Sunil Thomas, Cochin V. The ITO, Cochin

ITA 19/COCH/2014

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 81431 (ITAT-COCHIN)
• Duration Of Justice: 10 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-12-2014
• Appeal Filed By: Assessee
• Bench Allotted: DB
• Next Hearing Date: 04-12-2014
• Assessment Year: 2009-2010
• Appeal Filed On: 22-01-2014
• Court: TRIBUNAL
• Department Lawyers: K K JOHN
• Assessee Lawyers: C B M WARRIER
• Keywords: Gift; Income from undisclosed sources; Salary income; Onus to prove
• Section: 56(2); 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL COCHIN BENCH, COCHIN BEFORE S/SHRI N.R.S.GANESAN, JM AND CHANDRA POOJ ARI, AM I.T.A. NO.19/COCH/2014 ASSESSMENT YEAR : 2009-10 SHRI SUNIL THOMAS, KANJOOPARAMBIL BUILDING, CONVENT ROAD, KOCHI-35. [PAN ABRPT 6088M] VS. THE INCOME TAX OFFICER, WARD-2(1), KOCHI. (ASSESSEE-APPELLANT) (REVENUE-RESPONDENT) ASSESSEE BY SHRI C.B.M. WARRIER, CA REVENUE BY SHRI K.K. JOHN, SR. DR DATE OF HEARING 04/12/2014 DATE OF PRONOUNCEMENT 12/12/2014 O R D E R PER CHANDRA POOJARI, ACCOUNTANT MEMBER: THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAI NST THE ORDER DATED 23-10-2013 PASSED BY THE CIT(A)-II, KOCHI FOR THE ASSESSMENT YEAR 2009-10. 2. ALL THE GROUNDS IN THIS APPEAL ARE RELATING TO O NLY ONE ISSUE THAT THE GIFT OF RS.1,66,01,834/- RECEIVED BY THE ASSESS EE FROM HIS BROTHER SHRI SUDEEP THOMAS IS GENUINE AND SHOULD NOT HAVE B EEN ADDED AS UNDISCLOSED INCOME U/S. 68 OF THE INCOME TAX ACT. I.T.A. NO.19/COCH/2014 2 3. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSI NG OFFICER WHILE MAKING THIS ADDITION HAS OBSERVED THAT THE ASSESSEE WAS REQUIRED TO FURNISH EVIDENCES IN SUPPORT OF THE SAME. THE ASSE SSEE CLAIMED THAT THE GIFT WAS THROUGH PROPER BANKING CHANNELS AND PRODUC ED BANK ACCOUNT COPY FOR VERIFICATION. DURING THE ASSESSMENT PROCE EDINGS IT WAS NOTICED BY THE ASSESSING OFFICER THAT INSPITE OF GIVING VAR IOUS OPPORTUNITIES, THE ASSESSEE HAS NOT BEEN ABLE TO ESTABLISH THE CREDITW ORTHINESS OF HIS BROTHER WHO HAS MADE GIFT OF RS.1,66,01,834/-. ALT HOUGH ASSESSEE FURNISHED VARIOUS BANK ACCOUNTS BUT IT WAS SEEN THA T THERE WERE CASH DEPOSITS OR CHEQUE DEPOSITS IN THE BANK ACCOUNTS JU ST BEFORE MAKING THE PARTS OF THE GIFT. ALTHOUGH CONFIRMATION FROM HIS BROTHER AND BANK ACCOUNTS EVIDENCING THAT VARIOUS TRANSACTIONS HAVE