Income Tax Appellate Tribunal - Delhi
Mrs. Jyotsna Suri vs Deputy Commissioner Of Income-Tax on 3 January, 1997
Equivalent citations: [1997]62ITD185(DELHI)
ORDER
Chopra, A.M.
1. These four appeals of the Tax Payers are directed against common order dated 25-11-1995 of the learned Commissioner of Income-tax (Appeals)-XV, New Delhi. We find it convenient to dispose of these appeals in a consolidated order, the facts, circumstances and the grounds of appeal being identical, excepting that in Appeal No. 477 the assessee has taken one more ground of appeal, i.e., Ground No. 12 regarding disallowance of Rs. 67,000 on account of low drawings.
2. The relevant facts are that all four appellants are individuals. They filed their returns of income as under :-
Date of filing Income declared
of return
Shri Lalit Suri 21-8-1992 Rs. 89,490 including
salary from Bharat
Hotels Ltd. (Rs. 1,13,400)
Mrs. Jyotsna Suri 28-8-1992 Rs. 1,01,460 including
salary from Bharat Hotels
Ltd. (Rs. 1,15,200)
Miss Divya Suri 28-8-1992 Rs. 91,993 including
income from other sources
(Rs. 98,993)
Miss Deeksha Suri 28-8-1992 Rs. 80,778 including
income from other
sources (Rs. 87,777)
The assessments were framed in their cases on 28-3-1995 under section 143(3) of the Income-tax Act, 1961 in the case of Shri Lalit Suri at Rs. 78,39,640, including Rs. 77,33,952 added under section 68 of the Income-tax Act, in the case of Mrs. Jyotsna Suri at Rs. 52,64,530, including Rs. 51,55,968 added under section 68 of the Act ; in the case of Miss Deeksha Suri at Rs. 39,47,750 including Rs. 38,66,976 added under section 68 and in the case of Miss Divya Suri at Rs. 39,58,970 including Rs. 38,66,976 added under section 68 of the Act. The only dispute in these appeals (barring disputed addition of Rs. 67,000 in the case of Shri Lalit Suri) is against additions made under section 68 by the Assessing Officer, as sustained by the learned CIT(A), also keeping in view provisions of section 69A as discussed in paras 17-18 of his order. In their statement of income attached with the returns, the appellants by way of note indicated that the following amounts received and deposited in their accounts in Hong Kong & Shanghai Banking Corporation Ltd. on 22-11-1991 under the Remittance of Foreign Exchange and Investment in Foreign Exchange Bonds (Immunities & Exemptions) Act, 1991 and the scheme issued thereunder (for short referred to as 'The Scheme') are not income :-
Shri Lalit Suri US $ 3,00,000 equivalent to Rs. 77,33,952 Mrs. Jyotsna Suri US $ 2,00,000 equivalent to Rs. 51,55,968 Miss Divya Suri US $ 1,50,000 equivalent to Rs. 38,66,976 Miss Deeksha Suri US $ 1,50,000 equivalent to Rs. 38,66,976
3. The Assessing Officer issued notices under sections 143(2) and 142(1) and noted that the return filed by the assessee did not contain any evidences in the form of copy of the declaration to be made before the Authorised Dealer of Foreign Exchange, as prescribed in the Notification, GSR No. 594 dated 28-9-1991 of the Reserve Bank of India, and the return only contained photocopy of the instrument of remittances. He, therefore, called upon the assessee to file a copy of the prescribed declaration. He noted that the assessee did not file the same in spite of the fact that a number of adjournments were sought for the purpose. The Assessing Officer on his own wrote a letter on 13-1-1995 to Hong Kong & Shanghai Bank wherein the remittances from abroad were lodged and requested the Bank of furnish a copy of the declaration filed by the assessee with a view to ascertain the compliance of relevant provisions of the Scheme. The bank in their reply dated 18-1-1995 informed the Assessing Officer that no declaration under the Scheme had been filed by the appellant. The Assessing Officer accordingly took up the matter with the assessee vide his letter dated 27-1-1995 and forwarded the communication received from the Bank to the appellant and brought to the notice of the appellant the provisions of section 3(1)(a) of the Scheme dealing with immunities, which for the sake of convenience has also been reproduced in his communication as under :-
"3. Immunities - (1) Notwithstanding anything contained in any other law for the time being in force -
(a) no recipient, who claims immunity under this Chapter in accordance with such Scheme as the Reserve Bank of India may, by notification in the Official Gazette, specify for the purposes of receiving remittances under this Chapter, shall be required to disclose, for any purpose whatsoever, the nature and source of the remittance made to him."
3.1 The Assessing Officer informed the assessee that as "the D.D. in question has not been processed in accordance with the notified Scheme of Reserve Bank of India, you are not eligible to the immunities provided under the Act". The Assessing Officer, therefore, required the assessee to file his written submissions about the basis on which the receipt claimed as coming under the purview of the Scheme and to show cause why enquiry and investigation should not be commenced against him. The Assessing Officer noted that after taking some adjournments the assessee filed letter dated 14-2-1995 but had not addressed to the query raised directly. The assessee requested for some more time to locate the declaration, the assessee having remembered to have filed the same. The assessee also informed the Assessing Officer that the remittances were received during the currency of the Scheme and necessary evidence of money having been received had already been filed. The assessee further informed the Assessing Officer that filing of the declaration was only a procedural matter, directory in nature and not mandatory. The Assessing Officer by means of his letter dated 27-1-1995 drew the attention of the assessee to the provisions of the Scheme as also of the Act. He also pointed out that assessee's statement regarding filing of the declaration before the Hong Kong & Shanghai Bank was categorically denied by the Bank. He, thus, called upon the assessee to discharge the burden of proof regarding the sources of the remittances, failing which the receipt would be treated as unexplained income under section 68 of the Income-tax Act. He requested the assessee for compliance on 28-2-1995. On the date given the assessee sought adjournment as also subsequently when the matter was adjourned on 8-3-1995, 14-3-1995, 21-3-1995 and finally to 27-3-1995. He found no further communication coming from the appellant and noting that assessment is getting time barred when it would not be possible to wait indefinitely, he framed the assessment on 28-3-1995. Taking note of the fact that the Bank had categorically denied the filing of declaration by the appellant and the appellant having also not furnished any evidence regarding source of remittance, he treated the amounts involved as unexplained cash credit under section 68 of the Income-tax Act.
