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2007] 292 ITR 552 [2008] 167 TAXMAN 143 (DELHI) HIGH COURT OF DELHI Commissioner of Income-tax, Delhi (Central) - II v. Anil Kumar MADAN B. LOKUR AND V.B. GUPTA, JJ. IT APPEAL NO. 875 OF 2006 MARCH 13, 2007 Section 68 of the Income-tax Act, 1961 - Cash credits - Assessment year 1995-96 - Assessee had received two gifts of certain amount from NRE accounts of two donors - However, assessee had not placed on record anything to show as to what was financial capacity of donors, what was creditworthiness of donors, what kind of relationship donors had with assessee, what were sources of funds gifted to assessee and whether donors had capacity of giving large amount of gift to assessee - Whether Tribunal was justified in deleting addition on account of gifts alleged to have been received by assessee - Held, no FACTS The assessee had received two gifts of Rs. 10 lakhs each from the NRE accounts of the two donors. The Assessing Officer observed that the assessee had filed no evidence to prove the capacity of the donors for giving these substantial gifts. The assessee in his reply stated that he had submitted the form of gift deeds, the affidavits of the donors, the copies of the passport of the two donors and the bank certificates confirming the payment by pay order from the NRE accounts of the two donors. However, the Assessing Officer was not satisfied with the reply of the assessee and observed that the assessee had not discharged his onus of proving the creditworthiness of the donors and, accordingly, treated the amount declared by the assessee as gift to be his income and added the same to his income under section 68. The Commissioner (Appeals) as well as the Tribunal deleted the said addition on the ground that the said gifts received by the assessee were genuine. On appeal: HELD From the s of the High Court of Delhi in CIT v. R.S. Sibal [2004] 269 ITR 429/ 135 Taxman 492 and Sajan Das & Sons v. CIT [2003] 264 ITR 435/ 128 Taxman 621 , the position which emerged is as under: (i )mere identification of donor and showing the movement of gift amount through banking channels is not sufficient to prove the genuineness of the gift. (ii )since the claim of the gift…

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