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TMI Blog2017 (11) TMI 910X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee has explained that whatever cash has been found, the same should be considered to be covered under the huge disclosure made by the company as ultimately the cash found belong to the company only. Nowhere the assessee had stated that the cash belongs to the assessee and then he has changed the stand that it is out of the cash book of the company. Consistently assessee has been stating that the cash found is from the company’s account which is duly recorded in its book. Thus, we do not find any reason to disbelief the assessee that the source of the cash found is out of the cash-in10 hand of the company as recorded in its books of account. Accordingly, the addition of ₹ 5 lacs is directed to be deleted. So far as the cash amounting of ₹ 34,000/- is concerned which is not part of the imprest account, we are of the opinion that since it is very small amount of cash and which could be out of personal savings etc. from the source of income earned by the assessee, no adverse inference should be drawn. Thus, we direct the deletion of entire cash of ₹ 5,34,000/-. Addition on account of alleged unexplained jewellery found during search - sridhan provisions ap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or the quantum of assessment passed u/s 143(3) for the assessment year 2012-13. Since the issues involved in both the appeals are common arising out of identical set of facts, therefore, they were heard together and are being disposed off by way of this consolidated order. As a lead case we are taking up the appeal in the case of Shri Rakesh Mahajan being ITA No.,1810/DEL/2015 wherein the assessee has challenged two additions, viz., firstly, addition of ₹ 5,34,000/- made on account of unexplained cash found during the course of search;: and secondly, addition of ₹ 10,52,124/- made on account of alleged unexplained jewellery found during search. 2. The brief facts qua the issue involved are that a search and seizure operation u/s 132 (4) was carried out on 4.8.2011 at the business and residential premises of Nirala group which also covered the premises of assessee. During the course of search at the residential premises of Shri Rakesh Mahajan, cash amounting to ₹ 5,34,000/- was found. In his explanation, the assessee before the AO submitted that he has received sum of ₹ 5 lacs from M/s. Nirala Developers Pvt. Ltd. as imprest on 3.8.2011 and in support, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 01.08.2011 To Opening Balance 54,00,000 01.08.2011 To Bank of Baroda 02/09 Contra 62 1,00,000 01.08.2011 By Site Off.Imprest a/c-2 Journal 1273 1,00,000 01.08.2011 To F307 Abhishek Sindal Receipt 229 2,07,550 01.08.2011 By Bank of Baroeda 02/09 Contra 63 2,07,550 03.08.2011 To E701 Shishu Pal Receipt 234 59,500 03.08.2011 To F707 Sumit Vohra Receipt 235 182,350 03.08.2011 By(as per details) Imprest a/c Iftikhar Ahmed Imprest a/c Rakesh Mahajan Imprest a/c SKG ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ,000 towards advance tax for A.Y. 12-13 by voucher no. 611 on 06.08.2011. Contrary to the appellant s claim, no imprest accounts of directors appear in the cash book of Nirala Developers P Ltd. (though there is an Imprest account for site office) As per the document relied by the director, advance tax paid by Nirala Developers P Ltd. on 06.08.2011 as per voucher no. 612 was only ₹ 12,61,221 whereas Nirala Developers P Ltd has claimed as per its cash book, advance tax of ₹ 53,98,000 and ₹ 13,81,000, paid as per voucher no. 611 and 612 respectively on 06.08.2011. There is also discrepancy in respect of the receipt of ₹ 10,17,371 in Imprest a/c which is shown in the document relied by the appellant to have been received on 03.08.2011 by voucher no. 236, whereas the cash book filed by Nirala Developers P Ltd. shows that the sum was received on 06.08.2011 by voucher no. 245. * Lastly, he came to the conclusion that document relied by the assessee is patently incorrect, fabricated and unreliable, therefore, same is reliable to be rejected and thus, assessee s explanation on the cash seized from his residence found is unexplaine ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rala Developers Pvt. Ltd. in which these two person were directors. The contention of the assessee is that, as on the date of search, i.e., 4.8.2011 there was cash available in the books of Nirala Developers and these cash amount were kept at the residence of the directors. Thus, the cash found stands explained from the source of cash-in-hand with the company. From the perusal of the relevant cash book of the company, the copy of which is appearing at page 16 of the paper book for the period 30th June 2011 to 7.9.2011, we find that there is a huge opening balance up till 3.8.2011 and as on that date the availability of cash in the cash book is ₹ 53,98,000/-. Out of this cash, advance tax has been paid towards the income offered during the course of search on 6.8.2011. The cash of ₹ 53,98,000/- as on 3.8.2011 has been stated to be lying with the three directors of the company. It is not the case of the department at all that the cash-inhand as recorded in the said books of accounts was found from the premises of the company, i.e., M/s. Nirala Developers Pvt. Ltd. If the cash recorded in the company s book has been stated to be lying with the directors which was not found ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re the assessee had stated that the cash belongs to the assessee and then he has changed the stand that it is out of the cash book of the company. Consistently assessee has been stating that the cash found is from the company s account which is duly recorded in its book. Thus, we do not find any reason to disbelief the assessee that the source of the cash found is out of the cash-in10 hand of the company as recorded in its books of account. Accordingly, the addition of ₹ 5 lacs is directed to be deleted. 9. So far as the cash amounting of ₹ 34,000/- is concerned which is not part of the imprest account, we are of the opinion that since it is very small amount of cash and which could be out of personal savings etc. from the source of income earned by the assessee, no adverse inference should be drawn. Thus, we direct the deletion of entire cash of ₹ 5,34,000/-. 10. As regard the second issue is concerned, i.e., addition on account of unexplained jewellery, the brief facts are that, during the course of search and seizure carried at the residential premises of the assessee and his locker, jewellery weighing 1182 grams was found, which was valued at ₹ 30, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y found from the premises and locker of the assessee as well as his mother were as under:- Persons Search at Jewellery foundweight (grams) Jewellery foundvalue (Rs.) Jewellery seized weight (grams) Jewellery seized value (Rs.) Rakesh Mahajan (appellant) Residence Bank Locker 209.43 405.17 4,49,765 10,52,124 - 405.17 - 10,52,124 Renuka Mahajan (wife) Bank Locker 232.17 5,93,128 - - Kaushalya Mahajan (mother) Bank Locker Residence 319.00 8,30,464 - - Total 1236.24 30,80,840 405.17 10,52,124 Admittedly the assessee could not give any evidence in the form of purchase vouchers or bills for acquisition of jewellery. However, the assessee s content ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee s family consisting of assessee himself, his wife, his mother, one major unmarried daughter, one minor daughter and one minor son and the status of the assessee being owner and director of various companies then it has to be presumed that certain amount of jewellery would be available. If the availability of jewellery especially in the concept of Indian tradition and general practice in Hindu families whereby jewellery is gifted by the relatives and friends at the time of social functions, viz. marriages, birthdays, marriage anniversary and other festivals, such gifts in the form of jewellery are customary and such practice prevailing in our society cannot be ignored. It was for this prevalent norm and practice in the Indian families where jewelleries are gifted at time of marriage and birth of children and the married ladies receiving stridhan from both side of the family, it is presumed that family having certain status will have some jewellery. That is why, CBDT vide it aforesaid instruction, has laid down a criteria of availability of jewellery with various category of family members. Here in this case total jewellery weighing of 1236.24 grams was found and if o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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