Manjulaben Tejraj Shah, Palanpur V. The Income tax Officer,Ward-4, Palanpur

ITA 2075/AHD/2009

• Counselvise Citation: 207520514 RSA 2009
• Duration Of Justice: 2 year(s) 2 month(s) 10 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-09-2011
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: SMC
• Next Hearing Date: 19-08-2011
• Assessment Year: 2004-2005
• Appeal Filed On: 29-06-2009
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: VINOD TANWANI
• Assessee Lawyers: M J SHAH
• Keywords: Gift; Source of fund; Onus to prove
• Section: 68; 148

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCH 'SMC' BEFORE SHRI T K SHARMA, JUDICIAL MEMBER ITA NO.2075/AHD/2009 (ASSESSMENT YEAR:-2004-05) SMT. MANJULABEN TEJRAJ SHAH, VARDHMAN SOCIETY, NEAR JAIN BAUG, DEESA V/S THE INCOME-TAX OFFICER, WARD-2, PALANPUR PAN: AFQPS 1383 B [APPELLANT] [RESPONDENT] APPELLANT BY :- SHRI M J SHAH, AR RESPONDENT BY:- SHRI VINOD TANWANI, SR. DR DATE OF HEARING:- 19-08-2011 DATE OF PRONOUNCEMENT:- 09.09.2011 O R D E R THIS IS AN APPEAL BY ASSESSEE AGAINST AN ORDER DAT ED 20 TH APRIL, 2009 PASSED BY THE LEARNED COMMISSIONER OF INCOME-TAX (A PPEALS)-XV, AHMEDABAD [THE CIT(A)] FOR ASSESSMENT YEAR (AY) 2 004-05. THE GROUNDS RAISED BY THE ASSESSEE ARE AS UNDER:- [1] THAT THE LEARNED CIT(A) ERRED IN LAW AND ON FAC TS IN CONFIRMING THE PENALTY OF RS.1,12,889=00 MADE BY THE AO WITHOU T APPRECIATING THE EXPLANATION AND SUBMISSION MADE BY THE APPELLANT. [2] THAT THE PENALTY LEVIED U/S 271(1)(C) MAY BE DE LETED AFTER APPRECIATION OF THE CORRECT FACTS AND THE LAW ON TH E SUBJECT. [3] YOUR APPELLANT CRAVES LEAVE TO ADD, ALTER OR AM END THE GROUNDS OF APPEAL. 2 THE FACTS IN BRIEF AS PER RELEVANT ORDER ARE THAT THE RETURN DECLARING TOTAL INCOME OF RS.79,626/- WAS FILED BY AN ASSESSE E, INDIVIDUAL ON 19-08- 2 ITA NO.2075/AHD/2009 2004. THE RETURN WAS PROCESSED U/S 143(1)(A) OF THE INCOME-TAX ACT, 1961 [HEREINAFTER REFERRED TO AS THE ACT] ON 19-10-200 4. 2.1 DURING THE COURSE OF ASSESSMENT PROCEEDINGS IN THE CASE OF SORATHIA BHAVNABEN MAHESHBHAI, SORATHIA DIWALIBEN DHARAMSHIB HAI, AND SORATHIA REKHABEN BHARATBHAI, OF ANJAR, THE ITO (OSD), GANDH IDHAM HAD CALLED FOR THE DETAILS OF GIFT MADE FROM THE ASSESSEE. AFTER V ERIFICATION OF THE DETAILS, THE GIFT MADE BY THE ASSESSEE WAS CONSIDERED AS GEN UINE IN THE CASES OF ABOVE PERSONS. AN INTIMATION TO THAT EFFECT WAS PAS SED TO ITO VIDE OFFICE LETTER NO.ITO/GIM/INF/05-06 DATED 29-03-2006 FOR FU RTHER VERIFICATION AND NECESSARY ACTION. 