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Issues:
- Addition of unexplained gifts from NRI - Dispute over genuineness of gifts and donor's identity Analysis: Issue 1: Addition of unexplained gifts from NRI The Assessing Officer (AO) added the amount of gifts received by the assessee from an NRI to the assessee's income from undisclosed sources. The AO based this decision on the lack of documentary evidence regarding the NRI account in India, incomplete addresses, and the absence of proof of the NRI account from which the amount was withdrawn. The CIT(A) deleted this addition after the assessee provided evidence that the gifts were sent from the UK by the donor, who was a permanent UK resident. The CIT(A) found the gifts to be genuine and deleted the addition. The Revenue appealed this decision. Issue 2: Dispute over genuineness of gifts and donor's identity The Revenue argued that the CIT(A) wrongly deleted the addition as the donor's relationship with the assessee was misrepresented, the affidavit was attested in Ambala City, and the AO's reasoning for the addition was valid. The assessee clarified that the donor was his uncle permanently settled in the UK, and the gifts were sent through international money orders. The Tribunal noted that the AO did not dispute the gifts' receipt or credit in the assessee's account. The Tribunal found the donor's relationship discrepancy insufficient to doubt the gifts' genuineness. The Tribunal criticized the AO for not seeking clarification from the assessee or the donor before making the addition. Ultimately, the Tribunal upheld the CIT(A)'s decision to delete the addition, emphasizing the genuineness of the gifts and the lack of justification for the AO's adverse presumption. In conclusion, the Tribunal dismissed the appeal, affirming the CIT(A)'s decision to delete the addition of unexplained gifts from the NRI.
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