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TMI Blog2013 (12) TMI 1310X X X X Extracts X X X X X X X X Extracts X X X X ..... er on the facts and in the circumstances of the case, the Tribunal was right in law in deciding the deletion of addition of Rs. 10,00,000/- on account of the aforesaid gift, while the financial capability of the donor and the genuineness of the gift could not be established by the assessee and there was also no evidence before the Hon'ble Tribunal regarding the purpose for which the gift was given? 2. The present controversy relates to Assessment year 1996-97. The return of income to the tune of Rs. 28,92,297/- was filed by the assessee in January, 1997 and processed under Section 143 (1) (a) by the Assessing Authority. A notice under Section 143 (2) of the Act was issued and the case was selected for scrutiny. During the course of scr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ove creditworthiness. The CIT Appeal noted that the donor has mentioned the NRE account, the name of the bank and the cheque number by which the gift was given. The extracts of NRE account were also furnished which indicated that in his NRE account the donor has a sum of about Rs. 40 lacs. Out of this amount Rs. 10,00000/- was given to the assessee as gift. The copy of the income tax return of both the donor and his wife filed in USA were also filed. Their income in the year 1995 was US$ 1.16 lacs. From perusal of these two returns, CIT Appeal arrived to the conclusion that the assertion of Tribunal was not correct. Accordingly, CIT Appeal deleted the amount of Rs. 10,00000 with a finding of genuine gift transaction between the assessee and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the person, who has given the money. The observation made by a Division Bench of this Court for convenience is reproduced as under:- "It is a settled principle of law that under Section 68 of the Act is any amount is found credited in the books of account of the assessee the burden lies upon the assessee to prove its nature and source. While proving the same the assessee has to prove the identity of the person, genuineness of the transactions and creditworthiness of the person who has given the money." There appears to be no dispute about the proposition of law with regard to creditworthiness. 7. Section 68 of the Income Tax Act is reproduced as under:- "Where any sum is found credited in the books of an assessee maintained for any p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ord is US$.1.16 lacs. 11. The submission of the learned counsel for the appellant that the Assessing Authority was not satisfied with the explanation submitted by assessee hence rightly the amount of Rs. 10,00000/- was added as additional income of the assessment year in question, seems to be misconceived argument. The satisfaction of the Assessing Authority is not a mechanical one. Assessing Authority discharge a quasi judicial duty under the Income Tax Act and accordingly the satisfaction must not be arbitrary but it should be judicious based on the evidence or material on record. In the present case, the income tax return of the donor namely Dr. Chitranjan Jain and his wife Nisha Jain was filed before the Assessing Authority. No finding ..... X X X X Extracts X X X X X X X X Extracts X X X X
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