4. The assessee went in appeal before the learned CIT (Appeals) contesting the addition made. During the course of appellate proceedings the assessee also submitted that after passing of assessment order, he had filed a letter along with enclosures (Gift Deed) in the office of the Assessing Officer, as evidence in support of his claim that the amount received under the Scheme represented non-taxable gifts, such evidence being "Gift deed" from Shri Jayant Nanda, his wife's brother. The assessee also made written submissions before the learned CIT (Appeals) to the effect that the amount involved did not represent his income and the filing of declaration was a formality. The learned CIT (Appeals) took up the matter with the Assessing Officer, as also referred to the plea of the assessee that remittances in question have been received as gifts from Shri Jayant Nanda from Dubai and as such the same could not be treated as unexplained cash credit under section 68 of the Income-tax Act. The Assessing Officer countered the submissions of the assessee in his reply dated 21-8-1995 to the learned CIT (Appeals) and also submitted that before him it has never been the case of the assessee that the remittances are in the nature of gifts and as such any information in this regard filed after the assessment order constituted an additional evidence which could not be admitted under rule 46A on the facts and in the circumstances of the case when the assessee has been given ample opportunity to explain the source of remittance as also it was made very clear in terms of letter as early as on 21-2-1995 that assessee should discharge the burden of proof regarding the source of above remittances, failing which the receipt would be treated as unexplained cash credit under section 68 of the Income-tax Act. The assessee even thereafter filed certificates issued by Middle East Bank in August 1995 before the learned CIT (Appeals) in support of such gifts having been made by Shri Jayant Nanda, whose financial position was certified by the Bank in their certificates. The appellant, thus, made a request that these papers be taken as additional evidence by the learned CIT (Appeals). The learned CIT (Appeals), however, rejected the prayer of the appellant when he noted that the assessee has not made out any ground which could be specifically covered by rule 46A. The evidence now sought to be adduced having not been filed before the Assessing Officer and no reasons also given as to why the same could not be filed. The learned CIT (Appeals) further noted that proper and sufficient opportunity had been allowed by the Assessing Officer to the assessee to bring evidence on record to prove the nature and source of the amounts, as required by section 68 of the Act but the appellant "chose not to comply with the requirements". He, thus, held that on these facts and under these circumstances "it cannot be now pleaded that the appellants were prevented by sufficient cause from producing these documents before the Assessing Officer". The learned CIT (Appeals) noted that while all the evidence sought to be admitted before him have been obtained only recently, even the declaration from Shri Jayant Nanda, which though undated but is attested on 5-2-1995 was not filed before the Assessing Officer, the same having been filed only on 31st March, 1995 with the Assessing Officer when the assessment already stood concluded on 27th March, 1995 and assessment framed on 28th March, 1995. The learned CIT(A) duly took note of the show-cause notices issued by the Assessing Officer on 27-1-1995, and again on 21-2-1995 and the conduct of the assessee in submitting before the Assessing Officer time and again that his claim was covered under the Amnesty Scheme. The learned CIT(A) also noted that the assessee did not even bother to attend the proceedings adjourned for 27th March, 1995. He, thus, rejected the request made by the assessee for admission of the documents as additional evidence. He also noted that the assessee had not discharged the burden of proving the nature and source of the amounts involved and, therefore, upheld the view of the Assessing Officer that the amounts represented appellants' income chargeable to tax. The learned CIT(A) also noticed that the appellants had not contended before the Assessing Officer as also before him that the provisions of section 68 were not applicable. All the same he duly took note of the provisions of section 69A also before he confirmed the addition made by the Assessing Officer (Paras 17, 18 pages 12, 13 of CIT(A)'s order). The learned CIT(A) also held that the assessee has not qualified himself for grant of exemption under the Scheme, the requisite declaration having not been filed, such filing of declaration being mandatory. He thus upheld the finding of the Assessing Officer. The assessee is in appeal before us.
5. The learned Authorised Representative for the assessee Shri R. Ganeshan submitted that claim of the appellant is two-fold : one, whether the learned CIT(A) erred in not admitting the evidence filed after the completion of assessment proceedings as also during the course of appellate proceedings, and (two) that the amount involved cannot be treated as assessee's income. He submitted that the appellant had claimed the amounts as not representing his income, being remittances under the Scheme. The learned Authorised Representative invited our attention to letter dated 27th January, 1995 of the Assessing Officer to the assessee, in particular paragraph 6 thereof, as also letter dated 21st February, 1995 of the Assessing Officer addressed to the assessee and assessee's reply dated 14-2-1995 at page 6 of the paper book, as also further letter dated 24-2-1995 at page 10 of the paper book, which is addressed to Exchange Control Department, Reserve Bank of India. He further referred to letter dated 27th March, 1995 from Reserve Bank of India to the assessee and submitted that it has been the claim of the appellant that the amount represented remittances under the Scheme and, therefore, no enquiry could be made by the Assessing Officer. Shri Ganeshan submitted that having failed to locate the declaration, the appellant started collecting evidence in reply to Assessing Officer's notice that the amount would be treated as assessee's income under section 68 of the Income-tax Act. He further submitted that the appellant subsequently procured the evidence in the form of declaration from Shri Jayant Nanda, as attested on 2nd of February, 1995, which according to Shri Ganeshan, is Gift Deed and with a view to establish the financial capacity of Shri Jayant Nanda the assessee also filed copies from his bankers in the Middle East which were procured in August 1995 and adduced before the learned CIT (Appeals) for admission as evidence. In this connection, he invited our attention to evidence on record at pages 29 to 36 of the paper book, which are certificates from Bankers of Shri Jayant Nanda, as also copy of declaration dated 5-2-1995 and submitted that the learned CIT (Appeals) erred in not admitting the evidence so adduced.
5.1 Advancing his submissions further the learned Authorised Representative submitted that when immunity is not available then what is to be seen is whether the receipt is income. In this connection he referred to judgment of Calcutta High Court in the case of Shankar Industries v. CIT [1978] 114 ITR 689. Shri Ganeshan referred to photocopy of return of income of the assessee indicating that the appellant had duly placed on record photostat copies of bank drafts from Bankers abroad (Middle East) showing remittance in terms of dollars and the drafts, which were received during the period of currency of the Scheme, i.e., on 16-11-1991 as encashed on 22-11-1991 by credit to account of the appellant with Hong Kong Bank.
5.2 Referring to order of the CIT (Appeals) (Para 8, page 5 of the order) on rule 46A, Shri Ganeshan submitted that admittedly the Assessing Officer had given two months time to the assessee when he informed the assessee by his letter dated 27-1-1995 that the appellant had not complied with the requirement of submitting declaration, as required under the Scheme and the assessee has been seeking adjournment for furnishing the same on more than one occasion. The Assessing Officer further informed that he at his own had ascertained from Hong Kong Bank that no such declaration was filed by the appellant when a copy of communication received from the Bank was also made available to the assessee and his attention invited to section 3(1)(a) of the relevant Scheme dealing with immunities. The Assessing Officer while informing the assessee that as he had not complied with the requirement as envisaged under the Scheme, he is not eligible for the immunity, as claimed, called upon the assessee to indicate "the basis on which the above receipt is being considered as coming under the purview of the Amnesty Scheme and show cause why enquiry or investigation should not be commenced by the undersigned." Shri Ganeshan submitted that the time of two months allowed by the Assessing Officer was not enough since the donor was foreign based and supporting material was to be collected from the bank in support of capacity of the donor. Shri Ganeshan submitted that some evidence was already on record in the form of photocopies of the drafts. He submitted that the learned CIT (Appeals) ought to have admitted the evidence in terms of rule 46A to render substantial justice to the appellant. Shri Ganeshan placed reliance on Electra (Jaipur) (P.) Ltd. v. IAC [1988] 26 ITD 236 (Delhi) in support of his submission for admission of additional evidence and also referred to judgment of Calcutta High Court in the case of CIT v. Soorajmul Nagarmul [1983] 139 ITR 239.
