The Income Tax Appellate Tribunal has ruled that the affidavits received by tax authorities from Family Member are sufficient to prove that the Cash Gift is genuine.
Here in this case, the assessee, Dheeraj Thakran is an individual and his sources of income are from:
- Rent
- Profession
- And other sources.
And he has already filed an Income-tax Return. Thereafter the “case of the assessee was selected for scrutiny and the statutory notices under section 143 (2)/142(1)” in addition to the detailed questionnaire had been issued and served upon the assessee. The authorized representative of the assessee appeared before the AO and sought adjournment that was given a green signal by the AO.
However, by watching closely, it was found that there was non-compliance from the side of the assessee subsequently for which the AO proceeded to make assessment u/s 144 of the Act. The AO noted that the assessee has deposited cash of Rs. 32,90,000/- in the Oriental Bank of Commerce and Rs 17,50,000/- in Punjab National Bank during the impugned assessment year its details of which are given at para 2 of the assessment order.
However, since the assessee did not reply to explain the source of the aforesaid cash deposits in the bank account, the AO by relying on various decisions added the aforesaid income to the total income of the assessee.
Read More: The Ruling of the Income Tax Appellate Tribunal (ITAT)
The AO reiterated his stand that was taken earlier and further submitted that the assessee still could not explain the origin of cash deposits that have been made in the bank account and the various gifts that were received by him from his father, mother, brother, and wife.
Thereafter the ld.CIT(A) augmented the same to the assessee. Then The assessee filed a rejoinder to the same and following this event the ld.CIT(A) again called for a remand report from the AO. In the second remand report, the AO reiterated his earlier stand.
The Coram of the Judicial Member, Suchitra Kambleand R.K.Panda noted that during the time of assessment proceedings, the assessee had filed the affidavits of the donors who are parents, brother, and spouse, respectively. The Coram observed that since the gifts in the instant case are received from parents, brother, and spouse, respectively; therefore, having a doubt the “genuineness of such gifts received from blood relations is not justifiable.”
