Avtar Singh Gill Vs DCIT (ITAT Chandigarh)
In a case brought before the Income Tax Appellate Tribunal (ITAT), Chandigarh, an assessee, Avtar Singh Gill, challenged the confirmation of an income tax addition of Rs. 6.75 lakhs for Assessment Year 2014-15. The dispute arose from two gifts received by the assessee: Rs. 3.75 lakhs from his sister and Rs. 3 lakhs from his father-in-law.
The Assessing Officer (AO) and the Commissioner of Income Tax (Appeals) had previously rejected the assessee’s explanations, treating the gifts as unexplained income. The lower authorities’ rationale was that the gift deed from the sister was unregistered and that there was an immediate cash deposit in the father-in-law’s bank account before the gift was transferred to the assessee via NEFT.
The ITAT, however, reversed this decision. The tribunal noted that the assessee had provided documentation, including a photocopy of a sale deed for agricultural land, to establish the source of the funds. It clarified that a gift deed for a movable asset, such as money, does not require mandatory registration. The ITAT also found that the gift from the father-in-law, received through banking channels, was sufficiently explained.
The tribunal concluded that the tax authorities failed to conduct any independent inquiry to disprove the assessee’s claims. In the absence of any contrary evidence, the ITAT ruled that the assessee had discharged the onus of proving the gifts’ validity. The addition of Rs. 6.75 lakhs was therefore deleted. No specific judicial precedents were cited in the ruling.
