TMI Blog2016 (9) TMI 380X X X X Extracts X X X X X X X X Extracts X X X X ..... s his hard earned capital in favour of the donee for ever whereas in the case of loan the creditor retains the right to recover the money from the assessee. Therefore, onus is heavier on the assessee in a case of gift as compared to the case of credit. In case of credit, if identity of the creditor is known and creditworthiness of the creditor is established then onus is shifted to the Revenue to show that credit is not genuine. But in the case of gift all the three ingredients are necessary to be established by the assesses and merely by giving evidence of identity and credit worthiness of donor, genuineness cannot be taken to be established automatically, 'therefore, test of human probability assumes importance so as to show that there we ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee, hence, same is being dealt with as under: 3. The facts of the case are that assessment in this case was completed u/s143(3) on 03.03.2004 determining total income at ₹ 7,32,680/. This assessment was cancelled by CIT Ujjain u/s.263 vide order dated 31.01.2006. As a result of which fresh impugned assessment order has been made u/s 143(3)/263. During the course of fresh assessment proceedings the AO noticed that assessee has credited ₹ 5 lacs as gift received from Shri Chetandas Rajpal , a non resident of Dubai (UAE), elder brother of the assessee by DD No. 6348705 dtd. 07.10.2000 drawn on SBI Ujjain. The DD was issued by Emirates India International Exchange, Dubai, UAE. The AO required the assessee to produce the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g a bank account. Accordingly, CIT(A) upheld the transaction of gift of ₹ 5 lakh as unexplained u/s.68 of the Act. 4. Before us, ld. AR for the assessee submitted that the gift was received vide DD. The ACIT 1(1) has recorded the statement of donor, Shri Chetandas Rajpal on 03.12.2008, when he was in India , wherein he has admitted of having given the gift to the assessee. He has also stated that he is having FDR of ₹ 25 Lakh which means that he is a person of means. The DD was payable at SBI which was encashed in UCO Bank where the assessee was having his bank account. The A.O. was also satisfied with this explanation in the original assessment so made. Therefore, it was claimed that the identity, creditworthiness and genuin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... amount of DD was made by paying cash and why the transaction was not channelized through bank even both donor and donee were having bank accounts. No credible evidence was adduced in support of genuineness of the gift. It could happen only in income-tax world where capital and source of income of persons of unknown means are transferred to rich persons with multiple source of income. The flight of capital from rags to riches in the form of such gifts can happen only to save income-tax. There is nothing in this transaction which inspires confidence about the genuineness. The gift is undoubtedly bogus. In this context, it would be pertinent to refer to the comments of the Hon. Madras High Court in Addl. CIT vs. Ranganathan Chetty (C.R.) (198 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f loan the creditor retains the right to recover the money from the assessee. Therefore, onus is heavier on the assessee in a case of gift as compared to the case of credit. In case of credit, if identity of the creditor is known and creditworthiness of the creditor is established then onus is shifted to the Revenue to show that credit is not genuine. But in the case of gift all the three ingredients are necessary to be established by the assesses and merely by giving evidence of identity and credit worthiness of donor, genuineness cannot be taken to be established automatically, 'therefore, test of human probability assumes importance so as to show that there were reasons which prompted the donor to forgo his hard earned capital in fav ..... X X X X Extracts X X X X X X X X Extracts X X X X
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