Subscription   Feedback   New User   Login      
Tax Management India .com
TMI - Tax Management India. Com
Forum Articles Highlights TMI Notes SMS News What's New Calendar Imp. Links Database More...
Extracts
Home List
← Previous Next →

Ramesh Jhaveri (HUF) , Mumbai Versus Income Tax Officer, Range - 21 (3) (3) , Bandra, Mumbai

Unexplained credit u/s 68 - gift of Indian Millennium Deposit ("IMD‟) bond - whether proceeds of India Millennium Deposit cash not be brought to tax in the hands of appellant by invoking provisions of Section 56(2)(v)? - Held that:- We accept this gift as genuine because the identity and the creditworthiness of the donor have been established on record. The reason for making this gift is also stated and its genuinity stands proved. Entire evidences, which have been referred to above like t .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

nter alia, go to prove the claim of the assessee. Therefore, we delete the impugned addition. - Further, gift in question does not fall within the ambit of Section 56(2)(v) of the Act and same is exempt See case of Nilesh Jhaveri (HUF) [2016 (8) TMI 775 - ITAT MUMBAI ] - Decided in favour of assessee - I.T.A. No.4981/Mum/2014 - Dated:- 22-9-2016 - SHRI MAHAVIR SINGH, JM AND SHRI RAJESH KUMAR, AM For The Assessee : Shri Anuj Kishnadwala For The Revenue : Shri B S Bist ORDER PER RAJESH KUMAR, .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

hands of appellant by invoking provisions of Section 56(2)(v) of the I.T. Act, 1961. 2. The issue raised in this appeal is against the confirming the addition of ₹ 82,39,653/- by ld. CIT(A) by upholding the action of the AO of treating the gift of Indian Millennium Deposit (hereinafter called as IMD‟) bond as unexplained credit u/s 68 of the Income Tax Act, 1961 and the Ground No.2 is with regard to raising the issue of India Millennium Deposit cash not be brought to tax in the hands .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

sment proceedings, the AO found that the assessee has claimed IMD bonds of ₹ 82,39,653/- in the bank account as gift and claimed the same as exempt under the provisions of Section 10(15)(iid)(c) of the Act. The assessee submitted before the Assessing Officer that gift from three persons aggregating to ₹ 120 US$ = ₹ 52.81 lakhs in terms of Indian currency was received by the assessee. The said gifts were transferred by the donors in favour of the assessee vide letter dated 30.9. .....

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 IMD Bonds the assessee submitted that the same was exempt u/s 10(15)(iid)(c) of the Act. The assessee also specifically asked by the AO that as to how the gift received in the month of September, 2005 was exempt from tax as the provisions of section 56(2)(v) have undergone changes after September, 2004 i.e. any gift received from non relative is liable to be taxed in the hands of the donee exceeding ₹ 25000/- which is received after September, 2004. The AO finally not convinced with t .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

h Jhaveri (HUF) V/s ITO in ITA. No. 4980/Mum/2014(AY:2006-07) dated 04.08.2016 and be allowed accodingly. 5. On the other hands, the ld. DR while strongly opposing the arguments of the ld.AR submitted that the provisions of section 56(2)(v) of the Act were amended retrospectively and therefore any gift received from non relative is taxable under the said section. The ld. DR heavily relied on the orders of authorities below. 6. We have carefully considered the rival contentions and perused the ma .....

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 Tribunal in the case of Nilesh Jhaveri (HUF) (supra) in another family HUF family of assessee on identical facts, where the Tribunal has decided the issue as under: 2.2 Matter was carried before the First Appellate Authority, wherein various contentions were mainly raised with regard to IMDs are not any sum of money and further, regarding genuineness of creditor. Assessee raised various submissions and considering the same, CIT(A) confirmed the order of Assessing Officer. 2.3 Same has been .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

d that the said amount was claimed as non taxable by the assessee. iii. It was further submitted that the IMD certificate is not "any sum of money" and therefore it would not fall within the ambit of Section 56(2)(v) r.w.s. 2(24)(xiii) of the Act. iv. It was further contended that gifts are genuine as the identity of the donor i.e. Shri Sunil Kumar Khimchand Gandhi was proved through his Indian Passport. It was further submitted that although he resides at Dubai his capacity of giving .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

donor Shri Sunil Kumar K Gandhi was having annual income of US$ 15,00,000/- and therefore the gift of US$ 1,00,000/- to a close family friend was not unusual. ix. The creditworthiness of the donor got proved as the donor was holding IMDs for substantial period. Assessee ultimately contended that the genuineness of these gifts of IMD from close family friends need not be doubted. x. To prove the creditworthiness, assessee had submitted net worth certificate of Shri Sunil Kumar Khimchand Gandhi 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

