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TMI Blog2018 (7) TMI 120X X X X Extracts X X X X X X X X Extracts X X X X ..... f Cases. M/s. Dharampal Satyapal Group of cases is engaged in manufacturing and trading of Chewing Tobacoo and premium pan masala besides other businesses. The group is also involved in Food Products, Packing, Hospitality, Rubber, Steel and Education business. 3. In response to notice u/s 153 A of the IT Act 1961, the assessee filed her return of income on 29.09.2011 declaring total income of ₹ 1,37,950/-. During the course of assessment proceedings the Assessing Officer observed that during the course of search and seizure proceedings u/s 132 (1) of the IT Act at the residence of the assessee at 43/1, Rajpur Road, New Delhi the following jewellery as per the valuation made by the government registered valuer was found. Description Residence Weight Jewellery found Rs.95,60,586/- (48 items) 4514.084 grams precious metal 129.58 grams stones Jewellery seized Rs.62,65,670/- 4. On being questioned by the Assessing Officer to explain the sources of acquisition of the said jewellery, the asses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ation up to the date of search i.e. 21.01.2011 having a gap of 10 months. 5. However, the Assessing Officer was not satisfied the above explanation given by the assessee. According to him the items noted in the valuation report did not tally with the jewellery seized during the course of search for which jewellery valued at ₹ 62,65,670/- were seized. According to him the assessee has made only general submission and did not furnish any explanation regarding source of acquisition of the specific jewellery items which were not tallying with the Government valuer s report for which those were seized during the course of proceedings u/s 132 (1) of the IT Act. The Assessing Officer further noted that during the course of search at her residence the assessee failed to offer any satisfactory explanation with regard to the jewellery items not matching in description with the items disclosed in the wealth tax return. He, therefore, held that the investment in the jewellery items which were not tallying in description as well as in weight of precious metals and stones with the valuation report of the assessee and which were seized during the course of search and seizure proceedi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd deleted the remaining amount. He also upheld the assessment made u/s. 153 A/143 (3). The relevant observation of Ld. CIT (A) reads as under :- 3.4 I have considered the assessment order, written submission and arguments of Ld. AR. Ld. AR has argued that the Ld. Assessing Officer has made general remarks that search seizure action was carried out against D. S. Group of cases. There is no search against the appellant. Therefore, section 153 A has been wrongly invoked. I have considered these arguments. These arguments are not applicable to the facts of the case. In the present case, there is a search seizure action u/s 132 at the residence at 43/1, Rajpur Road, Delhi of the appellant who is a member of D. S. Group Jewellery was found seized as mentioned in para 3 of the assessment order in appellant s hand. Therefore, it is proved beyond doubt that there was a search action u/s 132 against the appellant. Further, date of search is 21.01.2011. Therefore, the present assessment year 2011-12 is the search assessment year. Hence the assessment has been made u/s. 143 (3) not u/s 153 A of I. T. Act, 1961. Hence this argument is not based on facts of the case. On meri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or altered. Under similar facts 1 have decided the appeals in D.S. Group in the ease of Mrs. Rita Kumari in IT A No. 117/13-14/1268 for A.Y'. 2011-12 where 1 have held that the jewellery has been remanufactured or alteration has been done by the assessee. That is why the items are not tallying with the valuation report. I have sustained 10% of value of such jewellery as unexplained investment on account of alteration /remanufacturing. In present ease also, I hereby sustain 10% of jewellery addition amounting to ₹ 6,26,567/- balance addition is deleted. Accordingly this ground of appeal is partly allowed. 9. Aggrieved with such part relief by Ld. CIT(A) the revenue as well as the assessee are in appeal before the Tribunal by raising the following grounds :- ITA No. 6103/Del/2014 (Assessee) 1. That on the facts and circumstances of the case, the Ld. CIT (A) has erred in holding 10% value of jewellery i.e. ₹ 6,26,567/- as unexplained jewellery in view of the explanation given and documentary evidence submitted. Therefore, the same is liable to be deleted. 2. The appellant craves leave for addition, modification, alteration, amendment of any of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has granted the relief. Referring to the decision of the coordinate Bench of the Tribunal in the case of Smt. Sunita Gupta Vs. DCIT vide ITA No. 5295/Del /2013 and 5370/Del/2013 order dated 17.03.2016 for A. Y. 2011-12, he submitted that under identical circumstances the Tribunal has deleted the entire addition. Referring to the decision of the coordinate bench of the Tribunal in the case of Rita Kumari Vs. DCIT and vice versa vide ITA No. 5296/Del/2013 and 5369/Del/2013 order dated 12.02.2016, he submitted that the Tribunal has deleted the entire addition by dismissing the appeal filed by the revenue and allowing the appeal filed by the assessee. He submitted that both the above assessees belong to the same group. Therefore, following the decisions of the Tribunal the entire addition made by the Assessing Officer should be deleted and the appeal filed by the revenue should be dismissed. He also filed the jewellery reconcilement statement. 12. We have considered the rival arguments made by both the sides, perused the orders of the authorities below and the paper book filed on behalf of the assessee. We have also considered the various decisions cited before us. We find during t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rse 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 Id. CIT(A) to the extent of ₹ 33,49,840/- was not justified. 10. In his rival submissions the Id. DR reiterated the observations made by the AO in the assessment order dated 21.03.2013 and further submitted that the jewellery found during the course of search did not match with the jewellery declared in the wealth tax return. Therefore, the Id. CIT(A) was not justified in allowing the relief to the assessee. It was further submitted 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. Therefore, the addition was ri ghtly made by the AO and the Id. CIT(A) was not justified in allowing the relief to the assessee. 11. We have considered the submissions of both the parties and c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 Id. 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 contention of the assessee that the remaking charges were incurred out of household withdrawals made from time to time in earlier years. We, therefore, do not see any justification on the part of the Id. CIT(A) in sustaining the addition which was made on the basis of surmises and conjecture. Accordingly, the addition sustained by the Id. CIT(A) is deleted. We, therefore, do not see any merit in the appeal of the department and the appeal of the assessee is allowed. 13. Similarly in the case of Rita Kumari (Supra) the Tribunal also deleted the entire addition made by the Assessing Officer and thereby dismissed the appeal filed by the revenue and allowed the appeal filed by the assessee. The relevant observations of the Tribunal from para 8 onwards read as under :- ..... X X X X Extracts X X X X X X X X Extracts X X X X
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