Nikhil Vinod Raj Rathod Jain Vs ITO (ITAT Mumbai)
Cash Gift from Father Needs Verification, Not Straight Rejection: ITAT Mumbai Remands ₹26.36 Lakh Cash Deposit Addition
Mumbai ITAT,set aside the order of the CIT(A), NFAC and remanded the matter to the AO for fresh examination of cash deposit addition of ₹26.36 lakh made u/s 68.
The AO had treated cash deposits in the Assessee’s bank account as unexplained, rejecting the explanation that the amounts were received as cash gifts from his late father, withdrawn from the father’s bank account on corresponding dates. The CIT(A) sustained the addition, doubting the genuineness of cash gifts and observing that a genuine gift should normally be routed through banking channels.
The Tribunal noted that the Assessee had produced bank statements showing matching withdrawals & deposits and, for the first time before the ITAT, filed a gift deed executed by his late father. While the identity of the donor (father) was undisputed, the ITAT held that creditworthiness and genuineness of the cash gift still required verification, especially since the donor was no longer alive and the gift deed required examination.
Considering the peculiar facts, the Tribunal admitted the gift deed as additional evidence and held that outright rejection was unjustified. The ITAT therefore set aside the orders of the lower authorities and restored the matter to the AO to verify the original gift deed, bank transactions of both father & son, and surrounding circumstances, and thereafter decide the issue afresh in accordance with law. The appeal was allowed for statistical purposes.
FULL TEXT OF THE ORDER OF ITAT MUMBAI
