THE INCOME TAX OFFICER-19(3)(2), MUMBAI v. RIYAZ QURESHI AHMED, MUMBAI

ITA 5679/MUM/2009 | 2006-2007
Pronouncement Date: 29-07-2011 | Result: Partly Allowed

Appeal Details

RSA Number 567919914 RSA 2009
Assessee PAN ALARY4000R
Bench Mumbai
Appeal Number ITA 5679/MUM/2009
Duration Of Justice 1 year(s) 9 month(s) 7 day(s)
Appellant THE INCOME TAX OFFICER-19(3)(2), MUMBAI
Respondent RIYAZ QURESHI AHMED, MUMBAI
Appeal Type Income Tax Appeal
Pronouncement Date 29-07-2011
Appeal Filed By Department
Order Result Partly Allowed
Bench Allotted D
Tribunal Order Date 29-07-2011
Date Of Final Hearing 19-05-2011
Next Hearing Date 19-05-2011
Assessment Year 2006-2007
Appeal Filed On 22-10-2009
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH D : MUMBAI BEFORE SHRI R.V. EASWAR (PRESIDENT) AND SHRI RAJENDRA SINGH (ACCOUNTANT MEMBER) ITA NO. 5679/MUM/2009 ASSESSMENT YEAR :2006-07 THE INCOME TAX OFFICER WARD 19(3)(2) ROOM NO.306 3 RD FLOOR PIRAMAL CHAMBERS PAREL LALBAUG MUMBAI-400 012. ..( APPELLANT ) VS. RIYAZ QURESHI AHMED B-57/58 LAKDIWALA GALI BEHRAM NAGAR BANDRA (E) MUMBAI-400 051. ..( RESPONDENT ) P.A. NO. (ABNPR 900 N) APPELLANT BY : SHRI M.R. KUBAL RESPONDENT BY : MS. RE EPAL TRALSHAWALA O R D E R PER RAJENDRA SINGH (AM). THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST THE ORDE R DATED 3.8.2009 OF CIT(A) FOR THE ASSESSMENT YEAR 2006-07. TH OUGH THE ASSESSEE HAS RAISED SEVERAL GROUNDS OF APPEAL THE ONLY EF FECTIVE GROUND IS REGARDING ADDITION ON ACCOUNT OF GIFT RECEIVE D AMOUNTING TO RS.53.00 LACS. 2. BRIEFLY STATED THE FACTS OF THE CASE ARE THAT THE ASSE SSEE FOR THE RELEVANT YEAR HAD DECLARED INCOME OF RS.85 149/- IN TH E RETURN FILED ON ITA NO.5679/M/09 A.Y:06-07 2 22.11.2006. IN THIS RETURN THE BALANCE IN THE CAPITAL ACCOUNT WAS SHOWN AT RS.3 92 746/-. THE ASSESSEE SUBSEQUENTLY REVISED THE RETURN ON 8.3.2007 IN WHICH THE TOTAL INCOME DECLARED WAS RS.1 41 230/- AND THE BALANCE IN THE CAPITAL ACCOUNT WAS INCREASED TO RS.57 55 746/-. THE ASSESSEE IN THE REVISED RETURN HAD SH OWN GIFTS RECEIVED OF RS.46.00 LACS FROM MR. AHMAD Q. QURESHI AND RS.7.00 LACS FROM MR. ZORAR A. QURESHI. THE ASSESSEE EXPLAINED THAT HE HAD FOUR BROTHERS NAMELY MR. AHMAD Q. QURESHI ZULFIKAR Q. QUR ESHI ZORAR Q. QURESHI AND EJAZ Q. QURESHI WHO WERE RESIDING IN SAUDI ARABIA AND WERE DOING BUSINESS WITH SAUDI PARTNERS. THE ASSESSING OFF ICER THEREAFTER ASKED THE ASSESSEE TO FILE DETAILS OF BUSINESS A CTIVITIES STATEMENT OF P&L ACCOUNT AND BALANCE SHEET CERTIFIED BY