1982 (8) TMI 103 - AT - Income Tax

Summary

Issues Involved:
1. Addition on account of unexplained cash.
2. Addition on account of unexplained jewellery.

Issue-wise Detailed Analysis:

1. Addition on Account of Unexplained Cash:

The case involves a search and seizure operation conducted on April 20, 1977, where Rs. 47,907 in cash was found at the assessee's premises. The Income Tax Officer (ITO) added this amount to the assessee's income as unexplained cash. The Appellate Assistant Commissioner (AAC) deleted this addition, leading to an appeal by the Revenue.

The assessee's counsel argued that the cash found could be explained by considering the cash book of M/s Bhagwan Das Jagan Nath, where the assessee's husband was a partner. The explanation provided by the assessee was that Rs. 25,000 was brought by her brother-in-law Brij Mohan the night before the search, Rs. 20,000 was delivered by her nephew Mohinder Kumar on the morning of the search, and the remaining Rs. 2,907 was her personal pin-money.

The Revenue's representative contended that the original statement made by the assessee during the search, where she admitted to keeping Rs. 30,000 to Rs. 40,000 in cash at home, should not be ignored. However, the Tribunal found that the cash book of the firm showed a cash-in-hand of Rs. 94,333 as of April 19, 1977, which was much higher than the cash found during the search. The Tribunal noted that the explanations provided by the assessee, her husband, and other family members were consistent and corroborated by the cash book entries. Therefore, the Tribunal upheld the AAC's decision to delete the addition of Rs. 47,000 on account of unexplained cash.

2. Addition on Account of Unexplained Jewellery:

During the same search, jewellery worth Rs. 52,550 was found, out of which the ITO added Rs. 33,310 as unexplained jewellery to the assessee's income. The AAC deleted Rs. 6,660 of this addition but confirmed the addition of Rs. 26,650. Both the assessee and the Revenue appealed against this decision.

The assessee claimed that the jewellery belonged to her mother-in-law, who had entrusted it to her for customary presentations at family weddings. She also stated that one of the chains valued at Rs. 3,000 belonged to her husband. The assessee provided affidavits and statements to support her claim, asserting that she was the eldest lady in the family and responsible for the jewellery.

The Tribunal found that the Revenue did not question the assessee or her husband about the utilisation of the jewellery left by her mother-in-law. The Tribunal noted that the AAC's observation that the appellant expressed her inability to provide information about the utilisation of the jewellery was incorrect, as no such query was ever put to the assessee. Given the lack of contradictory evidence from the Revenue and the consistent statements from the assessee and her family, the Tribunal decided to delete the addition of Rs. 26,650 on account of unexplained jewellery.

Conclusion:

The Tribunal allowed the assessee's appeal, deleting the addition of Rs. 26,650 on account of unexplained jewellery, and dismissed the Revenue's appeal, confirming the deletion of Rs. 47,000 on account of unexplained cash.