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Issues involved: Deletion of addition under section 68 of the Income-tax Act, 1961.
Summary: The appeal was filed by the Revenue against the deletion of an addition of Rs. 20,05,000 under section 68 of the Income-tax Act, 1961. The assessee claimed that the amount was withdrawn from his capital account and invested in shares, with gifts given through demand drafts. The CIT(A) deleted the addition after considering the deposits and withdrawals made by the assessee, as well as the purchase and sale of shares. However, the Revenue contended that the assessee failed to prove the source of the gifted amount and investments. The Tribunal noted discrepancies in the explanations provided by the assessee and concluded that the onus of proof was not met. As a result, the order of the CIT(A) was set aside, and the A.O.'s order was restored. The Tribunal emphasized that the assessee's explanations regarding the source of funds for gifts and share investments were not satisfactory. The Tribunal found that the withdrawals made by the business concern did not conclusively prove that the funds were personally withdrawn by the assessee. Additionally, the lack of evidence, such as a Wealth Tax return or balance sheet, raised doubts about the source of the funds. The Tribunal highlighted the absence of documentation regarding share transfers and income declaration, further weakening the assessee's case. Ultimately, the Tribunal concluded that the assessee failed to discharge the burden of proof, leading to the allowance of the Revenue's appeal.
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