NIRANJANKUMAR RATHI, MUMBAI V. ITO WD 1(3), MUMBAI

ITA 1228/MUM/2011

• Counselvise Citation: 122819914 RSA 2011
• Duration Of Justice: 4 year(s) 6 month(s) 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-09-2015
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: G
• Next Hearing Date: 07-07-2015
• Assessment Year: 2005-2006
• Appeal Filed On: 10-02-2011
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: SOMNATH UKKALI
• Assessee Lawyers: D C JAIN
• Keywords: Unexplained expenditure; Gift; Income from undisclosed sources
• Section: 69C; 131; 68; 69

Judgement Text

, INCOME TAX APPELLATE TRIBUNAL,MUMBAI G BENCH , , BEFORE S/SH. RAJENDRA,ACCOUNTANT MEMBER & PARTHASAR ATHY CHOUDHURY,JUDICIAL MEMBER /. ITA NO. 1228 /MUM/2011, / ASSESSMENT YEAR - 200 5 - 06 NIRANJAN KUMAR RATHI FLAT NO.204, GAGANGIRI APTT. KOMBADPADA ROAD, BHIWANDI . PAN: A CZPR 9806 J VS INCOME TAX OFFICER - 1 (3) RANI MANSION, 2 ND FLOOR MURBAD ROAD, KALYAN MUMBAI. ( / APPELLANT ) ( / RESPONDENT ) /ASSESSEE BY : SHRI D.C. JAIN / REVENUE BY : SHRI SOMNATH UKKALI / DATE OF HEARING : 26 - 08 - 2015 / DATE OF PRONOUNCEMENT : 04 - 0 9 - 2015 , 1961 254 ( 1 ) ORDER U/S.254(1)OF THE INCOME - TAX ACT,1961(ACT) PER RAJENDRA, AM - CHALLENGING THE ORDER DT .30.10.2010 OF CIT(A) - I,THANE,T HE A SSESSEE , HAS RAISED FOLLOWING GROUNDS OF APPEAL: 1. UNDER THE FACTS AND C IRCUMSTANCES OF THE CASE THE LEARNED CIT (APPEALS) ERRED IN CONFIRMING THE ADDITION OF RS.6,00,000/ - MADE BY THE ASSESSING OFFICER - STATING UNPROVED GIFTS 1 (A) THE LEARNED CIT (APPEALS) FAILED TO APPRECIATE THAT : - I) THE ADDITIONS ARE MADE SOLELY REL YING ON THE IMPROPER STATEMENT OF THE APPELLANT GIVEN, WHEN HE WAS MENTALLY UNFIT DUE TO HIS ILLNESS. II) THE APPELLANT FILED RELEVANT CONFIRMATION LETTERS FROM THE DONORS ALONGWITH COPIES OF ACKNOW - LEDGEMENT OF RETURNS AND FINANCIAL STATEMENTS - GIVIN G NAME ADDRESS AND IT NOS. ETC. ETC. III) ALL THE GIFTS ARE RECEIVED THROUGH THE BANKING CHANNELS. 2. UNDER THE FACTS AND CIRCUMSTANCES THE LEARNED CIT (APPEALS) ERRED IN CONFIRMING THE ADDITIONS OF RS.30,000/ - U/S. 69C AS UNEXPLAINED EX PENDITURE. 2 (A) THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) FAILED TO APPRECIATE THAT : - I) THE ADDITION OF RS.30,000/ - MADE U/S. 69 - C STATING EXPENSES INCURRED IN GETTING THE GIFTS; HAVING NO BASIS; MERELY ON ASSUMPTIONS. 3. UNDER THE FACTS AND CIRCUMSTANCES THE LEARNED CIT (APPEALS) ERRED IN CONFIRMING THE UNSECURED LOAN OF RS. 5,18,077/ - (ERRONEOUSLY TAKEN AT RS.5,13,077/ - IN COMPUTATION OF INCOME BY ASSESSING OFFICER IN THE ASSESSMENT ORDER), 3 (A) THE LEARNED CIT (APPEALS ) FAILED TO APPRECIATE THAT I) NECESSARY LOAN CONFIRMATIONS GIVING NAME, ADDRESS, I. T. NOS. WERE FILED ON RECORD. II) THE LOAN AMOUNTS WERE RECEIVED THROUGH BANKING CHANNELS . 