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2023 (8) TMI 515 - AT - Income TaxUnexplained jewellery - search and seizure operation concluded - AO observed that the assessee is income tax payee and return income is below taxable limit. She admitted issues not wealth Tax for assessee. The sources of jewellery was informed from savings and gifts - HELD THAT - As jewellery which was seized in the hands of assessee was found to be part of the jewellery surrendered by father-in-law of the assessee. In the case of Shri Hitesh Mittal 2022 (2) TMI 435 - ITAT DELHI another Coordinate Bench has taken note of the order in the case of Pallavi Mittal 2021 (9) TMI 1335 - ITAT DELHI and has again concluded that balance seized jewelleryin the hands of Hitesh Mittal, son of Shri S.C. Mittal stood accounted being part and parcel of jewellery surrendered by Shri S.C. Mittal. Learned DR could not bring on record anything to show that these factual findings were disputed, hence, this Bench is inclined to follow the same. The arguments raised on behalf of the Revenue on the basis of reference to Section 110 of the Evidence Act, which provides that where a person is found in possession of anything the burden of proving that he is not the owner is on the person who affirms that he is not the owner, is not applicable to the facts as in the case in hand with regard to the claim of assessee that the jewellery was family jewellery and a part of which has been disclosed as unaccounted income by the father in law, justifies and explains her claim. Accordingly, the addition made in the hands of assessee cannot be sustained. Appeal of assessee is allowed.
Issues Involved:
1. Addition of Rs. 35,68,470/- as undisclosed investment in jewellery. 2. Application of Section 110 of the Evidence Act. Summary: Issue 1: Addition of Rs. 35,68,470/- as undisclosed investment in jewellery The appeal concerns the addition of Rs. 35,68,470/- as undisclosed investment in jewellery found in a locker at Kotak Mahindra Bank, Mumbai, in the name of the appellant. The appellant claimed that the jewellery belonged to a joint family and was part of the undisclosed income declared by her father-in-law, Mr. Subhash Chander Mittal. The Ld. AO and CIT(A) did not accept this explanation, stating that the jewellery's source was not satisfactorily explained by the appellant and was not part of the declaration made by Mr. Subhash Chander Mittal. The jewellery worth Rs. 24,60,870/- was seized, and Rs. 11,07,600/- was not seized. The appellant argued that the jewellery was family-owned and part of the undisclosed income declared by Mr. Subhash Chander Mittal. However, the authorities below did not accept this claim, leading to the addition being sustained. Issue 2: Application of Section 110 of the Evidence Act The Revenue argued that under Section 110 of the Evidence Act, the burden of proving that the appellant was not the owner of the jewellery found in her possession was on her. However, the Coordinate Bench in a related case (Pallavi Mittal) had found that the jewellery was part of the undisclosed income declared by Mr. Subhash Chander Mittal. This finding was reiterated in another case (Hitesh Mittal), where it was concluded that the jewellery seized was accounted for as part of the jewellery surrendered by Mr. Subhash Chander Mittal. The Bench in the present case followed these findings, concluding that the jewellery was part of the undisclosed income declared by Mr. Subhash Chander Mittal. Therefore, the addition made in the appellant's hands could not be sustained. Conclusion: The Tribunal allowed the appeal, holding that the jewellery worth Rs. 35,68,470/- was part of the undisclosed income declared by the appellant's father-in-law, Mr. Subhash Chander Mittal. Consequently, the addition made by the Ld. AO and sustained by the CIT(A) was deleted. The arguments based on Section 110 of the Evidence Act were found inapplicable, and the appeal was allowed.
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