AUDITORS AND DETAILS OF PROPERTIES OWNED BY THE DONOR BROTHERS. TH E ASSESSEE THEREAFTER SUBMITTED THAT ALL THE BROTHERS WERE WORKI NG ON SALARY BASIS FOR THE LAST TWENTY YEARS. THE DETAILS OF THEIR EMPLOY MENT AND SALARY EARNED BY THEM WAS GIVEN AS UNDER :- SR. NO. NAME OF THE EMPLOYER NAME OF THE EMPLOYEE GIST OF CONFIRMATION 1 M/S. ABO IRABHIM MUTTON SHOP MR. ZORAR AHMAD QUIRESHI HE IS WORKING AS CASHIER AVERAGE MONTHLY SALARY 4000 RIYAL. 2 M/S. ABO IRABHIM MUTTON SHOP MR. ZULFIKAR AHMAD QUIRESHI HE IS WORKING AS SUPERVISOR AVERAGE MONTHLY SALARY 4500 RIYAL 3 M/S. AL ATIQ TRADING EST. MR. AHMED QUDDUS QUIRESHI HE IS WORKING AS A SALES MANAGER AVERAGE MONTHLY SALARY 5000 RIYAL 4. - MR. EJAZ Q. QURESHI RS.4 000/- RIYAL PER MONTH ITA NO.5679/M/09 A.Y:06-07 3 2.1 THE ASSESSEE ALSO SUBMITTED COPIES OF THE PASSPORTS OF T HE BROTHERS ALONG WITH COPIES OF NRI BANK ACCOUNTS MAINTAINE D IN INDIA. IT WAS ALSO SUBMITTED THAT HIS BROTHERS DID NOT OWN ANY PROPERTY IN SAUDI ARABIA. IT WAS FURTHER SUBMITTED THAT HIS FAMI LY WAS JOINT FAMILY AND ALL THE BROTHERS WORKING IN SAUDI ARABIA GAVE TH EIR EARNINGS TO THEIR ELDER BROTHER MR. AHMAD Q. QURESHI WHO DECIDED WHETHER THE AMOUNT WAS TO BE KEPT WITH THEM OR SENT TO NRI ACCOUNT . IT WAS ALSO SUBMITTED THAT THEY HAD BOOKED A FLAT IN 2003 WITH M /S. EMPIRE ASSOCIATES FOR A CONSIDERATION OF RS.26.50 LACS. THE THREE BROTHERS HAD MADE PAYMENTS TO M/S. EMPIRE ASSOCIATES FROM NRI ACCOU NT. FURTHER AHMED Q. QURESHI AND ZORAR Q. QURESHI HAD AL SO GIFTED MONEY TO THE ASSESSEE ON 30.6.2005. ULTIMATELY THE B ROTHERS GIFTED THE FLAT TO THE ASSESSEE ON 20.4.2005 AND COST OF THE FLA T WAS TREATED AS GIFT TO THE ASSESSEE. THIS WAS THE REASON FOR REVISING T HE CAPITAL ACCOUNT OF THE ASSESSEE. THE DETAILS OF THESE TRANSACTIONS W ERE GIVEN BY THE ASSESSEE AS UNDER :- DATE AMOUNT BY WHOM IN WHICH ACCOUNT CHEQUE DEPOSITED 30.06.2005 23 00 000 AHMAD QUDDUS QURAISHI RIYAZ AHAMD ABDUL QUDDUS QURAISHI 30.06.2005 3 50 000 ZORRAR AHMAD QURAISHI RIYAZ AHMED ABDUL QUDDUS QURAISHI 28.02.2003 2 10 650 ZULFIQAR AHMAD QURAISHI EMPIRE ASSOCIATES 28.02.2003 2 89 350 ZULFIQAR AHMAD QURAISHI EMPIRE ASSOCIATES 11.07.2002 1 50 000 ZORRAR AHMAD QURAISHI EMPIRE ASSOCIATES 04.03.2002 5 00 000 ZORRAR AHMAD EMPIRE ASSOCIATES ITA NO.5679/M/09 A.Y:06-07 4 QURAISHI 04.03.2003 5 00 000 ZORRAR AHMAD QURAISHI EMPIRE ASSOCIATES 11.07.2002 5 00 000 AHMAD QUDDUS QURAISHI EMPIRE ASSOCIATES 07.02.2003 5 00 000 AHMAD QUDDUS QURAISHI EMPIRE ASSOCIATES 2.3 THE