4 THE APPELLANT CRAVES LEAVE TO ADD, AMEND, ALTER, DELETE THE G ROUNDS OF APPEA L AT OR BEFORE THE HEARING OF APPEAL. 2. ASSESSEE, AN INDIVIDUAL ENGAGED IN THE BUSINESS OF MANUFACTURING OF CLOTH FILED HIS RETURN OF INCOME ON 28.10.2005, DECLARI NG TOTAL INCOME AT RS.90,960/ - . THE ASSESSING O FFICER ( AO ) ITA/ 1 228 /M/11 ,AY. 0 5 - 06 NIRANJAN K 2 C OMPLETED THE AS SE SS M E NT ON 17.7.07,U/S.143(3) OF THE ACT, DETERMINING H IS INCOME AT RS.12.38 LA KH S. 2.1 . FIRST GROUND OF APPEAL IS ABOUT CONFIRMING THE ADDITION OF RS.6.00 LACS. D URING THE ASSESSMENT PROCEEDING, THE AO FOUND THAT THE ASSESSEE HAD SHOWN ADDITION TO HIS C API TAL ACCOUNT OF RS.9.61 LACS, THAT THE ASSESSEE WAS HAVING THREE BANK ACCOUNTS IN HIS NAME OR IN THE NAMES OF FAMIL Y MEMBERS WITH THE S YNDICATE BANK BHIWANDI. IN THE ABOVE BANK ACCOUNTS FOLLOWING AMOUNTS HAD BEEN CREDITED: ( A ) A/C.NO.20480 NIRANJANKUMAR N. RA THI DATE AMOUNT(RS.) 13.05.2004 CLG 300000 01.06.2004 CLG 600000 A/C.NO.20575 NIRANJANKUMAR N. RATHI (HUF) DATE AMOUNT(RS.) 16.07.2004 BY CASH 150000 09.08.2004 BY CASH 50000 ( B ) A/C. NO.20574 SMT. SHANTA NIRANJAN RATHI DATE AMOUNT(RS.) 16.07.2004 BY CASH 150000 09.08.2004 BY CASH 50000 THE ASSESSEE SUBMITTED THE COPIES OF DECLARATION OF GIFTS MADE TO HIM BY FIVE PERSONS NAMELY: SAMPATLAL S . JAIN, KOLKATTA, P U NAM D EVI JAIN - KOLKATTA, MANISH R. SETHI - KOLKATTA, P ARASMAL J . SAROGI - KOLKATTA AND D UBELAL L. SAROGI - KOLKATTA.IN THIS REGARD THE ASSESSEE STATED THAT ABOVE GI FTS WERE RECEIVED BY HIM IN MAY, 2004 BY DEMAND DRAFTS AND SAME HAD BEEN CREDIT ED IN CURRENT ACCOUNT ON 1.6.2004. TO EXAMINE THE GENUINENESS OF THE GIFTS RECEIVE D BY THE ASSESSEE, THE AO RECORDED HIS STATEMENT ON OATH U/S. 131 OF THE ACT, ON 26.4.07 . A FTER CONSIDERING THE STATEMENTS OF THE ASSESSEE , THE AO HELD THAT THE ASSESSEE DID NOT KNOW THE PERSONS FROM WHOM HE HAD RECEIVED THE GIFTS, THAT HE WAS UNABLE TO QUO TE THEIR ADDRESSES, THAT THE DONORS WERE NOT HIS RELATIVES, THAT HE EXPRESSED HIS INABILITY TO FURNISH DETAILS LIKE THEIR AGE, OCCUPATION ETC., THAT ABOUT THE GENUINENESS OF THEIR GIFTS THE ASSESSEE E XPRESSED HIS INABILITY.VIDE HIS, LETTER DT.31.3. 20 07, A FU RTHER OPPORTUNITY WAS GIVEN TO THE ASSESSEE BY THE AO REQUIRING HIM TO SUBMIT HIS EXPLANATION, IF ANY, ON THE ISSUE .O N 14.6. 20 07, THE LETTER OF AO WAS RECEIVED BY THE ASSESSEE ON 2.6. 