2.2 ON VERIFICATION OF CAPITAL ACCOUNT FURNISHED WI TH RETURN OF INCOME FOR A.Y.2004-05, IT WAS NOTICED THAT THE CAPITAL ACCOUN T FURNISHED TO ITO(OSD), GANDHIDHAM WAS QUITE DIFFERENT. THE CAPIT AL ACCOUNT FURNISHED TO ITO (OSD), GANDHIDHAM CLEARLY SHOWED THAT THE AS SESSEE HAD FRAMED THE CAPITAL ACCOUNT AS REQUIRED BY THE ABOVE PERSONS TO JUSTIFY THE GIFT RECEIPT. THE SUBMISSION BEFORE THE ITO (OSD), GANDHDHAM AND FURNISHED TO JUSTIFY FRAUDULENT ACTION OF THE ASSESSEE. 2.3 DURING THE COURSE OF ASSESSMENT PROCEEDINGS OF THE ASSESSEE, THE ASSESSEE WAS ASKED TO EXPLAIN THE SOURCE OF GIFT OF RS.4,00,000/- MADE TO ABOVE PERSONS. THE ASSESSEE WAS ASKED TO EXPLAIN TH E DIFFERENCE IN CAPITAL ACCOUNT FURNISHED WITH THE ITO(OSD), GANDHIDHAM AND CAPITAL ACCOUNT FILLED WITH RETURN OF INCOME ALSO. THE ASSESSE VIDE LETTER DATED 23-9-2006 STATED THAT SHE HAD RECEIVED THE GIFT OF RS.2,00,00 0/- FROM DARJI KALUBHAI KHODABHAI, AT. HAYED, TA. PATAN AND RS.2,00,000/- F ROM DARJI PANABHAI MAGHABHAI AT. BALVA, TA.PATAN. 2.4 SUMMONS WERE ISSUED TO THE ABOVE PERSONS FOR VE RIFICATION OF THE ABOVE TRANSACTIONS. THE SUMMONS ISSUED TO THE DONOR S WERE RETURNED UN- SERVED WITH POSTAL REMARKS 'DARJI PANABHAI MAGHABHA I WAS PASSED AWAY' 3 ITA NO.2075/AHD/2009 AND 'DARJI KALUBHAI KHODABHAI WAS NOT RESIDES AS GI VEN ADDRESS'. THE ASSESSEE WAS ALSO ISSUED THE SUMMONS FOR VERIFICATI ON. ASSESSEE NEITHER ATTENDED THE OFFICE FOR VERIFICATION NOR THE ABOVE PERSONS ATTENDED. THEREFORE, THE ASSESSEE WAS ASKED VIDE LETTER NO.PL N/WD- 2/MTS/143(3)/2006-07 DATED 28/11/2006 TO ATTEND THE OFFICE FOR VERIFICATION WITH THE ABOVE PERSONS. THE ASSESSING OFFICER HAD CONDUCTED INQUIRIES WITH ADDL. SUPERINTENDENT OF STAMPS, GAND HINAGER AND FOUND THAT THE STAMPS OF GIFT WERE ALSO BOGUS. 2.5. THE AO OBSERVED THAT IT WAS CLEAR THAT THE ASS ESSEE HAD NOT RECEIVED ANY GIFT. THE SUM OF RS.4,00,000/- CREDITED IN THE BOOKS OF THE ASSESSEE WAS NOT EXPLAINED BY THE ASSESSEE. ACCORDING TO THE AO, THE EXPLANATION OFFERED BY THE ASSESSEE WAS NOT SATISFACTORY. THE SOURCE OF GIFT MADE REMAINED UNEXPLAINED ON THE PART OF ASSESSEE, HENCE, THE AMO UNT CREDITED IN CAPITAL ACCOUNT WAS TREATED AS CASH CREDIT AND ADDED TO THE TOTAL INCOME OF THE ASSESSEE. 