ASSESSING OFFICER THEREAFTER ASKED THE ASSESSEE TO SU BMIT THE COPY OF THE BANK ACCOUNTS MAINTAINED BY THE BROTHER S IN SAUDI ARABIA WHICH WAS NOT GIVEN ON THE GROUND THAT EMPLOYE ES IN SAUDI ARABIA WERE NOT ALLOWED TO OPEN BANK ACCOUNT IN THAT COUNTRY. ASSESSING OFFICER WAS NOT SATISFIED WITH THE EXPLANATION GI VEN REGARDING THE GIFT RECEIVED FROM THE BROTHERS. IT WA S OBSERVED BY HIM THAT THE ASSESSEE HAD NOT DECLARED ANY GIFT IN THE ORIGI NAL RETURN AND THAT IT WAS SHOWN ONLY IN THE REVISED RETURN. FURTHER IN THE INITIAL SUBMISSION THE ASSESSEE SUBMITTED THAT THE BROTHERS WERE D OING BUSINESS IN SAUDI ARABIA BUT LATER IN THE SUBMISSIONS FIL ED ON 17.11.2008 IT WAS SUBMITTED THAT THEY WERE SALARIED E MPLOYEES. REGARDING THE FINANCIAL CAPACITY OF THE DONORS THE A SSESSEE HAD FILED ONLY LETTERS FROM EMPLOYERS AND COPIES OF THE NRI ACCOUNT MAINTAINED IN INDIA. FROM THE EXAMINATION OF NRI ACCOUNT ASSESSING OFFICER OBSERVED THAT THE BROTHERS WERE REGULARLY SENDING SAVIN GS IN INDIA. THERE WERE HOWEVER SUBSTANTIAL DEPOSITS IN THE NRI ACCOUN TS BEFORE THE GIFTS WERE GIVEN OR BEFORE THE PAYMENTS WERE MADE TO M/S. EMPIRE ASSOCIATES. IT WAS NOT EXPLAINED AS TO WHERE SUCH SUBSTANTI AL AMOUNTS ITA NO.5679/M/09 A.Y:06-07 5 WERE PARKED IN SAUDI ARABIA BEFORE BEING REMITTED T O INDIA. THE FINANCIAL CAPACITY OF THE DONORS TO REMIT SUBSTANTIAL AM OUNT FOR MAKING GIFTS WAS NOT THUS ESTABLISHED. THE ASSESSING OFFICER THERE FORE AFTER APPLYING THE TEST OF HUMAN PROBABILITIES AND AFTER RE FERRING TO SEVERAL JUDGMENTS SUCH AS JUDGMENT OF HON'BLE SUPREME COURT IN T HE CASE OF CIT VS. P. MOHANAKALA (2007) (291 ITR 278) JUDGMENT OF HONBLE DELHI HIGH COURT IN THE CASE OF ACIT VS. RAJEEV TANDON (2007) (294 ITR 288) JUDGMENT OF HON'BLE SUPREME COURT IN THE CA SE OF D.P. MORE (82 ITR 540) AND IN THE CASE OF SUMATI DAYAL (214 ITR 801) CONCLUDED THAT THOUGH THE AMOUNT HAD COME FROM NRI ACCOUNTS OF TH E BROTHERS THE GIFTS WERE NOT GENUINE. THE ASSESSING OFFICER ACCORDIN GLY TREATED THE SUM OF RS.53.00 LACS AS INCOME FROM UNDISCLOSED SOURCES BRO UGHT IN THE BOOKS OF ACCOUNT UNDER THE GARB OF GIFTS. 2.4 IN APPEAL THE ASSESSEE SUBMITTED BEFORE THE CIT(A) THAT THERE WAS NO DISPUTE REGARDING IDENTITY OF DONORS WHO WERE THE BROTHERS OF THE ASSESSEE. THE BROTHERS WERE ALSO EARNING GOOD SALARY IN SAUDI ARABIA WHERE THEY HAD BEEN WORKING SINCE LONG. MR. Z ORAR A. QURESHI WAS WORKING SINCE 1982; MR. ZULFIKAR A. QURESHI SINCE 19 87 AND SHRI AHMED Q. QURESHI SINCE 1990. THE RATE OF RIAL WAS