20 07. THROUGH THE SAID LETTER HE WAS COMMUNICATED THAT THE AMOUNT IN QUEST ION WOULD BE ADDED TO HIS INCOME INVOKING THE PROVISIONS OF S ECTION 68 OF THE ACT.HOWEVER, THE ASSESSEE DID NOT RESPOND TO THE LETTER.ON 22.6. 20 07 A SUMMON U/S. 131 OF THE ACT WAS ISSUED DIRECTING THE ASSESSEE TO APPEAR BEFORE HIM ON 28.6. 20 07. THE ASSESSE E DID NOT APPEAR BEFORE THE AO .THEREFORE,H E DECIDED THE ISSUE ON THE BASIS OF MATERIAL AVAILABLE WITH HIM. T HE AO HELD THAT MERE IDENTIFICATION OF DONOR AND SHOWING THE MOVEMENT OF GIFT S THROUGH BANKING CHANNEL WAS NOT ENOUGH TO PROVE THE GENUINENESS OF TH E GIFTS, THAT THE ASSESSEE DID NOT ESTABLISH THE BASIC FACT THAT THE DONORS HAD THE MEANS AND THAT THE GIFT WAS GENUINE. HE PLACED RELIANCE ON THE CASES OF LAL L C HAND KAL R A (22 CTR 135), SAJANDAS & SON S ( 264 ITR 435 ), DURGA P RASAD MORE ( 82 ITR 540 ) AND SUM ATI DAYAL (214 ITR 801).THE AO FURTHER OBSERVED THAT THERE WAS NO EVIDENCE TO PROVE THAT THE GIFTS WERE MADE VOLUNTARILY AND OUT OF NATURAL LOVE AND AFFECTION, THAT THE ASSESSEE DID NOT ESTABLISH THE GENUINENESS OF THE GIFT EVEN THOUGH A FURTHER OPPORTUNIT Y WAS GIVEN. FINALLY, THE AO ADDED RS.6.00 LACS TO THE TOTAL INCOME OF THE ASSESSEE U/S. 68 OF THE ACT. ITA/ 1 228 /M/11 ,AY. 0 5 - 06 NIRANJAN K 3 2. 2. A GGRIEVED BY THE ORDER OF THE AO THE ASSESSEE PREFERRED AN APPEAL BEFORE THE F IRST APPELLATE AUTHORITY (FAA). BEFORE HIM, IT WAS CONTENDED THAT THE A SSESSEE HAD FURNISHED ALL THE RELEVANT DOCUMENTS LIKE AFFIDAVITS, CONFIRMATION LETTERS, AND ASSESSMENT ORDERS IN RESPECT OF THE DONORS BEFORE THE AO, THAT ONUS WAS ON THE AO TO MAKE ENQUIRY WITH THE DONORS, THAT THE ASSESSEE WAS SUFFERING FROM NEUROLOGICA L DISORDER AND HE WAS MENTALLY FIT TO REPLY THE QUESTIONS ASKED BY THE AO. THE ASSESSEE RELIED UPON THE CASE OF ORISSA CORPORATION ( 159 ITR78) . AFTER CONSIDERING THE SUBMISSION OF THE ASSESSEE AND ASS ESSMENT ORDER THE FAA HELD THAT THE FACTS OF THE CASE UN DER CONSIDERATION WERE CLEARLY DISTINGUISHABLE FROM THE CASE OF ORISSA CORP ORATIO N (SUPRA), THAT ASSESSEE HAD RECEIVED GIFTS FROM VARIOUS PARTIES OF KOLKATTA, THAT HE HAD NO IDEA ABOUT THE DONORS NOR DID HE KNOW ANYTHING ABOUT THEIR AGE OR OCCUPATION, THAT THE GIFTS HAD NOT FLOWN OUT OF NATURAL LOVE AND AFFECTION, THAT THE AMOUNT IN QUESTION WAS TO BE TREATED AS INCOME OF THE ASSESSEE BROUGHT INTO BOOKS OF ACCOUNT, THAT IT WAS NOTHING BUT FLOWING BACK HIS UNACCOUNTED INCOME, THAT MERE FILING OF RETURN OF DO NOR/GIVING OF AFFIDAVITS HAD NO RELEVANCE, THAT THOSE SECONDARY EVIDENCES WERE OF NO RELEVANCE.REFERRING TO THE CASE OF SUMATI D AYAL(SUPRA) , HE UPHELD THE ACTION OF THE AO. 2. 