9911796707
TMI Blog2010 (8) TMI 740X X X X Extracts X X X X X X X X Extracts X X X X ..... was almost equal to the lower gross profit declared. The trading results of the assessee were, thus, rejected and the addition of 22,01,000 was treated as undisclosed income of the assessee. In view thereof, the alleged gifts received from NRIs by the partners were the undisclosed income of the assessee-firm in the facts and circumstances of the present case - substantial question of law is answered in favour of the Revenue. X X X X Extracts X X X X X X X X Extracts X X X X ..... sented unexplained income of the assessee. The transaction could be gift if there was genuine love and affection, which was not established. Learned counsel for the Revenue referred to the finding recorded by the Commissioner of Incometax (Appeals) noticing the proceedings before the Assessing Officer that the amounts were received by the assessee-firm from NRIs. The NRIs who purportedly made the gifts were not produced. The partners in whose account the amount was credited were also not produced except three. The donors were strangers and had no relationship with the said partners. The partners were also not familiar to the NRIs who allegedly made the gifts. There was corresponding deposit in the accounts of the NRIs even before the gifts ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n below : Rs. 1. Sh. Sewa Singh 2,44,000 2. Sh. Parkash Singh 5,50,000 3. Sh. Ajit Singh 2,50,000 4. Sh. Parabjit Singh 1,00,000 5. Sh. Gajinder Singh 2,57,000 6. Sh. Sarabjit Singh 5,70,000 7. Sh. Jaswinder Singh 3,00,000 8. The Assessing Officer, after appreciating the evidence, had concluded that the gifts from the NRIs were not genuine. The relevant observations read thus : "In the present case, the assessee has received the gifts from strangers who are not at all related to the assessee in any manner. The statements of the three donees clearly show that the donors are complete strangers to them. Thus there is no reason why the donors should gift a sum of ₹ 22,01,000 to the donees. As regards the me ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t of the assessee this year should have been ₹ 62.57 lakhs as against the declared gross profit of ₹ 41.26 lakhs. Thus the assessee has declared less gross profit by ₹ 21.31 lakhs. The reasons advanced by the assessee for lower gross profit rate are not convincing. The assessee's partners have received alleged gifts amounting to ₹ 22,01,000 which amount is almost equal to the lesser gross profit declared by the assessee. The assessee therefore has understated his gross profit rate with a view to show the receipt of alleged gifts on which no tax was payable by the assessee. The trading results of the assessee are therefore rejected. Addition of ₹ 22,01,000 is therefore made to the returned income of the asse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ndisclosed income by way of deposit by a partner. 11. Now, adverting to the facts of the present case, a finding had been recorded by the Assessing Officer that in the previous year, the gross profit declared by the assessee was 4.39 per cent., i.e., ₹ 57.17 lakhs whereas it was 2.9 per cent. i.e. ₹ 41.26 lakhs in the current year. Applying the previous year's gross profit rate of 4.39 per cent. to the current year, it was noticed that the gross profit of the assessee would have been ₹ 62.57 lakhs as against the declared gross profit of ₹ 41.26 lakhs giving a difference of ₹ 21.31 lakhs. No plausible explanation had been furnished by the assessee for lower gross profit in the current year and the amount o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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