TMI Blog2010 (12) TMI 1202X X X X Extracts X X X X X X X X Extracts X X X X ..... cumstances of the case, the Ld. CIT(A) ought to upheld the order of the A.O. 2. We have heard the learned representatives of both the parties, perused the findings of the authorities below and the materials available on record. 3. Briefly, the facts of the case are that in the assessment order the AO has stated that during the year the assessee has received gift of ₹ 9,51,257/- from Smt. Bhanumati J. Doshi, New York, USA. He stated that on verification of the details/evidence submitted by the assessee, it is found that the assessee has not submitted proof/evidence in respect of creditworthiness of the donor. Hence, the AO issued a show cause notice dated 13-11-2006 to produce the copy of bank pass book, salary certificate, copy of account and balance sheet and copy of return of income filed before the concerned authority in USA. The A. O. contended that the assessee had failed to produce the proof/evidence and accordingly gift of ₹ 9,51,257/- is treated as unexplained cash credit u/s 68 of the IT Act and added to the total income of the assessee. 4. The addition was challenged before the learned CIT(A) and the assessee submitted vide his lette ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 05.2007. However, assessee has not attended on given date or has not filed any written submission. Therefore, one more opportunity was given to remain present on 24.05.2005 in the office of the undersigned. Accordingly, Shri Satish Kantilal Shah, Karta of HUF along with R. A. Sheth authorized C. A. of the assessee attended on 24.05.2007. A statement on oath recorded. Q. No.9. During visit in India where did Smt. Bhanuben Doshi (donor) stayed? Ams.9 Generally, Smt. Bhanuben stays at Mumbai only with her some relative. She is jain, whenever she comes to Palitana (religious place for Jain) for worship/darshan, she stays at Bhavnagar a Bhavnagar is the nearest city from Palitana. Q. No.10 Lastly, when did she come to India? Ans. 10 Lastly she came to India during December, 2006 Q. No.13 During which occasion donor has given gift to HUF? Ans.13 As she completed 25 years in Newyork, on this occasion she has given gift to the assessee. After perusal of assessee s submission, my comments are as under: (i) The claim of the assessee is not acceptable, as even after affording ample opportunity, the details were no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... convincingly over looked the asset statement of donor which was duly submitted and which shows that donor has liquid assets more than 14 times the gift amount and total wealth more than 50 times gift amount. The IT return of the donor clearly prove that her yearly income was almost thrice the gift amount this clearly prove that the donor do have creditworthiness to give a gift of $21000. Copy of the same was filed before the learned CIT(A). He further observed that the AO in his remand report had not rebutted the IT return. The learned Counsel for the assessee relied upon the decision of ITAT Ahmedabad Bench in the case of B. S. Corporation Vs ACIT (2001) 161 Taxman 29 and stated that in this case, the Tribunal held that if link is not established that the said amount belongs to the assessee or money is repaid to donor no addition can be made. He further relied upon the case of CIT Vs Vachani 184 ITR 121 (Delhi) and stat4ed that in this case, the Hon ble Delhi High Court held that it may be surprising as to how large sums of money received by a family in India by way of gifts from stranger from abroad, but unless there is something more tangible than suspicion, it will be difficul ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e learned DR submitted that since sufficient evidences were not filed before the AO at the assessment stage, therefore, the satisfaction of the AO as required u/s 68 of the IT Act is not proved. On the other hand, the learned Counsel for the assessee reiterated the submissions made before the authorities below and submitted that the donor is the cousin sister of wife of Shri Satish Kantilal Shah, Karta of the assessee HUF and therefore, it is not a gift between totally two strangers. He has submitted that sufficient evidences were produced before the learned CIT(A) for satisfaction of the three ingredients of section 68 of the IT Act. The learned Counsel for the assessee submitted that the donor was not a salaried person. Therefore, no salary certificate is issued in her case. The learned Counsel for the assessee referred to the documents filed on record which are also filed in the paper book i.e. copy of the passport of the donor, declaration of gift, bank certificate of the amount received as a gift, copy of the return filed by the donor in USA. The learned Counsel for the assessee on going through PB-25 which is the copy of the return of the donor stated that the filing st ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... jointly by her and her husband. The learned Counsel for the assessee was pointed out to explain as to who had the income for filing the return of income in USA. But, he could not explain as to whether the donor, Smt. Bhanumati J. Doshi was having source of income or her husband Jawahar K. Doshi. It is, therefore, not proved as to whether the donor has any source of income to make the gift. In the absence of any clarification, the copy of the return filed in USA by the donor and her husband would not support the contention of the learned Counsel for the assessee. The learned CIT(A) has therefore, wrongly placed reliance upon the same for the purpose of deleting the addition. The assessee in his statement stated that the donor is Managing Director of the Company but, is not aware of how much salary she was earning, but both husband and wife have filed their return of income. Once, the donor is claimed to be the Managing Director of the Company, it is highly unbelievable that she could not produce the salary certificate or any other confirmation/certificate to explain her source of income. The explanation of the learned Counsel for the assessee that the assessee is not a salari ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as to why gift was made in December, 2003 without visiting the assessee. No sufficient evidence has been filed before the authorities below to prove the genuineness of the gift in the matter. It is clear that the gift in the matter is not genuine and is the arranged affairs of the assessee. The assessee has failed to prove the source of the gift and the genuineness of the gift in the matter. The learned CIT(A) was thus not justified in holding that the AO has not rebutted in his remand report that the evidences produced by the assessee are incorrect. Since, the assessee did not file the required evidence to prove the creditworthiness of the donor and the genuineness of the transaction of the gift and no sufficient evidence was filed at the assessment stage, the learned CIT(A) was not justified in holding that the assessee had discharged his onus in proving genuine gift in the matter. Hon ble Delhi High Court in the case of CIT Vs Anil Kumar 292 ITR 552 held In the case of gifts mere identification of the donor and showing the movement of the gift amount through banking channels is not sufficient to prove the genuineness of the gift. Since the claim of gift is made by the as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Commissioner (Appeals). On appeal the High Court re-appreciated the evidence and substituted its own findings and came to the conclusion that the reasons assigned by the Tribunal were in the realm of surmises, conjecture and suspicion. On appeal to the Supreme Court: Held, reversing the decision of High Court, that findings of the Assessing Officer, the Commissioner (Appeals) and the Tribunal were based on the material on record and not on any conjectures and surmises. That the money came by way of bank cheques and was paid through the process of banking transaction was not by itself of any consequence. The High Court misdirected itself and erred in disturbing the concurrent findings of fact. Hon ble Punjab and Haryana High Court in the case of Yash Pal Goel Vs CIT 310 ITR 75 held that Held, dismissing the appeal that the financial position of M. suggested that he neither had the capacity to make the gift nor the source from where the gift was made. No reason whatsoever had been assigned for gifting such a huge amount by M to the assessee. M never visited the home of the assessee and hence there was no love and affection. It was nothing but a subterfuge to avoid income-tax. The ..... X X X X Extracts X X X X X X X X Extracts X X X X
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