RS.14 /- AND AT THIS RATE SAVINGS OF THE THREE BROTHERS WAS COMPUTED AT RS.4 39 32 000/-. IT WAS ALSO POINTED OUT THAT THE AMOUNT OF RS.57.50 LA CS ( RS .53.00 LACS WRONGLY MENTIONED BY ASSESSING OFFICER) GIFTED TO TH E ASSESSEE ITA NO.5679/M/09 A.Y:06-07 6 CONSTITUTED ONLY 13% OF THE TOTAL EARNINGS. IT WAS ALSO SUBMITTED THAT THE PERSONAL EXPENSES SUCH AS FOOD AND ACCOMMODATION WERE M ET BY THE EMPLOYERS AND THEREFORE SAVINGS RATE WAS HIGH IN S AUDI ARABIA. DETAILS OF EARNINGS OF THE BROTHERS WERE GIVEN AS PER CH ART BELOW:- SR. NO. NAME OF BROTHER MONTHLY SALARY IN S RIYAL ANNUAL SALARY IN S RIYAL ANNUAL SALARY IN RS. TOTAL SAVING SINCE MIGRATION 1 AHMED Q. QURESHI 5000 60 000 8 40 000 1 34 40 000 2 ZULFIQAR A. QURESHI 4500 54 000 7 56 000 1 43 64 000 3 ZORAR A. QURESHI 4000 48 000 6 72 000 1 61 28 000 TOTAL 4 39 32 000 2.5 IT WAS FURTHER ARGUED BEFORE CIT(A) THAT PAYMENT S TO M/S. EMPIRE ASSOCIATES AS WELL AS GIFTS TO THE ASSESSEE HAD COME FR OM NRI ACCOUNTS AND THE DEPOSITS IN NRI ACCOUNTS WERE INWARD REMI TTANCES FROM ABROAD. THERE WERE NO CASH DEPOSITS IN THE ACCOUNTS. THE IDENTITY OF THE ACCOUNT HOLDERS WAS ESTABLISHED BY PASSPO RTS DEED OF GIFTS AND CONFIRMATION AND NRI ACCOUNTS DULY ATTESTED BY THE ATTACH OF EMBASSY OF INDIA. THE ASSESSEE ALSO SUBMITTED THAT THE VARIOUS JUDGMENTS RELIED UPON BY THE ASSESSING OFFICER WERE DISTIN GUISHABLE AS IN THOSE CASES THE DONEES WERE EITHER NOT RELATED TO THE ASSESSEE OR IDENTITY WAS NOT ESTABLISHED. CIT(A) WAS SATISFIED BY THE EXPLANATION GIVEN. IT WAS OBSERVED BY HIM THAT THE GIFT WAS FROM BLOOD RELATIONS AND THEREFORE GENUINENESS COULD NOT BE DOUBTED. CIT (A) ACCORDINGLY ITA NO.5679/M/09 A.Y:06-07 7 DELETED THE ADDITION MADE BY THE ASSESSING OFFICER AMOUN TING TO RS .53.00 LACS (ACTUAL RS.57.50 LACS). AGGRIEVED BY THE SAID DECISION THE REVENUE IS IN APPEAL BEFORE THE TRIBUNAL. 3. BEFORE US THE LD. DR APPEARING FOR THE REVENUE ASSAILED THE ORDER OF CIT(A). IT WAS SUBMITTED THAT THE GIFTS RECEI VED COULD NOT BE CONSIDERED AS GENUINE ONLY BECAUSE THE SAME HAD COME FROM BLOOD RELATIONS PARTICULARLY WHEN THE FINANCIAL CAPACITY OF T HE DONORS WAS NOT ESTABLISHED. IT WAS NOT EXPLAINED SATISFACTORILY AS TO H OW SUCH HUGE FUNDS REMITTED THROUGH NRI ACCOUNTS FOR MAKING GIFTS WER E PARKED IN SAUDI ARABIA. ADMITTEDLY THE DONORS WERE NOT MAINT AINING ANY BANK ACCOUNTS. IT WAS ALSO POINTED OUT THAT THE PLEA OF THE ASSESSEE MADE FOR THE FIRST TIME BEFORE CIT(A) THAT EMPLOYERS PROVI DED FOOD AND ACCOMMODATION