Court No. - 3 Case :- INCOME TAX APPEAL No. - 435 of 2008 Appellant :- Smt. Sarika Jain Respondent :- Commissioner Of Income Tax, Bareilly And Another Counsel for Appellant :- Rakesh Ranjan Agarwal, Sayush Agarwal Counsel for Respondent :- Piyush Agrawal, S.S.C. I.T. Hon'ble Pankaj Mithal, J. Hon'ble Umesh Chandra Tripathi, J. Heard Sri Suyuash Agarwal, learned counsel for appellant- assessee and Sri Piyush Agarwal, learned counsel for Revenue. appellant-assessee by this Income Tax Appeal under Section 260-A of Income Tax Act, 1961 (hereinafter refereed as Act ) has challenged order of Income Tax Appellate Tribunal dated 20.12.2007. short question of law, which has been raised in this appeal is whether Income Tax Appellate Tribunal was justified in adding sum of Rs.12,20,000/-, alleged to have been received by appellant-assessee as gift as his income under Section 69-A of Act after deleting said addition as made by Assessing Officer and confirmed by CIT (Appeals) under Section 68 of Act. brief facts giving rise to present appeal are that appellant-assessee is partner in firm M/s S.J. Transformers and has inducted capital of Rs.12,20,000/- in relevant assessment year 2001-02. assessment of said year 2001-02 was completed and proceedings for re-assessment were initiated under Section 148 and notice was given to petitioner to explain source of above capital as inducted in partnership. In reply to said notice, petitioner submitted that he had received gift of Rs.5,00,000/- from one Sri Manish Kumar Kapoor 2 and Rs. 7,20,000/- from one Smt. Zakkan Begum. gifts were received through banking channel. In order to prove aforesaid gift transactions, gift deeds were also produced before authorities. statement of two doners were also recorded under Section 131 of Act and they proved factum of gift. Assessing Officer however held that gifts are not genuine as there were held to be unnatural and aforesaid amount was added as undisclosed income of appellant- assessee under Section 68 of Act. Commissioner of Appeals affirmed said order and recorded findings that documentation in respect of gifts are complete and appellant-assessee has established identity of doners and their credit worthiness to make gifts of said amount but again CIT (Appeals) refused acknowledge of said gift as there were not found to be genuine. In appeal to Tribunal, it has been held that addition made by Assessing Officer under Section 68 of Act and sustained by CIT (Appeals) cannot be sustained. Thereafter, Tribunal proceeded to add aforesaid amount as income of appellant-assessee under Section 69-A of Act. It is aggrieved by such addition under Section 69-A of Act that appellant-assessee has preferred this appeal. submission of Sri Suyash Agarwal, learned counsel for appellant-assessee is that all through case of parties is as to whether aforesaid amount alleged to have been received by appellant-assessee is liable to be added under Section 68 of Act and question of addition under Section 69-A was never there. Therefore, Tribunal has erred in making addition under Section 69-A of Act. Sri Piyush Agarwal admits that before Assessing Officer as well as CIT (Appeals) and Tribunal, dispute was as regarding addition of amount alleged to have been 3 received in gift by appellant-assessee under Section 68 of Act and nothing else. relevant sub-section (1) of Section 254 of Act reads as under :- 254. Orders of Appellate Tribunal. 254 (1). Appellate Tribunal may, after giving both parties to appeal opportunity of being heard, pass such orders thereon as it thinks fit. (Emphasis supplied). plain reading of aforesaid Section reveals that Appellate Tribunal has power to pass such orders thereon as it thinks fit. use of word thereon is important and it reflects that Tribunal has to confined itself to questions, which are arising or are subject matter in appeal and it cannot be travelled beyond same. power to pass such orders as Tribunal thinks fit can be exercised only in relation to matter that arises in appeal and it is not open to Tribunal to adjudicate any other question or issue, which is not in dispute and which is not subject matter of dispute in appeal. In present case, it is apparent that subject matter of dispute all through before Tribunal in appeal was only with regard to addition of alleged amount of gift received by appellant-assessee as his personal income under Section 68 of Act and not whether such addition can be made under Section 69-A of Act. In view of above, it can safely be said that Tribunal travelled beyond scope of appeal in making addition of said income under Section 69-A of Act. It may be worth noting that Tribunal has recorded categorical finding that it is clear that under provisions of Section 68, addition made by Assessing Officer and sustained by CIT (Appeals) cannot be sustained, meaning thereby that Tribunal was of opinion 4 that Assessing Officer and CIT (Appeals) committed error in adding aforesaid amount in income of appellant-assessee under Section 68 of Act. In view of above, when said income cannot be added under Section 68 of Act and Tribunal was not competent to make said addition under Section 69-A of Act, entire order of Tribunal stand vitiated in law. Accordingly, we answer question of law, as framed above, in favour of appellant-assessee and against Revenue and hold that Tribunal was not competent to make any addition under Section 69-A of Act and as same was subject matter of appeal before it. Accordingly, impugned order dated 20.12.2007 is set aside and matter is remanded to Tribunal for deciding appeal afresh in accordance with law. appeal is allowed. Order Date :- 18.07.2017 Nadim Sarika Jain v. Commissioner of Income-tax, Bareilly and Another