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2019 (4) TMI 202 - AT - Income TaxAssessment u/s 153A - proof of incriminating material found in search - HELD THAT - CIT(A) after perusal of the assessment order concluded that during search and seizure operations, books of accounts, document, loose papers etc. were seized. The seized documents and papers are the incriminating material on the basis of which additions have been made. We, therefore, do not find any reason to interfere with the order of the Ld. CIT(A). Unexplained Expenditure on foreign travel - HELD THAT - AO has estimated unexplained expenditure on foreign tours undertaken by the assessee. Ld. counsel for the assessee has, during course of hearing, drew our attention to the various advertisements by the travel agents in respect of foreign tours offered by them. After considering totality of facts, we are of the view that it would serve the interest of justice if estimate by the AO is reduced to 50%. Therefore, the AO is directed to delete 50% of the additions i.e. ₹ 3,00,000/-, ₹ 5,00,000/-, ₹ 4,97,175/-, ₹ 1,60,060/- & ₹ 8,00,000/- respectively for the A.Ys. 2010-11 to 2014- 15 and rest are sustained in view of the fact that the assessee could not furnish any confirmation of the travel agents. Unexplained investment in jewellery - CIT(A) confirming that the AO was justified in holding that only 100grms of gold jewellery found with the assessee is explained out of the addition of ₹ 29,79,754/- made by the AO towards alleged unexplained investment in jewellery - HELD THAT - If the total jewellery is calculated as per the board s circular, the availability would be of 2500 gms. Assessee s brother Shri Vipin Chouhan has purchased jewellery of ₹ 20 lacs through cheque which is estimated for 450 gms. Thus, the total jewellery of 2950 gms. stand explained whereas jewellery kept in locker belongs to his deceased mother who passed away on 26.9.2010 and the same was in the possession of the wife of the assessee for safe custody because she is the eldest daughter-in-law of the family. If this jewellery is considered then there would be no surplus. We find that assessee was required to prove that jewellery was jointly held and since the jewellery have been recovered from the possession of the assessee, therefore, contention of the assessee could not be accepted. The contention of the assessee that apart from the jewellery covered by CBDT Circular, the assessee has certain jewellery where he has evidences of purchase of the same, this aspect requires verification at the level of the AO. Therefore, we deem it appropriate to set aside the issue back to the file of the AO with direction to the assessee to furnish the requisite evidences in support of the claim Unexplained cash found during the course of search with the family - HELD THAT - Assessee has contended that the respective cash books have been seized and are verifiable and without verifying the same from the books, the additions are not justified. Considering the rival submissions, we are of the view that this aspect requires verification at the level of the AO. Therefore, we deem it appropriate to set aside the issue back to the file of the AO with direction to the AO to provide the copies of the required records to the assessee and then the AO will decide the issue afresh. The assessee is also directed to co-operate in this regard. Thus, this issue is allowed for statistical purposes only. Unexplained opening capital - HELD THAT - Assessee has claimed that all the details were furnished before the ld. CIT(A) but she did consider the same. The assessee further submitted that opening balance is out of past savings of the assessee, investment in the partnership firms were verifiable from the books of accounts and bank balances were also verifiable. Therefore, we deem it appropriate to set aside the issue back to the file of the CIT(A) with direction to call for remand repot from the AO on this issue and thereafter, CIT(A) would decide the issue afresh in terms indicated hereinabove. Thus, this issue is allowed for statistical purposes only.
Issues Involved:
1. Incriminating material 2. Unexplained expenditure on foreign travel 3. Unexplained investment in jewellery 4. Cash found 5. Unexplained opening capital Issue-wise Detailed Analysis: Issue No.1 - Incriminating Material: The primary issue was whether the Assessing Officer (AO) was justified in making additions for the years where assessment proceedings were not pending and no incriminating material was found during the search. The assessee argued that no incriminating material was found, thus rendering the assessment orders null and void. However, the CIT(A) concluded that books of accounts, documents, and loose papers seized during the search constituted incriminating material. The Tribunal found no reason to interfere with the CIT(A)'s order, thereby dismissing this issue for A.Ys. 2010-11 to 2013-14. Issue No.2 - Unexplained Expenditure on Foreign Travel: The AO made additions based on estimated unexplained expenditure on foreign tours undertaken by the assessee during A.Ys. 2010-11 to 2014-15, as the assessee failed to provide supporting documentary evidence. The Tribunal, considering the totality of facts and various advertisements by travel agents, directed the AO to reduce the estimated expenditure by 50%, as the assessee could not furnish confirmations from travel agents. This issue was partly allowed for A.Ys. 2010-11 to 2014-15. Issue No.3 - Unexplained Investment in Jewellery: For A.Y. 2014-15, the assessee challenged the addition towards unexplained investment in jewellery. The AO added the value of gold and silver found during the search, while the CIT(A) allowed a deduction as per the Board's Circular. The Tribunal found that the assessee needed to prove the joint ownership of the jewellery. It directed the AO to verify the evidence provided by the assessee regarding the purchase of jewellery and decide the issue afresh. This issue was allowed for statistical purposes only. Issue No.4 - Cash Found: In A.Y. 2014-15, the assessee contested the addition of apportioned cash found during the search. The AO added one-third of the total cash found with the family members to the assessee's income, which the CIT(A) upheld. The Tribunal directed the AO to verify the respective cash books and decide the issue afresh, as the assessee claimed that the cash was verifiable from the seized books. This issue was allowed for statistical purposes only. Issue No.5 - Unexplained Opening Capital: The assessee challenged the addition towards unexplained opening capital for A.Y. 2014-15. The AO made the addition as the assessee could not justify the opening capital shown in the balance sheet. The Tribunal directed the CIT(A) to call for a remand report from the AO and decide the issue afresh, considering the assessee's claim that the opening balance was from past savings and verifiable investments. This issue was allowed for statistical purposes only. Conclusion: The Tribunal partly allowed the appeals for statistical purposes, directing the AO to verify certain aspects and decide the issues afresh. The judgment was pronounced in the open Court on 28.03.2019.
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