Shri Amratlal N.Jariwala, Surat V. The Income tax Officer,Ward-5(1), Surat

ITA 1133/AHD/2011

• Counselvise Citation: [2011] 140 COUNSELVISE.COM (IT) 50711 (ITAT-AHMEDABAD)
• Duration Of Justice: 5 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-09-2011
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: SMC
• Next Hearing Date: 22-09-2011
• Assessment Year: 2004-2005
• Appeal Filed On: 18-04-2011
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: S A BOHRA
• Assessee Lawyers: M K PATEL
• Keywords: Unexplained cash credit; Gift; Opportunity of being heard; Principle of natural justice; Opportunity of cross examination; Corroborative evidences; Assessment record; Onus to prove
• Section: 143(3); 131; 68

Judgement Text

-1- IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCH 'SMC' BEFORE SHRI MUKUL KUMAR SHRAWAT JUDICIAL MEMBER ITA NO.1133/AHD/2011 (ASSESSMENT YEAR:-2004-05) SHRI AMRUTLAL NAGINDAS JARIWALA, 9/500, KOTSHEERI, WADIFALIA, SURAT V/S THE INCOME-TAX OFFICER, WARD-5(1), SURAT PAN: ACBPJ 6091 R [APPELLANT] [RESPONDENT] APPELLANT BY :- SHRI M K PATEL, AR RESPONDENT BY:- SHRI S A BOHRA, SR. DR DATE OF HEARING:- 22-09-2011 DATE OF PRONOUNCEMENT:- 26-09-2011 O R D E R THIS IS AN APPEAL AT THE BEHEST OF THE ASSESSEE WH ICH HAS EMANATED FROM THE ORDER OF THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS)-IV, SURAT [THE CIT(A)] DATED 21-12- 2010. THE GROUNDS RAISED BY THE APPELLANT ARE REPRO DUCED BELOW:- [1] THAT ON FACTS AND IN LAW THE LEARNED CIT(A) HAS GRIEVOUSLY ERRED IN CONFIRMING THE ADDITION OF RS.2,00,000/- MADE U/S 68 OF THE ACT. [2] THAT ON FACTS, STATEMENTS AND EVIDENCE ON RECOR D, IT OUGHT TO HAVE BEEN HELD THAT THE GIFTS RECEIVED ARE GENUINE AND NO ADDITION IS CALLED FOR. 2 ITA N O.1133/AHD/2011 2 THE FACTS OF THE CASE IN BRIEF AS EMERGED FROM TH E CORRESPONDING ASSESSMENT ORDER PASSED U/S 143(3) READ WITH SECTION 251 OF THE IT ACT, 1961, DATED 04-09-2009 WERE THAT EARLIER THE ISSUE OF ADDITION U/S 68 HAD REACHED UP TO THE ITAT BENCH-B AND VIDE AN ORDER DATED 10-03-2008 IN ITA NO.4569/AHD/2007 (AY 2004-05), THE MATTER WAS RESTO RED BACK TO THE FILE OF THE AO AS PER THE FOLLOWING OBSERVAT IONS:- 2. LEARNED COUNSEL OF THE ASSESSEE, AT THE OUTSET, CONTENDS THAT PRINCIPLES OF NATURAL JUSTICE IN THIS CASE HAVE BEE N VIOLATED, INASMUCH AS, STATEMENTS OF CREDITORS VIZ. SMT. HAASABEN B. JARIWALA, SHRI HARISH MOHANLAL AND SHRI NITESH HIRALAL RANA WERE T AKEN. ON ASSESSEE'S REQUEST, AO AGREED TO