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TMI Blog2011 (9) TMI 1144X X X X Extracts X X X X X X X X Extracts X X X X ..... ly to above query. According to AO, the assessee has not maintained any separate records for various items of household expenses. In the absence of details of such expenses, the AO held that the household expenses of ₹ 1,92,000 were on lower side on the basis of standard of living, other social obligation and such a high social status of the assessee, an addition of ₹ 1,08,000 (Rs. 3,00,000 - ₹ 1,92,000) on account of low household withdrawals was made by the AO under s. 69C of the IT Act, 1961 (in short 'the Act'). 4. On appeal, the CIT(A) deleted the addition and observed as under : 6. I have gone through the contention of the appellant's counsel and also perused the relevant submissions filed. The AO has made an addition of ₹ 1,08,000 on account of inadequate household withdrawals and by way of submissions, it has been stated by the appellant's counsel that the household expenses are to the tune of ₹ 1,92,000, besides the amount for electricity and educational expenses which have separately been debited to the tune of ₹ 3,37,857 and there is no basis with the AO to estimate the household withdrawal at ₹ 3 lacs. Con ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 3. 12-9-2006 1,00,000 -do- 4. 4-10-2006 1,00,000 -do- 5. 24-10-2006 2,00,000 -do- Vide letter dt. 10th Dec., 2009, the AO asked the assessee to appear before him and produce the person Shri Rupinder Singh who has given cash deposit of ₹ 10 lacs on different dates during the financial year 2006-07 relating to asst. yr. 2007-08 to the assessee as per supported affidavit filed on 25th Nov., 2009, to verify the correctness and truthfulness of the affidavit along with necessary supporting evidence. The AO treated the alleged gift as non-genuine for the following reasons : (i) It is undisputed that assessee's capital account has cash credit entries and when asked to explain the source of these credits, assessee had stated that these credits are on account of gifts received from brother-in-law Shri Rupinder Singh. (ii) It is also accepted fact that Shri Rupinder Singh was not produced when specifically asked to do so. Instead, the assessee has chosen to file an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ; 10 lacs and had also explained the sources of the same and also before the AO by way of letter, dt. 27th Dec., 2009, received by fax from Shri Rupinder Singh during the course of hearing of assessment proceedings was also filed, since the donor was away on 'Tirath Yatra' at that time, when the AO asked for his personal presence. A copy of the fax letter has already been filed before me in which the donor has confirmed the income of ₹ 5 lacs from the agricultural land, besides the income in respect of other family members. Copy of the bank pass book has already been filed before the AO to prove the source of withdrawals made for making the gift. The matter was remanded to the AO for verification of the submissions as made before me and before the AO as per letter addressed to ITO, Ward-VII, (1), was filed before me wherein, it has been stated that Shri Rupinder Singh was taken to the AO for recording the statement, if any, to the satisfaction of the AO and against an affidavit duly attested was filed to substantiate the fact that the gift has been made by Shri Rupinder Singh to his brother-in-law. From the fax message filed before the AO, it is proved that donor was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d that a fax letter was also sent by Shri Rupinder Singh, donor, because he was away and later also he confirmed the gift. The learned counsel for the assessee further submitted that creditworthiness of the donor is proved from the fact that gift was given out of his saving bank account. The AO has not doubted the source of the person who had given the gift. Learned counsel for the assessee brought to our notice that even in the remand proceedings, the assessee sought to produce the donor, but the AO did not accede to the assessee's request and then he filed a letter before the AO along with affidavit of Shri Rupinder Singh i.e. donor and he was also taken to the income-tax office for the purpose of any clarification which the AO would like to ask but the AO has only relied upon the earlier basis of making the addition, meaning thereby that the detail explanation given by the assessee was not considered by the AO. He, therefore, submitted that the order of the CIT(A) is based on correct appreciation of facts and well as settled legal position and, therefore, no interference is required in the order of CIT(A). 12. We have heard the rival submissions and have also perused the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... different dates. From the bank account, it is clear that the donor has made withdrawals on the same day on which he has given gifts to the assessee. It is an admitted position that donor is a close relative of the assessee. As regards the occasion for making the gift, the donor Shri Rupinder Singh has clearly mentioned in his letter dt. 21st Dec., 2009 that Shri Balbir Singh Sekhon, required some financial help for resetting up his profession so that he had given a gift of ₹ 10 lacs out of natural love and affection. In our view, the decision of the Hon'ble Punjab and Haryana High Court in the case of Lall Chand Kalra (supra) relied upon by the AO is not applicable to the facts and circumstances of the present case. In that case, there was no relation or the capacity of the person to give the money in gift. In the instant case, there is a very close relationship and the donor is wife's brother of the assessee. Considering the facts and circumstances of the present case, we fully agree with this observation of the CIT(A) that the assessee has not only proved the identity of the donor but also the capacity of the donor and genuineness of the transaction for the said gif ..... X X X X Extracts X X X X X X X X Extracts X X X X
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