2010 (6) TMI 872 - AT - Income Tax

Summary

Issues involved: Appeal against deletion of addition of unexplained gift of RBI Resurgent Bond u/s 56(2)(v) for assessment year 2004-05.

Summary:
The Revenue appealed against the decision of the CIT(A) to delete the addition of Rs. 65,14,276 made by the Assessing Officer regarding unexplained gifts of RBI Resurgent Bonds. The AO based the addition on detailed enquiries and judicial decisions, claiming the gifts were not genuine and lacked natural love and affection. However, the CIT(A) deleted the addition after considering documentary evidence and relying on the decision of the Hon'ble Allahabad High Court in a similar case. The High Court's decision emphasized the legitimacy of gifts of Resurgent India Bonds and the promotion of gifts by NRIs to non-relatives. The Tribunal upheld the CIT(A)'s decision, noting the genuineness of the gifts and the immunity from taxation for the donee. The Tribunal found no merit in the Revenue's grounds and dismissed the appeal.

In conclusion, the Tribunal upheld the CIT(A)'s decision to delete the addition of Rs. 65,14,276 related to unexplained gifts of RBI Resurgent Bonds, based on the genuineness of the gifts and the legal provisions supporting such transactions.