3. BEFORE US, THE A UTHORIZED R EPRESENTATIVE (AR) ARGUED THAT THE A SSESSEE HAD FILE D THE CONFIRMATIONS OF THE PERSONS WHO HAD GIVEN THE GIFTS TO THE ASSESSEE , THAT THE AO DID NOT MAKE ENQUIRIES IN THAT REGARD, THAT THE ASSESSEE WAS SUFFERING FROM EPILEPSY, THAT HE COULD NOT GIVE COHERENT REPLIES TO THE AO. DEPARTMENTAL REPRESENTATIVE (DR ) STATED THAT THE STATEMENT OF THE ASSESSEE CLEARLY REVEALED THAT THE ASSESSEE HAD NO KNOWLEDGE ABOUT THE PERSONS WHO HAD ALLEGEDLY GIVEN HIM GIFTS, THAT ASSESSEE WAS GIVEN AN OPPORTUNITY TO EXPLAIN THE GIFTS AFTER HIS STATEMENTS WERE RECORDED, THAT HE DID NOT FILE ANY EXPLANATION TO THE SHOW CAUSE NOTICE ISSUED BY THE AO. 2. 4 . WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL ON RECORD.WE FIND THAT THE AO HAD RECORDED THE STATEMENT OF THE ASSESSEE ,THAT THE ASSESSEE COULD NOT FURNISH POSTAL ADDRES SES,AGE,FULL NAMES AND OCCUPATIONS OF THE PERSONS GIVING HIM GIFTS DURING THE YEAR UNDER APPEAL,THAT THE AO ISSUED A NOTICE TO THE ASSESSEE AND ASKED HIM AS TO WHY THE AMOUNT IN QUESTION SHOULD NOT BE ADDED TO HIS TOTAL INCOME U/S.68 OF THE ACT,THAT TH E ASSESSEE DID NOT FILE ANY EXPLANATION THOUGH THE NOTICE WAS SERVED ON HIM,THAT BEFORE THE FAA AND THE BEFORE US IT WAS CONTENDED THAT THE ASSESSEE WAS SUFFERING FROM EPILEPTIC FITS,THAT NO MEDICAL CERTIFICATE IN THAT REGARD WAS EVER PRODUCED IN SUPPORT O F THE CLAIM,THAT THE ASSESSEE DID NOT KNOW THE PERSONS WHO HAD GIVEN HIM ALLEGED GIFT,THAT THERE WAS NO OCCASION FOR GIVING HIM GIFTS,NONE OF HIS RELATIVES HAD MADE A GIFT OF EVEN A SINGLE RUPEE TO HIM. WE HAVE TAKEN NOTE OF THE FACT THAT HE STATES THAT (AN SWER TO QUESTION NO.7)HE HAD RECEIVED GIFTS WORTH SIX LAKHS DURING THE YEAR AND THAT THE AMOUNT WAS RECEIVED THROUGH DEMAND DRAFTS(ANSWER TO QUESTION NO.8).THESE REPLIES CLEARLY SHOW THAT THERE WAS NOT ANY EFFECT OF ANY ILLNESS WHEN HIS STATEMENTS WERE REC ORDED. IN OUR OPINION, MERE IDENTIFICATION OF THE DONOR S AND SHOWING THE MOVEMENT OF THE GIFT AMOUNT THROUGH BANKING CHANNELS WAS NOT SUFFICIENT TO PROVE THE GENUINENESS OF THE GIFT. SINCE THE CLAIM OF GIFT WAS MADE BY THE ASSESSEE,THE ONUS WAS ON HIM NOT ON LY TO ESTABLISH THE IDENTITY OF THE PERSON MAKING THE GIFT BUT ALSO HIS CAPACITY TO MAKE A GIFT .THE ASSESSEE HAD FAILED MISERABLY IN IT. WHEN A CASH CREDIT ENTRY APPEARS IN THE ASSESSEE'S BOOKS OF ACCOUNT IN AN ACCOUNTING YEAR, THE ASSESSEE HAS THE LEGAL O BLIGATION TO EXPLAIN THE SOURCE OF SUCH RECEIPT. THE INITIAL ONUS IS ENTIRELY ON THE ASSESSEE, BUT THE QUESTION