2023 (3) TMI 917 - AT - Income Tax

Addition regarding gift received from father - assessee consistently submitting that the father of assessee Shri Krishna Dutta is a Pujari in Mandir, he also works as an astrologer and property dealer - HELD THAT - Unable to see any findings that the father of assessee does not own 6.5 acres agricultural land. CIT(A) noted that the assessee has not been able to convinced the AO regarding income from agriculture and agriculture income calculated by the assessee are based on presumptions only. Appellant father should have filed his return of income if he was having taxable income - Unable to agree with the conclusion drawn by FAA that in absence of return of income by his father the factum of gift cannot be accepted - when he is earning small income from puja astrology and earning exempt agricultural income then the requirement of filing of return of income arose only in a situation when his income falls within the purview of taxable limits, merely because a person, giving gift to his son, is not filing return of income, the transaction of gift cannot be doubted particularly when the person giving gift is owing 6.5 acres agricultural land which yielded agricultural produce to him. As basis taken by the AO as well as CIT(A) for dismissing the explanation of assessee regarding gift from his father is not reasonable, justified and sustainable. Therefore, the same is dismissed.

Summary

Issues involved:
The appeal against the order of the Commissioner of Income Tax (Appeals)-2, Gurgaon for AY 2009-10. The primary issue is the condonation of delay of 780 days in filing the appeal. The secondary issue pertains to the addition of Rs. 2,00,000 regarding a gift received from the father of the assessee.

Condonation of Delay Issue:
The assessee sought condonation of the 780-day delay in filing the appeal due to unavoidable circumstances and disputes with family members. The Senior DR contended that there was no sufficient cause for the delay and cited legal precedents. However, the Judicial Member found that the reasons presented by the assessee, including the involvement in criminal cases arising from family disputes, constituted sufficient cause under Section 5 of the Limitation Act, 1963. Consequently, the delay was condoned, and the appeal was admitted for hearing.

Gift Addition Issue:
The assessee's counsel argued that the Rs. 2,00,000 gift from the father was from legitimate sources, including income from puja, astrology, property dealing, and agricultural activities. The Assessing Officer and the CIT(A) had questioned the source of the gift, but the Judicial Member noted that there was no evidence to dispute the ownership of 6.5 acres of agricultural land by the father. The Judicial Member disagreed with the CIT(A)'s reasoning that the father's failure to file an income tax return cast doubt on the gift transaction. Ultimately, the Judicial Member directed the AO to delete the addition of Rs. 2,00,000, as the explanations provided by the assessee were deemed reasonable and justified.

Conclusion:
The Tribunal allowed the appeal in part, condoning the delay in filing and admitting the appeal for consideration. The addition of Rs. 2,00,000 regarding the gift from the father was directed to be deleted based on the ownership of agricultural land and legitimate sources of income presented by the assessee.