Cash from Sister-In-Law received in Bank Accounts during Demonetization Period is not gift: ITAT upholds Addition [Read Order]

The Chennai bench of Income Tax Appellate Tribunal (ITAT) has recently held that cash received from sister-in-law deposited in bank accounts during the demonetization period is not a gift. Hence, the bench upheld the addition made by the assessing officer.

Assessee M. Natarajan,  employed with Chief Labour Commissioner deriving salary income, had filed his return of income for the assessment year 2017-18  admitting a total income of Rs. 2,31,840/-.

After scrutiny assessment the AO made addition on cash deposits made during the demonetization period.

After hearing the explanation of the assessee, the AO, without satisfying the submission confirmed the addition made towards cash deposits in Axis bank as unexplained money of the assessee.

Aggrieved by the assessment order, assesssee filed an appeal before the CIT(A). The CIT(A) rejected the appeal filed by the assessee. Thereafter, the assessee filed a second appeal before the Tribunal.

Before the tribunal, Anand Babu Nath-counsel for the assessee submitted that the cash deposit is gifted by his sister-in-law from the sale of ancestral property.

P. Sajit Kumar, counsel for the revenue submitted that assessee changed the stand right from assessment proceedings to appellant proceedings.

Initially, the assessee claimed that he had received his share of consideration towards sale of ancestral property.

Subsequently, he changed his stand and argued that he had received a gift from his sister-in-law Smt. Pakkiri Ammal.

Finally, now the assessee claims that money received from his sister-in-law has been kept for medical treatment of his brother Shri. Balakrishnan and the same amount was deposited into bank account during the demonetization period.

So there was an inconsistency in arguments made by the assessee at different stages of proceedings.

It was observed by the tribunal that there is inconsistency in arguments in respect of source for cash deposits also assessee could not file any corroborative evidence to substantiate his arguments, that why the money received towards sale of property was kept in his sister-in-law bank account.

Therefore, the bench of Mahavir Singh, Vice President and Manjunatha. G, Accountant Member sustained additions made towards cash deposits made during the demonetization period.

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