Protective additions in minors hand not required if made on substantive basis in fathers hand

ITAT DELHI BENCH ‘A

ITA No. 407/Del/2011 -Assessment Year : 2004-05

Master Akshay Bansal Vs. Income Tax Officer

ITA No. 408/Del/2011 – Assessment Year : 2004-05

Miss Ayushi BansalVs. Income Tax Officer

PER G.D.AGRAWAL, VP:

These two appeals by the assessees are directed against the order of learned CIT(A)-XXVIII, New Delhi dated 1^st October, 2010 for the assessment year 2004-05.

2. The assessees have raised various grounds of appeal. However, they are all against the assessment of 2,51,000/- in the hands of each assessee on protective basis.

3. We have heard the arguments of both the sides and perused the material placed before us. The facts of the case are that both the assessees are minor children of Shri Kamal Piyush. During the accounting year relevant to the assessment year under consideration, Master Akshay Bansal had received the gift of 2,51,000/- from Shri Ashok Kumar Gupta and Miss Ayushi Bansal had received the gift of Rs. 2,51,000/- from Shri Mukesh Gupta. The Assessing Officer has noted that since both these assessees are minor children of Shri Kamal Piyush, therefore, their income is to be assessed in the hands of Shri Kamal Piyush under Section 64 of the Income-tax Act, 1961. However, he made the assessment of 2,51,000/- each on protective basis in the case of both the above assessees. On appeal, learned CIT(A) held that the protective addition in the hands of these two assessees are not required but finally, he held that the appeals of the assessees are dismissed. Therefore, the assessees are aggrieved. The relevant finding of the learned CIT(A) in this regard reads as under:-

“6. In the asstt. Order, the A.O. has stated that “during the course of asstt proceedings in the case of Sh. Kamal Piyush it was gathered that the assessee is minor, the above income will be clubbed u/s 64 in the case of Sh. Kamal Piyush’. In his submissions, the appellant has also stated that Master Akshay Bansal and Miss Ayushi Bansal are minors. In view ofthese facts, their income is liable to be added in the hands ofthe appellant. Since the addition on substantive basis, has been confirmed in the hands of Shri Kamal Piyush, the father of Master Akshay Bansal, the protective addition in the hands of Master Akshay Bansal is not required.

7. With these remarks, the appeal is dismissed.”