D.A.MEHTA - (1.)The Income Tax Appellate Tribunal, Ahmedabad Bench A has referred the following two questions under Section 256(2) of the Income Tax Act, 1961 (the Act) at the instance of the assessee:
[1] Whether on the facts and circumstances of the case, the ITO was justified in reopening the assessment u/s 147(a) of the I.T. Act [2] Whether, in the facts and circumstances of the case, the Tribunal was justified in holding that the addition of Rs.50,000/- in the total income of the assessee is income from undisclosed sources

(2.)The assessment year is 1981-82 and the accounting period is Samvat Year 2036. The assessee, an individual, had filed a return of income accompanied by a copy of his capital account in the partnership firm where he was a partner. The capital account contained a credit entry showing a sum of Rs.50,000/- as gift received. The assessment was originally completed on 25th August 1981 under Section 143(1) of the Act. On 30/6/1981, Shri Ramji Nanji, the donor, had filed a return of gift in respect of the above stated gift of Rs.50,000/- and the assessment came to be completed under Section 15(3) of the Gift Tax Act, 1958 vide order dated 17/3/1986. On the same day i.e. 17/3/1986, the assessing officer, having jurisdiction over the assessee, recorded reasons to the effect that he believed that the assessee had failed to furnish fully and truly all material facts relevant for assessment of his income chargeable to tax and hence, such income had escaped assessment within the meaning of section 147(a) of the Act. Notice under section 148 of the Act was issued and served on the assessee on the same day, namely, 17/3/1986. According to the assessing officer, the gift of Rs.50,000/- received by the assessee on 29/7/1980 was not a genuine gift and was liable to be taxed as unexplained income being the credit in the capital account. During course of re-assessment proceedings, the assessing officer examined the assessee on oath as well as Shri Ramji Nanji. After appreciating the evidence which had come on record, the assessing officer came to the conclusion that the credit of Rs.50,000/- appearing in the capital account remained unexplained; that the alleged receipt of gift from Ramjibhai was not genuine, and was nothing but assessee's own undisclosed income which had been credited to the assessee's capital account.
(3.)The assessee carried the matter in appeal before the Deputy Commissioner of Income Tax (Appeals), who vide order dated 22nd December 1988, allowed the appeal holding that the re-assessment proceedings were bad in law as the same were based on suspicion and change of opinion since all the materials were on record. On merits, he came to the conclusion that the gift was genuine, the donor having accepted the factum of gifting the amount by way of demand draft, and that the assessee had discharged the onus which was on the assessee. He, therefore, deleted the addition of Rs.50,000/- made by the assessing officer.