GIVE AN OPPORTUNIT Y FOR CROSS- EXAMINATION OF THESE WITNESSES BY HIS NOTICE DATED 15-12-1006. THE ASSESSEE VIDE LETTER DATED 26-12-2006 REQUESTED THE ITO TO SUPPLY COPIES OF STATEMENTS RECORDED UNDER SECTION 131 AND FURTHER INFORMED THAT SHRI HARISHKUMAR HAD LEFT SURAT AND SETTLED IN BANGALORE. THEREAFTER, COPY OF STATEMENT OF SMT. HANSABEN WAS RECEIVED. THE ASSESSEE ATTENDED OFFICE OF ITO ALONGWITH SMT.HANSA BEN AND OTHER DONORS VIZ. NITISH HIRALAL RANA ON 26-12-2003. AO, HOWEVER, DID NOT ALLOW CROSS-EXAMINATION OF WITNESSES AND STATED THA T TIME GRANTED WAS OVER AND ON THE NEXT DATE I.E. 27-12-2006 ASSESSMEN T ORDER WAS PASSED. IT WAS CONTENDED THAT AS THE AO HAS FAILED TO GIVE PROPER OPPORTUNITY TO ASSESSEE TO CROSS-EXAMINE, ADDITION MADE MAY BE DELETED. 2.1 ALTERNATIVELY, GROUND MAY BE SET ASIDE AND REST ORED BACK TO THE FILE OF AO TO DECIDE THE SAME AFRESH AFTER GIVING A SSESSEE ADEQUATE OPPORTUNITY OF BEING HEARD IN ACCORDANCE WITH LAW. 2.2 LEARNED DR SUPPORTED ORDERS OF LOWER AUTHORITIE S. 3. WE HAVE HEARD RIVAL SUBMISSIONS AND PERUSED MATE RIAL AVAILABLE ON RECORD. AS THE FACTS EMERGE, ASSESSEE WAS NOT GR ANTED PROPER OPPORTUNITY TO CROSS-EXAMINE THESE WITNESSES. CONSE QUENTLY, PRINCIPLES OF NATURAL JUSTICE HAVE BEEN VIOLATED. IN VIEW THEREOF, WE SET ASIDE MATER BACK TO THE FILE OF AO TO DECIDE TH E SAME AFRESH AFTER GIVING ASSESSEE AN OPPORTUNITY OF BEING HEARD. 3 ITA N O.1133/AHD/2011 2.1 IN CONSEQUENCE THEREUPON, THE CASE W AS FIXED FOR HEARING BY THE AO AND PARTY-WISE DISCUSSION WAS MAD E AS UNDER:- 3.1 GIFT OF RS.50,000/- SHRI HARISH MOHANLAL KAYASTH IN ORDER TO VERIFY THE GENUINENESS OF GIFT AND TO A LLOW CROSS EXAMINATION SUMMON WAS ISSUED TO SHRI HARISH MOHANL AL KAYASTH. SUMMON ISSUED TO SHRI HARISH MOHANLAL KAYASTH AT TH E ADDRESS GIVEN BY THE ASSESSEE RETURNED UNSERVED WITH POSTAL REMAR K AS 'LEFT'. THEREFORE, THE ASSESSEE WAS REQUESTED TO PRODUCE HI M FOR EXAMINATION AND REMAIN PRESENT FOR CROSS EXAMINATION. THE ASSES SEE BY ORDER SHEET ENTRY DATED 31.07.2009 WAS ONCE AGAIN REQUESTED TO EITHER PRODUCE SHRI HARISH MOHANLAL KAYASTH FOR EXAMINATION OR PRO VIDE HIS PRESENT ADDRESS IN ORDER TO TRACE HIM TO ASCERTAIN GENUINEN ESS OF GIFT. HOWEVER, THE ASSESSEE NEITHER PRODUCED THE ALLEGED DONOR NOR GAVE ADDRESS THUS LEAVING NO SCOPE FOR THE DEPARTMENT TO VERIFY HIS CONTENTION. ONUS TO PROVE GENUINENESS OF THE GIFT SQUARELY LIES UPON THE ASSESSEE. HOWEVER, THE ASSESSEE HAS NOT PRODUCED THE DONOR . THUS THE ESSENTIAL INGREDIENTS VIZ. CREDIT WORTHINESS OF THE DONOR AND GENUINENESS OF THE TRANSACTION MENTIONED IN SECTION 68 OF THE ACT ARE NOT PROVED BY THE ASSESSEE. 