BEEN MADE THROUGH BANKING CHANNELS WAS FURNISHED, BUT THE CREDITWORTH INESS OF HIS BROTHER WAS NOT ESTABLISHED. THE ASSESSING OFFICER HAS SPE CIFICALLY ASKED FOR THE SALARY SLIPS TO VERIFY THE CREDITWORTHINESS BUT THE SAME WERE NOT FURNISHED. ACCORDINGLY, THE ASSESSING OFFICER TREAT ED THIS GIFT AS CASH CREDIT IN THE HAND OF THE ASSESSEE OBSERVING THAT:- 9. IT IS NOTICED THAT SHRI SUDEEP THOMAS WAS EMPLO YED IN THE GULF ONLY FROM YEAR 2003. HIS SALARY DETAILS ARE NOT FU RNISHED THOUGH AS PER HIS LETTER IT IS STATED THAT SAME WILL BE SUBM ITTED. THOUGH HE CLAIMS TO HAVE BEEN ENGAGED IN CONSULTANCY SERVICES HIS LICENCE/PERMIT DOES NOT MENTION THE SAME NOR IS NAY EVIDENCE ADDUCED FOR SUCH ACTIVITY. THERE IS NO EVIDENCE AS TO THE NATURE OF TRANSACTIONS. IT IS NOTICED THAT SOME DEPOSITS IN CASH ARE CREDITED AND THEN STATED TO HAVE TRANSFERRED TO THE ASSESSEE . IN ADCB BANK ACCOUNT NO.2159720100001, THERE IS FUNDS TRANSFER T O THE FOLLOWING ACCOUNTS WHICH IS CLAIMED BY THE ASSESSEE AS PAYMEN TS TO HIM: I.T.A. NO.19/COCH/2014 3 A B C D E F DATE ACCOUNT INTO WHICH THE FUND IS TRANSFERRED AMOUNT TRANSFERRED TO ASSESSEE AS PER ASSESSEES CLAIM (UAE DIRHAM) DATE OF CORRESPONDING DEPOSITS INTO THE ACCOUNT AMOUNTS CREDITED (UAE DIRHAM) SOURCE AS PER BANK STATEMENT 5.4.2008 253029020001 50000 1.4.2005 B/F 2.4.2008 42750.48 17000 B/F CASH DEPOSIT 25.5.2008 253029020001 47000 21.5.2008 24.4.2008 31000 16000 CASH DEPOSIT CASH DEPOSIT 19.6.2008 230928020001 171595 16.6.2008 172000 FUND S TRANSFER FROM 297043010001 28.6.2008 253029020001 30000 21.6.2008 30000 CASH D EPOSIT 21.8.2008 253029020001 75885 16.8.2008 76596 FUNDS TRANSFER FROM 29704702001 19.11.2008 253029020001 70695 17.11.2008 70980 FUND S TRANSFER FROM 100595020001 22.11.2008 253029020001 512295 20.11.2008 512280.51 REM 693311 CONTINENT PROJECTS TECH 10. THE SOURCE OF THESE DEPOSITS ARE NOT CLEAR. INS PITE OF REPEATED REQUEST DURING THE COURSE OF HEARING THE ASSESSEE H AS PRODUCED THE BANK A/C. OF MR. SUDEEP THOMAS ON 28/12/2011 ONLY W ITHOUT ANY EXPLANATION FOR THE CREDITS AND ALSO THE MAJOR CRED ITS FROM THE ACCOUNT OF SUDEEP THOMAS ARE SEEN TRANSFERRED TO TH E ASSESSEE. THE SOURCE OF THESE CREDITS ARE NOT EXPLAINED. THE DEPOSITS MADE ON CERTAIN DAYS ARE WITHDRAWN DURING THE IMMEDIATELY S UCCEEDING DAYS FOR TRANSFER TO THE ASSESSEE BY SUDEEP THOMAS. THE