1 ITXA2284-09.doc IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION ttm GIFT TAX APPEAL NO.2284 OF 2009 The Commissioner of Gift Tax .. Appellant Vs. M/s.Nainraj Investments (P) Ltd. .. Respondent. Mr.Suresh Kumar with Ms.Padma Divakar for the appellant None for the respondent CORAM : J.P. DEVADHAR & K.K. TATED, JJ. DATE : 23rd SEPTEMBER, 2011. P.C. 1. Whether the ITAT was justified in quashing the gift tax proceedings on the ground that the additions made under the Income Tax Act, 1961 have been deleted by the ITAT, is the question raised in this appeal. 2. In the present case, the gift tax proceedings were initiated on the basis of the Assessment Order passed under section 143(3) of the I.T. Act, 1961 wherein additions amounting to Rs.65,42,739/- were made on account of arrears of show room rent, inadequate consideration and royalty. According to the Gift Tax Officer, since the Assessee had not accounted the aforesaid amount in its books of accounts the said amounts foregone by the 2 ITXA2284-09.doc assessee constituted gift under Gift Tax Act. 3. The proceedings initiated under the Gift Tax Act have been quashed by the ITAT on the ground that in the Income Tax proceedings the ITAT has held that the said amounts were not payable to the assessee. Counsel for the revenue has brought to the notice of the court that the appeal filed by the revenue against the decision of the ITAT deleting the additions made under the I.T. proceedings being Tax Appeal No.766 of 2009 has been dismissed by this court on 26.08.2008. 4. Thus, in the facts of the present case, since the decision of the ITAT in the Income Tax proceedings holding that amounts in question were not payable to the assessee, the question of treating the said amount as gift does not arise. Accordingly, the appeal is dismissed. (J.P. DEVADHAR, J.) (K.K. TATED, J.)