2007 (9) TMI 632 - HC - Income Tax

Summary

Issues Involved:
1. Whether the gift received by the daughter of the appellant is a taxable cash credit.
2. Whether the gift given by a Non-Resident out of natural love and affection to daughter of a friend for her marriage should be treated as income of the father.
3. Whether the findings of the ITAT are against the evidence on record.
4. Whether the ITAT misdirected itself in deciding the issue of genuineness of the gift.

Summary:
1. The appellant, a dealer in real estate, challenged the order of the Income-tax Appellate Tribunal upholding the addition of a gift received by the appellant's daughter as a taxable cash credit. The Assessing Officer found the gift to be bogus, leading to an addition of Rs. 1,90,000 in the appellant's income. The CIT(A) deleted this addition, citing the donor's statement and past decisions. However, the Tribunal reversed this decision, emphasizing the lack of relationship between the donor and donee, incongruity of the gift amount with the donor's income, and absence of specific occasion for the gift. The Tribunal found the appellant's claims unsubstantiated, leading to the dismissal of the appeal.

2. The appellant's claim that the gift from a Non-Resident friend for the daughter's marriage should not be treated as income was rejected by the Tribunal. The Tribunal highlighted the lack of relationship between the donor and donee, the substantial amount of the gift compared to the donor's income, and absence of a specific occasion for the gift. The Tribunal found the appellant's arguments unconvincing, leading to the dismissal of the appeal.

3. The CIT(A) had deleted the addition of the gift amount based on the donor's statement and past decisions. However, the Tribunal found the appellant's claims unsubstantiated, emphasizing the lack of relationship between the donor and donee, incongruity of the gift amount with the donor's income, and absence of specific occasion for the gift. The Tribunal concluded that the findings of the CIT(A) were not validly possible, leading to the dismissal of the appeal.

4. The Tribunal found that the appellant's claims regarding the genuineness of the gift were not supported by the evidence. The Tribunal emphasized the lack of relationship between the donor and donee, incongruity of the gift amount with the donor's income, and absence of specific occasion for the gift. The Tribunal concluded that the appellant's story was not credible, leading to the dismissal of the appeal.