OTHER TRANSACTION IN THE ACCOUNT ARE OF COMPARATIVELY MIN IMUM NUMBER I.T.A. NO.19/COCH/2014 4 AND VALUE. IN THE CIRCUMSTANCES, IT IS EVIDENT THA T THE DEPOSITS ARE MADE FOR TRANSFER TO THE ASSESSEE AND IT NOT OUT OF SOURCE OF SUDEEP THOMAS, THE ASSESSEES BROTHER. IT IS NOT STATED W HERE THE SALARY IS CREDITED/IF THERE IS ANY OTHER BANK ACCOUNT FOR THE PURPOSE. THE PURPOSE FOR WHICH SUCH A HUGE GIFT IS MADE IN ONE P ARTICULAR YEAR ALONE BY THE BROTHER WHO IS ONLY AN EMPLOYEE AND WH OSE SALARY INCOME IS NOT SUPPORTED BY EVIDENCE IS CAPABLE OF M EETING SUCH A HUGE GIFT. THE EXPLANATION FOR OTHER CREDITS IN TH E ACCOUNT IS ALSO NOT GIVEN. THESE FACTS WERE POINTED OUT TO THE AUTHORI ZED REPRESENTATIVE WHEN HE ATTENDED ON 28/12/2011. 4. ON APPEAL, THE CIT(A) OBSERVED THAT AFTER TAKING DOCUMENTS RELATING TO IDENTITY AND GENUINENESS OF TRANSACTION S FOR THE GIFT ON RECORD, THE ASSESSING OFFICER HAS REPEATED ASKED TH E ASSESSEE TO EXPLAIN THE SOURCE OF VARIOUS CREDITS IN THE BANK ACCOUNT T O PROVE THE CREDITWORTHINESS OF ASSESSEES BROTHER. THE CIT(A) OBSERVED THAT THOUGH THE ASSESSEE FURNISHED EMPLOYMENT LETTERS, B UT INSPITE OF SPECIFIC QUERY, HE DID NOT FURNISH ANY SALARY SLIPS FROM ANY OF THE EMPLOYER EITHER BEFORE THE AO OR BEFORE HIM. THEREAFTER, AC CORDING TO THE CIT(A), ONLY A STATEMENT SHOWING THAT HE IS EARNING 25000/- DIRHAMS PER MONTH WAS FURNISHED. ACCORDING TO THE CIT(A), EVEN IF IT IS PRESUMED THAT THIS SALARY STATEMENT WAS CORRECT WHICH IS NOT AS NO COR RESPONDING ENTRIES WERE SEEN IN THE BANK ACCOUNTS, THEN ALSO THE TOTAL ANNUAL INCOME OF THE ASSESSEES BROTHER WOULD BE ONLY RS.3,00,000/- DIRHAM WHEREAS HE HAS MADE A GIFT OF 11,50,510 DIRHAMS AND IN THIS SA LARY HE WOULD ALSO NEED SOME PORTION FOR HIS OWN UPKEEP AND FOR MAINTA INING HIS FAMILY. THUS, THE CIT(A) CONCLUDED THAT THE ASSESSEES BROT HER SHRI SUDEEP I.T.A. NO.19/COCH/2014 5 THOMAS DOES NOT HAVE THE CAPACITY AND CREDITWORTHIN ESS TO ADVANCE GIFT OF DIRHAM 11,50,510 TO THE ASSESSEE. 4.1 ACCORDING TO THE CIT(A), SECTION 68 ENACTS A GO LDEN RULE OF EVIDENCE WHICH IS NOT IN DISPUTE, I.E., IF ANY SUM IS FOUND CREDITED IN THE BOOKS OF ACCOUNT OF AN ASSESSEE, THE ONUS IS ON HIM TO EXPLAIN THE SAID ENTRY AND THE PRINCIPLE EMBODIED IN SEC. 68 IS ONLY A STATUTORY RECOGNITION OF WHAT WAS ALWAYS UNDERSTOOD TO BE THE LAW BASED UPON THE RULE THAT