Unexplained gift credit under Section 68: Tribunal remits matter for fresh verification of donor evidence and bank records.

Section 68 was examined in relation to an alleged gift from a spouse treated as unexplained credit. The Tribunal noted that the assessee had filed a gift deed, PAN and acknowledgements, but contemporaneous bank statements, clear transfer entries and complete supporting records were either missing or produced only at the Tribunal stage. It also recorded inconsistencies between ledger entries, bank records and the donor's tax disclosures, and found that the assessing officer had not been given a fair opportunity to verify the evidence through enquiry. The matter was therefore remitted to the jurisdictional Assessing Officer for fresh adjudication after full factual verification and a reasonable opportunity of hearing.

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Issues: Whether the addition of Rs. 12,54,54,594/- treated as unexplained credit on account of gift from spouse could be sustained, or whether the matter requires remand for fresh adjudication in view of missing/verifiable evidence.

Analysis: The Tribunal examined whether the assessee had discharged the primary onus under Section 68 of the Income-tax Act, 1961 by producing documents to prove identity, genuineness and creditworthiness of the donor and mode of transaction. The record shows the assessee supplied a gift deed, PAN and acknowledgements but did not provide contemporaneous bank statements or clear bank entries evidencing transfer of the gifted amount before the authorities below; certain material documents (complete ITRs and bank statements) were filed for the first time before the Tribunal. Discrepancies and lack of correlation were noted between ledger entries, bank statements and Schedule FA/AL entries in the donor's ITRs; the mode of payment and source of funds were not specifically recorded in the gift deed or affidavits. The Tribunal found that the available material required factual verification and that the assessing officer below had not had a fair opportunity to make enquiries under Sections 133(6) / 131 because key details were furnished late in the proceedings. In view of these facts and the need for on record factual verification, the Tribunal concluded that the matter should be remitted to the jurisdictional assessing officer for fresh adjudication with an opportunity to the assessee to produce complete evidence.

Conclusion: The appeal is remitted to the file of the jurisdictional Assessing Officer for de novo decision after affording the assessee a reasonable opportunity of being heard; the appeal is allowed for statistical purposes.

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