2.6 ON THE BASIS OF THESE FACTS, PENALTY PROCEEDING S U/S 274 R.W.S. 271(1)(C) OF THE ACT HAD BEEN INITIATED FOR FURNISH ING INACCURATE PARTICULARS OF INCOME RS.4,00,000/- AND NOTICE U/S 271(L)(C ) O F THE ACT WAS ISSUED ON 28/06/2007. 3. IN RESPECT OF THE ABOVE ADDITION, THE ASSESSEE P REFERRED AN APPEAL BEFORE THE CIT(A)-IX, AHMEDABAD. THE CIT(A) VIDE HI S APPEAL ORDER NO. CIT (A)-XV/WD.2/PLN/45/07-08 DATED 31-11-2007 STATE D THAT THE APPELLANT COULD NOT EXPLAIN THE CASH GIFT RECEIVED, IDENTITY, CREDITWORTHINESS AND GENUINENESS OF THE TRANSACTION , ALL REMAINED UNEXPLAINED. THE ADDITION MADE BY THE AO WAS THEREF ORE CONFIRMED, ALSO IN THE LIGHT OF THE ENQUIRIES CONDUCTED BY HIM FROM TH E STAMP DUTY OFFICE. FURTHER, THE ASSESSEE HAS NOT FILED APPEAL BEFORE T HE ITAT AGAINST CIT(A)S ORDER DATED 30-11-2007. 4 ITA NO.2075/AHD/2009 4. AFTER RECEIVING THE APPEAL ORDER, A FRESH PENALT Y NOTICE DATED 21/1/2008 WAS ISSUED AND SERVED UPON THE ASSESSEE, ASKING THE ASSESSEE WHY THE PENALTY SHOULD NOT BE LEVIED FOR THE CONCEA LMENT OF INCOME. IN RESPONSE TO THE AFORESAID SHOW CAUSE, THE ASSESSEE HAD REPLIED VIDE HIS LETTER DATED 2/2/2008, AS UNDER:- '............THAT WE HAVE NO INTENTION OF COMMITTIN G ANY DEFAULT UNDER THE ACT. WE ARE CO-OPERATIVE WITH THE DEPARTMENT AND APPEARED BEFOR E YOUR HONOUR AS AND WHEN CALLED FOR. WE ARE REGULAR AND PROMPT IN PAYMENT TO TAXES. MENS REA IS ALSO ABSENT. THE RETURN OF INCOME IS FURNISHED DECLARING TRUE AN D CORRECT INCOME. THAT GIFT RECEIVED AND GIFT GIVEN ARE GENUINE AND SAME ARE SU PPORTED BY EVIDENCES. THAT EVIDENCES, EXPLANATIONS, AFFIDAVITS & SUBMISSI ONS FILED FROM TIME TO TIME HAVE NOT BEEN CONSIDERED PROPERLY AND IT ITS RIGHT SPIRI T. THAT ADDITION MADE BY YOUR HONOUR U/S 68 IS HIGHLY EXCESSIVE AND AGAINST THE FACTS AND EVIDENCES ON RECORD. THAT WE HAVE FULLY EXPLAINED THE GIFT BY WAY OF FIL ING MEMORANDUM OF GIFTS, CONFIRMATIONS AND COPIES OF RELEVANT ACCOUNTS. FOR THE MISTAKE IN CAPITAL ACCOUNT, WE HAVE FILED THE AFFIDAVIT OF THE ACCOUNTANT WHICH MADE THE THINGS VERY CLEAR. YOUR HONOUR HAS ERRED IN NOT CROSS EXAMINING THE ACCOUNT ANT. THE 'IDENTITY, CREDITWORTHINESS AND GENUINENESS OF THE GIFT IS PRO VED BY FILING MEMORANDUM OF GIFT, 7 X 12 UTARA, OUR BANK STATEMENT ETC. AFFIDAV IT FILED BY US AND OTHER EVIDENCES AND EXPLANATIONS SUBMITTED BY US IS SUFFICIENT PROO F FOR DISCHARGE OF OUR BURDEN TO PROVE THE GENUINENESS OF THE TRANSACTION. THE