Addition towards unexplained credit not sustained as source of credit duly explained

Jignesh Kanubhai Patel Vs ACIT (ITAT Ahmedabad)

ITAT Ahmedabad held that addition u/s 68 of the Income Tax Act towards unexplained credit unsustainable as the assessee has been able to reasonably explain the source of gift from his mother.

Facts- During the year under consideration, AO observed that there was an increase in the capital from ₹ 14,88,157/- to ₹ 28,77,899/-. On being requisitioned by the AO, the assessee submitted that the capital of the current year included the profit of the current year and gift given to the assessee by his mother. The assessee submitted the gift deed and bank statement showing a gift of ₹ 11,98,025/-. On being requisitioned by the AO, the assessee submitted that the capital of the current year included profit of current year and gift given to the assessee by his mother. The assessee submitted the gift deed and bank statement showing gift of ₹ 11,98,025/-.

AO, however held that the gift was not genuine. Accordingly, AO held that the gift of ₹ 11,98,025/- as unexplained cash credit in the hands of the assessee.

CIT(A) upheld the assessment order. Being aggrieved, the present appeal is filed.

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