THE BURDEN OF PROOF IS ON THE TAXPAYE R TO PROVE THE GENUINENESS OF BORROWINGS SINCE THE RELEVANT FACTS ARE EXCLUSIVELY WITHIN HIS KNOWLEDGE. ACCORDING TO THE CIT(A), IN THIS CA SE, IT IS THE GIFT THAT HAS BEEN RECEIVED BY THE ASSESSEE WHICH ALSO ACQUIR ES THE SAME NATURE AS IT IS ALSO A SUM CREDITED IN THE BOOKS OF ACCOUN TS. ACCORDING TO THE CIT(A), DIFFERENT HIGH COURTS AS WELL AS SUPREME CO URT IN THEIR DECISIONS HAVE CONSISTENTLY HELD THAT WHEN THERE IS A SUM CRE DITED IN THE BOOKS OF ACCOUNT OF THE ASSESSEE OR MONEY IS RECEIVED BY THE ASSESSEE BY WAY OF LOAN OR GIFT, THE INITIAL ONUS LIES ON THE ASSESSEE TO ESTABLISH: (A) THE EXISTENCE OF THE THIRD PARTY GIVING THAT A MOUNT; (B) THE ABILITY AND CREDITWORTHINESS OF THE THIRD PARTY TO ADVANCE MONEYS (C) THAT PRIMA FACIE THE LOAN/GIFT IS A GENUINE ON E. I.T.A. NO.19/COCH/2014 6 4.2 ACCORDING TO THE CIT(A) UNDER SEC. 68, THE ONUS IS ON THE ASSESSEE TO OFFER EXPLANATION WHERE ANY SUM IS FOUN D CREDITED IN THE BOOKS OF ACCOUNT AND WHERE THE ASSESSEE FAILS TO PR OVE TO THE SATISFACTION OF THE ASSESSING OFFICER, THE SOURCE A ND NATURE OF THE AMOUNT OF CASH CREDITS, HE IS ENTITLED TO DRAW AN I NFERENCE THAT THE CREDIT ENTRIES REPRESENT INCOME TAXABLE IN THE HAND S OF THE ASSESSEE. ACCORDING TO THE CIT(A), IT IS NOT THE DUTY OF THE ASSESSING OFFICER TO LOCATE THE EXACT SOURCE OF THE CASH CREDITS AND THE BURDEN TO IDENTIFY THE SOURCE LIES UPON THE ASSESSEE AND HE IS REQUIRED TO EXPLAIN THE GENUINENESS OF THE CREDIT ENTRY. THE CIT(A) STATED THAT THE EXPRESSION NATURE AND SOURCE IN SEC. 68 HAS TO BE UNDERSTOOD TOGETHER AS A REQUIREMENT OF IDENTIFICATION OF THE SOURCE AND THE NATURE OF THE SOURCE, SO THAT THE GENUINENESS OR OTHERWISE OF COULD BE IN FERRED. 4.3 HOWEVER, THE CIT(A) FOUND THAT IN THE PRESENT C ASE, THOUGH THE ASSESSEE HAS PROVED THE IDENTITY OF THE DONOR AND H AS SHOWN THAT THE VARIOUS TRANSACTIONS FOR MAKING THE GIFT, ARE THOUG H THE BANKING CHANNELS, BUT HE HAS NOT BEEN ABLE TO ESTABLISH THE CREDITWORTHINESS OF HIS BROTHER AND THE NATURE AND SOURCE OF SUCH CREDI TS HAVE ALSO NOT BEEN EXPLAINED BY THE ASSESSEE. I.T.A. NO.19/COCH/2014 7 4.4 IN THIS CONTEXT, THE CIT(A) RELIED ON THE FOLLO WING DECISIONS TO HOLD THAT ONCE THE ASSESSEE HAS PROVED THE IDENTITY OF HIS CREDITORS, THE GENUINENESS OF THE TRANSACTIONS AND THE CREDITWORTH INESS OF HIS