TMI Blog2014 (12) TMI 641X X X X Extracts X X X X X X X X Extracts X X X X ..... been placed on record and under normal circumstances such a 'gift-deed' can be accepted - However, ongoing through the 'gift-deed', the Tribunal found that no witnesses are there to identify the execution of the 'gift-deed' in accordance with law - The execution of the 'gift-deed' is not established in accordance to the requirement of law as may be applicable in the countries where the 'gift-deed' is executed. Originally in the transaction there is no mention of the word 'gift', but thereafter the word 'gift' has been added by way of interpolation – Tribunal rightly relied upon Commissioner of Income-Tax Versus P. Mohanakala [2007 (5) TMI 192 - SUPREME Court] - for the purpose of applying the provisions of Section 68 of the Income Tax A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the financial year 2001-2002, the assessee filed a return of income showing the income received from M/s Narmada Enterprises - a proprietary concern, owned by the assessee. The assessee showed deriving income from salary, house, business and shares. It was stated that the assessee's proprietary concern is engaged in manufacturing tin containers, tin components and also carries on C F Agencies. During the year in question, the assessee declared a gross profit of ₹ 1,07,23,593/- against a turnover of ₹ 27,43,13,559/-. During the course of assessment, the AO found that the assessee had received 'gifts' from two non-resident Indians namely - one Shri M. Musa from Dubai; and, another Shri V. Balan from Singapore. The amo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rned counsel for the respondent/department, took us through the findings recorded by the Appellate Tribunal, from paragraph 8 onwards, wherein the Appellate Tribunal has doubted the genuineness of the 'gift' made and tried to argue that as the 'gift' is not found to be made genuinely by the donors and as the 'gift' deed itself was not proved in accordance to the requirement of law, the reasonable justification given by the Tribunal for doubting the genuineness of the 'gift' itself is a reasonable finding and it should not be interfered with. 6. In support of his contention, Shri Sanjay Lal invited out attention to a judgment of the Supreme Court in the case of Commissioner of Income Tax Vs. P. Mohanakala a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or. If all these three are present together then the provision of Section 68 may become applicable and the assessee may get benefit of the said provision. In the said case, the AO and the Income Tax Appellate Tribunal have found that even though identity of the creditors and his credit-worthiness are established, but the genuineness of the transaction is doubtful. The Income Tax Appellate Tribunal has gone into details with regard to genuineness of the transaction and from paragraph 8 onwards, has discussed at length as to why the transaction becomes doubtful. The assessee claims to have received 'gift' from two persons, the Tribunal found that these two persons are not related to the assessee. They are residing in two different cou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... usly gone through the findings recorded in paragraph 8, which runs to more than three pages, and we find that the Tribunal has subjectively analysed the nature of the transaction and has recorded a positive finding to the effect that the transaction being a 'gift' is doubtful. This finding recorded by the Tribunal is based on due appreciation of the material and evidence available on record and if this is a finding of fact, duly arrived at by two authorities namely - the AO and the Appellate Tribunal, it can be interfered with us only if it is wholly perverse or it can be said that a question of law arises only if we can classify the said finding as a perverse and arbitrary finding unsupported by any material or evidence available o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f Mohanakala (supra), to hold that if the two donors, who are involved in the said case, had absolutely no connection with the assessee and if they had made the 'gift' which is found to be doubtful in nature, then the only assumption that can be drawn is that money has been transferred to help the assessee and not as a 'gift'. It has been held that such a transaction by a stranger by way of 'gift' would not normally be made and if such a transaction is found to be unnatural, the taxing authorities are entitled to look into the surrounding circumstances and hold that the transaction is not genuine. The principle laid down by the Delhi High Court in the case of Rajeev Tandon (supra) also supports the aforesaid finding ..... X X X X Extracts X X X X X X X X Extracts X X X X
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