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TMI Blog2016 (4) TMI 1093X X X X Extracts X X X X X X X X Extracts X X X X ..... ation on the part of the ld. CIT(A) in sustaining the addition which was made on the basis of surmises and conjecture. Accordingly, the addition sustained by the ld. CIT(A) is deleted. - Decided in favour of assessee - ITA No. 5295/Del/2013, ITA No. 5370/Del/2013 - - - Dated:- 17-3-2016 - Sh. N. K. Saini, AM And Sh. A. T. Varkey, JM For The Assessee : Sh. R. S. Singhvi, Adv. For The Revenue : Sh. Jayant Mishra, CIT DR ORDER Per N. K. Saini, AM: These cross appeals by the assessee and the department are directed against the order dated 11.06.2013 of ld. CIT(A)-XXXIII, New Delhi. 2. In the assessee s appeal following grounds have been raised: 1. That having regard to the facts and circumstances of the case, Ld. CIT(A) has erred in law and on facts in not deleting the addition of ₹ 3,34,98,409/- fully as made by Ld. AO on account of alleged unexplained jewellery u/s 69A and has further erred in sustaining the addition to the extent of ₹ 33,49,840/- (i.e. 10% of ₹ 3,34,98,409/-) on account of remaking charges and that too without considering the submission/evidences of the assessee. 2. That in any case and in any view of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re that a search and seizure operation u/s 132 of the Income Tax Act, 1961 (hereinafter referred to as the Act) was carried out on 21.01.2011 in M/s Dharmpal Satyapal Group of cases. The assessee filed her return of income on 14.09.2011 declaring total taxable income of ₹ 13,90,700/-. The AO noticed that during the course of search and seizure proceedings u/s 132(1) of the Act at E-1A (E-13), Maharani Bagh, New Delhi jewellery worth ₹ 6,05,33,471/- in value was found. The AO asked the source of acquisition of the said jewellery. The assessee replied as under: A search operation was carried on 21.01.2011 at E-1A, Maharani Bagh, New Delhi. In the case of Sh. Rajiv Kumar and his family members, the total jewellery found was listed on 11.03.2011 and as per valuation report made out in the name of Smt. Sunita Gupta Rajiv Kumar, the value thereof comes to ₹ 6,05,33,471.00. The total net weight of precious metal as per the report is 8949.778 gms. Out of this total jewellery found jewellery having net precious metal weight of 5124.612 gms valued at ₹ 2,70,35,062.00 has been given back on the spot and the balance jewellery having net precious metal weight of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of search. In view of above factual position, it is submitted that the jewellery found is sufficiently explained and no interference is called for in the income returned for assessment on this issue. 6. The AO after considering the submissions of the assessee observed that the assessee failed to offer any satisfactory explanation with regard to the acquisition of jewellery items not matching in description with the items disclosed in the wealth tax return and that the various submissions made during the course of search like making and remaking of the jewellery items, loaned to friends and relatives etc. remained unsubstantiated. The AO held that the assessee had not furnished any explanation of source of acquisition of the specific jewellery items which were not tallying with the assessee s report and were seized during the course of search proceedings u/s 132(1) of the Act. The investment in the said jewellery items which had been determined by the government approved valuer at ₹ 3,34,98,409/- was treated as unexplained investment made by the assessee and added to the total income u/s 69A of the Act. 7. Being aggrieved the assessee carried the matter to th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... page 3 of the assessment order itself that certain difference may be on account of remake. Such statement on oath cannot be brushed aside lightly. Moreover, it is not uncommon in the Indian families when jewellery are not remade/reworked and if for that reason, some items did not match yet it cannot be said to be unexplained as the total jewellery found at the lime of search is well covered within the total jewellery declared to the tax department much before the date of search by way of wealth tax returns. Therefore one needs to take holistic view and if that view is .so taken, Your Honour would find that there was no unexplained jewellery. It is therefore prayed that the impugned addition may please be deleted . 8. The ld. CIT(A) after considering the submissions of the assessee sustained the addition of ₹ 33,49840/- by observing as under: I have considered the findings of the Assessing Officer and arguments of Ld. AR. It is undisputed fact that total Jewellery declared in weight for gold and diamond in wealth tax return exceeds total Jewellery found during the search. Total Jewellery declared in the wealth tax return of the appellant in weight was 1104gm of g ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... further submitted that the assessee and her husband were regularly filing their wealth tax returns wherein the jewellery was duly disclosed and the jewellery was got valued once in every 5 years, the said valuation was shown in the wealth tax returns by adding the estimated appreciation in the value of the jewellery. It was submitted that the value of the jewellery declared in the wealth tax return was as under: (i) Sh. Rajiv Kumar ₹ 1,71,23,672.00 (ii) Smt. Sunita Gupta ₹ 5,33,58,446.00 Total ₹ 7,04,82,118.00 It was stated that the jewellery found during the course of search and seizure proceedings was worth ₹ 6,05,33,471/-, therefore, the value declared by the assessee was more in the wealth tax return than found at the time of search. It was further submitted that for the year under consideration the assessee has shown the jewellery acquired for ₹ 53,28,760/-, therefore, the addition sustained by the ld. CIT(A) to the extent of ₹ 33,49,840/- was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . However, the concerned items and value thereof are reflected in our wealth tax return filed and on record. 12. The aforesaid explanation of the assessee appears to be plausible because in the society to which the assessee belongs the jewellery got remade with the passage of time and in accordance with the change in fashion/occasion. In the present case, it is undisputed fact that the AO nowhere stated that the jewellery found during the course of search was more than what was declared by the assessee in the regular wealth tax return furnished much earlier to the search. As regards to the addition sustained by the ld. CIT(A) by presuming that the assessee might have incurred certain expenses for making the jewellery is concerned, it is noticed that nothing is brought on record to substantiate that all the jewellery was got remade during the year under consideration. In this regard, the explanation of the assessee was that the source of remaking in the earlier years was from household withdrawals. In our opinion, the ld. CIT(A) sustained the addition only on the basis of presumption which is not tenable particularly when no evidence was brought on record to disprove this co ..... X X X X Extracts X X X X X X X X Extracts X X X X
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