CREDITORS, ONLY THEN THE BURDEN OF THE ASSESSEE STA NDS DISCHARGED: 1) CIT VS. UNITED COMMERCIAL AND INDUSTRIAL CO. (P VT.) LTD. (1991) 187 ITR 596 (CAL.) 2) CIT VS. PRECISION FINANCE PVT. LTD. (1994) 208 ITR 465 (CAL.) 3) NEMI CHAND KOTHARI VS. CIT (2003) 264 ITR 254 (GAU.) 4) KAMAL MOTORS VS. CIT (2003) 131 TAXMAN 155 (RA J.) 5) CIT VS. R.S. RATHORE (1995) 212 ITR 390 (RAJ.) 6) CIT VS. P.R. GANAPATHY (2012) (26 TAXMANN.COM 3 54 (SC). 7) CIT VS. P. MOHANAKALA (2007) (291 ITR 278) (SC) . 8) SUNIL K.M.P. VS. CIT (2009) 177 TAXMAN 481 (KER .) 9) MUMBAI VS. ITO (2010) 6 TAXMANN.COM 28 (MUM.-IT AT). 4.5 IN THIS CASE, ACCORDING TO THE CIT(A), THE ASSE SSEE HAS NOT BEEN ABLE TO PROVE THE CAPACITY AND CREDITWORTHINESS OF THE ASSESSEES BROTHER TO MAKE SUCH HUGE GIFT EITHER BEFORE THE ASSESSING OFFICER OR BEFORE THE CIT(A) AND EXPLANATION WAS ALSO NOT SUPPORTED BY AN Y DOCUMENTARY EVIDENCE AND THEREFORE, THE ASSESSING OFFICER HAS A DDED THE AMOUNT AS UNACCOUNTED INCOME OF THE ASSESSEE U/S. 68 OF THE I NCOME TAX ACT. ACCORDINGLY, THE CIT(A) CONFIRMED THE DISALLOWANCE OF GIFT AMOUNTING TO RS.1,66,01,834/- RECEIVED BY THE ASSESSEE. AGAINST THIS, THE ASSESSEE IS IN APPEAL BEFORE US. I.T.A. NO.19/COCH/2014 8 5. THE LD. AR SUBMITTED THAT THE ASSESSEE RECEIVED THE ABOVE AMOUNT FROM HIS BROTHER SHRI SUDEEP THOMAS WHO IS R ESIDING ABROAD THROUGH BANKING CHANNEL. THE LD. AR SUBMITTED THAT THE AMOUNTS RECEIVED FROM THE BANK ACCOUNT OF SHRI SUDEEP THOMA S WITH ADCB BANK, DUBAI WERE CREDITED IN THE BANK ACCOUNT OF TH E ASSESSEE WITH AXIS BANK. FURTHER, THE AMOUNTS OF RS.20,000/- AND RS.18 ,000/- RECEIVED FROM THE ACCOUNT WITH ICICI BANK OF SHRI SUDEEP THO MAS WERE CREDITED TO THE ASSESSEES BANK ACCOUNT WITH ICICI BANK. THE ASSESSEE HAS ALSO FILED THE COPY OF THE BANK ACCOUNTS BEFORE THE ASSE SSING OFFICER. THE ASSESSEE HAS ALSO FILED CONFIRMATION LETTER DATED 2 2/10/2011 FROM SHRI SUDEEP THOMAS. BEING SO, THE IDENTITY, GENUINENESS AND THE CREDITWORTHINESS OF THE ASSESSEES BROTHER WAS PROV ED BY DOCUMENTARY EVIDENCE. REGARDING THE CAPACITY OF SHRI SUDEEP THO MAS TO ADVANCE THIS MUCH AMOUNT TO THE ASSESSEE, THE LD. AR SUBMITTED T HAT SHRI SUDEEP THOMAS WAS A CIVIL ENGINEER AND HE WAS EMPLOYED AT T HE SAME TIME ACTING AS A CONSULTANT ENGINEER FOR THE OIL FIELD. THE LD. AR SUBMITTED THAT VARIOUS AMOUNTS HAVE BEEN CREDITED IN THE