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TMI Blog2012 (1) TMI 293X X X X Extracts X X X X X X X X Extracts X X X X ..... h March 2007, declaring total income of ` 67,72,958. The Assessing Officer completed the assessment 143(3) r/w section 153 of the Act, determining the income at ` 7,27,01,134, inter-alia, making addition on account of (i) unexplained cash credit of ` 28,60,000; (ii) bogus loan of ` 34,00,000; (iii) bogus IMD gift of ` 5,91,74,176; and (iv) low family withdrawals of ` 5,00,000. 3. Aggrieved, the assessee carried the matter in appeal, wherein the Commissioner (Appeals) granted part relief. He deleted the additions made on account of unexplained cash credit and bogus IMD gift. On low withdrawals, the Commissioner (Appeals) granted part relief. Aggrieved, the Revenue preferred appeal before the Tribunal on the following grounds:- 1. On the facts and in the circumstances of the case and in law, the CIT(A) erred in restricting the addition made by the Assessing Officer of ₹ 28,60,000/-,to the extent of ₹ 2,92,800/-, without appreciating that There was clear noting in the seized document 2 of annexure A-15 evidencing the total amount paid in cash to the broker was of ₹ 54 lacs and also by admitting fresh evidence in contravention of Rule 46A of IT rule. 2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... k a sum of ₹ 51,07,200/- by cheque as proceeds for alleged sale of shares, charged a premium of ₹ 1,51,440/- at 6% of Capital Gains for providing entry and balance cash receivable from him was ₹ 1,41,360/-. The appellant offered a sum of ₹ 25,24,000/- in the Return filed in response to notice u/s. 153A of the Act On account of the above. Based on the above seized material, the AO added a further sum of ₹ 28,60,000/- stating that the appellant offered for tax only the capital gain part of the transaction but not declared the amount paid in cash as purchase value of the shares and the premium paid for the bogus entry. 5. The learned Departmental Representative argued that the entire amount of receipt was rightly brought to tax by the Assessing Officer. He submitted that once the transaction relating to long term capital gain is a bogus transaction, then the entire consideration received by the assessee on showing the sale is to be considered as income of the assessee. He argued that the Commissioner (Appeals) has wrongly granted relief to the assessee on the ground that the purchase price of ` 25,83,200, does not represent unaccounted income ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 8,16,800/- as computed above. I have also perused the return filed in response to 153A notice wherein the amount of ₹ 25,24,000/- is offered as additional income. Thus, the net amount of ₹ 2,92,800/- (Rs.28,16,800 - ₹ 25,24,000) represents the unaccounted income which the appellant has not offered for taxation. I therefore confirm the addition to the extent of ₹ 2,92,800/- being excess net cash paid by the appellant. The balance addition of ₹ 25,67,200/- is deleted and this ground of appeal is thus partly allowed. 9. Thus, ground no.1, is dismissed. 10. The facts relating to grounds no.2 and 3, are brought out by the Commissioner (Appeals) at pages-6 and 7 of his, which is extracted below:- The facts of the case are that the appellant had received gift from Shri Kailash Agarwal and Smt. Hansa Agarwal, NRI, residing at Sharjah on 25-9-2005 of face value of USD 7,00,000 from Smt. Hansa Agarwal and USD 2,00,000 from Shri Kailash Agarwal in the form of IND. The said gift was received in the name of his minor children Master Manav Mehta Ms Khyati Mehta. The appellant prematurely en-cashed the said IMDs on 5-10-2005 and received the maturity ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sed by the Commissioner (Appeals). ITA no.2/Vizag/2011, assessment year 2006-07, order dated 11.8.2011; ACIT v/s Anuj Agarwal (Mumbai), (2010) 130 TTJ 49 (Mum.); and ITO v/s Komal Kumar Badar, (2009) 33 SOT 58 (Jp.) 13. Learned Counsel further drew the attention of the Bench to the order passed by the Assessing Officer and submitted that the assessee produced documentary evidence to demonstrate the very high network status of the donor. He took this bench through the evidences filed by the assessee in proof of the genuineness of the gift and argued that no addition can be made even under section 68 of the Act. 14. After hearing rival contentions, we find that the Commissioner (Appeals), while dealing with the issue, observed as follows:- I have also gone through the evidences submitted in the course of assessment proceedings and the statement of Donor s husband recorded by the AO in the course of assessment proceedings. The appellant has furnished documentary evidences to establish the genuineness of the gift. These evidences are not disputed by the AO and no reasons have been given for disbelieving the same. In fact, the Donor s husband has deposed bef ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Tribunal in ACIT v/s Anuj Agarwal (supra), held as follows:- Held: The gift in question was complete prior to 19th July, 2002. The gift deed dt. 19th July, 2002 records the fact that the gift was already completed prior to that date by delivery of IMD bonds y the donor to the done. As rightly held by the CIT(A), gift would be complete in the financial year 2002-03 within the meaning of ss. 122 and 123 of the Transfer of Property Act, 1882, Provisions of s. 56(2)(v) applied only to gift n or after 1st Sept, 2004. The fact that maturity proceeds were received by the assessee during the previous year relevant to asst. yr. 2006- 07 cannot be the basis to apply provisions of s. 562,)(v). There is also force in the submissions of the counsel for the assessee that prior to introduction of S. 56(2)(vii) by the Finance Act, 2009, w.e.f. 1st Oct., 2009, gifts in kind were outside the purview of s. 56(2)(v) or (vi). The expression used in s. 56(2)(v) and (vi) is where any sum of money exceeding ₹ 25,000 is received by an individual from any person. Considering the fact that in the present case, what was given without consideration was only IMD certificates, provisions of s. 56( ..... X X X X Extracts X X X X X X X X Extracts X X X X
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