WAS NOT SUPPORTED BY ANY EVIDENCE. HE ALSO REFERRED TO CONTRADICTORY STATEMENTS MADE BY THE ASSESSEE BEFORE TH E ASSESSING OFFICER. INITIALLY IT WAS SUBMITTED THAT THE BR OTHERS WERE DOING BUSINESS BUT THE POSITION WAS CHANGED LATER AND IT WAS STATED THAT THEY WERE SALARIED EMPLOYEES. SIMILARLY IN THE R ETURN THE GIFT WAS SHOWN FROM TWO BROTHERS BUT LATER IT WAS SUBMITTED THAT THE ASSESSEE HAD RECEIVED GIFTS FROM THREE BROTHERS. THE STATEMENT OF THE ASSESSEE WAS NOT RELIABLE AND THE GIFTS THEREFORE COULD NOT B E CONSIDERED AS GENUINE. IT WAS ACCORDINGLY URGED THAT THE ORDER OF CIT(A) SHOULD BE ITA NO.5679/M/09 A.Y:06-07 8 SET ASIDE. THE LD. AR FOR THE ASSESSEE ON THE OTHER HAND REITERATED THE SUBMISSIONS MADE BEFORE LOWER AUTHORITIES THAT THERE WAS NO DISPUTE ABOUT THE IDENTITIES OF THE DONORS WHO WERE BLOOD RE LATIONS AND WERE EARNING GOOD SALARY IN SAUDI ARABIA WHICH WAS SUPPORTE D BY EMPLOYER CERTIFICATE. THE MONEY HAD BEEN GIFTED THROUGH NRI A CCOUNT WHICH SHOWED THAT THE MONEY HAD COME FROM ABROAD. THE FOUR BROTHERS OF THE ASSESSEE WERE LIVING ABROAD AND WERE IN A POSITION T O MAKE THE GIFTS. THE CAPACITY TO GIFT WAS SUPPORTED BY THE SALA RY CERTIFICATES. IN RESPONSE TO THE QUERY BY THE BENCH IT WAS STATED THAT T HE TWO BROTHERS WERE LIVING WITH FAMILY IN SAUDI ARABIA WHI LE THE FAMILY OF THE OTHER TWO BROTHERS WERE LIVING WITH THE ASSESSEE WHO WAS LOOKING AFTER THEM. THE DONORS WERE OWN BROTHERS OF THE ASSESSEE AND T HEREFORE GENUINENESS COULD NOT BE DOUBTED. 4. WE HAVE PERUSED THE RECORDS AND CONSIDERED THE RIVAL CONTENTIONS CAREFULLY. THE DISPUTE IS REGARDING ADDITIO N ON ACCOUNT OF GIFTS CLAIMED TO BE RECEIVED BY THE ASSESSEE FROM NRI B ROTHERS. THE ASSESSEE HAS FOUR BROTHERS VIZ. AHMED Q. QURESHI ZORAR Q. QURESHI ZULFIKAR Q. QURESHI AND EIAZ Q. QURESHI WHO ARE WOR KING IN SAUDI ARABIA ON SALARY RANGING FROM 4000 TO 5000 RIYAL PE R MONTH. THE ASSESSEE HAD FILED SALARY CERTIFICATES FROM THE EMPLOYER S IN SAUDI ARABIA. THE ASSESSEE HAD ALSO FILED COPY OF PASSPORTS AND COPY OF NRI ITA NO.5679/M/09 A.Y:06-07 9 ACCOUNTS OF THE BROTHERS DULY ATTESTED BY EMBASSY OF INDIA . THERE IS NO DISPUTE ABOUT THE IDENTITY OF THE FOUR BROTHERS W ORKING IN SAUDI ARABIA. THE DISPUTE IS ONLY REGARDING GENUINENESS OF G IFTS BY THE BROTHERS. THE CLAIM OF THE ASSESSEE IS THAT THE BROTHERS H AD BOOKED A FLAT WITH M/S. EMPIRE ASSOCIATES TO WHICH PAYMENTS TOTALIN G RS.31.00 LACS HAD BEEN MADE BY THE THREE BROTHERS VIZ. AHMED Q. QURESHI ZORAR Q. QURESHI ZULFIKAR