2015 (8) TMI 131 - AT - Income Tax

Addition on account of excess stock of gold jewellery found during the course of search - CIT(A) deleted the addition - Held that - CIT(A) has taken note of all the relevant entries found in the seized documents and since no remand report was furnished by the Assessing Officer to the explanations of the assessee, the ld. CIT(A) has rightly held that this amount of ₹ 22,91,212/-was available with the assessee in the shape of jewellery and balance as cash in hand. We accordingly find no infirmity in the order of the ld. CIT(A)on this issue and we confirm the same. - Decided in favour of assessee. Addition for the difference worked out relating to silver jewellery weighing 40.462 Kg and the same was treated to be unaccounted and added to the total undisclosed income of the assessee - Held that - Since there is no specific finding in this regard in the order of the ld.CIT(A), this ground does not arise from the order of the ld. CIT(A).Moreover, there is nothing in the order of the ld. CIT(A) whereby addition made by the Assessing Officer has been deleted. Accordingly this ground is not maintainable and we reject the same. Addition on account of peak cash credit entries found in the diary during the course of search - CIT(A) deleted the addition - Held that - CIT(A) has noted totaling error in Annexure A-4 to the extent of ₹ 1.35 lakhs and while making addition onaccount of aggregate credits, relief of ₹ 1.35 lakhs was given to theassessee. Since it was a totaling error, there is no infirmity in the order ofthe ld. CIT(A). Accordingly we confirm the same.- Decided in favour of assessee. Undisclosed investment in elevation of showroom at Birhana Road, Kanpur - CIT(A) deleted the addition - Held that - The issue was examined by the ld. CIT(A) and he has taken note that the assessee has already declared investment of ₹ 2,82,989/- towards renovation of shop at Birhana Road, Kanpur as against ₹ 3.42 lakhsestimated by the valuation cell. The ld. CIT(A) has noted that thedifference between the investment as declared by the assessee andestimated by the valuation cell is on account of variation in PWD and CPWDrates. The valuation between the two is around 10 to 15% and if thebenefit is given to the assessee the cost estimated by the valuation celltowards renovation of showroom would stand reduced by 15% and in sucha circumstances it would come to ₹ 2,90,700/- as against ₹ 2,82,989/- bythe assessee. Therefore, no addition is called for. The ld. CIT(A)accordingly deleted the addition in this regard. No infirmity has beenpointed out in the order of the ld. CIT(A). We accordingly confirm theorder of the ld. CIT(A) on this issue.- Decided in favour of assessee. Unexplained investment in house property - CIT(A) deleted the addition - Held that - CIT(A) has correctly observed that the difference between the figures as declared by the assessee and estimated by the valuation cell was on account of variation in CPWD and PWD rates. The ld. CIT(A) accordingly allowed a rebate of 15% and total investment in property comes to ₹ 10,97,350/- as against declared investment at ₹ 11,29,500/-. The ld. CIT(A) accordingly correctly deleted the addition in this regard.- Decided in favour of assessee. Addition on account of Moti Nagine found during the course of search - CIT(A) deleted the addition - Held that - Since nothing has been pointed out by the Revenue on this issue, we find no infirmity in the order of the ld. CIT(A) on this issue. Accordingly we confirm the same.- Decided in favour of assessee.

Issues Involved:
1. Deletion of addition on account of excess stock of gold jewellery.
2. Deletion of addition on account of difference in silver stock.
3. Deletion of addition on account of unaccounted gold stock.
4. Deletion of addition on account of peak cash credit entries.
5. Deletion of addition on account of unexplained investment in property renovation.
6. Deletion of addition on account of unexplained investment in another property.
7. Deletion of addition on account of Moti Nagine.
8. Deletion of addition on account of diamond jewellery.
9. Quashing the order of the CIT(A) and restoring the order of the Assessing Officer.

Detailed Analysis:

1. Deletion of Addition on Account of Excess Stock of Gold Jewellery:
The Assessing Officer made an addition of Rs. 18,40,470/- for excess stock of gold jewellery found during the search. The CIT(A) deleted this addition, and the Tribunal upheld this deletion, noting that the CIT(A) had correctly analyzed the ledger entries and found that the amount of Rs. 22,91,212/- was available with the assessee in the form of jewellery and balance cash in hand. The Tribunal found no infirmity in the CIT(A)'s order.

2. Deletion of Addition on Account of Difference in Silver Stock:
The Assessing Officer added Rs. 3,49,122/- for the difference in silver stock found during the search. The Tribunal noted that the CIT(A) did not make any specific finding on this issue in his order. Since there was no deletion of this addition by the CIT(A), the Tribunal found this ground not maintainable and rejected it.

3. Deletion of Addition on Account of Unaccounted Gold Stock:
The Assessing Officer added Rs. 51,620/- for unaccounted gold stock. As with the silver stock issue, the Tribunal noted the absence of a specific finding by the CIT(A) and rejected this ground as it did not arise from the CIT(A)'s order.

4. Deletion of Addition on Account of Peak Cash Credit Entries:
The Assessing Officer made an addition of Rs. 1,35,000/- for peak cash credit entries found in a diary during the search. The CIT(A) noted a totaling error in Annexure A-4 and granted relief of Rs. 1.35 lakhs. The Tribunal confirmed the CIT(A)'s order, finding no infirmity.

5. Deletion of Addition on Account of Unexplained Investment in Property Renovation:
The Assessing Officer added Rs. 59,011/- for unexplained investment in property renovation. The CIT(A) examined the issue and noted that the difference between the declared investment and the estimated amount by the valuation cell was due to variation in PWD and CPWD rates. The CIT(A) granted a rebate of 15%, reducing the estimated cost to Rs. 2,90,700/- against the declared Rs. 2,82,989/-. The Tribunal confirmed the CIT(A)'s order.

6. Deletion of Addition on Account of Unexplained Investment in Another Property:
The Assessing Officer added Rs. 1,61,500/- for unexplained investment in another property. The CIT(A) observed that the difference between the declared investment and the valuation cell's estimate was due to rate variations. Allowing a 15% rebate, the total investment was reduced to Rs. 10,97,350/- against the declared Rs. 11,29,500/-. The Tribunal found no infirmity and confirmed the CIT(A)'s order.

7. Deletion of Addition on Account of Moti Nagine:
The Assessing Officer added Rs. 10,000/- for Moti Nagine found during the search. The Tribunal noted no discussion on this issue in the CIT(A)'s order and rejected the ground as it did not arise from the CIT(A)'s order.

8. Deletion of Addition on Account of Diamond Jewellery:
The Assessing Officer added Rs. 40,000/- for diamond jewellery found during the search. Similar to the Moti Nagine issue, the Tribunal found no discussion in the CIT(A)'s order and rejected this ground.

9. Quashing the Order of the CIT(A) and Restoring the Order of the Assessing Officer:
The Tribunal dismissed the Revenue's appeal, finding no infirmity in the CIT(A)'s order and confirming the deletions and reliefs granted by the CIT(A).

Conclusion:
The Tribunal upheld the CIT(A)'s order, confirming the deletions and reliefs granted on various grounds, and dismissed the Revenue's appeal. The Tribunal found that the CIT(A) had correctly analyzed the evidence and provided appropriate relief based on the facts and explanations provided.

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