the donor and the donee, except where gifts are made for charity and philanthropic purposes. In the present case, the appellant merely relies upon the form of declaration by Bhupinder Kumar that the gift was made out of love and affection. However, it was accepted and admitted before the tribunal that the donor and donee/assessee were not known to each other. Thus, t ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
