Retrospective Assessing Officer definition upheld; unsupported bond gifts treated as unexplained cash credit under tax law.

A retrospective amendment to the definition of Assessing Officer in Section 2(7A) was applied to pending proceedings, so the jurisdictional objection to assessment by an Additional Commissioner failed and the assessment was upheld. The alleged gifts of Resurgent India Bonds were disbelieved because the assessee did not establish donor identity, relationship, or any credible basis for the transfers, and the credits were found inconsistent with ordinary human conduct. Once the gifts were held not genuine, the credited amount was treated as unexplained cash credit under Section 68, and the addition was sustained.

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Issues: (i) Whether an Additional Commissioner of Income Tax could act as an Assessing Officer in view of the retrospective amendment to the definition of Assessing Officer. (ii) Whether the alleged gifts of Resurgent India Bonds were genuine and, if not, whether the amount was taxable as unexplained cash credit.

Issue (i): Whether an Additional Commissioner of Income Tax could act as an Assessing Officer in view of the retrospective amendment to the definition of Assessing Officer.

Analysis: The definition of Assessing Officer in Section 2(7A) was amended by the Finance Act, 2007 with retrospective effect from 1 June 1994 so as to include an Additional Commissioner of Income Tax. A retrospective amendment operates upon pending proceedings, and the assessment order could not be invalidated merely because the specific reference was inserted later. The challenge to jurisdiction was therefore examined only in the light of the amended provision.

Conclusion: The jurisdictional objection was rejected and the assessment by the Additional Commissioner was held valid.

Issue (ii): Whether the alleged gifts of Resurgent India Bonds were genuine and, if not, whether the amount was taxable as unexplained cash credit.

Analysis: The assessee failed to furnish basic details of the donors, establish any relationship with them, or produce material showing why such substantial gifts were made without occasion. On the facts, the gifts were found to be unsupported by ordinary human conduct and were disbelieved by the Assessing Officer, the Commissioner (Appeals), and the Tribunal. Once the gifts were found not genuine, the credited amount attracted Section 68 as unexplained cash credit.

Conclusion: The gifts were held to be not genuine and the addition under Section 68 was sustained.

Final Conclusion: The tax appeal failed on both the jurisdictional and merits issues, and the addition to income remained undisturbed.

Ratio Decidendi: A retrospective amendment to the definition of Assessing Officer applies to pending proceedings, and an unsupported gift credit may be treated as unexplained cash credit where the assessee fails to establish genuineness and donor identity on the test of human probabilities.

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