TaxTMI 
TaxTMI 
2026 (3) TMI 1231
X X X X Extracts X X X X
X X X X Extracts X X X X
....d in the return of preceding assessment year" "2. Large payments made u/s 194C to persons who have not filed return of income" 3. Thus, the Assessing Officer (herein after "AO") in order to examine the aforesaid issues, asked the Assessee to submit various details, as per reasons of selection. 4. The Assessee in response filed copy of return of income along with computation, profit and loss account and balance sheet for the year under consideration and detailed note about her activities. 5. The AO on perusing the capital account of the Assessee found that the Assessee has received gift amounting to Rs. 12,54,54,594/- during the year under consideration and therefore he asked the Assessee to furnish the information, such as name / address of the Donor, PAN, amount, mode of payment, relationship with Donor and evidence with relation thereto. 6. The Assessee in response to the said query/ information sought for by the AO, filed her part reply dated 09.03.2022, inter-alia claiming as under: "With regard to the para - 7 of your letter dated 02.03.2022, a gift has been received from my husband Shri Ripusudan Kundra for the year ended 31st March, 2020 relevan....
X X X X Extracts X X X X
X X X X Extracts X X X X
....creditworthiness of the same has not been established, as required u/s 68 of the Act. 10. Thus, the AO on the aforesaid peculiar facts and circumstances and various judgments, as cited in the assessment order which we will deal with in the latter part of this order, ultimately added the amount of Rs. 12,54,54,594/- to the income of the Assessee, as unexplained credit u/s 68 of the Act, chargeable to tax, as per the provisions of Sec. 115BBE of the Act. 11. The Assessee being aggrieved challenged the said addition by filing first appeal before Ld. Commissioner raising various grounds, as mentioned by the Ld. Commissioner in para -3 of the impugned order and also filed her written submissions, which read as under: "5. During the appellate proceedings, the appellant has submitted a written which is reproduced as under: FACTS OF THE CASE: "1. The appellant is an individual and regularly assessed to tax vide PAN ACPPS6622P. 2. For the assessment year under consideration, the appellant filed her return of income on 04.02.2021 vide efiling acknowledgement number 240116101040221 declaring total income of Rs. 10,84,45,500/-. 3. The case of ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....llant to furnish information regarding gift received amounting to Rs 12,54,54,594/-. 6. In reply to the said notice the appellant vide letter dated 24.03.2022 and 15.09.2022 submitted the relevant documents to prove the genuineness of the said transaction. The relevant portion of letter dated 15.09.2022 is reproduced for your honour's ready reference: "2. The husband of the assessee Shri Ripu Sudan Kundra having PAN: AZUPK9777F has gifted to her wife during the year ended on 31st March, 2020 relevant to the assessment year 2020- 21 out of natural love and affection and to hold the same absolutely forever. The copy of the duly signed 'Gift Deed' between husband and wife dated 05.03.2020 having full name, PAN, relation, address, full particulars, amount and signature of witnesses is enclosed herewith for your honour's kind perusal alongwith the acknowledgement of income tax return in form ITR V filed on 29.01.2021 vide efiling acknowledgement number 231839011290121 of husband, Shri Ripu Sudan Kundra as asked by your goodself. Being the gift received from spouse, the genuineness of the abovesaid gift is beyond doubt." 7. It is submitted that ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....f gifts. At same time, revenue had not adopted due process of law by issuing summons under section 131 for carrying out detailed investigation from Donors, more particularly when Assessing Officer was already having information regarding PAN of Donors, bank accounts of Donors and other related details. The Hon'ble ITAT held that, on facts, additions under section 68 could not be made and issue of verification of gifts was to be remanded to file of Assessing Officer to decide same afresh. b. Decision of Hon'ble Gujarat High Court in the matter of Commissioner of Income-tax VI v. Heena Sharma, [2013] 33 taxmann.com 176 (Gujarat). The Hon'ble High Court held that where assessee in support of gifts received from Donors submitted requisite documents such as copies of demand drafts, gift deed, PAN cards and acknowledgement of returns of Donors, no addition could be made in respect of gift amount by taking recourse to provisions of section 68. c. It is submitted that Hon'ble Apex court in the case of CIT Vs Divine Leasing & Finance Ltd. (2007 158 Taxman 440/299 ITR 268) has held that if the relevant details of the address or PAN/identity of the creditor a....
X X X X Extracts X X X X
X X X X Extracts X X X X
....f the above facts, the alleged addition and the consequent order passed u/s 143(3) of the Act dated 21.09.2022 is invalid, incorrect, illegal, not as per provisions of law, clearly outside the sanction of law, illegal, bad-in-law, void for want of jurisdiction and thus may kindly be deleted/quashed/annulled. 15. Further, the appellant may kindly be informed, if any further clarification or details/ documents or any further information is required for deciding the matter. The transactions are fully corroborated and supported by the necessary relevant documents and have been furnished but in case any further documents are required, the same can readily be provided before a decision is taken in the matter. 16. In addition to the above, your honour may kindly provide us with an opportunity for further submissions before deciding on the matter." 12. The Ld. Commissioner by considering the assessment order and the submissions of the Assessee, and examining the case in detail, ultimately affirmed the addition of Rs. 12,54,54,594/- made by the AO, as unexplained credit u/s 68 of the Act, by more or less observing and holding as under: "That the Assessee has su....