5.3 Shri Ganeshan submitted that the amount involved was received by way of foreign bank drafts through normal banking channel and evidence to this effect was furnished with the return itself and it is on the basis of this very evidence that the Assessing Officer made enquiries from the bank to find out as to whether the appellant had filed any declaration, as required under the Scheme. No doubt, according to Shri Ganeshan, the learned Authorised Representative, it has always been the stand of the appellant that the amount was received under the Scheme and, therefore, not open to enquiries/investigation, yet he is not debarred from contending even before the Tribunal that though the amount was claimed immune under the Scheme but the same represented gifts not chargeable to tax. In support of this proposition, he relied on Kerala High Court judgment in the case of CIT v. Khairunnissa Ebrahim [1993] 201 ITR 903, as also CIT v. Mahalakshmi Textile Mills Ltd. [1967] 66 ITR 710 (SC). He also invited our attention to appellant letter dated 21-3-1995 filed before the Assessing Officer submitting, inter alia, that the amount represented personal gifts. The learned Authorised Representative also invited our attention to written submissions dated 28-7-1995, 22-9-1995 and 25-10-1995 as made before the learned CIT(A) forming part of the paper book at pages 12 to 20 in support of his claim that the amount involved was by way of gifts from abroad.
5.4 Referring to the Scheme, Shri Ganeshan submitted that though declaration provided immunity from enquiry, the filing of such declaration was not mandatory but only directory in nature. He took us through the provisions of Remittance of Foreign Exchange and Investment in Foreign Exchange Bonds (Immunities & Exemptions) Act, 1991/Scheme, as also placed on record a copy of the form of declaration.
5.5 Reverting back to his submissions in support of the claim that the amount involved was on account of gifts from abroad, Shri Ganeshan submitted that the learned CIT (Appeals) in para 15 of his order has mentioned that the identity of the donor was informed to the Assessing Officer. Shri Ganeshan submitted that the two months' time given by the Assessing Officer requiring the assessee to discharge the onus cast upon him was not adequate, since to establish capacity of the donor evidence was required which could be obtained only in August 1995 by way of certificate from Bankers (in Middle East) of Shri Jayant Nanda. It was, therefore, stressed that sufficient time was not allowed to the appellant and in the circumstances the evidence adduced before the learned Commissioner of Income-tax (Appeals) ought to have been admitted by him.
5.6 On merits, the learned Authorised Representative referred to section 68 of the Income-tax Act and submitted that the appellant has no books of accounts there being only a bank statement. Shri Ganeshan submitted that before the Assessing Officer could bring the amount to charge as assessee's income there should have been enough provocation for the Assessing Officer to treat the amount as not satisfactorily explained, when on the other hand, there is some evidence before the Assessing Officer himself in the form of photocopies of bank drafts issued by Middle East Bank, encashment of these drafts being the amount credited in assessee's bank account on 22-11-1995. This, according to the learned Authorised Representative, afforded reasonable evidence and the learned Commissioner of Income-tax (Appeals) ought to have considered whether such evidence is sufficient or not to hold that the remittance is not income or the remittance would be income of the assessee. He submitted that it is nobody's case that photocopies of the drafts are not satisfactory evidence. Referring to the judgment of Hon'ble Supreme Court in the case of Grindlays Bank Ltd. v. ITO [1980] 122 ITR 55/3 Taxman 38, Shri Ganeshan stressed that there should have been some provocation for the Assessing Officer to conclude that the remittance represented assessee's income, as what is taxable under the Income-tax Act is income of the assessee and it was the duty of the learned Commissioner (Appeals) to consider the evidence to determine whether the amount represented assessee's income. In this connection, the learned Authorised Representative referred to Supreme Court judgment in the case of CIT v. Rai Bahadur Hardutroy Motilal Chamaria [1967] 66 ITR 443 at pages 449 and 450. Shri Ganeshan submitted that evidence submitted deserved scrutiny at least and, therefore, the remittance could not be treated as assessee's income. He stressed that the time of 2 months given by the Assessing Officer was not enough.
6. The learned Departmental Representative, Shri Syali, Advocate on claim of the appellant for admission of additional evidence pointed out that there is not even an application for admission of additional evidence under rule 46A before the learned CIT (Appeals). Not only this even in the grounds of appeal taken before the CIT (Appeals) there is no mention of such additional evidence. Shri Syali submitted that it is within the discretion of the appellate court to admit additional evidence but this discretion is to be exercised within the four corners of law. He submitted that the person who invokes the provisions for admission of additional evidence must establish that he was prevented by sufficient cause from obtaining the evidence sought to be admitted as additional evidence apart from the fact that he must also establish by conduct that the claim made is on bona fide grounds. Shri Syali submitted that nowhere at any stage the appellant had prayed that he was prevented by sufficient cause from procuring the additional evidence, inasmuch as even in written submissions dated 28-7-1995 as filed before the learned CIT (Appeals) there is no mention of rule 46A. Advancing his arguments Shri Syali submitted that the statute does not confer any right on the assessee for admission of additional evidence, rather it casts an obligation on the appellant to show sufficient cause before invoking the provisions of rule 46A. He pointed out that it is only on 25th October, 1995 when for the first time the appellant in his written submissions at page 19 of the paper book mentioned about Rule 46A and nowhere before. Shri Syali pointed out there is no application either on the part of the assessee for admission of such additional evidence. Shri Syali took us through the manner in which the learned CIT (Appeals) has dealt with this issue by referring to para 5, page 7 of the order of the learned CIT (Appeals) calling upon the appellant to explain as to why the documents could not be filed before the Assessing Officer and why the same should be admitted at the appellate stage keeping in view the provisions of rule 46A of the Income-tax Rules. Shri Syali pointed out that the assessee in turn submitted that the CIT(A) has wide powers for admitting additional evidence and the provisions of rule 46A should not be interpreted in a restrictive manner. He pointed out that it was submitted before the learned CIT (Appeals) that under sub-rule (4) of rule 46A, the learned CIT (Appeals) himself can call for additional evidence to enable him to dispose off the appeal. Shri Syali submitted that what the assessee sought before the learned CIT (Appeals) was that the evidence should be admitted by the learned CIT(A), as required by him to enable him to dispose off the appeal. Shri Syali pointed out that even the declaration of Shri Jayant Nanda, which is admittedly attested on 5-2-1995 and as such was already there, was not filed even before completion of assessment in 28th March, 1995 obviously for the reason that it has never been the case of the appellant that the amounts represented gifts from Shri Nanda. Shri Syali submitted that it has all along been the stand of the assessee not only up to the stage of assessment but also thereafter that the amount received is under the Scheme and, therefore, the assessee enjoyed immunity from enquiry and investigation. On the other hand, the Assessing Officer by notice dated 9-11-1992 issued under section 143(2) conveyed to the appellant that his case was to be finalised under section 143(3) requiring production of evidence and material on the part of the appellant in support of the return filed. This, according to Shri Syali, should have alerted the assessee for filing the declaration claiming immunity. Shri Syali submitted that in case the assessee did not want any enquiry regarding the nature and source of receipt of money from abroad, then it was his duty to file the declaration, which admittedly has not been filed at any stage. He in particular invited our attention to appellant's letter dated 24-2-1995 addressed to the Reserve Bank of India admitting having not filed the declaration, yet the appellant did nothing whatsoever to meet the show-cause notice issued by the Assessing Officer dated 27-1-1995, in particular para 6 as also vide notice dated 21-2-1995. He invited our attention to order-sheet entries, copy of which was made available to the learned Authorised Representative for the assessee, particularly entry dated 24th October, 1994 calling upon the assessee to furnish evidence of foreign exchange received and subsequent entry dated 23rd December, 1994 requiring the assessee to file certificate from the Bank in the prescribed form under the Immunity Scheme of 1991. He submitted that thereafter a number of hearings took place, yet the assessee neither filed the required declaration nor any such evidence in support of the claim that the amount received represented gifts from abroad. He submitted that it is only on 21st of March, 1995 when the assessee while reiterating before the Assessing Officer that he had received remittances in foreign exchange through normal banking channel under Amnesty Scheme, 1991, the assessee had applied to the Reserve Bank of India for grant of appropriate certificate as per the Amnesty Scheme and such certificate would be received in two or three days mentioned that "the sum received outside India by the assessee were given by the remitter as personal gifts and were sent in India to us at our request for which the evidence confirming the same can be filed." Shri Syali submitted that there is admission on the part of the assessee that the sums were received by the assessee himself outside India but given by the remitter as personal gifts. He submitted that the identity of the remitter is not even mentioned in this letter even though the Assessing Officer had given his mind as early as on 21-2-1995. Shri Syali submitted that even in the concluding portion of this letter the assessee assured the Assessing Officer that "certificate from the Reserve Bank of India will be filed before your honour by Monday or Tuesday of the next week", when the assessee did not attend any proceedings.
