M.M.KUMAR, J. - (1.) 2006 (Annex. A.5) passed by the Income -tax Appellate Tribunal, Chandigarh Bench 'A', Chandigarh (for brevity, 'the Tribunal') in ITA No. 884/Chd/2001 in respect of asst. yr. 1997 -98 upholding the addition of Rs. 4 lacs on account of NRI gift given to the assessee.
(2.) AT the hearing, it is claimed that the following two substantive questions of law would arise for determination of this Court : "(i) Whether in the facts and circumstances of the case, the Hon'ble Tribunal was correct in law in confirming the addition of Rs. 4 lacs received by the assessee/ appellant as a bogus gift even though the same had been received through banking channels and it had been proved that the parties were known to each other ? (ii) Whether in the facts and circumstances of the case after having proved the credibility and capacity of the donor, it was further necessary for the donee to prove the 'occasion' for making the gift even though as per the definition of 'gift', a gift is deemed to be transaction without consideration -
(3.) DURING the course of assessment proceedings for the asst. yr. 1997 -98, the AO included a sum of Rs. 4 lacs for the purposes of assessment which was introduced by the assessee in his capital account claiming a sum to be a gift received from Shri Arun Wangoo, an NRI from United Kingdom. Before making addition, assessee was granted opportunity to discharge the burden of proving the gift of sum of Rs. 4 lacs. The AO refused to accept the gift as genuine by recording the following reasons : "(a) There was no occasion on this particular date when the gift has been received. (b) The credential and the status of the donor remain unproved in the absence of his examination. (c) There exists no relationship between the donor and donee, in other words, and they are stranger to each other. (d) There is no permission of RBI for making this gift. (e) Person from whom the assessee has received gift of Rs. 4,00,000 does not fall in the definition of relative as defined in s. 5(ii)(e) of the GT Act." On appeal to the Commissioner of Income -tax (Appeals) [for brevity, 'the CIT(A)'], the additions so made by the AO were deleted by holding that the assessee was aware of the names of the wife and children of the donor, his relatives and friends in Chandigarh. It was further held that the AO did not bring on record any material to prove that the gift was not genuine and that the assessee had received the gift from a close friend on account of assessee's ill -health. The CIT (A) also recorded his finding that the donor had the capacity to make the gift and, therefore, the genuineness of the gift could not be doubted. The CIT(A) placed reliance on the judgment of the Tribunal in the case of R.K. Syal vs. Asstt. CIT (2000) 66 TTJ (Chd) 656 in [ITA No. 1165/Chd/1996], to support the conclusion that once the affidavit of the donor affirming the gift has been filed then the initial onus of the assessee to prove the gift stood discharged.;