9911796707
TMI Blog1990 (11) TMI 191X X X X Extracts X X X X X X X X Extracts X X X X ..... ghing in all 3,582 grams were seized along with silver ingots weighing 24.83 Kgs. There was also a simultaneous search and seizure by the Income-tax Department. On the basis of the statement of the assessee's son Ratnakara Pai, who is also staying with the assessee, the silver ingots were treated as having been declared by Ratnakara Pai, while the gold and gold ornaments etc. were treated as owned by the assessee. During the course of search proceedings, the Central Excise authorities had also come across other gold jewellery which was claimed to be belonging to the assessee and his family. Such jewellery weighing 1,039 grams found at home and some other jewellery found in the locker which belonged to his daughter-in-law were not seized. The Income-tax Officer completed the assessment on a total income of Rs. 6,65,500, which included a sum of Rs. 5,80,000 being the value of alleged unexplained bullion and jewellery and Rs. 20,000 as alleged unexplained expenditure. The assessee was aggrieved and appealed to the CIT (Appeals), but did not succeed. Hence this second appeal by the assessee. 3. As regards the addition of Rs. 5,80,000 made in respect of the gold and gold jewellery po ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... x Officer in the income-tax proceedings was of the view that there was nothing on record to show that there was such direction given by the Commissioner of Income-tax. On the other hand, the Income-tax Officer noticed that there were discrepancies in the statements furnished by the assessee before the Central Excise authorities and the income-tax Officer. In the statements given before the Central Excise authorities the assessee had stated that he kept the gold buried in the flower bed on the south of his bedroom, that out of it two ingots of primary gold weighing 1730 grams had been purchased by him about 10 years ago on two occasions from certain Chettiar from Madurai side, that it was buried along with ornaments after some years, that the ten standard gold bars had been removed by him piece by piece on different occasions from the gold purchased from Bombay for his jewellery shop, that the 85 gold coins weighing 364 grams had been purchased by him in retail from different persons who had offered them at his jewellery shop for sale, that in most of the cases the persons who owned gold sovereigns had sold them to him in emergencies and that certain prize medals included in it had ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... other items under section 119 of the Customs Act, 1962 and under section 71 of the Gold (Control) Act, 1968. The appeal preferred by the assessee against the above order of the Collector of Customs was also dismissed by the Customs, Excise and Gold (Control) Appellate Tribunal, South Regional Bench at Madras, vide order dated 1-8-1986. According to the assessee the gold jewellery seized from him was acquired in the past and not in the financial year relevant to the assessment year in question. The assessee contended that he had explained the position to the satisfaction of the Commissioner of Income-tax, Cochin and hence the addition of Rs. 5,80,000 under section 69A of the Income-tax Act, 1961, is illegal and unjust and is to be deleted. In this connection, the assessee also placed reliance on the following decisions reported in 5. Mariappa Nadar v. ITO [1984] 19 TTJ (Mad.) 431 Shakuntala Devi Saraf v. ITO [1988] 31 TTJ (Jp.) 9 ITO v. Nagardas Jashraj [1988] 28 ITD 386 (Ahd.) The assessee, therefore, prayed for the deletion of the sum of Rs. 5,80,000 made under section 69A. On the other hand, the learned departmenal representative supported the view of the CIT (Appeals). 6. We ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessment years 1980-81 to 1982-83. Assessment orders were passed on the same date. Going through the assessment orders it is apparent that the Wealth-tax Officer had accepted the existence of gold ornaments weighing about 3237 grams for the assessment years 1975-76 to 1980-81 and included the same in the net wealth of the assessee. For the other two years, viz., 1981-82 and 1982-83 in addition to 3237 grams of gold jewellery other ornaments weighing about 345 grams and the value of 58 sovereigns were also included in the assessments. On the basis of such inclusion of the impugned gold ornaments etc., for the assessment years beginning from 1975-76 onwards, the Wealth-tax Officer had initiated penalty proceedings under section 18(2) and imposed penalties under section 18(1)(a) of the Wealth-tax Act. The above orders are on record. Thus, the documents produced before us clinch the issue that the Income-tax Officer acting in the capacity of Wealth-tax Officer had accepted the explanation offered by the assessee that the gold ornaments were in existence with the assessee at least as early as 1975-76. Therefore, there is enormous force in the contention of the learned advocate, S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tax Officer under section 69A of the Income-tax Act is unjustified and the same is deleted. Thus the ground is decided in favour of the assessee. 8. The next ground relates to the addition of Rs. 20,000 from other sources on account of marriage expenses of the daughter. According to the assessee, he incurred a sum of Rs. 30,000 in connection with the marriage of his fifth daughter held on 9-12-1982. The assessee returned an income of Rs. 30,000 under other sources. The Income-tax Officer found that the unexplained expenditure incurred by the assessee in connection with the marriage of his fifth daughter would be Rs. 50,000 and added Rs. 20,000 to the income of the assessee. For making this addition, the Income-tax Officer also relied on the entries in the two small note books seized along with the jewellery from the possession of the assessee, wherein marriage expenses of two daughters were recorded. The expenses for the marriage of the fifth daughter conducted on 9-12-1982 were noted as Rs. 75,500. According to the assessee, he gave 40 sovereigns to his daughter at the time of her marriage and they were available with him. Considering all the facts and the Income-tax Officer fi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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