The Ahmedabad Bench of Income Tax Appellate Tribunal (ITAT) has set aside the tax department’s addition of unexplained income against a taxpayer, Manubhai, who had received Rs. 4.31 lakh in cash gifts for his son’s marriage.
The bench of Dr. B.R.R. Kumar (Vice-President) and Siddhartha Nautiyal (Judicial Member) observed that Manubhai had furnished complete details of his contract income and the list of gift-givers. The AO failed to conduct any independent inquiry to disprove the evidence. Just because the gifts were received before the wedding did not automatically make them “non-genuine,” particularly when documentary proof and guest lists were submitted. If the assessee had fabricated the evidence, he could have easily shown the gift receipts as being post-wedding.
The dispute traces back to AY 2011-12, when Manubhai filed his income tax return declaring an income of ₹4.61 lakh, which included salary and income under presumptive taxation (Section 44AD) from contract work.
During scrutiny, the Assessing Officer (AO) found cash deposits of Rs. 14.2 lakh in his SBI account and ₹15 lakh in HDFC Bank. Manubhai explained the deposits of Rs. 14.2 lakh from contract work, Rs. 9 lakh from sale of agricultural land, Rs. 1 lakh withdrawn from his wife’s account, and Rs. 5 lakh from marriage gifts and personal savings.
Out of these, the AO disputed Rs. 14.2 lakh contract income and Rs. 4.31 lakh in marriage gifts, treating them as unexplained income. Eventually, the AO added Rs. 18.51 lakh to his taxable income.
Despite producing the marriage invitation card, marriage certificate, and a detailed guest list of gift-givers, the AO dismissed his claims on the grounds that wedding gifts were received nearly a month before the actual wedding date, which the department argued was against normal practice.
The tribunal noted that the fact that marriage gifts were received prior to the date of marriage itself could not lead to the conclusion that the same are not genuine, when a complete lists of persons from whom the gifts were received was duly submitted during the course of assessment proceedings and no specific defect had been pointed out with respect to the lists of persons so furnished by the assessee.
The Tribunal held that the additions were unsustainable and allowed the appeal.
Case Details
Case Title: Manubhai Dahyabhai Bhoi Versus Income Tax Officer
Case No.: I.T.A. No.779/Ahd/2025
Date: 12.08.2025
Counsel For Appellant: Sulabh Padshah, AR
Counsel For Respondent: Pratik Sharma, Sr. DR
