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Issues Involved: Determination of whether gifts received by the assessees from illiterate farmers were genuine or income from undisclosed sources.
Summary: 1. The common grievance in all appeals by the Revenue was the direction by the Dy. CIT(A) to exclude gifts received by the assessees, deemed non-genuine by the Assessing Officer, from the total income. 2. Dr. J.J. Kansagara (Individual), Dr. (Smt.) Daxaben J. Kansagara, Dr. Pradeep J. Kansagara (Individual), and Dr. J.J. Kansagara (HUF) received gifts from illiterate farmers, which the AO deemed as undisclosed income. 3. The AO found the gifts suspicious as the donors were financially, socially, and academically lower than the donees, and the gifts were made in a short period, suggesting a managed affair. 4. The Dy. CIT(A) held that the AO lacked independent reasons for treating the gifts as income, as the donors confirmed the gifts, provided evidence of agricultural income, and the gifts were made by cheques/drafts. 5. The Revenue argued that the gifts were an attempt to convert black money into white, but the assessees' counsel emphasized the donors' statements and evidence of agricultural income. 6. The Tribunal noted the disparity between the donors and donees, the protective gift-tax assessments on the donors, and the abnormal behavior of the assessees in seeking gifts from strangers. 7. Applying the test of human probabilities, the Tribunal found the gifts from strangers to be non-genuine, citing legal precedents where gifts from unrelated individuals were deemed suspicious. 8. The Tribunal upheld the AO's decision to treat the gifts as income from undisclosed sources, reversing the Dy. CIT(A)'s findings. 9. Consequently, the appeals by the assessees were allowed.
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