ITAT Remands Rs. 12.54 Cr Gift Case of Shilpa Shetty to AO for Fresh Examination

The Income Tax Appellate Tribunal (ITAT), Mumbai Bench, has remanded a tax dispute involving Shilpa Shetty Kundra back to the Assessing Officer for fresh examination in connection with a Rs. 12.54 crore gift received from her husband during AY 2020–21. The assessee had declared the amount as a genuine gift supported by a gift deed; however, during scrutiny, the Assessing Officer found that no bank statements or documentary evidence were provided to establish the actual transfer of funds.

The officer also noted that the declared income of the donor, her husband Shri Ripusudan Kundra did not justify the large gift amount, thereby questioning his creditworthiness. Accordingly, the amount was treated as unexplained credit under Section 68, and the addition was upheld by the Commissioner of Income Tax (Appeals).

On further appeal, the ITAT observed that the gift deed did not specify the mode of transfer and there was no clear banking trail to substantiate the transaction. The Tribunal also highlighted inconsistencies in the financial records, including lack of correlation between bank entries and the claimed gift, as well as insufficient explanation regarding the source of funds, including alleged foreign remittances.

While noting that the assessee had submitted certain documents, the ITAT held that the primary onus under Section 68 proving identity, genuineness, and creditworthiness was not fully discharged.

In view of these deficiencies and the need for proper verification, the Tribunal set aside the orders of the lower authorities and remanded the matter to the Assessing Officer for fresh adjudication, directing the assessee to furnish complete supporting evidence. The appeal was thus allowed for statistical purposes.