The Income Tax Appellate Tribunal (ITAT), Delhi bench has upheld an addition towards the gift from the father as the assessee failed to prove the creditworthiness of the donor under the provisions of the Income Tax Act, 1961.
During the course of assessment proceedings, the assessee, Praveen Kumar Chauhan was called upon to explain the source of cash deposited of Rs.10,50,000/- in his Saving Bank Account. However, the assessing officer rejected the explanation of the assessee and made an addition of Rs.10,00,000/- treating unexplained deposits in the saving bank account of the assessee and thus assessed the income at Rs.10,00,000/-.
The assessee contended that the amount was received as a gift from his father.
The department, on the other hand, argued that the assessee has merely filed an affidavit. However, creditworthiness of the donor could not be proved by the assessee by furnishing the requisite evidences.
Shri Kul Bharat, Judicial Member has observed that “this finding of Ld.CIT(A) is not rebutted by the assessee by placing the requisite details and evidences. The explanation of the assessee regarding cash deposited in his bank account was stated to be a gift received from his father. An affidavit by the father of the assessee was also filed. However, the assessee could not prove the creditworthiness of the donor by furnishing the supporting evidences regarding creditworthiness of the donor. The assessee was required to prove the creditworthiness of the donor. Therefore, I don’t see any reason to interfere in the finding of the authorities below, the same is hereby affirmed. Thus, grounds raised by the assessee are dismissed.”
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