TMI Blog2000 (2) TMI 221X X X X Extracts X X X X X X X X Extracts X X X X ..... uring the accounting period, were personal business in bentonite lumps, share of profit from different firms, interest income and dividend income. The first ground of appeal is regarding the addition of Rs. 64,997 made on account of gift received by the assessee from a foreign party in US dollars. 3. During the course of assessment proceedings, the assessee explained to the AO that the gift was sent by one Shri Ramesh Chawla through Shri Harishchandra Goyal, New York. The assessee also explained that Shri Ramesh Chawla has sent this gift to him in US $5000 because he had helped Shri R. Chawla in his earlier life in Gandhidham. Shri R. Chawla attained prosperity in his life because of the guidance of the assessee. It is stated that he also persuaded him to go abroad. It is because of the assessee that Shri R. Chawla is now settled in USA and he is now a nicely placed person. He also informed the AO that Shri R. Chawla regards him as his father and in view of such relationship he has set the gift to him. The gift was riot only sent to him but also to his son Shri Nilesh Bansal. Therefore, the gift has been received by him but also to his son Shri Nilesh Bansal. Therefore, the gift ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... donee and the donor. 7. We have heard the rival parties. During the course of hearing, the learned counsel produced before us copy of letter dt. 25th Dec, 1987, written by Shri R. Chawla of USA to the assessee wherein he has mentioned the draft number for US $ 5,000 and has also stated that the same is being sent to the assessee through Shri Harishchandra Goyal. Shri Goyal informed the assessee, vide letter dt. 27th Dec, 1987, that he had received F.D.D. for US $ 5,000 issued by NBG International, Coral Cables (Miami) Florida bearing No. 003244 : 061000256 000001880, dt. 7th Jan., 1988, for and on behalf of the assessee. He has also stated that he is forwarding this draft to the assessee which is a gift from Shri R. Chawla. In view of the documents, the genuineness of the gift cannot be doubted. The identity of the donor is established. In view of the above documents, the transaction cannot be doubted. The capacity of Shri R. Chawla, who is settled in USA, to advance US $ 5,000 to the assessee cannot also be doubted. Keeping in view the fact that he has also made donations to Gandhidham. The donation was also received in the form, of a draft and the same was also deposited in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ons of s. 69 of the Act. 11. The learned CIT(A) deleted the addition made by the AO on the ground that the AO could not find out any defects in the books of account and, therefore, his referring the case to the Valuation Officer was not justified. This is a search case and the Department could not find out any evidence, during the course of the search, to support the view that the assessee has undervalued the cost of construction. The learned CIT(A) has also stated that the AO does not have any authority, under the IT Act, to make reference to the Valuation Officer for determining the cost of construction. 12. During the course of hearing, the learned Departmental Representative contended that the AO is fully empowered to make reference to the Valuation Officer in order to make a proper assessment. According to him, the AO, while making the assessment, can collect information through any source for determining the correct profits of the assessee. He also referred to the provisions of s. 69B. According to him, the books of account are not relevant while making the additions under the provisions of s. 69B. He further argued that the construction was for residential purposes and i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... w of the above facts and the various case laws discussed above, we fully agree with the findings of the learned CIT(A) that the addition made by the AO is not justified. The order of the learned CIT(A), on this issue, does not require any interference from our side. 16. The third ground of appeal is regarding the addition of Rs. 33,500 made under the provisions of s. 68 of the Act on account of unexplained cash credits. The AO, in his order, has stated that there were deposits in the names of the following three persons in the balance sheet of the assessee: Rs. (i) Sonali Varma 15,000 (ii) Tapankumar Moulik 9,500 (iii) Chhotalalji 9,000 According to the AO, the assessee could not produce confirmatory letters from Tapankumar Moulik and Chhotalalji. Regarding Sonali Varma, the AO stated that she was not having any taxable income. Thus, he came to the conclusion that the three deposits were out of the undisclosed income of the assessee as the three persons mentioned above were not in a position to advance such amounts. He also supported his case by stating that all t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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