WHETHER SUCH ONUS HAS BEEN DULY DISCHARGED BY THE ASSESSEE OR HAS BEEN SHIFTED TO THE REVENUE CAN ONLY BE DETERMINED AFTER THE EVALUATION OF ALL THE SURROUNDING CIRCUMSTANCES . THERE CANNOT BE ONE GENERAL OR UNIVERSAL PROPOSITION OF LAW WHICH COULD BE THE ITA/ 1 228 /M/11 ,AY. 0 5 - 06 NIRANJAN K 4 GUIDING YARDSTICK IN THE MATTER. EACH CASE HAS GOT TO BE DECIDED ON THE FACTS AND CIRCUMSTANCES OF THE CASE. THE SURROUNDING CIRCUMSTANCES TO BE CONSIDERED MUST, HOWEVER, BE OBJECTIVE FACTS, EVIDENCE ADDUCED BEFORE THE TAXING AUTHORITIES, PRESUMPTION OF FACTS BASED ON COMMON HUMAN EXPERIENCE IN LIFE AND REASONABLE CONCLUSION. IN HOLDING A PARTICULAR RECEIPT AS INCOME FROM UNDISCLOSED SOURCE, THE F ATE OF THE ASSESSEE CANNOT BE DECIDED BY THE REVENUE ON THE BASIS OF SURMISES, SUSPICIONS OR PROBABILITIES. HUMAN PROBABILITY CANNOT BE IGNORED THAT GENERALLY NO ONE WOULD GIFT AN UNKNOWN PERSON LAKHS OF RUPEES WITHOUT ANY RHYME OR REASON ,THAT THE RECEIVER OF THE GIFTS WOULD NOT KNOW THE ADDRESSES AND OCCUPATIONS OF THE BENEVOLENT DONORS WHO HAD GIVEN HIM GIFTS OF LAKHS TO RUPESS TO A PERSON WHO HAD OFFERED INCOME LESS THAN RS.ONE LAKHS DURING THE YEAR . ALL THESE FACTORS,IF WEIGHED AGAINST THE SO CALLED CONFI RMATIONS OF THE DONORS,TILT THE SCALE AGAINST THE ASSESSEE .CONSIDERING THE PECULIAR FACTS AND CIRCUMSTANCES OF THE CASE UNDER APPEAL AND FOLLOWING THE PRINCIPLE ENUMERATED BY THE HONBLE APEX COURT IN THE CASE OF DURGA PRASAD MORE (82ITR540)AND SUMATI DAYAL (SUPRA),WE DECIDE GROUND NO.1 AGAINST THE ASSESSEE. 3. GROUND NO.2 IS ABOUT CONFIRMING THE ADDITION OF RS.30,000/ - U/S. 69C UNDER THE HEAD UNEXPLAINED EXPENDITURE.DURING THE ASS ESSMENT P ROCEEDINGS THE AO HELD THAT THE ASSESSEE HAD FAILED TO ESTABLISH THE GENUINENESS OF GIFT OF RS.6.00 LACS. H E OBSERVED THAT THE ASSESSEE HAD PURCHASED THOSE GIFTS A N D HAD PAID COMMISSION FOR OBTAINING THE GIFTS, THE AMOUNT OF COMMISSION PAID WAS ESTIMATED @ 5% I.E. RS.30,000/ - . INVOKING THE PROVISION OF S ECTION 69C OF THE ACT , THE AO MADE AN ADDITION OF THE SAID AMOUNT.IN THE APPELLATE PROCEEDINGS THE FAA CONFIRMED THE ORDER OF THE AO FOR THE REASONS HE HAD DISMISSED THE APPEAL FILED BY THE ASSESSEE WITH REGARD TO GROUND NO.1. 3. 