3.2 GIFT OF RS.50,0007/-FROM SHRI NITESH HIRALAL RANA IN RESPONSE TO SUMMON ISSUED SHRI NITESH H RANA ATTENDED THE OFFICE ON 31.07.2009. HIS STATEMENT WERE RECORDED ON OATH. HE DERIVES INCOME FROM LABOUR WORK OF JARI. HIS TOTAL INCOME A S PER RETURN OF INCOME FILED FOR AY 2003-04 AND 2004-05 IS RS.52000 /- AND RS.59750 RESPECTIVELY. HE HAS OUTSTANDING LIABILITY IN THE F ORMS OF UNSECURED LOANS OF RS.66000/- AS ON 31.3.2004 IN THE VERY YEA R WHEN GIFT OF RS.50000/- HAS BEEN CLAIMED. ON PERUSAL OF BANK ACC OUNT OF SHRI NITESH H RANA IT IS SEEN THAT AVERAGE BALANCE WAS R S.3000 TO RS.4000/-EXCEPT THE ENTRY OF GIFT TO ASSESSEE. CASH OF RS.40000 AND RS.10000 WERE DEPOSITED ON 23.05.2003 AND CHEQUE OF RS.50000 WAS GIVEN TO THE ASSESSEE. THE CHEQUE WAS CLEARED ON 27 .05.2003 MEANING THEREBY THAT CHEQUE WAS GIVEN ON SAME DAY OF CASH D EPOSIT OR JUST AFTER A DAY OR TWO. ON BEING QUESTIONED ABOUT AVAILABILITY OF CASH SHRI NITESH H RANA IN REPLY TO QUESTION NO. 15 STATED THAT HE KEPT CASH O N HAND OF HIS 4 ITA N O.1133/AHD/2011 BUSINESS AND DEPOSITED IN BANK ACCOUNT TO GIVE GIFT . SHRI NITESH H RANA WAS ASKED TO BRING BOOKS OF ACCOUNT BUT HE DID NOT BRING THE SAME ON THE PRETEXT THAT BOOKS WERE DESTROYED IN TH E FLOOD. IT IS NOTEWORTHY THAT HIS OTHER DOCUMENT SUCH AS PROPERTY DOCUMENT, RETURN OF INCOME ETC. WERE NOT DESTROYED. THE AR OF THE AS SESSEE WAS ALLOWED TO CROSS EXAMINE SHRI NITESH HIRALAL RANA W HICH HE DECLINED. GIFT IS CLAIMED TO HAVE BEEN GIVEN ON ACCOUNT OF FR IENDLY FAMILY RELATION AS PER GIFT DECLARATION. SHRI NITESH H RAN A IS NOT RELATED TO THE ASSESSEE. THERE WAS NO OCCASION OR REASON TO PART W ITH SUCH A HUGE MONEY. IT IS AGAINST GENERAL HUMAN NATURE AND BEHAV IOR TO MAKE A GIFT WITHOUT ANY OCCASION TO A PERSON WHO IS NOT EVEN DI STANTLY RELATED. GENERALLY A PERSON WILL DISCHARGE HIS LIABILITY PRI OR TO MAKING FREE GIFTS. AS APPARENT FROM BANK ACCOUNT AND RETURN OF INCOME OF SHRI NITESH H RANA, HE IS NOT CAPABLE TO MAKE A GIFT OF HUGE AMOUNT OF RS.50000/-. 3.3 GIFT OF RS.1,00,000/- FROM SMT. HANSABEN BHUPENDRA JARIWALA ASSESSEE CLAIMED GIFT OF RS. 100000/- FROM SMT. HAN SABEN B JARIWALA. DURING THE COURSE OF ASSESSMENT U/S 143(3 ) THE AO EXAMINED HER. SHE ADMITTED ON OATH THAT SHE WAS NOT HAVING EXTRA MONEY TO GIVE ANY GIFT BUT ON INSTRUCTIONS OF THE A SSESSEE DEPOSITED RS.49500 IN CASH ON 3.03.2004, RS.49,500/- ON 4.03. 