DCIT Vs Mira Bibi (ITAT Kolkata)
ITAT Kolkata: Cash Gifts from Brothers-in-Law Not Taxable—Section 68 Addition of ₹1.21 Cr Deleted
The Kolkata Bench of the ITAT dismissed the Revenue’s appeal for AY 2017-18 in the case of Mira Bibi, upholding the order of the CIT(A) which deleted the addition of ₹1.21 crore made under section 68 on account of cash gifts received from relatives.
The Tribunal noted that the assessee had received cash gifts of ₹75 lakh and ₹46 lakh from her brothers-in-law. During assessment, the assessee furnished confirmations, PAN, income-tax returns, balance sheets, and financial statements of the donors, clearly establishing their identity, creditworthiness, and the genuineness of the gifts. Both donors were regular income-tax assessees with substantial declared incomes and sufficient capital to make the gifts, and the gifts were duly reflected in their respective books.
The ITAT agreed with the CIT(A) that gifts received from relatives, as defined under section 56(2)(vii), are specifically exempt from taxation and cannot be recharacterised as unexplained cash credits under section 68 merely due to the absence of formal gift deeds. The Tribunal further observed that the Assessing Officer had not brought any adverse material to doubt the genuineness of the transactions or the financial capacity of the donors.
Relying on the Calcutta High Court decision in CIT v. Sanjeev Jain and coordinate bench rulings, the ITAT held that once the assessee discharges the primary onus under section 68, the burden shifts to the Revenue. In the absence of any rebuttal, the addition was rightly deleted. Accordingly, the Revenue’s appeal was dismissed.
FULL TEXT OF THE ORDER OF ITAT KOLKATA
