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2016 (3) TMI 238 - ITAT MUMBAIRevision u/s 263 - Claim of receipt of gift - Section 56 v/s 68 - Held that:- Section 56 of the Act grants exemption for bringing into tax such income under the head income from other sources. But, however, section 68 of the Act contemplates that with respect to any credit in the books, it is an obligation cast upon the assessee to explain the credit as appearing in the books of the assessee to the satisfaction of the A.O. by establishing the identity and creditworthiness of the creditors and genuineness of the transaction. This initial and primary burden is cast upon the assessee u/s 68 of the Act to establish the identity and creditworthiness of the donor and to substantiate that the transaction is genuine. Thus, both the sections viz. Section 56 and 68 of the Act operate in different field whereas Section 56 of the Act deals with computation of the income of the tax payer under the head ‘Income from other sources’ which provides relief in case of receipts from close relatives as defined u/s 56 of the Act while Section 68 of the Act is placed under Chapter VI of the Act which deals with ‘Aggregation of income and set off or carry forward of loss’ and Section 68 of the Act cast primary onus on the assessee to explain nature and source of cash credit as appearing in the books of the assessee to the satisfaction of the AO and failure to explain the cash credit to the satisfaction of the AO shall lead to computation of income from undisclosed sources under the head ‘Income from other sources’. Thus, in our considered view based on the facts as emanating from the records, the A.O. has not made any enquiry or verification before accepting the gift of ₹ 1.48 crores received by the assessee from his maternal uncle, Mr Chimanlal Mehta and has merely accepted the submissions of the assessee with respect to receipt of said gift and the Pr. CIT has rightly invoked the provisions of section 263 of the Act directing the A.O. to make proper enquiry and reframe the assessment. The case laws relied upon by the assessee are not applicable in this case as in the instant appeal, the AO has not made any inquiries or verification which should have been made to satisfy the ingredients of Section 68 of the Act and has merely accepted the submissions of the assessee with respect to the gift of ₹ 1,48,00,000/- received by the assessee from his maternal uncle . - Decided against assessee
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