Q. QURESHI DURING THE PERI OD 11.7.2002 TO 4.3.2003. THE FLAT WAS ULTIMATELY TRANSFERRED IN THE NAME OF ASSESSEE ON 20.4.2005 AND TREATED AS GIFT FROM THE BROTHERS. IN ADDITION AHMED Q. QURESHI AND ZORAR Q. QURESHI HAD ALSO TRANSFE RRED SUMS OF RS.23.00 LACS AND RS.3.50 LACS RESPECTIVELY TO THE ASSESSEES A CCOUNT FROM THEIR NRI ACCOUNT ON 30.6.2005 WHICH HAS BEEN SHOWN BY THE ASSESSEE AS GIFT. THUS THE TOTAL AMOUNT INVOLVED IN GIFT IS RS.57.50 LACS AND NOT RS.53.00 LACS AS MENTIONED BY THE ASSESSING OFFI CER. THIS FACTS HAS BEEN DULY NOTED BY THE CIT(A) AND THERE IS NO DISPUTE ABOUT THE FACTUAL POSITION. 4.1 THE CASE OF THE ASSESSEE IS THAT THE THREE BROTHERS HA D SUBSTANTIAL SAVINGS IN SAUDI ARABIA WHERE THEY HAD BEEN WORKING SINCE LAST SEVERAL YEARS. THE GROSS SALARY IN CASE OF THREE BROT HERS HAD BEEN COMPUTED AT RS.4 39 32 000 AND EXPLAINED THAT GIFT CON STITUTED ONLY ABOUT 13% OF GROSS SALARY AND THEREFORE SOURCE OF GIFT WAS ITA NO.5679/M/09 A.Y:06-07 10 SATISFACTORILY EXPLAINED. THERE ARE HOWEVER SEVERAL DISCREPANCIES IN THE VERSION OF THE ASSESSEE DULY NOTED BY THE AO. IN THE ORIGINAL RETURN ASSESSEE HAD NOT DECLARED ANY GIFT WHICH WAS ONLY SH OWN IN REVISED RETURN. FURTHER IN THE REVISED RETURN GIFT WA S FROM TWO BROTHERS BUT LATER IT HAS BEEN SUBMITTED THAT GIFTS WERE FROM T HREE BROTHERS. IT HAS ALSO BEEN POINTED OUT THAT INITIALLY ASSESSEE EXPLAIN ED THAT BROTHERS WERE DOING BUSINESS BUT LATER ON SAID THAT THEY WERE WORKING AS SALARIED EMPLOYEES. FURTHER IT HAS BEEN POINTED OUT THAT BROTHERS HAVE BEEN REGULARLY SENDING SAVINGS IN INDIA TO NRI ACCO UNTS BUT THERE WERE SUBSTANTIAL DEPOSITS IN THE NRI ACCOUNTS BEFORE THE GIVING OF GIFTS OR MAKING PAYMENTS TO EMPIRE ASSOCIATES IN AMOUNTS VARYIN G FROM RS.5.00 LACS TO RS.20.00 LACS. THESE FACTS ARE NOT IN DISPU TE. THE ASSESSEE HAD NOT EXPLAINED SATISFACTORILY HOW THE ASSESSEE HAD PARKED SUBSTANTIAL FUNDS IN CASH IN SAUDI ARABIA AS ADMITTEDLY N O ACCOUNT HAD BEEN OPENED IN SAUDI ARABIA. AT THE TIME OF HEARING BEFORE US IT WAS SUBMITTED THAT ACCUMULATED SAVINGS HAD BEEN DEPOSITED WIT H EMPLOYERS BUT NO SUPPORTING EVIDENCE HAS BEEN FILED. N O SUCH PLEA HAD BEEN TAKEN BEFORE THE LOWER AUTHORITIES. THUS THE RE IS NO EVIDENCE ON RECORD TO PROVE THAT THE ASSESSEE HAD ACCUMULATED SAVING S KEPT IN CASH IN SAUDI ARABIA FROM WHICH DRAFTS HAD BEEN PREPA RED IN AMOUNTS VARYING FROM RS.5.00LACS TO RS.20.00LACS AND REMITTED TO NRI ACCOUNTS BEFORE MAKING THE GIFTS OR MAKING PAYMENTS TO EMPIRE ASSOCIATES. ITA