2004 AND RS.1000/- ON 5.03.2004 AND THEN ISSUED A CHEQUE OF RS.1,00,000/- TO THE ASSESSEE.SHE ALSO STATED THAT THE ASSESSEE HAD PREPARED DECLARATION OF GIFT AND OBTAINED HER SIGNATURES ON THE DECLARAT ION. SHE ALSO STATED THAT THE MONEY WAS RETURNED IN CASH. IN THIS BACK G ROUND AND TO ALLOW CROSS EXAMINATION TO ASSESSEE, SMT. HANSABEN WAS SU MMONED ONCE AGAIN DURING THE COURSE OF DE-NOVO ASSESSMENT PROCE EDING. SMT. HANSABEN ATTENDED THE OFFICE ON 31.07.2009 AND HER STATEMENT WERE RECORDED ON OATH. FROM HER STATEMENT THE FOLLOWING SIGNIFICANT POINTS EMERGES :- 1. SHE HAD NO SURPLUS MONEY TO MAKE GIFT 2. CASH OF RS.49500 EACH WERE DEPOSITED ON 3.3.2004 & 4.3.2004 AND RS.1000 ON 5.3.2004. THEN CHEQUE OF RS.1,00,000 WAS GIVEN. NORMALLY, A PERSON WOULD AVOID DEPOSITING RS .50000 CASH IN BANK ACCOUNT ONLY TO AVOID FURNISHING PAN W HICH IS NECESSITY IN CASE OF SUCH CASH DEPOSIT AND THAT IS WHY RS.49500 WERE DEPOSITED ON TWO OCCASIONS. 5 ITA N O.1133/AHD/2011 3. SHE IS NOT RELATED TO THE ASSESSEE. THERE WAS NO NATURAL LOVE OR AFFECTION 4. THERE WAS NO OCCASION TO MAKE A GIFT. 5. HER AVERAGE BANK BALANCE WAS BELOW RS.2,000/-. 6. SHE DOES NOT KNOW WHAT IS INCOME TAX RETURN. THE RETURN WAS FILED TO GIVE COLOR OF GENUINENESS TO THE GIFT. THE ASSESSEE WAS SUPPLIED A COPY OF THE STATEMENT R ECORDED. AS PER AOS REMARK GENERALLY A RICH GIVES GIFTS TO WEA KER OUT OF LOVE AND AFFECTION ON SOME OCCASION, HOWEVER, IT WA S NOT SO IN THE PRESENT CASE. IT WAS HELD THAT MERE FILING OF D ECLARATION DID NOT MAKE A NON-GENUINE GIFT TO A GENUINE GIFT. APPL YING THE PROVISIONS OF SECTION 68 THE CLAIM OF GIFT WAS DISA LLOWED. 3 BEFORE THE LEARNED CIT(A) IT WAS REITERATED THAT (I) TWO DONORS HAVE APPEARED,(II) THEIR GIFT DEEDS WERE FIL ED ALONG WITH THE DETAILS OF CHEQUES AND (III) THEY WERE TAX PAYE RS AND, THEREFORE, IT WAS A GENUINE GIFT WHICH SHOULD HAVE BEEN ALLOWED. HOWEVER, THE LEARNED CIT(A) WAS NOT CONVINCED AND A FFIRMED THE ACTION OF THE AO VIDE FOLLOWING PARA:- 4.3. I HAVE GONE THROUGH THE FACTS. SHRI HARISH MO HANLAL KAYASTHA WAS NOT TRACEABLE. THE APPELLANT DID NOT KNOW HIS A DDRESS NOR COULD HE GIVE COMPLETE DETAILS. THOUGH IT IS CLAIMEDTHAT PAP ERS WERE SUBMITTED TO THE AO, NO PAPERS WERE PUT BEFO.V ME. THE GIFT R ECEIVED FROM THIS DONOR IS THEREFORE HELD AS UNEXPLAINED CASH CREDIT. AS REGARDS SHRI NITESH H. RANA AND HANSABEN BHUPENDRA JARIWALA IT I S SEEN THAT THESE PEOPLE APPEARED BEFORE