eed; (c) donor had given an affidavit affirming the making of the gift; (d) there was a confirmation through post of gift per demand draft; (e) affirmation of the assessee in examination on oath recorded by the Assessing Officer; (f) affirmation of the donor in examination on oath recorded; (g) direct reply of the donor to the Assessing Officer confirming the gift; (h) donor was stated to be a friend of the assessee‟s father; (i) donor was doing some finance business; and (j) source of the .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

or function; (iii) that the donor visited his house one or two times though never beyond the drawing room; (iv) that the donor was a person of low financial status having monthly income of less than ₹ 5,000/- and has shown withdrawals from his capital account less than ₹ 3,000/- per month; (v) that the donor has no house, no telephone number, no fixed deposit and not any other immovable assets; or that the original deposit by the donor of ₹ 1,25,000/- with B‟ Ltd. was not .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

of account as income of assessee if assessee offers no explanation about the nature and sources of sum so credited or if the explanation offered by assessee thereof was not satisfactory. On the facts and circumstances as narrated above, in my opinion, are such as satisfactorily explains the nature and sources of the credit by way of gift. Therefore, gift could not be said to be credit, the sources of which were not explained satisfactorily. It was a genuine gift and the assessee has proved its .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

totaling to ₹ 68,66,378/-. In regard to issue of taxability of gifts the assessee's main stand has been that section 56(2)(v) of the Act mentions the word "any sum of money" and according to the assessee the gift of IMDs did not fall within the purview "any sum of money". Assessee also claimed that in the instant case the gift was received before 01.09.2004, which was much prior to the insertion of section 56(2)(v) of the Act inserted by the Finance Act w.e.f 01.04. .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

should be accepted is a million dollar question before us. The view in favour of the assessee is fortified with numerous evidences which forms a complete chain of events, as has been discussed above. The occasion of having made this gift has been explained by the donor himself that he was obliged by the father of the donee in the year 1994 during his visit to deity Vaishno Devi when the father of the assessee helped him and his family members. Thus, the occasion and reason for making a gift are .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

oo harsh and too illogical to decide against the assessee who has produced entire evidences desired, required and insisted on by learned AO and that would result in an illegality and injustice. We have to go by evidences available on the record. The possibilities and realities of life come only thereafter, and when the adverse possibilities are also found to be explained there should be an end of these "possible realities", otherwise no gift would be or can be treated as genuine, as th .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

of donor, direct letter sent to AO, statement on oath both of donor and the donee, proof of source of the draft of ₹ 2,50,000 with further evidence, inter alia, go to prove the claim of the assessee. Therefore, we delete the impugned addition and allow this appeal. 2.8 Nothing contrary was brought to our knowledge. Facts being similar, so, following same reasoning, this issue is decided in favour of assessee. 2.9 Regarding interest, assessee relied on notification u/s.10(15)(i) of the Act .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

 

 

 

 

 

  ↓     Latest Happening     ↓  

Circular: Certain Clarifications sought on Construction Services provided in the Real Estate Sector reg.

Forum: transfer of shares

Forum: Input tax credit

News: Anti-dumping duty on import of bus/truck tyres from China

News: Fast-track GST refund, else ₹ 65K cr may be stuck: Exporters

Forum: Input credit of gst paid on urd

Forum: 3B mistake

Highlight: It is open to the Settlement Commission to use best judgment in arrival of the figure. Nonetheless it has to explain the manner in which the best judgment figure has been arrived at by the Settlement Commission - HC

Highlight: Deemed dividend u/s 2(22)(e) - advances given to societies - in the absence of legal right of the assessee in the said society the amount advanced cannot be treated as deemed income.

Highlight: When electrical installations are treated as plant and machinery the depreciation has to be allowed @ 25% as per provisions contained u/s 32

Forum: GST return filing software online | Easy GST compliance management

Forum: Excise duty credit on finished stock at additional place of business.

TMI Note: Capital Gain - transfer of right in the land or transfer of land itself - addition u/s 50C - Harassment to the honest tax payers

Highlight: Option to avail composition scheme under GST by electronically filing an intimation in FORM GST CMP-02 and FORM GST ITC-03 upto 30-9-2017 - See Rule 3(3A)

TMI Note: Does ICDS apply for the purposes of computing exemption u/s 11 to 13.

Highlight: Voluntary Reporting of Estimated Current Income and Advance Tax Liability - CBDT issues draft notification

TMI Note: Certain ICDS provisions are inconsistent with judicial precedents. Whether these judicial precedents would prevail over ICDS.