NO.5679/M/09 A.Y:06-07 11 4.2 IN SUCH CASES WHERE NO EVIDENCE IS AVAILABLE CONCLUSION H AS TO BE DRAWN AFTER CONSIDERING THE SURROUNDING CIRCUMSTANCES A ND APPLYING THE TEST OF HUMAN PROBABILITY. IT IS A SETTLE D LEGAL POSITION AS HELD BY HONBLE SUPREME COURT IN CASE OF DURGA PRASAD MORE (SUPRA) THAT FOR GIVING FINDINGS ON ANY FACTUAL SITUATION REV ENUE AUTHORITIES ARE ENTITLED TO LOOK INTO THE SURROUNDING CIRCUMSTANCES AND A PPLY THE TEST OF HUMAN PROBABILITY. THE BROTHERS OF THE ASSESSEE ARE WORKING IN A FOREIGN COUNTRY. IT IS NOT UNDERSTOOD WHY THEY HAVE N OT OPENED BANK ACCOUNT THERE. IT HAS BEEN SUBMITTED THAT THEY ARE NOT AUTHORIZED TO OPEN BANK ACCOUNT IN SAUDI ARABIA WHICH CANNOT BE ACCEPT ED. IN ANY CASE EVEN IF THEY DID NOT HAVE BANK ACCOUNT THEY HAD NRI ACCOUNTS IN INDIA TO WHICH THEIR SAVINGS WERE REGULARLY REMITTED. IT IS NOT UNDERSTOOD WHY THEY WERE NOT SENDING ALL THEIR SAVINGS TO NRI ACCOUNT FOR SAFE KEEPING. IT IS UNBELIEVABLE THAT THE PERSON IN A FOREIGN COUNTRY WOULD KEEP HUGE CASH WITH EMPLOYERS THERE WHICH IS HIGHLY RISKY PARTICULARLY WHEN THE SAVINGS CAN BE EASILY REMITTE D TO NRI ACCOUNT. IT IS HIGHLY IMPROBABLE THAT SOMEONE WILL KEE P HUGE CASH WITH EMPLOYERS IN FOREIGN COUNTRY. THE AMOUNTS CLAIMED TO BE ACCUMULATED IN CASH AND SENT TO NRI ACCOUNT ARE SUBSTANTIA L. FOR EXAMPLE THERE IS DEPOSIT OF RS.20.00 LACS ON 4.5.05 IN NRI ACCOUNT OF AHMED A. QURESHI AND RS.10.00 LACS ON 27.2.2003 IN THE ACCOUNT OF ZORAR Q. QURESHI SOURCE OF WHICH IS EXPLAINED AS ACCUMULAT ED CASH ITA NO.5679/M/09 A.Y:06-07 12 SAVING KEPT IN CASH IN SAUDI ARABIA. THERE IS ALSO NO E VIDENCE PLACED ON RECORD TO SHOW THAT THERE WERE SUCH HUGE SAVINGS FROM SALARY INCOME BY THE BROTHERS IN SAUDI ARABIA. A CLAIM WAS MA DE FOR THE FIRST TIME BEFORE THE CIT(A) THAT FOOD AND ACCOMMODATION EX PENSES WERE MET BY THE EMPLOYER WHICH WAS NOT SUPPORTED BY ANY EV IDENCE. EVEN BEFORE US NO EVIDENCE HAS BEEN PLACED ON RECORD REGARDIN G THIS. THE ASSESSEE HAD NOT SHOWN ANY GIFTS IN THE ORIGINAL RETURN. CONSIDERING THE ENTIRETY OF THE FACTS AND CIRCUMSTANCES AND TAKING I NTO ACCOUNT HUMAN PROBABILITY WE HAVE TO CONCLUDE THAT CLAIM OF T HE ASSESSEE THAT THE BROTHERS HAD ACCUMULATED SAVINGS IN CASH KEPT WITH EM PLOYERS CANNOT BE ACCEPTED. THEREFORE THE SOURCE OF DEPOSITS IN NRI ACCOUNT FROM WHICH THE AMOUNTS HAVE BEEN RECEIVED BY THE ASSESSEE AS GIFTS OR FROM WHICH PAYMENTS HAD BEEN MADE TO EMPIRE ASSOCIATE S IN RESPECT OF FLAT WHICH WAS GIFTED TO THE ASSESSEE IS NOT EXPL AINED SATISFACTORILY. 