In this connection, Shri Syali referred to the observations of the learned CIT (Appeals) in paragraph 15 of his order that "at best, it can be said in their favour that the identity of the donor was informed to the Assessing Officer, is not factually correct when such identity was made known only after conclusion of the assessment proceedings on 28-3-1995 when the assessee filed the papers including the so-called Gift Deed which in fact as is also admitted by the learned Authorised Representative for the appellants, is the declaration attested on 5-2-1995, of the alleged donor. Shri Syali also questioned the placing of letter dated 29-3-1995 as addressed to the Assessing Officer in the paper book of the appellant (page 27) and invited our attention to his specific objection raised on this count before the Bench, vide order sheet dated 23-10-1996 and pointed out that the objection taken be upheld and the letter be not treated as part of record, since the appellants have not complied with the requirement of the Bench. He submitted that it is only on 31-3-1995 that the appellants filed the two papers (including declaration of the donor which is the so-called Gift Deed) before the Inspector of Income-tax. Having heard the learned representatives, we uphold the objection taken by Shri Syali with regard to paper book page 27, i.e., letter dated 29-3-1995 and direct that this is not a part of the record.
Shri Syali emphasised that it has all along been the case of the appellant that the amount was received under the Scheme so that he is not investigated. This stand was not only before the Assessing Officer, as also before the CIT(A) but even after the passing of the appellate order when the assessee wrote a letter dated 7-12-1995 to Shri Montek Singh Ahluwalia, Finance Secretary, Government of India reiterating that the amounts were received under the Remittance of Foreign Exchange and Investment in Foreign Exchange Bonds (Immunity & Exemption) Act, 1991 and the Scheme made thereunder. On the other hand, the assessee wanted the evidence to be admitted in support of his plea that the gifts were received from abroad from Shri Jayant Nanda, a blood relation, and, therefore, the same did not represent his income. Shri Syali pointed out that power to admit additional evidence is discretionary and it is only to be seen that the discretion is rightly exercised or not. He referred to various judgments of the Hon'ble Supreme Court governing the circumstances under which additional evidence could be admitted, including Delhi Service Forum & others in 'Judgment Today' Vol. 2 SC 295 at page 304 and Tata Cellular v. Union of India AIR 1996 SC 11 at page 28, para 29.
6.1 Shri Syali submitted that the Tribunal has to address itself as to whether the learned CIT(A) has taken irrelevant considerations into account for not admitting the additional evidence or has ignored relevant consideration in doing so or his conclusion is such that it is shocking to the conscience. He submitted that the view taken by the learned CIT(A) is not militated by any of these aspects. He submitted that "sufficient cause" has to come from the assessee and in this case the appellants had not even attempted to file the additional evidence before the Assessing Officer when admittedly two months' time was given. He referred to Allahabad High Court judgment in the case of Jagannath Prasad Kanhaiya Lal v. CIT [1988] 171 ITR 596/36 Taxman 239 at pages 602 to 603 on his proposition relating to "sufficient cause".
6.2 On the plea of substantial justice as raised by the appellants, Shri Syali submitted that full and proper opportunities were given and admittedly at least more than two months' time was allowed to them when it was made known to them that they would not come under the Immunity Scheme having not filed the declaration and the provisions of section 68 of the Income-tax Act would be invoked, yet the appellants did nothing whatsoever to satisfy the Assessing Officer regarding inapplicability of the revisions of section 68. On the other hand, the Assessing Officer even approached the Bank on his own with a view to assist the assessee in locating the declarations claimed as filed and when he drew a blank and a negative reply, he informed the appellants of his stand as also of his intentions. Manifestly, according to Shri Syali, the assessees have not been acting in a bona fide manner as even after the results of Assessing Officer's enquiry made known to them, they went on to lead the Assessing Officer to believe that they are going to file the necessary declaration. There is no mention of any attempt either being made by the appellants for collecting the so-called additional evidence. He submitted that under rule 46A, the word is 'sufficient cause' and for discharging the onus of proving 'sufficient cause', the burden is heavier on the assessees vis-a-vis 'good cause'. He referred to Supreme Court judgment in the case of Arjun Singh v. Mohindra Kumar AIR 1964 SC 993 at 999 para 8. Shri Syali also submitted that the appellants have not acted in right manner, omission is wilful and their conduct not bona fide and, therefore, plea of substantial justice is not available to them. He referred to Sarpanch, Lonand Grampanchayat v. Ramgiri Gosavi AIR 1968 SC 222 in support of his proposition that before the assessee can legitimately claim substantial justice, there has to be no negligence, nor inaction nor want of bona fide as imputable to the appellant. He, therefore, submitted that on facts of the case the discretion was rightly not exercised in favour of the appellants when there has been negligence, inaction and lack of bona fides on their part. He invited our attention in particular, to para 3, page 3 and again paras 7 and 8 at page 5 of the order of the learned CIT(A) demonstrating lack of bona fide on the part of the appellants while proper and sufficient opportunities were given by the Assessing Officer for satisfying the provisions of section 68 of the Income-tax Act and at no point of time the appellants even whispered that they were collecting evidence from abroad for satisfying conditions under section 68 much less praying for more time for this purpose. He also referred to page 6 onwards of order of the CIT(A) and submitted that the learned CIT(A) has made five points in his order, (i) no declaration was filed for claiming immunity under the Scheme while adjournments were sought only for the purpose of filing of declaration ; (ii) declarations were neither filed nor reasons given for not filing ; (iii) proper and sufficient opportunity was granted to the appellants for adducing the so-called additional evidence ; (iv) there is no rebuttal of applicability of the provisions of section 68 of the Income-tax Act, and (v) additional evidences are not contemporaneous. Shri Syali submitted that evidence must be credible and relevant. He submitted that the Bank Certificates filed by the appellants are irrelevant pieces of evidence, being dated 1995 and not 1991 when the alleged gifts were made. He referred to Allahabad High Court judgment in the case of Ram Prasad Sharma v. CIT [1979] 119 ITR 867/2 Taxman 469 at page 871 and submitted that repeated opportunities were given by the Assessing Officer to produce evidence in support of the claims made, as also the Assessing Officer made his mind known to the appellants, yet they chose not to act and, on the other hand, kept on harping on the plea of immunity under the Scheme. This, according to Shri Syali, is nothing but a case of wilful negligence and mis-leading the Assessing Officer. He submitted that the reliance placed by the learned Authorised Representative for the assessee on Electra (Jaipur) (P.) Ltd.'s case (supra) is not of any help, the same being not applicable being entirely on different facts. On CIT v. Saligram Prem Nath [1989] 179 ITR 239/45 Taxman 322 (Punj. & Har.), as relied upon by Shri Ganeshan, Shri Syali submitted the Hon'ble High Court directed admission of additional evidence only when it was noted that the appellant was not given an opportunity to be heard, which is not the case with the appellants, when on the other hand, in these cases the Assessing Officer has given full and repeated opportunities, made his stand known, informed the appellants that the bank enquiry did not support their cases. Nothing more was required to be done by the Assessing Officer while nothing was done by the appellants.