THE A.O DURING THE SET ASIDE PROCEEDINGS AND ACCEPTED MAKING GIFTS. HOWEVER, THEIR FINANCIAL STA TUS WOULD NOT ALLOW THEM TO MAKE GIFTS - BOTH WERE EARNING VERY NOMINAL AMOUNTS. EVEN THE BANK ACCOUNTS OF THE DONORS REVEALED THAT THEY DID NOT HAVE THE CAPACITY TO MAKE THE GIFTS. IT IS TRUE THAT THERE IS NO REQUIREMENT OF AN OCCASION OR RELATIONSHIP TO MAKE A GIFT BUT IN PRACTICE NO ONE WILL GIVE GIFTS WITHOUT CAUSE OR WITHOUT EXISTENCE OF A RELATIONSHIP. BOTH THE DONORS HAVE CLAIMED THAT THEY HAD GIVEN GIFTS O UT OF CASH ACCRUING 6 ITA N O.1133/AHD/2011 FROM BUSINESS. LOAN CAN BE MADE OUT OF BUSINESS FUN DS BECAUSE THIS WILL BE RETURNED. GIFTS ARE ALWAYS MADE OUT OF SURP LUS FUNDS. BANK ACCOUNTS ALSO REVEALED THAT AVERAGE CASH A BALANCES WERE VERY SMALL. IT IS ALSO UNLIKELY THAT DESPITE HAVING BANK ACCOUNT T HE PERSON WOULD KEEP SUCH LARGE AMOUNTS ON HAND. THE AMOUNTS IN THE MSELVES MAY BE SMALL BUT THESE ARE HUGE WHEN WE CONSIDER THE STATU S OF THE PERSONS AND THEIR INCOMES. IN MY OPINION, THESE GIFTS DO NO T SURVIVE THE TEST OF PREPONDERANCE OF HUMAN PROBABILITIES IN RESPECT OF CREDITWORTHINESS. I THEREFORE HOLD THAT THE GIFTS MADE BY SMT. HANSABEN BHUPENDRA JARIWALA AND SHRI NITESH H RANA WERE NOT GENUINE. T HE ADDITION IS THEREFORE SUSTAINED. THESE GROUNDS ARE DISMISSED. 4 FROM THE SIDE OF THE ASSESSEE, THE LEARNED AR MR. M K PATEL AND FROM THE SIDE OF THE REVENUE, THE LEARNED DR MR. S A BOHRA APPEARED. THE LEARNED ARS MAIN EMPHASIS WAS THAT ONCE THE AMOUNT WAS PAID THROUGH CHEQUES AND THE DONORS HAVE PERSONALLY APPEARED BEFORE THE AO AND AFFIRMED THE GIFTED AMOUNTS, AND MOREOVER THE DONORS WERE HAPPENED TO B E TAX- PAYERS, THEREFORE, THE GENUINENESS OF THE GIFTS SHO ULD NOT HAVE BEEN DOUBTED. 5 ON THE OTHER HAND, THE LEARNED DR HAS STATED THAT THOSE PERSONS WERE OF ORDINARY MEANS, THEREFORE, IT WAS A GAINST HUMAN NATURE TO MAKE A GIFT OUT OF THE MEAGER AMOUNT AVAI LABLE WITH THE DONORS. A PERSON IS EXPECTED TO FIRST DISCHARGE HIS OWN LIABILITY AND THE LIABILITY OF SONS AND DAUGHTERS BUT THOSE P ERSONS HAVE MADE GIFTS WHICH WERE AGAINST HUMAN BEHAVIOUR. 6 I HAVE HEARD BOTH THE SIDES. I HAVE ALSO PERUSED THE ORDERS OF THE AUTHORITIES BELOW. IT IS EVIDENT THAT THE MA TTER WAS RESTORED TO THE FILE OF THE AO BY THE RESPECTED CO-ORDINATE BENCH FOR THE LIMITED PURPOSE TO GRANT PROPER OPPORTUNITY TO CROS S EXAMINE THOSE WITNESSES. IT WAS COMMENTED BY THE TRIBUNAL T HAT LACK OF 7 ITA N O.1133/AHD/2011 OPPORTUNITY WAS A VIOLATION OF