1 . BEFORE US THE AR AND THE DR MADE THE SAME SUBMISSIONS WHICH WERE MADE BEFORE WHILE ARGUING THE GROUND NO.1 .THOUGH , WE HAVE UPHELD THE ADDITION MADE BY THE AO UNDER SECTION 68 OF THE ACT AND CONFIRMED BY THE FAA,BUT WE ARE UNABLE TO ENDORSE THEIR VIEWS ABOUT THE ESTIMATING THE EXPENDITURE @ 5%. SECT ION 69C STIPULATES THAT THE AO SHOULD ARRIVE AT THE CONCLUSION THAT THE EXPLANATION OFFERED BY THE ASSESSEE IS NOT SATISFACTORY.IN THE CASE UNDER CONSIDERATION,THE AO HAD NOT CALLED FOR ANY EXPLANATION FROM THE ASSESSEE AND HAD NOT REJECTED THE SAME.HE HAD ISSUED A NOTICE TO THE ASSESSEE BEFORE MAKING AN ADDITION U/S.68 BUT HE HAS NOT MENTIONED ANYTHING ABOUT ISSUING A NOTICE FOR MAKING ADDITION U/S.69 OF THE ACT.SECTION 69 IS ONE OF THE DEEMING SECTIONS AND BEFORE APPLYING THE SAME,THE AO IS REQUIRED TO AD HERE TO ITS STRICT COMPLIANCE.BECAUSE OF NON ISSUE OF NOTICE BY THE AO FOR MAKING ADDITION U/S.69 WE DECIDE GROUND NO.2 IN FAVOUR OF THE ASSESSEE AND DELETE THE ADDITION. 4. GROUND NO.3 IS ABOUT A N ADDITION OF RS. 5.13 LACS MADE U/S.68 OF T HE ACT BY THE A O .DURING THE ASS ESSMENT P ROCEEDINGS, THE AO FOUND THAT THE ASSESSEE HAD SHOWN A LOAN OF R S.5,18,077/ - FROM TWO ENT ITIES NAMELY I) NIRANJAN RATHI,HUF - (RS.2.39 LACS) AND S HANTA R ATHI - (RS.2.78 LACS).THE ASSESSEE FURNISHED THE COPY OF IT ACKNOWLEDGEMENT AND S TATEMENT OF INCOME OF BOTH ENTITIES. THE AO DIRECTED THE ASSESSEE TO FURNISH COPY OF BANK ACCOUNT S , BUT SAME WAS NOT FURNISHED.THE AO THEN CALLED FOR COPY OF BANK ACCOUNT FROM THE BANK.HE FOUND THAT CASH HAD BEEN DEPOSITED BEFORE ISSUING CHEQUES TO THE AS SESSEE .T O TEST THE GENUINENESS AND CREDITWORTHINESS OF THE TRANSACTION , THE AO ISSUED SUMMONS TO BOTH THE CREDITORS BUT NO ONE APPEARED BEFORE HIM .THE AO REFERRED TO THE DECISION OF UNITED COMMERCIAL C O. PVT. LTD.(187 ITR 576), SO FIA FINANCE LTD. (205ITR9 8 ) . FINA LLY, HE HELD THAT EVEN AFTER GIVING SPECIFIC OPPORTUNITY TO THE ASSESSEE , HE HAD NOT ESTABLISHED THE CREDIT WORTHINESS OF THE LOAN CREDITORS. ITA/ 1 228 /M/11 ,AY. 0 5 - 06 NIRANJAN K 5 4.1. IN THE APPELLATE PROCEEDINGS THE ASSESSEE ARGUED THAT CREDITORS WERE NONE OTHER THAN ASSESSEE S HUF AND HIS WIFE.THE ASSESSEE RELIED UPON THE CASE OF ORISSA CORPN. LT D .(SUPRA). REJECTING THE SUBMISSION OF THE ASSESSEE THE FAA HELD THAT CREDIT WORTHINESS OF THE DONORS WAS NOT ESTABLISHED, IT WAS ALSO NOT KNOWN AS TO WHETHER THEY WERE ASSESSED TO TAX, THAT IT WA S ALSO NOT KNOWN AS TO WHETHER THEY WERE HAVING SUFFICIENT FUNDS TO ADVANCE LOANS.FINALLY HE UPHELD THE ORDER OF THE AO. 4.2. BEFORE US, THE AR CONTENDED THAT THE ASSESSEE WAS ASSESSED IN THE CAPACITY OF KARTA OF THE HUF THAT HE HAD FILED THE CONFIRMATION, THAT THE CONFIRMATION OF HIS WIFE WAS ALSO FILED BEFORE THE AO. DR SUPPORTED THE ORDER OF THE FAA AND STATED THAT CASH WAS DEPOSITED IN THE BANK ACCOUNTS OF THE CREDITOR BEFORE THEY HAD ISSUED CHEQUES TO THE ASSESSEE . 