6.3 On the declaration prescribed under the Immunity Scheme being mandatory or directory, Shri Syali referred to the word 'shall' used for purposes of filing of the declaration, as also the intention of the Legislature. He submitted that the declaration is prescribed to distinguish the remittances under the Scheme from other remittances and, therefore, unless there was declaration the remittance would not qualify for acceptance under the Scheme without enquiry. He referred to Craies on Statute Law (7th edition) by S.G.G. Edger at page 264 and submitted that the Scheme is a new enactment, that too for a limited period conferring benefits on the persons who do not wish to face enquiries and, therefore, it was obligatory on the part of the assessee to file the declaration. He also referred to Francis Bennion on Statutory Interpretation, 2nd edition at page 32 to the effect that "conferring of a right or benefit where legislation confers some right or benefit on a person which he would not have at common law, the conditions laid down as to the accrual of the right or benefit, unless purely formal, are mandatory. If they are not complied with the right or benefit will not accrue."
Shri Syali submitted that the filing of declaration under the Scheme is not a mere formality since the same has been specifically prescribed for the purpose of grant of immunity, as is evident from the very wording used in the declaration. According to Shri Syali, if filing of declaration was a mere formality and procedural, as is made out by the appellants, the Reserve Bank of India would not have refused the appellants. The Reserve Bank refused only because the filing of declaration is mandatory and they have no power to allow the appellants to file the same after expiry of time limit prescribed. He submitted that the money coming within the time prescribed under the Scheme as supported by declaration, only would be immune from enquiry. He also referred to Principles of Statutory Interpretation - Justice G.P. Singh - in support of his proposition that filing of declaration under the Scheme was essential and imperative and, therefore, mandatory.
6.4 On merits also Shri Syali submitted that it is the claim of the appellants that it is not their income and before treating the amount as their income, there should have been some provocation on the part of the Assessing Officer. On the other hand, according to Shri Syali, the provocation should have come from the appellants themselves when it was informed that provisions of section 68 of the Act would be applicable. Shri Syali submitted that onus is entirely on the appellants and nothing has been done to discharge the same. He referred to D.C. Rastogi (HUF) v. Asstt. CIT [1996] 57 ITD 295 (Delhi), CIT v. Sophia Finance Ltd. [1994] 205 ITR 98 (Delhi)(FB) and Dr. K. George Thomas v. CIT [1986] 159 ITR 851/26 Taxman 136 (SC). Referring to Grindlays Bank Ltd.'s case (supra) as relied upon by the appellants, Shri Syali submitted that this decision is on its own facts.
6.5 On Khairunnissa Ebrahim's case (supra), Shri Syali submitted that this ratio is not applicable on the facts of these cases. He submitted that in Khairunnissa's case it was found that the relevant provisions of section 28(iv) of the Income-tax Act had been ignored and the Court held that the Tribunal was bound to entertain in the ground regarding the applicability of section 28(iv) of the Act and render a decision thereon. He submitted that in the guise of raising a new point the appellant cannot be allowed to bring in evidence which has never been produced before the Assessing Officer, even when repeated, opportunities were given. He accordingly submitted that on the facts of the case, the appellants are not entitled to adduce the so-called additional evidence when there has been no attempt even in this direction before the Assessing Officer. Shri Syali in support of his submissions also referred to judgment of Bombay High Court in the case of CIT v. Anil Hardboards Ltd. [1994] 207 ITR 802.
7. In reply, Shri Ganeshan, the learned Authorised Representative for the appellants, explained that while the appellants were under the belief that they had filed declarations under the Scheme filing of the same was not mandatory but directory only. He explained that even though the word 'shall' has been employed in the Scheme in the context of filing of the declaration it is not obligatory for filing of the declaration. He submitted that sufficient time was also not given by the Assessing Officer to enable the appellants to collect evidence from abroad and, therefore, there existed 'sufficient cause' for non-compliance on the part of the appellants as mentioned in para 8 of the written submission dated 25-10-1995 before the CIT(A). He submitted that the decision of the Tribunal - D.C. Rastogi (HUF)'s case (supra) as referred to by the revenue was rendered on its own facts and, therefore, inapplicable in these cases. He also reiterated that the appellants had sufficient reasons for not filing evidence before the Assessing Officer and the words "sufficient cause" as used in rule 46A do not stand in the way of the appellant, the same being inter-changeable. In this connection, he referred to the provisions of sub-sections (3) and (4) of section 249 of the Act in support of his proposition.
8. We have heard the learned representatives of the parties at length and have perused the relevant record. We have also taken note of the judgments cited by the learned representatives. In essence the issues requiring decision on our part are : (i) whether the filing of declaration under the Immunity Scheme was mandatory or declaratory to enable the appellants becoming entitled to the benefit available under the said Act/Scheme ; (ii) if the benefit as in (i) above cannot be availed of by the appellants, whether the learned CIT (Appeals) was justified in not admitting the evidence adduced after the framing of the assessment in support of appellants' claim that the amounts represent non-taxable gifts from abroad and finally (iii) if the answer to issue No. (ii) is in the affirmative, then whether on the basis of material on record the order of assessment, as also of the learned CIT (Appeals) are acceptable.