PRINCIPLES OF NATURA L JUSTICE. THE MATTER WAS RESTORED BACK TO THE FILE OF THE AO TO D ECIDE AFRESH AFTER GRANTING AN OPPORTUNITY OF HEARING. THE RELEV ANT PORTION AND THE DIRECTIONS OF THE TRIBUNAL HAVE ALREADY BEEN RE PRODUCED HEREINABOVE. IN THE SECOND ROUND OF ASSESSMENT PROC EEDINGS, AS FAR AS A GIFT OF RS.1 LAC DONATED BY SMT. HANSABEN BHUPENDRA JARIWALA IS CONCERNED, IT WAS AFFIRMED BY THE AO TH AT SHE WAS EXAMINED IN PERSON . CONSEQUENT UPON THE DIRECTIONS OF THE TRIBUNAL SHE WAS ONCE AGAIN SUMMONED. ADMITTEDLY, S HE HAD ATTENDED THE OFFICE ON 31-07-2009. IN HER CROSS EXA MINATION SHE HAD ADMITTED THAT (I) THE SAID SUM WAS GIFTED ON 03-03-2004 BY WAY OF CHEQUE NO.126987 DRAWN ON INDIAN OVERSEAS BA NK, ZAMPA BRANCH, SURAT. THAT (II) IT IS ALSO AN ADMITTED POSITION THAT SHE WAS FILING INCOME-TAX RETURNS FOR AYS 2002 -03 AND 2004-05. THERE WAS A BALANCE OF RS.2,27,772/- AS ON 31-03-2003 IN HER RETURN OF INCOME FOR AY 2003-04. THAT (III) IT HAS ALSO BEEN AFFIRMED THAT THERE WAS SUFFICIENT BALANCE IN HER BANK ACCOUNT OUT OF WHICH THE SAID SUM OF RS.1 LAC WAS G IFTED. THAT (IV) THE GIFT DEED IN SUPPORT OF THE GIFT TRANSACTI ON HAS ALSO BEEN PLACED ON RECORD. THE LEARNED AR HAS CONTESTED VEH EMENTLY WITH THIS FACTUAL BACKGROUND THAT (V) THE IDENTITY OF TH E PERSON, (VI) THE CAPACITY OF THE PERSON AND (VII) THE GENUINENES S OF THE TRANSACTION WAS NOT DOUBTED BY THE REVENUE DEPARTME NT. EVEN IN THE CASE OF THE DONOR NO ACTION WAS TAKEN BY THE RE VENUE DEPARTMENT AND HER CAPITAL ACCOUNT AND INCIDENCE OF GIFT HAD DULY BEEN ACCEPTED BY THAT AO. ONCE THE IMPUGNED DONATION HAD BEEN AFFIRMED IN HER RESPECTIVE INCOME-TAX RETU RN AND THAT RETURN HAD BEEN ACCEPTED BY THE RESPECTIVE AO, THEN , THERE WAS 8 ITA N O.1133/AHD/2011 NO OCCASION TO TAKE AN ADVERSE VIEW BY THE AO OF TH E DONEE. THE CASE LAW CITED IN SUPPORT OF THESE ARGUMENTS IS A D ECISION OF THE HONBLE GUJARAT HIGH COURT PRONOUNCED IN THE CASE O F MURLIDHAR LAHORIMAL VS. CIT [2006] 280 ITR 512 (GUJ )]. 6.1 LIKEWISE IN THE CASE OF SHRI NITESH H RANA, IT IS AN ADMITTED POSITION THAT IN RESPONSE TO SUMMONS HE HAD ATTENDED THE OFFICE ON 31-07-2009. THAT (I) HIS STATEMENT WAS RECORDED ON OATH BY THE AO. THAT (II) HE HAS INFORMED THAT H E DERIVED INCOME FROM LABOUR WORK OF JARI. THAT (III) HE HAS ALSO FILED THE INCOME-TAX RETURNS FOR AYS 2003-04 AND 2004-05 DISC LOSING INCOME IN A RANGE OF RS.52000/- TO RS.59000/- RESPE CTIVELY. THAT (IV) THE SAID GIFT WAS THROUGH CHEQUE NO.071166 DAT