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TMI Blog2011 (8) TMI 1224X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessee was in receipt of ₹ 34,33,189/- by way of gift of IMD (Indian Millennium Deposits) Bonds worth US $ 50000 and interest there on in US $ 26,272.12 from NRI friend, Shri Raman Talwar. The assessee claimed it to be non-cash gift and claimed exemption u/s 10 of the Act. But as per the provisions of sub-section (v) of section 56 of the Act, any sum of money exceeding ` 25,000/- from a person not related to the assessee is to be treated as income in the hands of the assessee under the head Other Sources during the year of receipt. Having observed that the assessment order is erroneous and prejudicial to the interest of the revenue, the CIT issued a show cause notice to the assessee. In response there to it was stated that gift was r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fficer and he has accepted the claim of the assessee after making a detailed verification. On merit he has contended that he has received the gift before 1st September, 2004. He further submitted that the provisions of Section 56(2)(v) shall apply to the sum of money received on or after 1.9.2004 but before 1.4.2006. Since IMB is a security and not sum of money , the provisions of section 56(2)(v) would not be applicable in the case of the assessee. In support of his contention, he has placed a reliance upon the following judgements of the Tribunal:- 1) ACIT Vs. Anuj Agarwal 130 TTJ 49 2) CIT Vs. G.K. Kabra 211 ITR 336 3) Synergy Entrepreneur Solutions Pvt. Ltd. Vs. DCIT ITA 306/Mumbai/ 2010 dated 31.3.2011. 4. The Ld. D.R. o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... from 01-09-2004. Since the impugned IMD Bonds was transferred to the name of the assessee after, 01-09-2004, the Ld. CIT has opined that the impugned gift transaction is hit by the provisions of the section 56(2)(v) of the Act. 6. We have gone through the provisions of section 56(2)(v) and also the provisions of section 56(2)(vi) and 56(2)(vii), which were introduced subsequently. A combined reading all these three provisions facilitates the correct understanding of their purpose. We notice that under these provisions, if any individual or Hindu Undivided family receives any sum of money or any other property without consideration, the same is deemed to be income of the assessee. However, we notice that these provisions have been intr ..... X X X X Extracts X X X X X X X X Extracts X X X X
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