JURISDICTIONAL HIGH COURT IN THE CASE OF GLASS LINES EQUIPMENTS CO. LTD. VS CIT - 253 ITR 459 (GUJARAT) HAS HELD THAT IF THE CO NTENTS OF THE AFFIDAVITS ARE NOT BELIEVED AND THE CROSS EXAMINATION IS NOT AFFORDED IN THE INTEREST OF -NATURAL JUSTICE, THE ORDER IS BAD IN LAW. ASSESSMENT AND PENALTY PROCEEDINGS ARE TWO DIFFEREN T PROCEEDINGS. PENALTY PROCEEDINGS ARE QUASI-JUDICIAL PROCEEDINGS. THEREFO RE EVERY EVIDENCES FURNISHED SHOULD BE CONSIDERED FAIRLY AND PROPERLY. IT IS NOT COMPULSORY TO LEVY PENALTY WHEN THE ADDITION IS CONFIRMED IN APPEAL. THERE IS EVERY THING ON RECORD WHICH PROVES THE FIN ANCIAL CAPACITY OF DONORS, CREDIT WORTHINESS OF THE DONORS, RELATIONSHIP OF THE DONOR S, SOURCES OF FUND GIFTED TO THE ASSESSEE AND CAPACITY OF DONOR TO GIFT THE AMOUNT T O THE 5 ITA NO.2075/AHD/2009 OUR ACCOUNTANT HAS APPEARED BEFORE YOUR HONOUR FOR NUMBERS OF TIMES AND EXPLAINED BEFORE YOUR HONOUR THE FACTS OF THE CASE. WE ARE STILL READY TO APPEAR BEFORE YOUR HONOUR AND READY TO FURNISH EVIDENCE, I F ANY, WHICH MAY BE REQUIRED BY YOUR HONOUR. IN VIEW OF THE ABOVE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND TO MEET THE ENDS OF JUSTICE, YOUR HONOUR IS KINDLY REQUESTED TO DROP THE PENALTY PROCEEDINGS AND OBLIGE. ..........' 4.1 AFTER CONSIDERING THE AFORESAID SUBMISSIONS OF THE ASSESSEE, THE AO CONCLUDED AS UNDER:- 5. THE ASSESSEE'S SUBMISSION IS CONSIDERED CAREFUL LY BUT NOT ACCEPTABLE, BECAUSE A.O. HAD GIVEN ADEQUATE OPPORTUNITIES TO TH E ASSESSEE FOR EXPLAINING THE GIFT RECEIVED. SUMMONS WERE ALSO ISSUED TO THE ASSE SSEE AS WELL AS TO THE PERSON FROM WHOM THE GIFT WAS RECEIVED WHICH WERE NOT COMP LIED WITH AND AS THERE WAS NO VERIFICATION AND THE GIFT WAS MADE IN CASH, THE GENUINENESS OF THE GIFT COULD NOT BE PROVED BY THE ASSESSEE. FURTHER, IN THE COURSE O F THE INQUIRIES FROM THE ADDL. SUPERINTENDENT OF STAMPS, GANDHINAGER THE STAMPS OF GIFT WERE FOUND BOGUS. IT IS A FIT CASE FOR LEVY OF PENALTY CONSIDERING THE DETAIL S FURNISHED DURING THE COURSE OF ASSESSMENT PROCEEDINGS. 6. CONSIDERING THE ABOVE PARTICULARS AND RELEVANT D ETAILS, THE ASSESSEE HAS FURNISHED THE INACCURATE PARTICULARS OF INCOME OF R S.4,00,000-. IT IS A FIT CASE FOR LEVY OF PENALTY U/S 271(L)(C) OF THE ACT. I THEREFO RE LEVY A MINIMUM PENALTY OF RS.1,12,8897- AS AGAINST THE MAXIMUM LEVIABLE COMES TO RS.3,38,667/-. 