INCOME TAX OFFICER Vs. SUBHASH CHAWLA

JUDGEMENT

(1.) THIS is department's appeal for assessment year 2005 -06 against the order dated 21.10.2013 passed by learned CIT(A), Jalandhar, challenging the action of the ld. CIT(A) in deleting the addition of Rs. 13,74,467/ - as against total addition of Rs. 16,56,176/ - made by the AO on account of unaccounted income of the assessee u/s. 68 of the Income -tax Act, 1961.

(2.) THE assessee is proprietor of M/s. Chawla Forex and New Chawla Jean House. He filed his return of income for the year under consideration, declaring income of Rs. 2,85,100/ -. Vide assessment order dated 31.12.2007, the income of the assessee was assessed at Rs. 19,83,470/ -. While doing so, the AO, inter alia, made addition of Rs. 16,56,176/ - u/s. 68 of the Act. While doing so, the AO observed that in the capital account of the assessee, appearing in the books of account of M/s. Chawla Forex, there were four credits totaling to Rs. 16,56,176/ -; that on query, the assessee submitted that these credits were on account of gifts made by his brother, who was settled in Italy; that the assessee was asked to prove the identity and creditworthiness of the donor; that the assessee produced a few documents written in the Italian language; that these were claimed to be bank statements of the donor; that the assessee was asked to file the translated version of these documents; that a certificate from Canara Bank, Tanda was filed, which document, while giving DD number, certified that the said credits in assessee's bank account were on account of foreign drafts; that the name and address of the sender or even the country of origin was not specified; that the assessee also filed photocopies of two bank drafts issued by the foreign bank in the name of the assessee; that the translated version of the bank account showed that the account was in the name of one Shri Rohan Chawla, whereas the name of the assessee's brother, as per copy of his passport, was Ram Chander Chawla; that to this, the assessee explained that his brother had changed his name in 2003, for which, notice in the newspaper had been given; that the photocopy of newspaper dated 16.03.2003 had been filed as evidence in this regard; that there was no evidence with the assessee regarding identity of the donor, his creditworthiness, or the confirmation of the transaction, or the occasion on which the alleged donation was given by the donor. It was on these facts, that the AO made addition of the amount under consideration, i.e., Rs. 16,56,176/ -, to the income of the assessee.

(3.) AGGRIEVED , the department is in appeal before us.