9911796707
TMI Blog1999 (1) TMI 54X X X X Extracts X X X X X X X X Extracts X X X X ..... ss premises of the assessee on16th July, 1987. During the search gold ornaments weighing 5.05 kg. were found. It was noted by the Department that expected quantity of such stock should have been available with the assessee at 6.042 Kgs. The assessee was called upon to explain the shortage and it was submitted by the assessee that gold worth 1.037 Kgs. were issued to Karigars for making ornaments and that was evident from exhibit 13 of seized record. The AO did find force in this explanation of the assessee but he observed that even after that there was discrepancy of 605 grams of gold. About this, the explanation of the assessee was that ornaments worth 605 grams of gold given to customers for approval but that explanation was rejected by t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ment order and once addition on account of sale of gold jewellery outside books of account. On this amount of exceeding Rs. 2 lakhs which has already been added, there was no justification for making this addition of Rs. 42,350 as gold jewellery worth Rs. 16,94,000 allegedly sold at the time of search is to be treated as included in the sale of gold jewellery outside books of account exceeding Rs. 2 lakhs and he deleted the addition against which the Revenue is in appeal. 4. On the date of hearing, the learned Departmental Representative placed reliance on the order of AO and learned counsel for the assessee had reiterated the same submissions as were taken before the CIT(A). 5. We have considered the submissions and perused the record ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t on the sale of silver jewellery was @ 15 per cent and AO should have considered this aspect which he failed. Bifurcation of sale of Rs. 3.5 lakhs into silver and gold jewellery was also furnished before CIT(A) in which silver jewellery sale was more than 50 per cent. This plea did find favour with the CIT(A) who observed that profit in silver jewellery was 15 per cent as against 25 per cent of gold jewellery. Placing reliance on the bifurcation so furnished by the assessee, he gave relief of Rs. 17,500 to the assessee and Revenue is in appeal. 8. The learned Departmental Representative placed reliance on the order of AO and contended that assessee had not furnished the detail of sale of gold and silver ornaments to the AO and CIT(A) was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the assessee that no doubt, repair work of Rs. 4 lakhs of gold/jewellery was carried out by the assessee, there was a nominal income from repair work as businessmen carry out repair work without any charge with an intention to earn goodwill among the customers. It was also the case of the assessee that during search operation no document was seized by the Department showing any income from repair work in the case of the assessee as well as any other assessee who were also subject to search operation. The learned CIT(A) noted that value of jewellery repair can hardly be any indication about the repair charges received as most of the time repair work was carried out free of charge to earn goodwill. But he estimated the income from repair ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ddition of Rs. 3,49,000 was made on that account was also available to the assessee for alleged investment. On these two pleas, the CIT(A) deleted the addition as these explanations were found sufficient to conclude that assessee was having sufficient gold and amount for making investment. Against deletion of this addition of Rs. 50,000, the Revenue has come in appeal. 16. The learned Departmental Representative placed heavy reliance on the order of AO and assessee placed reliance on the order of CIT(A). 17. We are of the considered view that CIT(A) has rightly appreciated the factual position as assessee found short of gold worth Rs. 1,69,400 at the time of search that gold was available to him to effect sale of gold ornaments outside ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tinue for every case where documents seized in search as income from outside book in earlier years. The Revenue is in appeal. 19. As in every ground, the learned Departmental Representative placed reliance on the order of AO and learned counsel for the assessee placed reliance on the orders of CIT(A). 20. We have considered the rival submissions and perused the record. Admittedly, there was no evidence with the AO to show that assessee had earned any interest of pawning business during the year under consideration. It was a case of search and no document was seized by the Revenue to show that assessee earned any interest income from pawning business. The basis for the AO to make addition was the earlier year s income but that addition w ..... X X X X Extracts X X X X X X X X Extracts X X X X
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