8.1 To arrive at an answer to issue No. (i) above, we have to look not only into the relevant provisions of the said Act/Scheme but also the circumstances under which the same were introduced for a very limited duration, i.e., from September 1991 ending with 1-2-1992. A perusal of the said Act reveals that position relating to Balance of Payment had become difficult and there was urgent need for attracting large flow of foreign exchange from abroad. It was, therefore, considered expedient to provide for certain immunities and exemptions to the recipients of foreign exchange from abroad under the said Act, notwithstanding anything contained in any other law for the time being in force (section 3 of the said Act). The immunity was, however, available to a recipient who claimed it "in accordance with such Scheme as the Reserve Bank of India may, by notification in the Official Gazette specify for the purposes of receiving remittances. . . ." Under sub-section (3) of section 3 of the said Act, the Central Government "shall cause the Scheme notified under clause (a) of sub-section (1) to be laid, as soon as may be after it is notified, before each House of Parliament. Paragraph 3 of the Scheme provided that the recipient of a remittance in foreign exchange desirous of claiming immunity under sub-section (1) of section 3 of the Act, shall, not later than 15 days from the date of receipt of such remittance, file a declaration in the Form with the authorised dealer through whom the remittance is received." The Form of declaration is as prescribed in sub-para (b) of paragraph 2 of the Scheme. It is in duplicate, second copy of which is to be given to the claimant duly authenticated with signature/date and seal intending to serve as a proof of applicability of the immunity as contemplated under the said Act/Scheme. Such a declaration is admittedly not filed by the appellants. Arguments have been advanced at length by the learned Authorised Representative for the appellants that filing of the declaration is not mandatory and, therefore, benefit of immunity under the Scheme is still available. Whereas the word 'shall' has been employed for the purpose of filing of declaration in sub-para (a) of paragraph 3 of the Scheme, yet this alone is not determinative of the issue as to whether filing of declaration is mandatory or declaratory. As observed by their Lordships of the Supreme Court in the case of State of U.P. v. Babu Ram Upadhya AIR 1961 SC 751 at page 765, "For ascertaining the real intention of the Legislature", points out Subbarao, J., "the Courts may consider, inter alia, the nature and design of the statute, and the consequences which would follow from construing it the one way or the other ; the impact of other provisions whereby the necessity of complying with the provisions in question is avoided ; the circumstances, namely, that the statute provides for a contingency of the non-compliance with the provisions ; the fact that the non-compliance with the provisions is or is not visited by some penalty ; the serious or the trivial consequences, that flow therefrom ; and above all, whether the object of the legislation will be defeated or furthered."
8.2 As already stated, filing of the declaration is pre-fixed with the word 'shall' which raises a presumption of its being mandatory, unless intention of the Legislature is to the contrary. On the other hand, the intention of the Legislature is evident. Foreign exchange remittances are being received day in and day out on various counts, including during the currency of the Scheme but any and every remittance does not come within the purview of the said Act/Scheme. For the purpose of identification of the remittances under the said Act/Scheme, the declaration is essential. Thus, to distinguish between a remittance under the Act/Scheme and one which does not fall thereunder, the only distinct feature is the declaration. Therefore, the filing of the declaration is mandatory to enable the recipient to fall in the distinct category of those who are to enjoy immunity from inquiry unlike others. The intention of the Legislature behind the Scheme and filing of the declaration was to effectuate a right to immunity on the recipient leaving no discretion with the authority once the declaration is filed. Thus, the only mode of effectuating the object of the Legislature ; the only formality to be observed, i.e., filing of the declaration is not only essential but imperative. We draw strength in these observations from renowned treatise by Hon'ble Justice Guru Prassana Singh at page 259, 6th edition, 1996 on Principles of Statutory Interpretation. The rule stated by VINER is to the same effect : "Every statute limiting anything to be in one form, although it be spoken in the affirmative, yet it includes in itself a negative." As an example of an Indian statute of this description, the provisions of sections 54, 59, 107 and 123 of the Transfer of Property Act, 1882, prescribing modes of transfer by sale, mortgage, lease or gift may be mentioned. The formalities prescribed by these provisions for effecting a transfer of the nature mentioned in them are mandatory and the language used although affirmative clearly imports a negative.
8.3 In other words, right can be effected only by the formality prescribed and no other manner. Such right or benefit, thus, accrues only when the condition of filing of declaration is met. Filing of declaration in these circumstances is not a mere formality but is mandatory having direct relationship in effectuating the object of the Act/Scheme. This approach is also supported by various authorities cited by Shri Syali, the learned Senior Special Counsel of the revenue, including Sir Francis, Bennion, Craies, Maxwell.
8.4 The time prescribed for filing of the declaration is also indicative of the true intention of the Legislature. In case the filing of the declaration is declaratory, as is argued by the learned Authorised Representative for the appellants, the very purpose of the Act/Scheme would be defeated, there being no other mode available to avail of the immunity. The Legislature in its wisdom has not provided any power with the authorities under the Act/Scheme to extend the time for filing of the declaration. The relevant authority, i.e., the Reserve Bank of India has also been guided by the identical principles as is apparent from its reply dated 27-3-1995 to appellants' request dated 24-2-1995 stating that the Act/Scheme "do not contemplate or empower Reserve Bank of India or any other authority to condone the delays in the submission of declaration forms". The declaration, thus, is a statutory safeguard against a fraudulent or deceptive endeavour on the part of a recipient to claim immunity.
8.5 For the aforesaid reason we hold that the declaration to be filed under the Scheme is mandatory and not declaratory. Since the appellants did not do so the benefit of immunity under that Act/Scheme is not available to them.
9. Now we take up the second issue, i.e., admission of evidence (called additional evidence), as filed in the office of the Assessing Officer after the framing of assessment as also before the learned CIT (Appeals). This was the main thrust of arguments/submissions of the learned Authorised Representative. At the very outset we may say that the principle governing admission of additional evidence, promotion and advancement of substantial justice are well-settled and laudable principles of jurisprudence. The cardinal question, however, is whether in the given facts and circumstances the said principles can be invoked or are available to the appellants.
9.1 We find, as is also highlighted by Shri Syali, the learned Special Counsel for the Department, that throughout the assessment proceedings the appellants' stand was that they are entitled to immunity under the Scheme, necessary declarations having been filed with the concerned bank but not traceable and for filing the same the appellant sought adjournment time and again. In spite of repeated requests made by the Assessing Officer to file the declaration, the appellants did not file the same and went on demanding more time. On the other hand, the Assessing Officer wrote to the bank concerned, i.e., Hong Kong Bank for verification of appellants claim of having filed the declaration. The Bank on 18-1-1995 confirmed that no such declaration stood filed by the appellants under the Scheme with regard to the remittances received by them. Accordingly, the Assessing Officer issued a show-cause notice on 27-1-1995 informing the appellant the result of his enquiries from the bank, as also enclosing the copy of communication received from the bank. The Assessing Officer in this letter also required the appellants to show the basis on which the remittance is claimed as coming under the purview of the Scheme and show cause why enquiry or investigation should not be commenced by him. However, this letter was not the initiation of enquiry, as rightly pointed out by Shri Syali for the revenue. The enquiry process had already commenced as early as on 24th October, 1994 in the case of Deeksha Suri and repeated on 23-12-1994 in the case of Deeksha and Divya Suri. Thus, it is not as if on 27-1-1995 the appellants for the first time became aware that declarations were required or in the absence thereof immunity claimed would not be available. On the other hand, in the computation sheets filed by the appellants along with their returns, they have claimed immunity from enquiry in respect of the remittances and, therefore, when the Assessing Officer picked up the case for scrutiny by issuing notice under section 143(2) at the end of November 1992, it became evident that the Assessing Officer is going to investigate the claim, thus, requiring the appellants to substantiate the same. No efforts were, however, made in this direction. While, therefore, it is admitted by the appellants that they became aware of need for declaration only vide letter dated 27-1-1995, in fact the notice of hearing issued much prior to this date, cannot be ignored in favour of the appellants. The stand of the appellants that they became aware of the need of filing of declaration only on 27-1-1995 is not factually correct, when as per order-sheet entry dated 23-12-1994 in the case of Deeksha Suri, the Assessing Officer required the filing of certificate from the bank in the prescribed form under the Immunity Scheme of 1991. On the other hand, if the appellants were under a bona fide belief that Declaration need not be filed, being declaratory in nature, on the very first occasion when the Assessing Officer asked for the declaration, their legitimate answer would have been that whereas no declaration was filed, it was not necessary either to do so. On the other hand, their emphatic and repeated stand has been that the declarations were prepared in the prescribed form ; they were duly signed and in order to locate them time be granted. Only in letter dated 14-2-1995, in reply to Assessing Officer's letter dated 27-1-1995 it was claimed that filing of declaration was purely procedural. In the same breath additional time was asked for to locate the same, when it was stated, "in order to locate the declarations, I would request you to kindly give me time for some more days, as my wife and I remembered having filed these declarations".
