Gift from non-resident brother held non-taxable after proving donor identity and genuineness through bank statements

ITAT Mumbai allowed the appeal, directing deletion of two additions made by AO. First, gift received from non-resident brother through three cheques was held non-taxable as assessee proved donor's identity, creditworthiness, genuineness, and relationship through bank statements from Bank of Baroda NRE account and ICICI Bank showing sufficient funds. Gift from relative is not chargeable to tax. Second, interest income of Rs. 40,500 was double-taxed as assessee had already disclosed it in return computation but AO added it again during processing. ITAT directed deletion of both additions, allowing both grounds of appeal.

---

---

Issues:
1. Addition of gift amount to total income.
2. Double taxation of income from other sources.
3. Confirmation of interest under sections 234B and 234C.

Analysis:

Issue 1: Addition of gift amount to total income
The appellant challenged the addition of Rs. 20,00,000/- to the total income, contending it was a gift from his non-resident brother and should be exempt. The appellant provided evidence including cheques, passport, and gift deed to establish the genuineness of the gift. The tribunal noted that the appellant had proved the identity, creditworthiness, and genuineness of the gift. The tribunal directed the Assessing Officer to delete the addition of Rs. 20,00,000/- as it was proven to be a gift from a relative and not taxable income.

Issue 2: Double taxation of income from other sources
The appellant also contested the double taxation of Rs. 40,500/- as income from other sources. The tribunal observed that the appellant had already disclosed this income in the computation, and it was erroneously added again by the Assessing Officer. The tribunal directed the Assessing Officer to delete this double addition from the total income, as it was a clear case of duplication.

Issue 3: Confirmation of interest under sections 234B and 234C
The tribunal dismissed the appeal on the confirmation of interest under sections 234B and 234C, stating it was consequential in nature. The tribunal found no infirmity in the lower authorities' orders regarding this issue.

In conclusion, the tribunal partly allowed the appeal, directing the deletion of the additions to the total income related to the gift amount and the double taxation issue. The confirmation of interest under sections 234B and 234C was upheld. The tribunal's decision was pronounced on 16.08.2024.

---