TMI Blog2009 (9) TMI 676X X X X Extracts X X X X X X X X Extracts X X X X ..... me consideration over and above the consideration stated in the sale deed have been invested, no addition can be made on presumptions and suspicions. In the latest case of CIT v. Smt. Shakuntala Devi [ 2009 (3) TMI 5 - DELHI HIGH COURT] , Hon ble Delhi High Court held it may be relevant to note that a Division Bench of the court comprising Dr. Arijit Prasayath and Justice D.K. Jain, as their Lordships then were retreated that there must be a finding of the revenue that the assessee had received amounts over and above the consideration stated in the sale deed, following the ratio of K.P. Varghese s case (supra). The Division Bench of Hon ble Delhi High Court in CIT v. Ashok Khetrapal [ 2007 (7) TMI 36 - HIGH COURT , DELHI] observed that by referring to the report of valuation officer in the absence of any incriminating documents found in the course of a search no addition could be made by treating investment as undisclosed on the basis of any DVO s report. Hence, we do not find any merit in the addition made by AO under the head Unexplained investment on account of various properties purchased by the assessee during the block period on the basis of fair market value as est ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ansaction is designed to show huge amounts as gifts without any liability of paying taxes. The findings so recorded by the lower authorities could not be controverted by the learned AR by bringing any material, much less a cogent material so as to persuade us to deviate from the alleged finding. We therefore do not find any reason to interfere in the order of the lower authorities in respect of the addition made on account of bogus gifts. In the result, the grounds taken by all the assessees with regard to gifts in various years, are being dismissed. Charging of interest u/s 234B - it was held by the Co-ordinate Bench in the case of Dinesh Jain belonging to the same group of assessee s vide order, that interest u/s 234B is to be calculated from the date of order u/s 143(1) or 153A whichever is later. Respectfully following the decision referred, we direct the AO to recompute the interest u/s 234B as directed hereinabove. In the result, all the appeals of the assessee and, revenue, are allowed in part, in terms indicated hereinabove. - I.P. BANSAL AND R.C. SHARMA, JJ. Rajesh Jain for the Appellant. Stephen George for the Respondent. ORDER Per ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e-tax and for the purpose of wealth tax assessment. The Assessing Officer stated that in the entire block period comprising assessment years 1998-99 to 2004-05 many properties have been acquired by the assessee, which are duly declared in the Income-tax returns. Further during the proceedings under section 153A/143(3) of the Act, the detailed charts of various properties acquired by different assessees of the group, substantiating the source of investment, have been furnished and are available on records. The Assessing Officer also made a reference to the valuation cell in respect of the property so purchased by the assessee for ascertaining the fair market value of the property on the very same date when the assessment order was passed. The Assessing Officer resorted to provisions of Wealth-tax Act for arriving at the fair market price of these properties and made addition on the basis of difference between fair market value so arrived at as per the provisions of Schedule 3 of Wealth-tax Rules. It was submitted by the assessee that all the properties so purchased were duly supported by proper conveyance deed/sale deed and value of which has duly been accepted by the sub-registrar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ese properties indicate that the amount invested has been suppressed. Accordingly, he applied provisions of Rule 3 of Part ( b ) of the 3rd Schedule to the Wealth-tax Rules for the purpose of determining the fair market value of these properties. The Assessing Officer also made a reference to the DVO, as the reference was made one day prior to the framing of assessment, he was not in receipt of any DVO s report. It is undisputed fact that department has not referred any incriminating material having been found during the course of search and investigation made thereafter which indicate that assessee had paid anything more than what has been stated in the sale deeds. It was also not the allegation of the department that there was any difference in the value of the property as accepted by the sub-registrar for the purpose of stamp duty valuation. In view of the fact that no material was found indicating anything paid over and above the registered sale price of the property so acquired, keeping in view of the decision of Hon ble Supreme Court in the celebrated judgment of K.P. Varghese s case ( supra ) wherein it was held that onus lies on the department to prove that some considera ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oceedings under section 131 of the Act and the donors furnished their bank statements, financial statements like balance sheets of their firms, copy of Income-tax returns for the last six years for demonstrating the capacity for making gifts. It was further submitted that the donors duly disclosed the nature of relationship with the family and explained the reasons for giving gifts to the appellant and his minor children. The assessee also submitted the copy of statements of both the donors recorded by the Assessing Officer. These statements are said to have been recorded by the Assessing Officer around six to nine months back before passing the assessment order on 8-11-2007. The assessee submitted that the copies of the statements were never confronted to the assessee by the Assessing Officer in spite of his special request made by him in response to show-cause notice issued by the Assessing Officer before passing the assessment order. The assessee pleaded that the addition made on account of gift is totally arbitrary and the same is made on suspicion only. Being not satisfied with the replies of the assessee, the addition was made by the Assessing Officer and the same was confirm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2004] 270 ITR 368 (Raj.) and CIT v. Anil Kumar [2007] 292 ITR 552 (Delhi), the authorities below come to the conclusion that gifts are nothing but assessee s own money received back under the guise of gifts from unknown persons. In the case of Anil Kumar ( supra ), the Hon ble Delhi High Court has categorically held that the onus lies on assessee to establish the identity as well as the financial capacity of donor. In the case of Chain Sukh Rathi ( supra ), although gift was given by father to the son, still it is held that undisclosed income of the assessee in the absence of any occasion. The CIT(A) has also fortified the findings of the Assessing Officer by observing that consistently the courts are of the opinion that apart from identity and creditworthiness, the genuineness of the transaction is of vital issue in gifts. Unless occasion and relationship is established, the gifts cannot be held as genuine. From the perusal of family details it can be seen that a number of close relations are available but none of them had gifted any sums to the assessee. However, assessee could receive substantial amounts as gifts from a remotely connected persons. Assessee also could ..... X X X X Extracts X X X X X X X X Extracts X X X X
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