TMI Blog2016 (3) TMI 326X X X X Extracts X X X X X X X X Extracts X X X X ..... serious infirmity We are thus clearly of the opinion that the Tribunal fell into an error in interfering with the order of the CIT(A) without first dislodging the reasons given by him. Assuming that another view was possible, that itself would be no ground to interfere with the order of the CIT(A) unless it is shown that the appreciation of evidence by the CIT(A) was either perverse or untenable and that in holding in favour of the assessee the CIT(A) either ignored material evidence or that the view taken by him was patently untenable. - Decided in favour of assessee - G. A. No. 584 of 2005, ITA No. 51 of 2005 - - - Dated:- 4-3-2016 - Girish Chandra Gupta And Asha Arora, JJ. For the Appellant : Mr. Ananda Sen, Adv. Mr. Biswajit Mal, Adv For the Respondent : Mr. Asha G. Gutgutia, Adv, Ms. Swati Keshwani, Adv JUDGMENT Girish Chandra Gupta J. The assessee has come up in appeal under Section 260A of the Income Tax Act, 1961 (hereinafter referred to as the Act ) against a judgment and order passed by the Income Tax Appellate Tribunal, D Bench, Kolkata in ITA No.2541 (Cal) of 2003 dated 29th April, 2004 pertaining to the assessment year 1996-97. The fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ase it is assumed that the assessee has no valid explanation regarding this increase in opening stock and opening capital. It is treated that this increase of ₹ 50,000/- in opening stock and ₹ 3,26,550/- in opening capital is income from undisclosed source of the assessee. This amount is added back to the total income of the assessee. The assessee appealed before the Commissioner of Income Tax (Appeals) (hereinafter referred to as the CIT(A) ) against the order of the assessing officer. Before the CIT(A) the assessee raised the contentions that:- 1. he had handed over all the notices to his Advocate who did not attend the hearings and that he himself was unaware of this non-compliance on the part of his Advocate; 2. he is an under graduate with income from pooja and other allied activities. In the year 1986 he started a business in the name of Sona Cycle Mart with an initial investment of ₹ 25,900/-. He filed income tax return for the first time in the assessment year 1990-91 indicating therein business income under the name Sona Cycle Mart but never filed his personal balance-sheet till the assessment year 1998-99; 3. in the assessment year 19 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The donor has not any blood relationship with dale donee. As per ITI s report the donor had made cash gift ₹ 10,000 on 10-04-95 out of his business agricultural income could not produce any evidence except declaration affidavit. The CIT(A) by an order dated 14th March, 2001 deleted the addition of ₹ 2,40,000/- which was claimed to have been received by way of gifts. The disallowance of the balance amount of ₹ 86,550/- was maintained. Furthermore, addition of ₹ 50,000/- on account of discrepancy in the opening stock was also maintained. The CIT(A) held as follows:- As regards the difference of ₹ 50,000/- between the closing stock and opening stock, the A. R. could not file any satisfactory evidence. Hence the addition is confirmed on this ground. As regards addition on account of introduction of capital amounting to ₹ 3,26,550/-, I have considered the argument of the A. R. and the report of the A. O. The appellant has received gift from several donors which has been verified by the A. O. In case of donor Rani Bala Bhattacharya, Manasi Metia, Haridas Sinha Dhrubajoyti Bhattacharya the source of gift has been establish ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... /- was chargeable to gift- tax, there was no evidence that gift-tax was paid. (c) In the case of Haridas Sinha, the donor is the brother-in-law of the assessee and he declared that he had made a gift of ₹ 40,000 on several dates from out of his pension income. It was never explained as to what his pension was and the reason for making the gift of ₹ 40,000/- . (d) In the case of Sanjay Panda, the donor is not any blood relation. In this case there was a declaration of gift but there was no evidence on record to show that this donor had ability to make the gift as alleged. (e) In the case of Dhrubajyoti Bhattacharya, elder brother of the assessee, he is alleged to have made gift of ₹ 30,000/- on two dates in cash out of his salary. he is an employee of State Bank of India. This donor happens to a bank employee. In spite of that he does not appear to have maintained bank account to which he could have drawn cheque if the gift was genuine. There was no such effort on the part of the assessee to establish the genuineness of the gift. (f) In the case of Rabindranath Ghorai also this donor was no blood relation and for some strange reason he app ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stances are not rare, when even strangers make gifts, out of very many considerations, including arising out of love, affection and sentiments. The learned Counsel appearing for the revenue supported the order of the tribunal and contended that the genuineness of the alleged gifts could not be ascertained from the remand report furnished by the assessing officer before the CIT(A). He further contended that the assessing officer had duly served notice u/s.148 on the assessee. On three separate occasions the case of the assessee was fixed for hearing but no one turned up. Therefore the assessing officer was compelled to carry out ex-parte assessment u/s.144. It was in these circumstances that the assessing officer by his order dated 14th March 2001 u/s. 144 r/w. 147 rightly concluded that the assessee had no explanation to offer regarding the increase in opening stock and opening capital and the same was income of the assessee from undisclosed sources. In this view of the matter the action of the assessing officer in adding back these amounts to the total income could not be faulted and the CIT(A) fell in error by interfering with the same. We have heard the arguments advanc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e reversing a finding of fact, the appellate court has to bear in mind the reasons ascribed by the trial court. This view of ours finds support from what was stated by the Privy Council in Rani Hemanta Kumari Debi v. Maharaja Jagadindra Nath Roy Bahadur [10 CWN 630 : 8 Bom LR 400] wherein, while regarding the appellate judgment of the High Court of Judicature at Fort William as careful and able , it was stated that it did not come to close quarters with the judgment which it reviews, and indeed never discusses or even alludes to the reasoning of the Subordinate Judge . We are thus clearly of the opinion that the Tribunal fell into an error in interfering with the order of the CIT(A) without first dislodging the reasons given by him. Assuming that another view was possible, that itself would be no ground to interfere with the order of the CIT(A) unless it is shown that the appreciation of evidence by the CIT(A) was either perverse or untenable and that in holding in favour of the assessee the CIT(A) either ignored material evidence or that the view taken by him was patently untenable. In that view of the matter question No. 1 formulated above is answered in the negative a ..... 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