5 ON APPEAL, THE LEARNED CIT(A) UPHELD THE LEVY OF PENALTY IN THE FOLLOWING TERMS:- 3. DURING THE COURSE OF PENALTY APPELLATE PROCEEDIN GS SHRI BAKUL SHAH, C.A. APPEARED AS AUTHORIZED REPRESENTATIVE OF THE APPELL ANT AND FILED WRITTEN SUBMISSIONS. THE ENTIRE FOCUS OF THE SUBMISSION IS THAT THE ACCOUNTANT OF THE APPELLANT SHRI TEJRAJBHAI AMICHAND SHAH HAD ADMITTE D HIS MISTAKE IN SUPPLYING INCORRECT COPY OF CAPITAL ACCOUNT OF THE APPELLANT VIDE HIS AFFIDAVIT DATED 25.12.2006. IT WAS ALSO EXPLAINED THAT IT IS NOT PO SSIBLE FOR ANYBODY TO KNOW WHETHER THE STAMP PAPER SOLD IN THE MARKET IS GENUI NE OR NOT. THAT EVEN IF THE STAMP PAPER IS NOT GENUINE NEITHER THE APPELLANT NO R THE DONOR COULD BE BLAMED FOR THE SAME AND THAT THE GENUINENESS OF THE GIFTS COUL D NOT BE DOUBTED \ A ON THAT COUNT. IT WAS STATED THAT THE ONUS' IS ON THE REVEN UE TO PROVE MAT THE GIFTS WERE NOT GENUINE FOR THE PURPOSE OF LEVY OF PENALTY. RELIANC E WAS PLACED ON THE GUJARAT HIGH COURT DECISION IN THE CASE OF GLASS LINE EQUIP MENTS CO. LTD VS. CIT 253 ITR 459 (GUJARAT). 4. AFTER GOING THROUGH RIVAL SUBMISSIONS THE POSITI ON EMERGES AS UNDER: 6 ITA NO.2075/AHD/2009 I. I FIND THAT SUFFICIENT OPPORTUNITIES WERE GIVEN TO THE APPELLANT TO EXPLAIN THE SOURCE, IDENTITY OF THE' DONORS AND THEIR CREDITWOR THINESS. NEITHER THE DONORS NOR THE APPELLANT APPEARED DURING THE ASSESS MENT PROCEEDINGS NOR IN THE APPELLATE PROCEEDINGS. II. THE AFFIDAVIT OF THE ACCOUNTANT THAT HE FURNISH ED INCORRECT COPY OF CAPITAL ACCOUNT BEAR LITTLE SIGNIFICANCE BECAUSE THIS IS NO T THE CASE OF THE APPELLANT THAT GIFTS WERE NOT RECEIVED. HE HAS MAINTAINED THR OUGHOUT THAT THE SOURCE OF RS.4,00,000 CREDITED TO HIS CAPITAL ACCOUNT WERE TWO GIFTS RECEIVED FROM TWO PERSONS WHOM HE COULD NEVER PRODUCED AND WHOM T HE INCOME-TAX DEPARTMENT COULD NEVER FIND. DELHI HIGH COURT DECIS ION IN THE CASE OF CIT VS. ANILKUMAR - 292 ITR 552(DELHI) WAS RELIED UPON BY THIS OFFICE WHILE CONFIRMING THE GIFT ADDITION, HI THE CASE OF CIT VS . ANILKUMAR THE ADDITION ON ACCOUNT OF GIFTS UNEXPLAINED WAS UPHELD BY THE H IGH COURT AS HIGH COURT FOUND NOTHING ON RECORD TO SHOW AS TO WHAT WA S THE FINANCIAL CAPACITY OF THE DONORS, WHAT WAS THE CREDITWORTHINE SS OF THE DONORS, WHAT KIND OF RELATIONSHIP THE DONORS HAD WITH THE ASSESS EE, WHAT WERE THE SOURCE OF FUNDS GIFTED TO THE ASSESSEE AND WHETHER THEY HA D THE CAPACITY OF GIVING LARGE AMOUNTS OF GIFTS TO THE ASSESSEE. III. THIS