On 20/21-2-1995, the Assessing Officer again sought a clarification and pointed to the appellants that the burden of proof regarding the nature and source of the remittances would have to be discharged by them in the absence of the declarations and the provisions of section 68 of the Income-tax Act, 1961 would apply. The appellant again went into a limbo for almost a month. On 21-3-1995 it was again reiterated that the remittances were received under the Scheme and the appellants have applied to the Reserve Bank of India for grant of appropriate certificate as per the Scheme and that "we assure your honour that certificate from Reserve Bank of India will be filed before your honour by Monday or Tuesday of the next week." As per the order-sheet entries the matter thereafter was adjourned to 27-3-1995 when it was getting time barred on 31-3-1995. On 27-3-1995, there was no compliance. The Assessing Officer, therefore, without choice framed the assessment on 28-3-1995.
9.2 It is not the case of the appellant that before finalising of the assessment anything was placed on recording in discharge of the onus placed on them. Vide letter dated 21-3-1995 it was mentioned that "the sums received outside India by the assessees were given by the remitter as personal gifts and were sent in India to us at our request, for which evidence confirming the same can be filed." In the same letter the assessee reiterated that it enjoyed immunity and had approached the Reserve Bank of India. Having been appraised of the applicability of section 68, the same was not disputed by the appellants. Nor at any point of time the Assessing Officer was informed that the declarations have not been filed inadvertently and, thus, the matter should be examined on other lines. Despite having been confronted with the obligation to discharge their onus in January 1995, the appellants as late as on 21-3-1995 were as yet informing the Assessing Officer that the evidence can be filed. Nothing prevented the appellants from filing the evidence which they had in their possession, especially declaration of Jayant Nanda, which admittedly stood attested on 5-2-1995. Even the name of Jayant Nanda was not made known to the Assessing Officer. In the circumstances the learned CIT (Appeals) was absolutely right in holding that it was only a blatant effort on the part of the appellant to cure the lacuna in their version. As is manifest the appellants intentionally in the entire proceedings before the Assessing Officer represented that they were entitled to immunity under the Scheme. Having led the department in this direction by their representations and having not availed of the opportunity, it cannot now plead lack of adequate time in discharging the onus. If evidence was awaited nothing prevented the appellants from appraising the Assessing Officer of this stand. This was not the reason for seeking time.
9.3 Though the conduct not befitting a diligent and a cooperative assessee, it need further be examined whether the appellants were right in seeking discretionary jurisdiction for admission of additional evidence before the first appellate authority. In the course of hearing before the first appellate, four written submissions were filed, i.e., dated 28-7-1995, 22-9-1995, 25-10-1995 and 27-10-1995 (Paper book pages 11 to 22). In the first submission the thrust was that the declaration required under the Scheme is not mandatory and, therefore, in view of the facts already on record, the Assessing Officer was not correct in treating the remittance as income from undisclosed sources. The facts highlighted by the appellants in support of their claim for admission of additional evidence are also not borne out from record having been placed before the Assessing Officer. All what is sought to be admitted as additional evidence was filed after the assessment, while no evidence on the basis of which documents filed after the assessment could be called as additional evidence, was filed before the Assessing Officer.
9.4 In the second submission effort was made again to lead the additional evidence when in the first place making a request for its admission.
9.5 It was only in the third submission when for the first time this issue was addressed. It was submitted that "the perusal of assessment records lying with the Assessing Officer and the circumstances will show that the necessity for all these evidences and affidavit had only arisen after 28-3-1995, when the Assessing Officer passed the Income-tax assessment order." These submissions further emphasise that a copy of the Gift Deed was filed before the Assessing Officer. Attention is invited to rule 46A of the Income-tax Rules to emphasise that a duty is cast on the appellate authority to call for evidence for proper adjudication of the matter. Assertion that sufficient cause existed with the appellants is also there, i.e., the matter before the Assessing Officer was analysed only from the point of immunity under the Act/Scheme and since the matter now requires consideration from a different angle, additional evidence be admitted.
9.6 In the last submission attention again is invited to the Immunity Act/Scheme and it is submitted that the prescribed declaration is only a ministerial act. Thus, the only request made for admission of additional evidence is submission dated 25th October, 1995, which has been effectively dealt with by the learned CIT (Appeals). No other application/reason have been placed on record in support of the submission of additional evidence under any of the clauses of rule 46A of the Income-tax Rules. This cause factually cannot be construed to be 'sufficient' since it was the appellant who led the Department to believe the particular situation. Being well aware that the appellants had not complied with mandatory requirement of filing of the declarations, they did not at any point of time make any attempt to discharge the onus placed by the Assessing Officer under the provisions of section 68 of the Income-tax Act in spite of specific notice given in this direction. Having failed to do so, it does not now lie with the appellants to submit their inaction or negligence as a sufficient cause entitling them to file the evidence. We, therefore, endorse the views of the learned first appellate authority.
9.7 This apart, an assessee cannot adduce additional evidence as of right. Rule 46A merely enables admittance of evidence subject to fulfilment of its pre-conditions, which embody the rule of equity that a person should not suffer if he was prevented by 'sufficient cause' for making a compliance. No doubt the word 'sufficient' should receive a liberal construction so as to advance substantial justice, but as observed by the Hon'ble Supreme Court in the case of Sarpanch, Lonand Grampanchayat (supra), the discretion is to be exercised to advance substantial justice only "when no negligence, nor inaction nor want of bona fide is imputable to the appellant." We find that the claim of the appellant for admission of additional evidence is not advanced on any judicial principles, as laid down by the Hon'ble Supreme Court in the case cited above. Further, a Constitution Bench of the Supreme Court in State of U.P. v. Manbodhan Lal Srivastava 1958 SCR 533 at page 540 observed, "It is well-settled that additional evidence should not be permitted at the appellate stage in order to enable one of the parties to remove certain lacunae in presenting its case at the proper stage to fill in gaps."