4.3 MERELY BECAUSE THE AMOUNTS HAD BEEN GIVEN THROUGH CHEQUE FROM NRI ACCOUNT THE GENUINENESS OF TRANSACTION CANNOT BE ACCEPTED PARTICULARLY WHEN THE SOURCE IS NOT EXPLAINED SATISFACTOR ILY. IT HAS BEEN HELD BY THE HONBLE SUPREME COURT IN THE CASE OF P.MOHANAKALA (SUPRA) THAT THE GENUINENESS OF TRANSACTION CANNOT BE DE CIDED ONLY BASED ON THE FACT THAT THE TRANSACTION WAS THROUGH BANK ING CHANNELS. THE ENTIRE FACTS AND SURROUNDING CIRCUMSTANCES HAVE TO BE SEEN. IN ITA NO.5679/M/09 A.Y:06-07 13 THE CASE OF SUMATI DAYAL (SUPRA) THE ASSESSEE HAD SHOWN IN COME IN SUCCESSIVE YEARS FROM WINNINGS FROM JACKPOTS IN HORSE RACES. T HERE WAS NO DISPUTE THAT THE MONEY HAD BEEN RECEIVED FROM HORSE RACE CLUBS AND ON THE BASIS OF WINNING TICKETS. BUT CONSIDERIN G THE SURROUNDING CIRCUMSTANCES: THE ASSESSEE HAD NO EXPERIENCE IN HORSE RACES; SHE WAS ALWAYS WINNING AND HAD NO LOSSES; THERE WERE NO EXPENSES SHOWN FOR VISITING THE HORSE RACE EVENTS IT WAS HELD BY THE HON'BLE SUPREME COURT THAT INCOME SHOWN AS WINNINGS IN H ORSE RACES WAS NOT GENUINE AND IT AS THE INCOME OF THE ASSESSEE FRO M UNDISCLOSED SOURCES. CONSIDERING THE ENTIRETY OF FACTS AND CIRCUMSTANCES WE REJECT THE CLAIM OF THE ASSESSEE THAT THE AMOUNTS CREDITED IN THE BANK ACCOUNT OF THE ASSESSEE WERE GIFTS RECEIVED FROM THE BROTH ERS AS THE SOURCE IS NOT EXPLAINED SATISFACTORILY. THE GIFTS CANNOT BE ACCEPTED AS GENUINE ONLY ON THE GROUND THAT THE SAME WERE RECEIV ED FROM OWN BROTHERS WHEN SOURCE OF DEPOSITS IN THEIR NRI ACCOUNTS IS NO T EXPLAINED SATISFACTORILY. THE AMOUNTS HAVE TO BE TREATED AS INC OME OF THE ASSESSEE.HOWEVER WE MAY POINT OUT THAT OUT OF TOTAL SUM OF RS.57.50 LACS A SUM OF RS.31.00 LACS HAD BEEN PAID IN THE FINANCI AL YEAR 2002- 03 AND THEREFORE SAID AMOUNT CANNOT BE ADDED TO THE I NCOME OF THE ASSESSEE IN THE ASSESSMENT YEAR UNDER CONSIDERATION. THE AMO UNT RECEIVED DURING THE YEAR WERE RS.23.00 LACS FROM AH MED Q. QURESHI ITA NO.5679/M/09 A.Y:06-07 14 AND RS.3.50 LACS FROM ZOARAR Q. QURESHI TOTALING TO RS.2 6.50 LACS. THE ADDITION IS THEREFORE UPHELD ONLY TO THE EXTENT OF RS.26.50 LACS. 5. IN THE RESULT THE APPEAL OF THE REVENUE IS PARTLY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 29.7.2011. SD/- SD/- (R.V. EASWAR) (RAJENDRA SINGH ) PRESIDENT ACCOUNTANT MEMBER MUMBAI DATED: 29.7.2011. JV. COPY TO: THE APPELLANT THE RESPONDENT THE CIT CONCERNED MUMBAI THE CIT(A) CONCERNED MUMBAI THE DR BENCH TRUE COPY BY ORDER DY/ASSTT. REGISTRAR ITAT MUMBAI.