ED 07-05- 2003 DRAWN ON BANK OF BARODA. THAT (V) AS PER THE G IFT DEED IT WAS AFFIRMED THAT THE DONEE BEING A FAMILY FRIEND, THEREFORE, THE GIFT WAS GIVEN BY HIM. AGAIN THE LEARNED AR HAS STA TED THAT BY THE VERY PRESENCE OF THE DONOR, THE IDENTITY WAS NO T IN DOUBT AND BEING A TAX-PAYER THOUGH ON NOMINAL INCOME HIS CAPA CITY WAS NOT IN DOUBT AND THE INCIDENCE OF GIFT WAS DULY AFFIRME D BY THE GIFT DEED. 6.2) HOWEVER, IN RESPECT OF THIRD DONOR, VIZ., SHRI HARISH MOHANLAL KAYASTHA, SUMMONS WERE ISSUED BUT REMAINED UNSERVED. THE LEARNED AR HAS THEREFORE FAIRLY EXPRE SSED THAT HE HAD NOTHING MUCH TO ADD EXCEPT TO PLACE RELIANCE ON THE SUBMISSIONS ALREADY MADE BEFORE THE FIRST APPELLATE AUTHORITY. 6.3) FROM THESE DETAILS IT IS CLEAR THAT THE AMOUNTS IN QUESTION, IN RESPECT OF TWO DONORS WHO HAVE APPEARE D BEFORE THE 9 ITA N O.1133/AHD/2011 AO AND AFFIRMED THE AMOUNTS GIFTED BY THEM, ARE NOM INAL BUT THE VERY REASON FOR DISALLOWANCE GIVEN BY THE AO WAS TH AT THE OCCURRENCE OF GIFT WAS AGAINST THE GENERAL HUMAN NA TURE. THE AO WAS ALSO OF THE VIEW THAT THERE WAS NEITHER ANY OCC ASION NOR THEY WERE RELATED TO THE DONEE, HENCE, THE GIFT APPEARED TO BE NOT A GENUINE GIFT. INDEED, IT IS CORRECT THAT THERE WAS NO RELATIONSHIP BETWEEN THE DONOR AND THE DONEE AND THERE WAS NO OC CASION STATED BY ANY OF THE PARTIES FOR MAKING THE GIFT BU T OTHER CORROBORATIVE EVIDENCES SUCH AS AFFIRMATION OF THE DONORS, THEIR RESPECTIVE INCOME-TAX ASSESSMENT RECORDS WHERE THE DONATED AMOUNTS WERE NOT DISTURBED AND THAT THEY HAVE GIFTE D THE AMOUNTS THROUGH CHEQUES / BANKING CHANNELS, THEREFORE, CONS IDERING THE SMALLNESS OF THE MATTER, I CAN HOLD THAT THE FACTS OF THESE GIFTS ARE VERY CLOSE TO THE FACTS OF THE CITED DECISION OF TH E HONBLE GUJARAT HIGH COURT IN THE CASE OF MURLIDHAR LAHORIM AL (SUPRA). FOR REFERENCE, HELD PORTION IS REPRODUCED BELOW:- HELD, THAT THE TRIBUNAL FAILED TO NOTE THE FACT TH AT THE IDENTITY OF THE DONOR WAS ESTABLISHED, THE DONOR HAVING APPEARED IN PERSON BEFORE THE ASSESSING OFFICER, THE GENUINENESS OF THE TRANSACTI ON WAS ESTABLISHED, NOT ONLY BY THE RECEIPT OF THE BANK DRAFT, BUT ALSO BY THE FACT OF THE TRANSACTION HAVING BORNE GIFT TAX ONCE THE ASSESSME NT WAS FRAMED. THE PRIMARY ONUS WHICH RESTED WITH THE ASSESSEE, THUS, STOOD DISCHARGED. THEREAFTER, IF THE REVENUE WAS NOT SATISFIED WITH T HE SOURCE OF THE FUNDS IN THE HANDS OF THE DONOR, IT WAS UP TO THE R EVENUE TO TAKE APPROPRIATE ACTION. THE TRIBUNAL CONSIDERED THE MOT IVATION