Subscription   Feedback   New User   Login      
Tax Management India .com
TMI - Tax Management India. Com
Articles Highlights TMI Notes SMS News Newsletters Calendar Imp. Links Database Experts Contact us More....
Extracts
Home List
← Previous Next →

Shailesh Kumar M. Gandhi Versus ITO-11 (3) (3) , Mumbai.

2016 (5) TMI 26 - ITAT MUMBAI

Addition on account of gift - Held that:- The provision of section 56(2)(v) has been amended by inserting clause(v) by Finance Act,2004 and the same was applicable on the transactions taken place between 01.09.04 to 01.04.06 wherein in the present case, the transaction had taken much before the said time i.e. on 02.07.04 therefore, amendment provision of section 56(2)(v) are prospective in nature and not retrospective in nature and thus are applicable w.e.f. 1.09.04. Ld. CIT(A) has applied the a .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

is no pre condition in section 122 or123 of Transfer of Property Act which defines gift that the donor or donee should be related to each other. However in the Income Tax Act there was an amendment in section 56(2)(v) which was brought into effect by Finance Act, 2004 and was effective from 1st September, 2004. However, in the present case the gift was received before the amendment provision come on to the statute books i.e. 02.07.2004 therefore amended provisions are not applicable to the fact .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

M.: The Present Appeal has been filed by the Assessee against the order of Commissioner of Income Tax (Appeals) - 7, dated 30.10.2012 for A.Y. 2005-06 whereby CIT(A) has dismissed the appeal filed by the assessee against the order of AO dated 21.12.2009 on the grounds of appeal mentioned herein below. 1. The learned Commissioner of Income Tax (Appeals) has erred in allowing addition of an amount of ₹ 2,00,000/- received as gift during the F.Y. 2004- 05 as unexplained cash credit. The learn .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

case. 2. Without prejudice to above, The learned Commissioner of Income Tax (Appeals)has erred in relying on provisions of S.56(2)(v) as mended by Finance Act, 2004 without appreciating the fact that the same is not applicable since the same was amended much after the gift was received by the Appellant. The learned Commissioner of Income Tax (Appeals) ought to have allowed the various contentions of appellant under the facts and circumstances of the case. 2. The brief facts of the case are that .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

3 of the I.T. Act thereby setting aside the order of assessment to verify the gift of ₹ 2,00,000/- received by the assessee from his friend. Thereafter a fresh notice u/s 143(2) was served upon the assessee and after seeking the reply, AO passed the order of assessment dated 21.12.2009 thereby making addition of ₹ 2,00,000/-. 3. Aggrieved by the order of the AO, assessee filed appeal before CIT(A) and the CIT(A) after considering the case of the assessee had dismissed the appeal vide .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

2,00,000/- vide Cheque No.132339 drawn on HDFC Bank Ltd, Ghatkopar Branch, Mumbai. In this respect, the ld. AR drew our attention to the copy of the confirmation letter from donor, donor s bank passbook/statement, Income Tax Return Copy etc. It was further submitted that the donor belongs to Gujrat and assessee is also from Gujrat and therefore being from the same native place and being Gujraties they have close family relatives they have close among for the last 15 years and therefore there was .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

on 56(2)(v) are not applicable to the facts of the present case. The amendment clause (v) in sub-section (2) of section 56 was inserted by Finance Act 2004 and was effective from 1.09.2004 but the transaction in the present case are before that i.e. on 02.07.2004. 4.2 On the other hand ld. DR appearing on behalf of the revenue relied upon the detailed order passed by the lower authorities and requested for dismissing the appeal and submitted that though the donor has been established, but the do .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

the following observations. I have considered the AO s order as well as the appellants AR s submission. Having considered both, I find that inspite of the acquaintance and his relation with the donor which was developed in the last 15 years as claimed by the appellant, it nowhere makes to comply the necessity what has been intended to be complied for the exemption of gift for taxability as envisaged under Clause (v) of Explanation to the proviso of sub clause(v) of sub section-2 of section 56 o .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

nd still gift the sum in the F.Y. 2004- 05 to the appellant as well as to his son and wife. Further to that, I am of the considered view that the AO has rightly questioned the capacity of the donor to gift so much amount to the appellant when he himself is not having sufficient sources for his own. Making such huge gift of ₹ 2,00,000/- can not be believed to be genuine and justified. Hence, I am in agreement with the AO's finding that the gift was completely unexplained and hence in my .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

further mentioned by the ld. CIT(A) that the donor was getting salary of ₹ 2.55lakhs p.a. therefore it was not possible to give ₹ 2,00,000/- as gift to the assessee. Therefore on this basis ld. CIT(A) confirmed the additions made by the AO. 5.2 We have considered the submissions made by the assesse as well as the revenue and after considering the same we are of the considered view that the provision of section 56(2)(v) are not applicable in the present case. The provision of section .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ed that this clause shall not apply to any sum of money received- (a) from any relative; or (b) on the occasion of the marriage of the individual; or (c) under a Will or by way of inheritance; or (d) in contemplation of death of the payer; or (e) from any local authority as defined in the Explanation to clause (20) of section 10; or (f) from any fund or foundation or university or other educational institution or hospital or other medical institution or any trust or institution referred to in cl .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

referred to in clause (ii) to (vi).] From the afore mentioned provision it is clear that the provision of section 56(2)(v) has been amended by inserting clause(v) by Finance Act,2004 and the same was applicable on the transactions taken place between 01.09.04 to 01.04.06 wherein in the present case, the transaction had taken much before the said time i.e. on 02.07.04 therefore, amendment provision of section 56(2)(v) are prospective in nature and not retrospective in nature and thus are applica .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

 

 

 

 

 

what is new what is new
  ↓     bird's eye view     ↓  


|| Home || Acts and Rules || Notifications || Circulars || Schedules || Tariff || Forms || Case Laws || Manuals ||

|| About us || Contact us || Disclaimer || Terms of Use || Privacy Policy || TMI Database || Members || Site Map ||

© Taxmanagementindia.com [A unit of MS Knowledge Processing Pvt. Ltd.] All rights reserved.

Go to Mobile Version