9.8 The mere fact that the evidence sought to be produced is vital/important does not constitute sufficient cause to allow its admission at the appellate stage. It is for the party seeking to adduce additional evidence to come within the four corners of rule 46A. It is trite law that evidence capable of being adduced should be credible from the relevancy and materiality point of view. The jurisdiction to admit additional evidence is not the same as jurisdiction to admit additional ground or allow setting up a new plea based on facts already on record. Onus is on the person seeking to adduce additional evidence to prove the circumstances enabling him to do so. It is indeed incorrect of assert on the part of the appellants that prior to 28-3-1995 there was no need to file these evidences or the Gift Deed (actually confirmation attested on 5-2-1995). In letter dated 21-3-1995 the appellants in passing have stated the remittances to be gifts. There was no need to do so if they were unaware of their ineligibility to immunity. Further, why make such hectic efforts to file letter dated 29-3-1995 and 30-3-1995 ? If it were a remittance qualifying for immunity, as was the case of the appellant, then why a gift deed (i.e., declaration attested on 5-2-1995), which again was not filed before the Assessing Officer. If immunity was not available then why not a contemporaneous gift deed of 1991 itself. Still further, not a single word is said by the appellants before the Assessing Officer in discharge of their onus under section 68 of the Income-tax Act, when a specific notice is given by the Assessing Officer or even as regards the applicability of that section in their subsequent correspondence.
9.9 In its letter dated 24-2-1995 addressed to the Reserve Bank of India, the appellants have admitted that after was 'omission' on their apart of not having filed the declaration. Yet the appellant did not approach the Assessing Officer to appraise him also of this fact and make a clean breast of their affair. On the other hand, they were still persisting that they had filed the declaration but required more time to trace the same. All this shows intentional lack of bona fides on the part of the appellants. Therefore, the learned CIT(A) was right in not allowing the appellants to adduce the additional evidence under rule 46A, as they are not legally entitled to do so. We may refer to Allahabad High Court judgment in the case of Ram Prasad Sharma (supra) in support of our finding. On facts and in the circumstances of the case, in our view, the learned CIT (Appeals) has properly exercised his discretion in not allowing the appellants to adduce additional evidence, there being want of diligence, inaction and lack of bona fides on the part of the appellants.
10. On the issue of foreign remittances having been treated as appellants' income, the Assessing Officer noted that the assessees had not even identified the remitter, much less have furnished any evidence regarding the source of the amounts. While the Assessing Officer had already put to the appellants as to why provisions of section 68 of the Income-tax Act, 1961 enabling taxation as undisclosed income be not invoked, the section actually applicable is 69A of the Act, as has been discussed by the Commissioner of Income-tax (Appeals) since the approach of the two sections does not differ, the ultimate result does not change either. Shorn of additional evidence the facts on the record of the Assessing Officer/CIT (Appeals) are that the appellants have received the amounts involved through banking channels from a country outside India. As per letter dated 21-3-1995 filed before the Assessing Officer, the amounts were stated to be personal gifts sent at the request of the appellants in India. The remitter is not even identified, what to say about his capacity and genuineness of the transaction. Since the initial burden has not been discharged by the appellants the amounts, in our view, have rightly been treated as their incomes from undisclosed sources. The fact that the money has been received from abroad through normal banking channels in no way absolves the appellants from discharging their burden cast upon them to establish the identity of the remitter, his capacity and genuineness of the alleged gifts. We may refer to Full Bench judgment of Hon'ble Delhi High Court in the case of Sophia Finance Ltd. (supra), wherein with reference to a prime facie capital receipt (share capital raised by a company immediately after its incorporation) their Lordships were pleased to hold that the Assessing Officer would not only be entitled to but would be duty bound to enquire whether the receipts were on capital account. Respectfully following the said judgment, in the absence of evidence pertaining to genuineness of gifts, identity of the donor (we have already observed at pages 18-19 above that the CIT (Appeals) has erroneously mentioned in para 15 of his order that identity of the donor was informed to the Assessing Officer), his financial capacity, the action of the lower authorities is upheld. The onus of proving the source is on the assessees and it is not for the revenue to disprove the assessee's version in case where section 68 or section 69A are attracted. The decision in Grindlays Bank, relied upon by the learned Authorised Representative for the appellants, Grindlays Bank Ltd.'s case (supra) does not come to their rescue because in that case their Lordships of the Supreme Court were only considering whether the direction given by the Calcutta High Court reported in Grindlays Bank Ltd. v. ITO [1978] 115 ITR 799 was correct. In other words having quashed the notice under section 142(1) by way of a writ, whether a fresh assessment could be directed by their Lordships of the High Court. A question had arisen whether the Assessing Officer was justified in asking for books of Head Office of the Bank situated outside India. It was held the material asked for had no bearing on the assessment being made in India and, therefore, the Assessing Officer had exceeded his jurisdiction.
10.1 In the appeals before us it is nobody's case that by inviting attention of the appellants to the provisions of section 68 (to be read as 69A) the Assessing Officer had exceeded his jurisdiction. The enquiry was relevant to the framing of assessments and not on extraneous matter.
10.2 We, therefore, do not find any merit in the submissions made by the learned Authorised Representative for the appellants on any count. While we are yet to address ourselves on Ground of Appeal No. 12 in the case of Lalit Suri [IT Appeal No. 477 of 1996], the appeals of Smt. Jyotsna Suri [IT Appeal No. 300 (Delhi) of 1996], Miss Deeksha Suri [IT Appeal No. 475 (Delhi) of 1996] and Miss Divya Suri [IT Appeal No. 476 (Delhi) of 1996] are dismissed, as also that of Shri Lalit Suri on this count.
11. Now we deal with the Ground of Appeal No. 12 taken by Shri Lalit Suri, which is against addition of Rs. 67,000 sustained by the learned CIT (Appeals) as alleged low drawings. The Assessing Officer on an analysis of withdrawals made by the appellant and his wife noted that not only the withdrawals shown were inadequate (Rs. 29,000) but erratice and irregular, inasmuch as there were no withdrawals in some months, such as May, November, March. He took the view that the withdrawals shown is woefully inadequate given the economic situation and social status of Shri Lalit Suri. Even the drawings shown by his wife at Rs. 24,000 did not come to the rescue of the assessee. He estimated the expenses of Shri Lalit Suri at Rs. 1,20,000 for the year, leading to an addition of Rs. 91,000. This was contested in appeal when the learned CIT (Appeals) on a consideration of relevant facts and circumstances, as also keeping in view his order for assessment year 1990-91 in the case of the appellant agreed with the observation of the Assessing Officer that the drawings shown by the appellant are indeed very low, apart from being erratic. For the reasons given in paras 23 and 24 of his order, the learned CIT (Appeals) allowed a relief of Rs. 24,000, thus, retaining an addition of Rs. 67,000. This is objected to by the appellant.
11.1 While no arguments were advanced we find that the reasons recorded by the authorities below remain uncontroverted and, therefore, we find no ground to interfere with the findings recorded by the learned CIT (Appeals) and endorsing the same we uphold the order of the learned Commissioner of Income-tax (Appeals) on this count also.
12. In the result, all the four appeals are dismissed.