Commissioner of Income Tax v. Indrajit Singh Suri

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The Tax Publishers2013 TaxPub(DT) 1670 (Guj-HC) : (2013) 215 TAXMAN 0581 Income Tax Act, 1961 --Income from undisclosed sources--Addition under section 68Identity, creditworthiness and genuineness of donors--Assessing officer made addition on account of gift received from assessee's mother as undisclosed income on the ground that neither genuineness of the transaction nor creditworthiness of the donor had been proved by the assessee. Held: Was not justified as it was found that the identity of donor had been proved, cash book of donor was found to be having sufficient cash balance to gift a sum and more so, there was declaration of gift executed and all the accounts of donor had been maintained by computerized books. Income Tax Act, 1961 Section 68 Income Tax Act, 1961 --Income from undisclosed sources--Addition under section 69Unaccounted investment in Ninad Co-operative Housing Society--assessing officer had made addition on account of unaccounted investment in Ninad Co-op. Housing Society. Tribunal deleted addition . Revenue and contended that the assessee and his employees agreed that this was investment made in the flats and the suit for possession of same was also preferred on behalf of the assessee. Held: Was not justified as it was found that assessing officer had largely proceeded on the basis of the statement of one Gajjar in whose books of account, the said transaction of Ninad Co-op. Housing Society had emerged. It further appeared that no opportunity of cross-examination of Gajjar, though requested for, was granted by the assessing officer. Cumulatively, thus, there was violation of principles of natural justice by not allowing cross-examination, despite such request coupled with absence of any evidence, therefore, there was a substantial error committed by assessing officer. Income Tax Act, 1961 Section 69 Income Tax Act, 1961 --Income from undisclosed sources--Addition under section 69Unaccounted investment--assessing officer had made addition on account of unaccounted investment made with certain parties relying on the statement given by that party. Held: Was not justified as the transaction would not fall within the block period under consideration and more so, no opportunity was given to assessee to cross examine that parties with whom unaccounted investment was made. Income Tax Act, 1961 Section 69 Income Tax Act, 1961 --Income from undisclosed sources--Addition under section 69 Unexplained investments--assessing officer noted a Civil Suit wherein the assessee claimed possession of the property from Jaishil A. Patel against the payment of Rs. 5 lakhs and another sum of Rs.₹50,000 given as registration charges. Such amount was, therefore, added as undisclosed income of the assessee. Held: Was not justified as it was apparent from the books of account maintained by the assessee and books of account of other family members that sufficient cash balance was available to make such payment. The applicant had also accepted price and tax authorities had collected the stamp charges. Such addition, therefore, was rightly held unsustainable. Income Tax Act, 1961 Section 69 In the Gujarat High Court Akil Kureshi & Sonia Gokani, J.J. CIT v. Indrajit Singh Suri Tax Appeal No. 872 of 2012 2 April, 2013 Decision: In favour of assessee. Appellant by : Mauna M. Bhatt SUBSCRIBE FOR FULL CONTENT

The Tax Publishers2013 TaxPub(DT) 1670 (Guj-HC) : (2013) 215 TAXMAN 0581

Income Tax Act, 1961

--Income from undisclosed sources--Addition under section 68Identity, creditworthiness and genuineness of donors--Assessing officer made addition on account of gift received from assessee's mother as undisclosed income on the ground that neither genuineness of the transaction nor creditworthiness of the donor had been proved by the assessee. Held: Was not justified as it was found that the identity of donor had been proved, cash book of donor was found to be having sufficient cash balance to gift a sum and more so, there was declaration of gift executed and all the accounts of donor had been maintained by computerized books.

Income Tax Act, 1961 Section 68

Income Tax Act, 1961

--Income from undisclosed sources--Addition under section 69Unaccounted investment in Ninad Co-operative Housing Society--assessing officer had made addition on account of unaccounted investment in Ninad Co-op. Housing Society. Tribunal deleted addition . Revenue and contended that the assessee and his employees agreed that this was investment made in the flats and the suit for possession of same was also preferred on behalf of the assessee. Held: Was not justified as it was found that assessing officer had largely proceeded on the basis of the statement of one Gajjar in whose books of account, the said transaction of Ninad Co-op. Housing Society had emerged. It further appeared that no opportunity of cross-examination of Gajjar, though requested for, was granted by the assessing officer. Cumulatively, thus, there was violation of principles of natural justice by not allowing cross-examination, despite such request coupled with absence of any evidence, therefore, there was a substantial error committed by assessing officer.

Income Tax Act, 1961 Section 69

Income Tax Act, 1961

--Income from undisclosed sources--Addition under section 69Unaccounted investment--assessing officer had made addition on account of unaccounted investment made with certain parties relying on the statement given by that party. Held: Was not justified as the transaction would not fall within the block period under consideration and more so, no opportunity was given to assessee to cross examine that parties with whom unaccounted investment was made.

Income Tax Act, 1961 Section 69

Income Tax Act, 1961

--Income from undisclosed sources--Addition under section 69 Unexplained investments--assessing officer noted a Civil Suit wherein the assessee claimed possession of the property from Jaishil A. Patel against the payment of Rs. 5 lakhs and another sum of Rs.₹50,000 given as registration charges. Such amount was, therefore, added as undisclosed income of the assessee. Held: Was not justified as it was apparent from the books of account maintained by the assessee and books of account of other family members that sufficient cash balance was available to make such payment. The applicant had also accepted price and tax authorities had collected the stamp charges. Such addition, therefore, was rightly held unsustainable.

Income Tax Act, 1961 Section 69

In the Gujarat High Court

Akil Kureshi & Sonia Gokani, J.J.

CIT v. Indrajit Singh Suri

Tax Appeal No. 872 of 2012

2 April, 2013

Decision: In favour of assessee.

Appellant by : Mauna M. Bhatt