X X X X Extracts X X X X
X X X X Extracts X X X X
....nee, full address of Donor and Donee and acknowledgment of income tax return of Donor for the A.Y 2020-21 and therefore the Assessee has discharged her primary onus cast u/s 68 of the Act. The Ld. Counsel for the Assessee also relied on various judgments including the decisions of Hon'ble Apex Court in the cases of CIT Vs. Orissa Corporation (P) Ltd., 1986 AIR 1849 and CIT Vs. Divine Leasing & Finance ltd, 2007, 158 Taxman 440/299 ITR 268, which we will deal with, in the latter part of the order. The Ld. Counsel also placed on record, the copy of gift deed executed by the husband of the Assessee and clarificatory affidavits of the Assessee and her husband qua gift. 15. On the contrary, Ld. DR refuted the claim of the Assessee by submitting that before either of the authorities the Assessee has not submitted the details of the transaction involved and / or the mode of payment of gift. Further the Assessee did not file the bank statement despite being asked specifically by the authorities below, on various occasions. Even the return of income of the Donor, is not commensurate with the gifted amount given. The PAN of the donor was only provided on dated 15.09.2022 i.e. at the fag e....
X X X X Extracts X X X X
X X X X Extracts X X X X
....s, the Assessee except providing scanned copy of 'gift deed' failed to provide any evidence with regard to mode of payment/receipt and bank statement of Assessee and her husband, showing the actual transfer of the gifted amount. The AO also observed that the PAN of Assessee's husband was provided only by reply dated 15.09.2022 i.e. at the fag end, so that no further enquiry could be made under Section 68 of the Act. Further the Assessee's husband has shown his total income at Rs. 27,71,020/- for the AY under consideration, which does not commensurate with the amount of gift given and therefore, the credit worthiness of the Donor could not be established. The AO therefore, more or less on the aforesaid reasons made the addition of the gifted amount under consideration. 19. We further observe from the impugned order that before the ld. Commissioner as well, the Assessee admittedly failed to file any copy of the bank statement of the Assessee and her husband despite being asked specifically and therefore the ld. Commissioner affirmed the addition made by the AO under Section 68 of the Act by considering the peculiar facts and circumstances specific to the effect that the Assessee f....
X X X X Extracts X X X X
X X X X Extracts X X X X
....2.02.2020 and thereafter two bank transactions of Rs. 10 lakhs each carried out on dated 17.02.2020 and further shown the amount of Rs. 12,54,54,593/- as on 31.03.2020 the gifted amount received from Shri Ripu Sudan Kundra however, it is a fact that from the bank statement referred to above, the actual movement of gifted amount, is no-where appearing. There is also no co- relation in the bank entries, qua amount involved. 23. As observed above that in the above bank statement, as on 31.03.2020, the amount of Rs. 24,82,29,633/- was available as balance and up to 31.03.2020, the mode/movement of aforesaid gifted amount, is nowhere appearing in the bank statement and also not clearly established by the Assessee. 24. We further observe that the Assessee before the authorities below has only filed acknowledgment of return filed by the Assessee's husband for the AY under consideration, without its financials/profit and loss account. However, before us on being asked the Assessee has filed complete copy of ITRs of the Assessee's husband for the AYs 2019-20 and 2020-2021. Perusing the same, we observe that the Assessee's husband in the Schedule FA {which pertains to the details of....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... file the relevant bank statements. (iv) Further, the Assessee also failed to co-relate the transacted amount with the appropriate evidence. (v) Further, the claim of the Assessee that Assessee's husband had received the amount of Rs. 12,81,41,672/- from M/s. Kuki Investment, is not established clearly. (vi) The Assessee has also claimed that a sum of Rs. 72,12,33,650/- was receivable by Assessee's husband from M/s. Kuki Investment, which has been disclosed in the ITR for the AY 2019-20 under "Schedule AL", whereas in the AL-Schedule the amount of Rs. 84,05,77,374/- is showing, as loans and advances given and there is no such bifurcation of such amount, as claimed by the Assessee. (vii) Further, in the ITR of 2020-21 year, the Assessee's husband has shown total investment in BAHAMAS to the tune of Rs. 22,81,85,851/- in Column-D of Schedule-FA but in Schedule-AL, the Assessee's husband left all columns as blank without giving any details. Therefore, various discrepancies remained to be proved by the Assessee to establish the genuineness of the gift transaction. (viii) Further the Assessee's husband income was not commensurate with the gif....
X X X X Extracts X X X X
X X X X Extracts X X X X
....s 68 of the act completely, as observed above, requires factual verification. Thus, considering the peculiar facts and circumstances in totality for proper and just decision of the case and substantial justice, we are inclined to remand the instant case to the file of the Jurisdictional AO (JAO) for decision afresh, suffice it to say by affording reasonable opportunity of being heard to the Assessee. 29. We also deem it appropriate to direct the Assessee to establish her claim by filing/providing complete details/clarifications and documents before the JAO, without any default. We clarify that in case of subsequent default, the Assessee shall not be entitled for any leniency. 30. Thus, the case is accordingly remanded to the file of the Jurisdictional AO (JAO) for decision afresh, suffice it to say by affording reasonable opportunity of being heard to the Assessee. 31. The judgements relied on by the parties prima facie appears to be factually dissimilar to the peculiar facts and circumstances of this case and the issue involved and therefore are not strictly applicable to the case in hand and thus, we deem it appropriate not to explore the same in depth, as we have decide....