A woman from Delhi, who is a school teacher by profession, was given a cash gift of Rs 3.5 lakh by her daughter, which she did not tell in her ITR. After this, the Income Tax Department sent a notice to him. The teacher appealed against this at the Income Tax Appeal Tribunal (ITAT), Delhi. Now ITAT, while giving the verdict in this case, obeyed the teacher and has rejected the decision of the tax department.
Actually, the case is for the financial year 2017-18. According to the Economics Times report, a Delhi teacher received a cash gift of Rs 3.5 lakh from his daughter, which he deposited in his bank and used it to buy the property. Later the teacher made his total income according to Rs 7.4 lakh ITR Full, but did not mention the amount received from the gift. Then this money came under the eyes of the Income Tax Department and he asked for its full view.
Tax officer did not listen to teacher
The teacher told in response that his daughter has given this amount to him. The daughter is 25 years old and does not work yet, but used to save a little bit. He deposited his old money for his savings and gave a gift to the mother. But the tax officer refused to accept this. He said that the daughter does not have evidence of so much money. It also told that the money deposited in the daughter’s account was in small notes and the money was deposited and withdrawn again and again. Officials said that if anyone already had cash money, he would not understand the need to deposit and withdraw again and again. Finally, the officers, considering the entire 3.5 lakh rupees as unknown money, imposed tax on it.
Justice received from woman’s appeal
The woman, angry with this decision, went to an officer of the Income Tax Department, who again repeated the same old things and upheld the tax decision. After this, the woman appealed to the Income Tax Appellate Tribunal (ITAT) of Delhi. Here he re -submitted all the documents, such as gift declaration, daughter’s bank statement, old cash accounts and slips to deposit money in the bank. The woman said that the daughter had saved a little amount for many years and kept it in cash and gave a gift to the mother. He also told that the daughter did not like to keep much money in the bank, so she used to deposit and withdraw money when needed.
Daughter has the right to give gift
ITAT closely investigated the case and said that the daughter is 25 years old, is an adult and can give a gift to anyone on her own free will. The tribunal admitted that giving such a gift in the mother-daughter relationship is absolutely common. If the daughter has saved the money and given a gift to the mother, then it cannot be suspected that she is not rich. ITAT said that tax officers ignored the spirit of relationship and gift. He canceled all the old decisions and removed the tax amount and said that this money is valid and no tax is made on it.
There will be no tax on gift but evidence is important
At the same time, Dr. Suresh Surana, an expert in tax cases on this matter, said that according to the Income Tax Act, if a gift has been received from the relative, then there is no tax on him. Mother-daughter relationship comes under the same realm. But he also said that it is very important to have evidence of his proof. For example, written announcement of gifts, bank transactions, and income status of gift giver. Cash transactions often doubt, so it is better to give gift bank transfer.