ASSE SSEES BANK ACCOUNT AND THE COPY OF THE BANK ACCOUNT HAS BEEN FILED BEF ORE THE ASSESSING OFFICER TO PROVE THAT SHRI SUDEEP THOMAS HAS ENOUGH AMOUNT TO LEND THE SAME TO THE ASSESSEE. ACCORDING TO THE LD. AR, THE AMOUNT HAS BEEN GIVEN TO THE ASSESSEE FOR THE PURPOSE OF PURCH ASE OF RESIDENTIAL FLAT FROM M/S. MATHER CONSTRUCTIONS, COCHIN FOR RS. 62,98,804 INCLUDING I.T.A. NO.19/COCH/2014 9 REGISTRATION CHARGES AND FOR PURCHASING FURNITURE A ND FITTINGS AND OTHER ITEMS OF EQUIPMENT FOR FLAT TO THE EXTENT OF RS.3,4 5,000 AND PURCHASE OF LANDED PROPERTIES OF RS.7,48,500/-. 5.1 THE LD. AR SUBMITTED THAT THE IDENTITY OF THE P ERSON WHO HAS GIVEN THE GIFT AND THE SOURCE OF HIS FUNDS AND HIS BANK ACCOUNT PROVED THE CREDITWORTHINESS OF ASSESSEES BROTHER, SHRI SU DEEP THOMAS WHO GIFTED THE AMOUNT. BEING SO, THE LD. AR SUBMITTED THAT THE PROVISIONS OF SEC. 56(2) OF THE ACT CANNOT BE APPLIED TO THE ASSE SSEES CASE AS THE AMOUNT WAS RECEIVED FROM BLOOD RELATIVE. 6. ON THE OTHER HAND, THE LD. DR RELIED ON THE ORDE R OF THE LOWER AUTHORITIES. 7. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE R ECORD. IN THIS CASE, HUGE AMOUNT OF RS. 1,66,01,834/- WAS RECEIVED FROM THE ASSESSEES BROTHER, SHRI SUDEEP THOMAS THROUGH BANK ING CHANNEL. THE CLAIM OF THE ASSESSEE IS THAT SINCE SHRI SUDEEP THO MAS HAS GIVEN THE AMOUNT TO THE ASSESSEE WHO IS HIS BROTHER FOR THE P URPOSE OF PURCHASE OF RESIDENTIAL PROPERTY. THIS AMOUNT RECEIVED FROM THE BANK ACCOUNT OF SHRI SUDEEP THOMAS WITH ADCB BANK, DUBAI WAS TRANSF ERRED TO THE BANK ACCOUNT OF THE ASSESSEE IN INDIA. THERE IS SU FFICIENT BALANCE IN THE I.T.A. NO.19/COCH/2014 10 BANK ACCOUNT OF SHRI SUDEEP THOMAS AND BEING SO, TH E CAPACITY OF SHRI SUDEEP THOMAS TO LEND THAT MUCH AMOUNT TO THE ASSES SEE CANNOT BE DOUBTED AS HE WAS EMPLOYED AS CONSULTANT ENGINEER IN AN OIL FIELD IN DUBAI AND HE WAS ALSO MANAGING DIRECTOR OF HIS OWN COMPANY. BEING SO, THE ASSESSEE HAS PROVED THE IDENTITY AND SOURCE OF SOURCE AND THEREFORE, ADDITION CANNOT BE MADE. 8. HOWEVER, ON EXAMINATION OF THE BANK ACCOUNT OF T HE ASSESSEES BROTHER SHRI SUDEEP THOMAS, VARIOUS CASH DEPOSITS H AVE BEEN MADE INTO HIS ACCOUNT AND THE ASSESSEE HAS NOT BEEN ABLE TO EXPLAIN THE SOURCE OF THE CREDIT IN THE ACCOUNT OF SHRI SUDEEP THOMAS. AS PER SEC. 68 OF THE I.T. ACT, THE ASSESSING OFFICER IS DUTY B OUND TO ENQUIRE WITH