2013 (7) TMI 1031 - AT - Income Tax

Summary

Issues:
1. Addition of household expenses
2. Addition of unexplained cash and jewellery

Addition of Household Expenses:
The appeal was filed by the Revenue against the order of the CIT(A) for A.Y. 2008-09. The AO estimated household expenses at Rs. 1,20,000 and made an addition of Rs. 1,08,000. The CIT(A) deleted the addition citing the need for cogent material to support such estimates. The ITAT found that similar additions had been deleted in previous cases, maintaining consistency. Therefore, the addition of Rs. 1,08,000 was rightly deleted by the CIT(A).

Addition of Unexplained Cash and Jewellery:
The AO made additions totaling Rs. 30,35,537 due to unexplained cash and jewellery found during a search operation. The CIT(A) reduced the addition to Rs. 20,02,140 after considering explanations provided by the appellant regarding the jewellery. The ITAT noted discrepancies in the A.O.'s approach and directed the CIT(A) to re-decide the issue after considering all relevant facts and reconciliations. The appeal of the Revenue was partly allowed for statistical purposes.

Conclusion:
The ITAT upheld the deletion of the addition of household expenses by the CIT(A) and directed a re-decision on the addition of unexplained cash and jewellery, highlighting the need for a thorough examination of all relevant facts and explanations provided by the appellant.