TaxTMI 
TaxTMI 
2018 (12) TMI 1598
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....d 29.02.2008, in I.T.A.No.1942/Mds/2007 for the assessment year 2004-05. 2. The above appeal was admitted, on 04.11.2008, on the following substantial questions of law:- "(i) Whether on the facts and circumstances of the case and having regard to the provisions of Section 68 whether the appellant had discharged his initial burden in respect of gift/loan received by the appellant? (ii) Whether on the facts and circumstances of the case the Appellate Tribunal is right in law in holding that the additional evidence provided before the Commissioner of Income Tax (A) cannot be taken cognizance of to prove the credit worthiness of the donor/creditor, instead of remanding the matter to the Assessing Officer for consideration o....
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....nor, the mode of receipt, the confirmation by way of a gift deed and copy of the bank account of the donor. Thus, it was contended that the addition made by the Assessing Officer was merely based on suspicion, surmises and conjectures. 6. The learned counsel for the assessee referred to various decisions in support of his contentions. The CIT(A) allowed the assessee's appeal on the ground that the genuineness of the transaction not being doubted and all three conditions having been satisfied, there is no reason to make an addition in respect of a gift by merely citing human probability and based on suspicion. The CIT(A) also referred to certain decisions to support his conclusion. The Revenue filed appeal before the Tribunal among ot....
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.... letter produced by assessee purported to be written by the company in UAE stating that the company has given him 2 lakhs USD was not produced before the Assessing Officer; no enquiry was made by the CIT(A) when the assessee claimed that the donor was earning a sum of 2 lakhs USD, which is nearly double the amount of his salary from Citi Bank, USA for 4 years and this aspect was not investigated. 11. Further, the Tribunal held that the amount of gift and loan was transferred out of the NRO account of the donor at Global Trust Bank, Secunderabad and the credit of this sum into the bank was through telegraphic transfer and the source of transfer was not established as to how it was relatable to the donor. The communication sent by Assessin....
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....e in the said case, the identity of the donor was in doubt. 14. With regard to the contentions advanced by the Revenue that the CIT(A) contravened Section 46 by referring to an alleged income of the donor, which was not placed before Assessing Officer, the learned counsel relied on sub-Rule 4 of Rule 46A of the Rules and submitted that, if sufficient cause is shown for not producing the document before the Assessing Officer, the same can be produced before the CIT(A). 15. Referring to the order passed by the Tribunal in I.T.A. No.1745/Mds/2011, which arose out of an order imposing penalty on the assessee, it is submitted that the appeal filed by assessee was allowed and the Tribunal has pointed out that, if the Assessing Officer did n....
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....record. 19. The first aspect of the matter, which we propose to consider is whether the CIT(A) was justified in accepting the documents, which were not produced before the Assessing Officer. Rule 46A of the Rules provides for an opportunity to the assessee to produce documents. However, there are conditions, which are required to be fulfilled, before the Appellate Authority accepts such documents. Firstly, the burden of proof is on the assessee to show sufficient cause for not having been able to produce the documents before the Assessing Officer. Upon the CIT(A) being satisfied that the assessee for bona fide reasons could not produce document, then the Assessing Officer has to be given an opportunity to submit his report. This repor....
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....ould probablise the theory of gift. 22. Furthermore, the assessee did not place any material before the CIT(A) as to why the alleged additional income earned by the donor by doing consultancy work for a company in UAE was not produced by him before the Assessing Officer. The pre-requisite for accepting a new document at the first appellate stage is that the assesee should show sufficient cause. This is lacking in the instant case. Had the assessee produced the document before the Assessing Officer in all probabilities, an investigation would have been conducted. Considering the income of the donor, a salaried person in United States, the Assessing Officer rightly concluded that the probability of a salaried nephew giving a gift to his un....