4.3. WE HAVE HEARD THE RIVAL SUBMISSIO NS AND PERUSED THE MATERIAL BEFORE US. UNDER SECTION 68 OF THE ACT, T HE AO HAS JURISDICTION TO MAKE ENQUIRIES WITH REGARD TO THE NATURE AND SOURCE OF A SUM CREDITED IN THE BOOKS OF ACCOUNT OF THE ASSESSEE AND IT IS IMMATERIAL AS TO WHETHER THE AMOUNT SO CRED ITED IS GIVEN THE COLOUR OF A LOAN OR A SUM REPRESENTING SALE PROCEEDS OR EVEN RECEIPT OF SHARE APPLICATION MONEY. THE USE OF THE WORDS ANY SUM FOUND CREDITED IN THE BOOKS IN SECTION 68 INDICATES THAT THE SECTION IS VERY WIDELY WORDED AND THE AO IS NOT PRE CLUDED FROM MAKING AN ENQUIRY AS TO THE TRUE NATURE AND SOURCE OF A SUM CREDITED IN THE ACCOUNT BOOKS EVEN IF IT IS CREDITED AS RECE IPT OF SHARE APPLICATION MONEY. THE USE OF THE WORDS MAY BE CHARGED IN SECTION 68 CLEARLY INDICATES THAT THE AO HAS THE JURIS DICTION, IF THE FACTS SO WARRANT, TO TREAT SUCH A CREDIT TO BE THE INCOME OF THE ASSESSEE. IN THE CASE BEFORE US,THE AO HAD CALLED THE WIFE OF THE ASSESSEE AND THE ASSESSEE HIMSELF AS THE KARTA OF HUF TO PROVE THE GENUINENESS OF THE TRANSACTIONS.AO HAD SPEC IFICALLY FOUND THAT BEFORE ISSUING CHEQUES TO THE ASSESSEE THERE WERE CASH DEPOSITS IN THE BANK ACCOUNTS OF BOTH THE CREDITORS.THE ASSESSEE HAD NOT FILED THE BANK STATEMENTS OF BOTH THE ENTITIES.IT WAS THE AO WHO GATHERED THE INFORMATION FROM THE BANKS BY ISSUING NOTICES U/S.133(6)OF THE ACT.HE ASKED THE ASSESSEE TO PROVE THE CLAIM MADE ABOUT THE CREDITORS,BUT THE ASSESSEE CHOOSE NOT TO RESPOND TO THE QUERY RAISED BY THE AO. THE INITIAL ONUS WA S ENTIRELY ON THE ASSESSEE AND HE DID NOT DISCHARGE IT.IN OUR OP INION,AFTER THE INQUIRY MADE BY THE AO THE ONUS HAD NOT SHIFTED TO THE REVENUE .IN SUCH A SITUATION THE AO DETERMINED THE ISSUE AFTER THE EVALUATION OF ALL THE SURROUNDING CIRCUMSTANCES. IT IS SAID THAT T HERE CANNOT BE ONE GENERAL OR UNIVERSAL PROPOSITION O F LAW WHICH COULD BE THE GUIDING YARDSTICK IN SUCH MATTER S . EACH CASE HAS GOT TO BE DECIDED ON THE FACTS AND CIRCUMSTANCES OF THE CASE. BECAUSE OF THE FAILURE ON PART OF THE ASSESSEE;TO PROVE THE GENUINENESS OF THE TRANSACTION AND CREDITWORTHINESS OF THE TR ANSACTION AND TO FILE SATISFACTORY EXPLANATION - ESPECIALLY WHEN CASH WAS FOUND TO BE DEPOSITED IN THE ACCOUNTS OF THE CREDITORS - ABOUT THE LOANS RECEIVED;WE CONFIRM THE ORDER OF THE FAA AND DECIDE GROUND NO.3 AGAINST THE HIM. AS A RESULT,APPEAL FILED BY THE ASSESSEE STANDS PARTLY ALLOWED. . ORDER PRONOUNCED IN THE OPEN COURT ON 04 TH SEPTEMBER ,2015. 04 TH , 2015 SD/ - SD/ - / ( / PARTHASARATHY CHOUDHURY) ( / RAJENDRA) / JUDICIAL MEMBER / ACCOUNTANT MEMBER / MUMBAI, /DATE: 04 . 09 . 2015 . . . JV. SR.PS.