IS ALSO AN ADMITTED FACT THAT AGAINST ADD ITION CONFIRMED ON ACCOUNT OF UNEXPLAINED GIFTS THE APPELLANT HAD NOT APPROACHED IT AT. HI OTHER WORDS HE HAD NOT CHALLENGED THE ORDER OF THE CIT(A). IN VIEW OF THE ABOVE, PENALTY IMPOSED BY THE AO IS CONFIRMED. FOR THIS RELIANCE IS PLACED ON KARNATAKA HIGH COURT DECISION IN THE CASE OF CIT VS. MASTER SUNIL R.KALRO - 292 ITR 86 WHEREIN ALL MATERIALS GATHERED BY THE INCOME-TAX DEPARTMENT WERE AGAINST THE ASSESSEE ON THE BASIS OF WHICH GIF TS COULD NOT BE HELD GENUINE. IN THIS CASE, HON'BLE HIGH COURT HELD THAT FOR LEVY OF PENALTY CONCEALMENT NEED NOT BE ESTABLISHED 'TO THE HILT'. FURTHER RELIANCE IS PLAC ED ON HON'BLE SUPREME COURT DECISION IN A SALES-TAX CASE IN HINDUSTAN STEELS LT D. VS. STATE OF ORISSA 83 ITR 26 WHERE PENALTY WAS FOUND WARRANTED IN TAX DEFAULTS W HERE IT IS ESTABLISHED THAT THE ASSESSEE HAD NOT ACTED BONAFIDE OR ACTED DELIBERATE LY IN DEFIANCE OF LAW OR WAS GUILTY OF CONDUCT CONTUMACIOUS OR DISHONEST, OR ACT ED IN CONSCIOUS DISREGARD OF ITS OBLIGATION. IN THE ABOVE BACKGROUND THE PENALTY OF RS.1,12,889/ - LEVIED BY THE AO U/S 271(1)(C) IS CONFIRMED. 6 THE ASSESSEE HAS NOW COME IN APPEAL BEFORE US AGA INST THE AFORESAID FINDINGS OF THE LEARNED CIT(A). SHRI M J SHAH, LEAR NED COUNSEL APPEARING ON BEHALF OF THE ASSESSEE REITERATED THE SUBMISSION S MADE BEFORE THE LEARNED 7 ITA NO.2075/AHD/2009 CIT(A) AND RELIED UPON THE DECISION OF THE HONBLE GUJARAT HIGH COURT IN THE CASE OF GLASS LINE EQUIPMENTS CO. LTD. VS. CIT 253 ITR 459 (GUJ). 7 THE LEARNED DR, ON THE OTHER HAND, SUPPORTED THE ORDERS OF THE AO AND THE LEARNED CIT(A). 8 WE HAVE HEARD BOTH THE PARTIES AND GONE THROUGH T HE FACTS OF THE CASE AS WELL AS THE DECISION REFERRED TO BY THE LEARNED CIT(A) IN HIS ORDER. IT IS PERTINENT TO NOTE THAT ITO(OSD), GANDHIDHAM CALLED FOR THE DETAILS OF GIFT MADE FROM THE ASSESSEE AND CAPITAL ACCOUNT FURNISHE D TO THE ITO(OSD), GANDHIDHAM WHICH IS ATTACHED AS ANNEXUREA TO THE ASSESSMENT ORDER. AFTER VERIFICATION OF DETAILS, GIFTS MADE BY THE AS SESSEE WERE CONSIDERED AS GENUINE IN THE CASE OF DONE. AN INTIMATION TO THAT EFFECT WAS RECEIVED VIDE LETTER DATED 19.03.2006 WAS PASSED ON TO THE AO OF THE ASSESSEE FOR FURTHER VERIFICATION AND NECESSARY ACTION. ACCORDINGLY, NOT ICE UNDER SECTION 148 WAS ISSUED TO THE ASSESSEE. DURING THE COURSE OF AS SESSMENT PROCEEDINGS, THE AO ASKED THE ASSESSEE TO