FOR MAKING THE GIFT WHICH WAS NOT RELEVANT. THE ADDITION OF RS .50,000 WAS NOT JUSTIFIED. NO ORDER IN DISAGREEMENT OF THE ABOVE JU DGMENT OF THE JURISDICTIONAL HIGH COURT HAS BEEN CITED BEFORE ME FROM THE SIDE OF THE REVENUE. HOWEVER, THERE WAS A DISCUSSION DUR ING THE 10 ITA NO.1133/AHD/2011 COURSE OF ARGUMENTS BY THE LEARNED DR ABOUT A DECIS ION OF THE HON'BLE SUPREME COURT IN THE CASE OF CIT VS. P MOHA NKALA [2007] 291 ITR 278 (SC)], BUT EVEN DURING THE HEARI NG IT WAS ADMITTED THAT IN THAT CASE THE DONOR WAS TO RECEIVE A SUITABLE COMPENSATION FROM THE ASSESSEE AND THEREFORE THE GI FT ITSELF WAS DOUBTED AND HELD THAT IT WAS NOT A REAL GIFT. THE H ONBLE COURT HAS THEREFORE HELD THAT THOUGH MONEY CAME BY WAY OF BANK CHEQUE BUT MERELY THAT THE GIFT WAS BY THE PROCESS OF BANKING TRANSACTION ITSELF DID NOT ESTABLISH THE GENUINENIT Y OF THE GIFT. IN OTHER WORDS, THE FACTS OF EACH CASE, ESPECIALLY WHE N THE PROVISIONS OF SECTION 68 ARE TO BE CONSIDERED, HAVE TO BE EXAMINED IN THE LIGHT OF THE CORROBORATIVE EVIDENCE S AND OVERALL CIRCUMSTANCES OF THAT VERY CASE. IN THE PRESENT CASE, THE MOST IMPORTANT PART IS THAT THE TRIBUNAL HAS GIVEN CERTA IN DIRECTIONS AND THOSE DIRECTIONS WERE CONFINED TO TH E OPPORTUNITY OF CROSS EXAMINATION OF THE DONORS AND IF ON CROSS EXAMINATION IT WAS NOT DOUBTED THAT THE DONORS HAVE AFFIRMED THE GIFTED AMOUNTS, THEN, THE AO IS EXPECTED TO CON FINE HIS JUDGMENT WITHIN THOSE DIRECTIONS. FOR THIS REASON ALONE, I CAN HOLD THAT REST OF THE ISSUE AS RAKED UP BY THE AO I N THE SECOND ROUND OF ASSESSMENT NEED NOT TO BE TAKEN UP AND NEC ESSITATED TO DECIDE THE MATTER WITHIN THE AMBITS OF THE DIRECTIO NS OF THE TRIBUNAL. I, THEREFORE, HOLD THAT THE ASSESSEE IS E NTITLED FOR RELIEF ONLY IN RESPECT OF TWO DONORS, VIZ. SMT. HANSABEN B HUPENDRA JARIWALA AND SHRI NITESH HIRALAL RANA. THE AMOUNT O F GIFT DONOTED BY THE THIRD DONOR, VIZ. SHRI HARISH MOHANL AL KAYASTHA IS HEREBY AFFIRMED. THE GROUND IS PARTLY ALLOWED. 11 ITA NO.1133/AHD/2011 7 IN THE RESULT, THE APPEAL IS PARTLY ALLOWED. ORDER PRONOUNCED IN THE COURT TODAY ON 26-09-2011 SD/- (MUKUL KUMAR SHRAWAT) JUDICIAL MEMBER DATE : 26-09-2011 COPY OF THE ORDER FORWARDED TO: 1. SHRI AMRUTLAL NAGINDAS JARIWALA, 9/500, KOTSHEER I, WADIFALIA, SURAT 2. THE INCOME-TAX OFFICER, WARD-5(1), SURAT 3. CIT CONCERNED 4. CIT(A)-IV, SURAT 5. DR, ITAT, AHMEDABAD BENCH-SMC, AHMEDABAD 6. GUARD FILE BY ORDER DEPUTY REGISTRAR ASSISTANT REGISTRAR ITAT, AHMEDABAD 12 ITA NO.1133/AHD/2011