1982 (4) TMI 144 - AT - Income Tax

Summary

Issues:
1. Addition of value of jewellery in assessment under s. 69A of the IT Act.
2. Ownership of jewellery found in bank locker during search.
3. Application of provisions of s. 69A and s. 132(4A) of the IT Act.

Analysis:
The judgment involves an appeal by an individual assessee concerning the addition of Rs. 21,968 in respect of the value of jewellery not belonging to the assessee. The facts reveal that a search under s. 132 of the IT Act was conducted at the assessee's premises, resulting in the seizure of jewellery from a bank locker held in the name of the assessee's son. The Income Tax Officer (ITO) assessed the value of the jewellery in the hands of the assessee under s. 69A of the Act, as the locker had been last operated in a relevant year. The assessee contended that the jewellery belonged to an elderly lady and was meant for the children's marriages, supported by a statement and a reported court decision. The First Appellate Authority partially allowed relief but upheld the assessment of jewellery value for the relevant assessment year.

The second appeal before the Appellate Tribunal raised arguments based on various legal precedents and the statement of the elderly lady claiming ownership of the jewellery. The Tribunal considered the provisions of s. 69A of the Act, emphasizing that unexplained money or assets can be deemed the income of the assessee only if ownership is established. It noted that the bank locker was in the son's name, and the elderly lady had claimed ownership, thereby challenging the assessment in the hands of the assessee. The Tribunal also discussed the presumption under s. 132(4A) of the Act, highlighting that possession or control of the jewellery was not with the assessee, leading to the reversal of lower authorities' orders.

The Tribunal concluded that the value of the jewellery could not be assessed in the hands of the assessee for the relevant assessment year. It emphasized the lack of evidence establishing ownership of the jewellery by the assessee, especially considering the bank locker was in the son's name and the statement of the elderly lady claiming ownership. Consequently, the appeal by the assessee was allowed, overturning the lower authorities' decisions.