EXPLAIN THE SOURCE OF GIFT OF RS.4 LAKHS. THE ASSESSEE, VIDE LETTER DATED 23.09.2006 DATED THAT S HE HAS RECEIVED THE GIFT OF RS.2 LAKHS FROM DARJI KALUBHAI KHODABHAI, AT HAYED TA: PATAN AND RS.2 LAKHS FROM DARJI PUNABHAI MAGHABHAI AT: BALVA, TA: PATAN. ON THE BASIS OF ABOVE, SUMMONS WERE ISSUED, ENQUIRY WAS CONDUCTED, REPLY FILED BY THE ASSESSEE WAS CONSIDERED AND THE AO IN PARA 8 OF THE ASSESSMENT ORDER HELD THAT THE REPLY OF THE ASSESSEE IS NOT ACCEPTABLE FO R THE FOLLOWING REASONS. A) THE SUBMISSIONS MADE TO ITO (OSD), GANDHIDHAM WA S SINGED BY THE ASSESSEE HERSELF HENCE IGNORANCE OF THE ASSESSEE CAN BE NOT ACCEPTABLE IN THIS MATTER. B)THE ACCOUNTANT IS NOT RESPONSIBLE FOR ANY ENTRY I N THE BOOKS OF THE ASSESSEE. THE BOOKS ARE WRITTEN AS PER THE MATERIAL PROVIDED BY T HE ASSESSEE. C) THE GIFT RECEIPT BY THE ASSESSEE IS IN CASH AND NOT BY DRAFT OR ACCOUNT PAYEE CHEQUE. THE PERSONS FROM THE GIFT RECEIVED ARE NOT PRODUCE BEFORE THE UNDER SINGED FOR VERIFICATION. THE ONUS OF PROVE THE GENUINENESS OF TRANSACTION IS ON THE ASSESSEE. THE ASSESSEE WAS FAILS TO PROVE THE GENUI NENESS HENCE', THE AMOUNT OF GIFT OF RS.400009/- IS TREATED AS INCOME FROM UNDIS CLOSED SOURCE OF THE ASSESSEE. 8 ITA NO.2075/AHD/2009 D) THE CAPITAL ACCOUNT OF THE ASSESSEE DOES NOT R EFLECT THE ENTRY OF GIFT RECEIPT AND GIFT MADE. E) ON VERIFICATION OF THE BALANCE SHEET OF THE ASSE SSEE THE ASSESSEE HAVING CASH CREDIT ABOVE OF RS.8 LAKH FROM DIFFERENT 42 PERSONS . AS THE ASSESSEE HAS TO PAY THE ABOVE PERSONS, BEFORE MAKING GIFT, FIRST SHE WILL P AY THE DUES. THE CREDIT WORTHINESS FOR GIFT ITSELF NOT PROVED. F) AS PER THE INFORMATION CALLED FOR FROM THE ADDLL . SUPERINTENDENT OF STAMPS, GANDHINAGAR, THERE WAS NATIONAL HOLIDAY ON 02/10/20 03 ON EVENT OF GANDHI JAYANTI AND NO SALES OF STAMPS WERE MADE ON THAT DA Y BY THE STAMP VENDOR. G) AS PER THE SALES REGISTER OF THE STAMP WENDOR, S R.7825 AND 7840 WERE REGISTERED IN THE NAME OF INTER CONTINENTAL (INDIA)LTD., WERE AS THE ASSESSEE PRODUCED THE GIFT DEED BEFORE ME AT SR.NO.7825 IN THE NAME OF DARJI P UNABHAI MAGHBHAI AND SR.NO.7840 IN THE NAME OF DARJI KALUBHAI KHODABHAI, WHICH ALSO GIVE INDICATION OF FRAUDULENT ACTION OF THE ASSESSEE AGAIN. 