Highlight: Provisions of ICDS shall prevail w.e.f. AY 2017-18 to the transactional issues dealt therein over earlier judicial pronouncements.

Notification: Levy of anti dumping duty on New/unused pneumatic radial tyres with or without tubes and/or flap of rubber (including tubeless tyres) having normal rim dia code above 16 originating in, or exported from China PR

News: Voluntary Reporting of Estimated Current Income and Advance Tax Liability

TMI Note: In case of conflict between ICDS and other specific provisions of the Income-tax rules, 1962 governing taxation of income like rules 9A, 9B etc. of the Rules, which provisions shall prevail.

TMI Note: Does ICDS apply to computation of Minimum Alternate Tax (MAT) u/s 115JB of the Act or Alternate Minimum Tax (AMT) u/s 115JC of the Act.

TMI Note: Where a term has not been defined under ICDS, nor under the Act, but has different interpretations given to it by the courts in tax cases, and in ICAI Accounting Standards, which interpretation would prevail while interpreting ICDS.

TMI Note: Whether the provisions of ICDS apply to a non-resident who claims the benefit of a double taxation avoidance agreement (DTAA).

TMI Note: In case any of the ICDS provisions is contrary to a circular or press release issued by the CBDT, which would prevail over the other.

TMI Note: ICDS-I requires disclosure of significant accounting policies and other ICDS requires specific disclosures. Where is the taxpayer required to make such disclosures specified in ICDS.

Notification: Income Computation and Disclosure Standards (ICDS) - New ICDS to be effective from AY 2017-18

News: RBI Reference Rate for US $

Highlight: GST - Detention of goods under transport - discrepancy in documents - the statutory provisions provide a mechanism for adjudication following detention of goods including for the provisional release thereof pending adjudication - HC

Highlight: Reassessment - first few paragraphs of the assessment order dealt with objections and disposed of accordingly - Unfortunately, the manner in which the AO has decided the issue is wholly unsustainable in law - HC

Highlight: Business expenditure u/s 37 - liquidated damage - breach of contract terms - Expenditure was not incurred for any purpose which is an offence or which is prohibited by law - cannot be disallowed - HC

Highlight: Valuation - inclusion of reimbursement of expenses - managing participation of clients in certain mela, fairs, promotional activities etc. - They are liable to service tax on the gross amount received - They cannot restrict their tax liability to only agency commission

Highlight: TDS liability - ITAT confirmed the liability - We do not see how it is possible for us to uphold the order of the Tribunal and when it purports to decide two Appeals of the Revenue by single paragraph conclusion - HC

Highlight: Reopening of assessment - sufficiency of material available with the AO to form a belief that income chargeable to tax had escaped assessment - bogus purchases - seller refused to respond - notice would not be interfered with - HC

Highlight: Exemption u/s 11 - education activities - transport and hostel facilities surplus cannot be considered as business income of the assessee society

News: Draft Notification for insertion of new rule 39A in the Income-tax Rules, 1962 comments and suggestions-reg.

Highlight: Genuineness of labour wages expenses, embroidery charges, fabrication expenses etc. - getting work done through small workmen who do not have any permanent place of residence - disallowance of ad hoc expenditure deleted.

Highlight: Project import - Since the goods were never used for the purpose for which it was imported, the actual user condition has been violated - Redemption fine and penalty imposed.

Highlight: Penalty u/s 112 (a) - CHA - Lack of due diligence and failure to take more precautions can not, by itself, bring in penal consequences

Highlight: Import of services - GST - The fact that those services were received outside India will not change the fact that the services have been paid for by the beneficiary appellant, who is located in India. - Demand confirmed.

Notification: SEZ for IT/ITES at Madhurwada Village, Visakhapatnam District in the State of Andhra Pradesh - denotified.

Highlight: Merely because payment is received in Indian rupee, it cannot be said that payment against export has not been received in convertible foreign exchange.

Highlight: Merely vehicle numbers was not mentioned on the invoices cannot be the reason to deny Cenvat Credit

Highlight: Extension of time limit for submitting the declaration in FORM GST TRAN-1 under rule 120A of the Central Goods and Service Tax Rules, 2017 - Circular

Circular: Extension of time limit for submitting the declaration in FORM GST TRAN-1 under rule 120A of the Central Goods and Service Tax Rules, 2017

News: Auction for Sale (Re-issue) of Government Stocks

Article: TDS APPLICABILITY ON GOVERNMENT CONTRACTS UNDER GST (Under Section 51 of the CGST Act, 2017)

News: Manmohan takes potshots at note ban, 'hasty' rollout of GST

News: GST on petrol, diesel requires wider discussion: Nitish

Article: WHEN CAN ONE TAKE ITC FOR RCM CASES?



|| 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