REGARD TO THE NATURE AND SOURCE OF ANY SUM CREDITED IN THE BOOKS OF ACCOUNT, IRRESPECTIVE OF THE NOMENCLATURE OR SOURCE INDICATED BY THE ASSESSEE. IN OTHER WORDS, THE REAL NATURE OF THE TR ANSACTION SHOULD BE ASCERTAINED BY THE ASSESSING OFFICER AND THE ASSESS EE IS REQUIRED NOT ONLY TO PROVE THE IDENTITY OF THE CREDIT BUT IS ALS O REQUIRED TO PROVE THE CAPACITY OF THE CREDITOR TO LEND THE MONEY AND THE GENUINENESS OF THE TRANSACTION. IN THE PRESENT CASE, THE ASSESSEE HAS BEEN ABLE TO PROVE THE IDENTITY OF THE CREDITOR BY FURNISHING THE CONF IRMATION LETTER. HOWEVER, THE GENUINENESS OF THE TRANSACTION IS NOT PROVED. THE RECEIPT OF MONEY THROUGH BANKING CHANNEL IS NOT SUFFICIENT TO PROVE THE I.T.A. NO.19/COCH/2014 11 GENUINENESS OF THE CREDIT. IN THE PRESENT CASE, HUG E AMOUNT WAS DEPOSITED INTO THE BANK ACCOUNT OF SHRI SUDEEP THOM AS BEFORE TRANSFERRING THE SAME TO THE ASSESSEES BANK ACCOUN T. THE ASSESSEE WAS NOT ABLE TO PRODUCE ANY BANK ACCOUNT DETAILS OF SHR I SUDEEP THOMAS FROM WHERE HE HAS RECEIVED SUCH AMOUNT. THE ASSESS EES PLEA IS THAT SHRI SUDEEP THOMAS IS HIS BLOOD RELATIVE AND THEREF ORE IS EXEMPT FROM THE PROVISIONS OF SEC. 56(2) OF THE ACT CANNOT BE A CCEPTED. THE ASSESSEE STATED THAT THE DEPOSIT WAS MADE TO SHRI S UDEEP THOMAS FROM HIS OWN SOURCE OF SAVINGS. TO PROVE THE PAST SAVIN GS OF SHRI SUDEEP THOMAS FROM WHICH THE AMOUNT WAS LENT TO THE ASSESS EE, IT IS INCUMBENT UPON THE ASSESSEE TO FILE DETAILED STATEM ENT OF ASSETS AND LIABILITIES, BALANCE SHEET, CASH FLOW STATEMENT OF SHRI SUDEEP THOMAS WHICH THE ASSESSEE HAS FAILED TO FURNISH. 9. THE ASSESSING OFFICER OBSERVED IN HIS ASSESSMENT ORDER THAT SHRI SUDEEP THOMAS WAS EMPLOYED IN THE GULF ONLY FROM YE AR 2003. HIS SALARY DETAILS WERE NOT FURNISHED THOUGH AS PER HIS LETTER, IT IS STATED THAT THE SAME WILL BE SUBMITTED. THOUGH HE CLAIMS T O HAVE BEEN ENGAGED IN CONSULTATION SERVICE, HIS LICENSE/PERMIT DOES NOT MENTION THE SAME NOR IS ANY EVIDENCE ADDUCED FOR SUCH ACTIVITY. THERE IS NO EVIDENCE AS TO THE NATURE OF THE TRANSACTIONS AND I T WAS NOTICED THAT SOME DEPOSITS IN CASH WERE CREDITED AND THEN STATED TO HAVE BEEN I.T.A. NO.19/COCH/2014 12 TRANSFERRED TO THE ASSESSEE. IN ADCB BANK, THERE WA S FUNDS TRANSFER TO THE VARIOUS ACCOUNTS AS PER THE TABLE MENTIONED IN EARLIER PARA WHICH WAS CLAIMED BY THE ASSESSEE AS PAYMENTS MADE TO HIM . THUS IT IS THE DUTY OF THE ASSESSEE TO EXPLAIN AS TO HOW THE ASSES SEES BROTHER GOT FUNDS. THE ASSESSEE IS NOT ABLE TO GIVE ANY SATISFA CTORY EXPLANATION, EXCEPT BY SAYING THAT IT WAS FROM SAVINGS. IN THE ABSENCE OF ANY MATERIAL TO SHOW THAT THE ASSESSEES BROTHER HAS SA VED SO MUCH MONEY, WE ARE NOT IN A POSITION TO UPHOLD THE CLAIM OF THE ASSESSEE THAT THE FUNDS WERE TRANSFERRED FROM SHRI SUDEEP THOMASS BA NK ACCOUNT TO THE ASSESSEES BANK ACCOUNT FROM PAST SAVINGS. THE ASSE SSEE HAS FAILED TO PROVE THE CREDITWORTHINESS OF THE ASSESSEES BROTHE R. 10. THE CONTENTION OF THE LD. AR IS THAT IF THE ASS ESSEE COULD NOT EXPLAIN THE CREDITWORTHINESS, THE ADDITION COULD BE MADE ONLY IN THE HANDS OF THE ASSESSEES BROTHER AND NOT IN THE HAND S OF THE ASSESSEE. HOWEVER, WE ARE NOT ABLE TO APPRECIATE THIS ARGUMEN T. AS PER SEC. 68, THE ASSESSEE IS REQUIRED TO EXPLAIN THE CAPACITY OF THE LENDER TO ADVANCE MONEY TO THE ASSESSEE TO THE SATISFACTION OF THE AS SESSING OFFICER. IN THE ABSENCE OF ANY MATERIAL TO SUGGEST THAT THE ASS ESSEES BROTHER HAS SUFFICIENT SOURCE TO TRANSFER HUGE MONEY TO THE ASS ESSEES ACCOUNT, WE ARE OF THE OPINION THAT THE ADDITION MADE U/S. 68 O F THE ACT IS WARRANTED. THE ONUS IS ON THE PART OF THE ASSESSEE TO PROVE THE I.T.A. NO.19/COCH/2014 13 CREDITWORTHINESS OF ASSESSEES BROTHER, GENUINENESS OF THE TRANSACTION, AND IDENTITY OF THE CREDITOR. MERELY BECAUSE CONFI RMATION LETTER FROM THE CREDITOR WAS FURNISHED THAT FUNDS WERE TRANSFERRED TO THE ASSESSEES BANK ACCOUNT, IT WILL NOT PROVE THE GENUINENESS OF THE TRANSACTIONS AS HELD BY THE SUPREME COURT IN THE CASE OF CIT VS. P. MOHANAKALA (2007) (291 ITR 278). ACCORDINGLY, WE DO NOT FIND ANY INF IRMITY IN THE ORDER OF THE LOWER AUTHORITIES. HENCE, THIS GROUND OF THE AS SESSEE IS DISMISSED. 11. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS DISMISSED. PRONOUNCED IN THE OPEN COUR T ON 12-12-2014. SD/- SD/- (N.R.S.GANESAN) (CHANDRA POOJARI) JUDICIAL MEMBER ACC OUNTANT MEMBER PLACE: KOCHI DATED: 12TH DECEMBER, 2014 GJ COPY TO: 1. SHRI SUNIL THOMAS, KANJOOPARAMBIL BUILDING, CONV ENT ROAD, KOCHI-35. 2. THE INCOME TAX OFFICER, WARD-2(1), KOCHI. 3. THE COMMISSIONER OF INCOME-TAX(APPEALS)-II, KOCH I. 4. THE COMMISSIONER OF INCOME-TAX, KOCHI 5. D.R., I.T.A.T., COCHIN BENCH, COCHIN. 6. GUARD FILE. BY ORDER (ASSISTANT REGISTRAR) I.T.A.T., COC HIN