8.1 ON THE BASIS OF ABOVE NARRATED FACTS, THE AO CO NCLUDED THAT THE ASSESSEE FAILED TO PROVE THE GENUINENESS OF THE GIF T RECEIVED AND TREATED THE ALLEGED GIFT OF RS.4 LAKHS RECEIVED AS NON-GENUINE AND ADDED TO THE TOTAL INCOME OF THE ASSESSEE. WITH REGARD TO CONFIRMATION /GIFT DEED FILED BEFORE THE AO, THROUGH FIELD ENQUIRIES MADE UNDER SECTION 133(6), THE AO FOUND THAT THE DONORS DID NOT EXIST ON THE GIVEN ADDRESSE S. THE SUMMONS WERE RATHER RETURNED BACK BY THE POSTAL AUTHORITIES UNSE RVED WITH THE POSTAL REMARK THAT DARJI PANABHAI MAGHABHAI WAS PASSED AW AY AND DARJI KALUBHAI KHODABHAI DID NOT RESIDE ON THE GIVEN ADDR ESS. WHEN THE ASSESSEE WAS INFORMED ABOUT THIS, BEFORE THE AO, TH E ASSESSEE NEVER TURNED UP FOR VERIFICATION. ON THIS BASIS, IT WAS FOUND BY THE AO THAT THE GIFT DEEDS WERE EXECUTED ON THE SAME STAMP PAPERS OF RS.50/- P URCHASED ON 2.10.2003 WITH SERIAL NUMBER 7825 AND 7840 BUT THE ENQUIRIES MADE FROM THE ADDITIONAL SUPERINTENDENT OF STAMPS, GANDHINAGAR RE VEALED THAT THE STAMP PAPERS BEARING THE AFORESAID SERIAL NUMBERS WERE NO T PURCHASED BY THE APPELLANT BUT PURCHASED BY ONE INTER CONTINENTAL (I NDIA) LTD. THE ADDITION WAS CONFIRMED BY CIT(A) VIDE ORDER DATED 30.11.2007 . NO APPEAL IN ITAT 9 ITA NO.2075/AHD/2009 WAS PREFERRED AGAINST CIT(A) ORDER BY THE ASSESSEE IN WHICH THE GIFT ADDITIONS WERE UPHELD. 8.2 THE FINDING OF FACT, RECORDED BY THE AO IN THE ASSESSMENT ORDER, THE LD. CIT(A) IN THE QUANTUM APPEAL CLEARLY INDICATES THAT EVEN THE ASSESSEE FAILED TO PROVE THE GENUINENESS OF THE TRANSACTION BECAUSE ALLEGED GIFT OF RS.4 LAKHS FROM TWO ALLEGED DONORS WERE CLAIMED TO BE RECEIVED IN CASH. THE RESULT OF ENQUIRY CONDUCTED BY THE AO ALSO REVE ALS THAT GIFTS, IN QUESTION, WERE BOGUS. I AM, THEREFORE, OF THE VIEW THAT IN THE IMPUGNED ORDER, THE LD. CIT(A) HAS GIVEN COGENT REASON FOR C ONFIRMING THE PENALTY OF RS.1,12,889/- LEVIED BY THE AO UNDER SECTION 271(1) (C) OF THE I.T. ACT. I, THEREFORE, INCLINE TO UPHOLD THE ORDER OF THE LD. C IT(A). RESULTANTLY, THE APPEAL OF THE ASSESSEE IS DISMISSED. 9. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS DIS MISSED. ORDER PRONOUNCED IN THE COURT TODAY ON 09-09-2011 SD/- (T K SHARMA) JUDICIAL MEMBER DATED: 09/09/2011 COPY OF THE ORDER FORWARDED TO: 1. SMT. MANJULABEN TEJRAJ SHAH, VARDHMAN SOCIETY, N EAR JAIN BAUG, DEESA 2. THE INCOME-TAX OFFICER, WARD-2, PALANPUR 3. CIT CONCERNED 4. CIT(A)-XV, AHMEDABAD 5. DR, ITAT, AHMEDABAD BENCH-SMC, AHMEDABAD 6. GUARD FILE BY ORDER DEPUTY/ASSISTANT REGISTRAR ITAT, AHMEDABAD TALUKDAR/SR.P.S. 10 IT A NO.2075/AHD/2009