2012 (3) TMI 144 - AT - Income Tax

Shoguns received on marriage taxable as gift - Marriage of assessee s daughter - Held That - Shoguns were given to assesse and not too daughter, logically cheque should be in bride name - No details provided which showed that amount has been transferred to bride s account. Decided against assesee. Foreign Travel Expenditure disallowed on account of personal element - Held That - Revenue could not bring any material on record to show that such expenditure are personal. Decided in favour of assessee.

Summary

Issues:
1. Addition of gifts received on daughter's marriage under Section 56(2)(vi) of the Income-tax Act, 1961.
2. Addition of foreign traveling expenses as personal use.

Issue 1: Addition of gifts received on daughter's marriage under Section 56(2)(vi) of the Income-tax Act, 1961:

The appellant challenged the addition of Rs. 21,07,513 representing gifts received on the marriage of the appellant's daughter. The Assessing Officer (AO) invoked Section 56(2)(vi) of the Act, treating the gifts as income from other sources. The AO found that the gifts were received by the appellant and not by the daughter, thus applying the provision. The CIT(A) upheld the AO's decision, emphasizing that the cheques were in the appellant's name, not the daughter's. The appellant failed to provide evidence of the gifts' utilization for the daughter's benefit. The Tribunal agreed with the lower authorities, dismissing the appeal as the gifts were credited to the appellant's account and not transferred to the daughter's account, confirming the addition.

Issue 2: Addition of foreign traveling expenses as personal use:

The appellant contested the addition of Rs. 5,50,000 for foreign traveling expenses, deemed for personal use by the AO. The AO estimated expenses at Rs. 50,000 per trip for 11 trips. However, no concrete evidence was presented to establish the personal element in these expenses. The Tribunal found the revenue's assumptions baseless and lacking material evidence. Consequently, the Tribunal allowed the appeal on this ground, overturning the addition of foreign travel expenses as personal use.

In conclusion, the Tribunal partly allowed the appeal, dismissing the addition of gifts received on the daughter's marriage under Section 56(2)(vi) but overturning the addition of foreign traveling expenses as personal use.