9911796707
TMI Blog1984 (12) TMI 100X X X X Extracts X X X X X X X X Extracts X X X X ..... inding also took into account the result of examination of books of account of M/s Mill Stores Bearing Co. by him during assessment of gift tax for the asst. yr. 1975-76. To this finding of fact he applied s. 4(5A) of the WT Act, 1957 (for brevity the Act) which was inserted by the Taxation Laws (Amendment) Act, 1972 w.e.f. 1st April, 1976. Thus the gift was not taken genuine and Rs. 1,00,000 were added to the wealth of the assessee. The AAC of WT concurred with the finding of the WTO and as such dismissed the appeals of the assessee for both the years. Hence the assessee is in second appeal for both the years. 2. Arguments of ld. representative for the assessee are these: (1) Provisions of s. 4(5A) of the Act which came into force ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... into effect. 5. Field of this issue has been fully covered by the judgment of the Hon'ble Delhi High Court in the case of Indian Glass Agency vs. CIT (1982) 26 CTR (Del) 394 : (1982) 137 ITR 245 (Del). Following excerpts from the said judgment can be advantageously referred to: "A gift cannot be said to have been made merely because the owner of a business makes entries in his books of account without an allocation of funds corresponding to such entries.........In such cases, there should be something more than mere book entries to show that a gift has been made........ But there is a substantial difference between a case where such entries are made in the books of account belonging to assessee himself and a case where the gift is e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... onees or that the firm, family or company accepted the transaction by effecting necessary book entries, and that these entries have been further implemented by the donees being permitted to draw upon the accounts to which monies have been credited, the validity of the gifts would be upheld. "On the other hand, the circumstances may clearly indicate that no real gift had been made or intended." 6. It appears that in view of the transfer by books entries, the tax authorities below sought evidence of physical delivery of money by the assessee to the donees. It is not the requirement of law that in case of gift by book entries there should be physical delivery of money by the donor to the donee. The word "actually" in s. 4(5A) should not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d in favour of the donees. Such enquiry is necessary for finding out genuineness of the gift. 9. It is argued by representative for the assessee that the gift was accepted as genuine in the wealth-tax assessment for the year 1975-76. This statement of facts needs verification. If that is so, there appears no fresh cause of action for making enquiry into the genuineness of the gift. In that event, the department does not get fresh ground for treating the amount of the said gift as wealth of the assessee. 10. Learned representative for the assessee also contended that the gift was in fact assessed to tax in the asst. yr. 1975-76 and, therefore, by virtue of the said assessment, it should be treated as genuine. We do no agree with this a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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