Revenue Tax division doubts Rs 10 lakh reward – brother will get tax discover for money obtained from sisters; how he appealed & received the case

Items obtained from kinfolk and associates can generally land you within the revenue tax web. One such case was of a Mr. Maheshwari from Agra, who needed to show the genuineness of Rs 10 lakh obtained as money from his sisters.In line with an ET report, a businessman from Agra, Mr. Maheshwari, stated he obtained Rs 2.74 crore (2,74,33,250) as a present from his Delhi-based sister, together with Rs 6.25 lakh from one other sister. Each sisters had been married, and he utilised these funds in his enterprise ventures. He subsequently filed his revenue tax return (ITR) for AY 2016-17, declaring an revenue of Rs 10 lakh (10,80,770).His ITR confronted scrutiny after receiving a discover beneath Part 143(2) on September 19, 2017. The revenue tax assessing officer (AO) documented within the evaluation order that Mr. Maheshwari earned revenue as a agency accomplice. The officer noticed a capital enhance of Rs 1.8 crore (1,83,77,061) throughout AY 2016-17.Throughout the investigation, Mr. Maheshwari clarified that he had launched capital of Rs 3.67 lakh and Rs 1.8 crore into his proprietorship corporations. He attributed this to his Delhi-based sister’s reward of Rs 2.74 crore (2,74,33,250), which she had declared in her ITR.He moreover reported receiving Rs 6,25,000 in presents from his different sister. While he offered documentation to exhibit the donors’ monetary functionality, the tax officer questioned sure transactions. These included two Rs 5,00,000 presents obtained on April 15, 2015, and Could 15, 2015, from his Delhi sister, plus the Rs 6,25,000 from his different sister, citing inadequate documentation.Additionally Learn | PPF guidelines: Why Kerala Excessive Courtroom ordered a mom to return additional curiosity earned in kids’s Public Provident Fund accounts – definedThe tax official deemed these reward quantities as a deliberate association to evade taxation beneath the Revenue Tax Act and categorised them as unexplained money credit score beneath Part 68 throughout evaluation, the ET report stated.The Agra resident challenged this determination by submitting an attraction with the Commissioner of Appeals (CIT A).The CIT A confirmed the tax official’s classification of the Rs 10,94,000 reward from the Delhi-based sister as unexplained money credit score beneath Part 68, citing inadequate proof of the donor’s monetary capability. Dissatisfied with this determination, the person approached the Revenue Tax Appellate Tribunal Agra bench. On September 30, 2025, the ITAT Agra dominated in his favour, the report stated.

Money presents beneath tax web: What helped show the genuineness?

The brother’s success within the case stemmed from offering complete documentary proof that validated each the authenticity of the presents and the monetary capability of the donors.In line with the ET report, the Tribunal’s findings had been:

Additionally Learn | Six years after receiving wage arrears, retired staff had been instructed to repay the complete quantity – till this Supreme Courtroom ruling modified every partThe ITAT Agra dominated that the Part 68 additions had been unwarranted, deciding within the assessee’s favour by accepting the presents as reputable and correctly defined.ITAT Agra’s judgement (ITA No. 316/AGR/2024) dated September 30, 2025, acknowledged that the assessee’s attorneys highlighted a sale deed exhibiting his Delhi-based sister had obtained money from a property sale, which she subsequently gifted to him. The tribunal famous that their sibling relationship was undisputed.ITAT Agra stated: “The factum of a sister giving a present to brother can be supported by affirmation. Therefore in my thought of opinion, the supply of the donor can be established by the assessee herein within the immediate case.”The tribunal famous that the assessee confirmed his sister had correctly paid capital positive factors tax on the property sale.ITAT Agra noticed that the CIT (A) had identified the Delhi Sister’s returns weren’t scrutinised beneath Part 143(3).ITAT Agra declared: “This can’t be a purpose to disbelieve the reward and doubt the creditworthiness of her. Revenue Tax shouldn’t be within the assessee’s (brother) palms as to get her returns scrutinized. That job is left to the knowledge of the revenue tax division. The assessee can’t be faulted for an act which isn’t in his management. Therefore there is no such thing as a purpose to disbelieve her creditworthiness to have given a money reward of Rs 10,94,000 to the assessee (brother) and accordingly the identical is to be handled as defined.“

The documentation reviewed by the Tribunal included:

Chartered Accountant (Dr.) Suresh Surana instructed ET that the Tribunal’s evaluation confirmed that each donors had been the assessee’s organic sisters, validating the familial bond applicable for such presents. The supply of Smt. Bansal’s money presents was adequately substantiated by property sale proceeds. The Tribunal specified that the absence of scrutiny of her return beneath Part 143(3) was not enough grounds to query her creditworthiness, as this accountability falls beneath the Revenue Tax Division’s jurisdiction relatively than the assessee’s.Surana notes that relating to Smt. Agarwal’s case, the Tribunal decided that the reward switch occurred by correct banking channels, supported by financial institution data and reward affirmation. The Tribunal concluded that the assessee had adequately fulfilled obligations beneath Part 68, demonstrating the donor’s id, creditworthiness, and transaction authenticity, significantly because the Assessing Officer didn’t pursue extra donor investigations regardless of having full data.