1985 (11) TMI 72 - AT - Income Tax

Summary

Issues:
1. Rejection of long term capital gains claim due to lack of purchase vouchers.
2. Confirmation of rejection by the Appellate Authority.
3. Argument regarding the difficulty in producing purchase vouchers after 60 years.
4. Dispute over the necessity of selling the ornaments.
5. Examination of the credibility of the sale voucher and the need for purchaser examination.

Analysis:
1. The initial issue revolved around the rejection of the assessee's claim of long term capital gains due to the absence of purchase vouchers for the sold gold ornaments. The Income Tax Officer (ITO) treated the entire amount as income from other sources, leading to the dispute.

2. The Appellate Authority confirmed the ITO's decision, emphasizing the lack of evidence regarding the source of acquisition of the ornaments. The Authority relied on the Bombay High Court decision in the case of H. M. Lakhani vs. CIT to support the confirmation of the addition made by the ITO.

3. During the appeal, the argument was presented that it was unreasonable to expect the assessee to produce purchase vouchers after such a long period. Additionally, the discrepancy was raised regarding how an individual without taxable income could possess unaccounted money, as alleged in the assessment order.

4. The Departmental Representative contended that the ornaments sold were women's ornaments, implying that they were not genuine and the sale voucher was false. The relevance of the H. M. Lakhani case was highlighted to support this argument, emphasizing the lack of necessity to sell the ornaments.

5. The crucial point of contention was the credibility of the sale voucher and the lack of examination of the purchaser by the ITO. The Tribunal found the assessee's explanation for not producing purchase vouchers after 60 years reasonable. It was deemed unnecessary to prove dire need to sell the ornaments, as individuals may choose to sell for various reasons, such as starting a business for their sons. Consequently, the Tribunal held that there was no justification for adding the amount as income from other sources, leading to the allowance of the appeal.