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Income Tax Appellate Tribunal, DELHI “A” BENCH: NEW DELHI
Before: SHRI G.S. PANNU & SHRI KUL BHARAT
This appeal filed by the assessee for the assessment year 2013-14 is directed against the order of learned CIT(A), Karnal dated 21.12.2016.
The assessee has raised following grounds of appeal:-
1. “That having regard to the facts and circumstances of the case, Ld.CIT(A has erred in law and on facts in upholding the action of the Ld. A.O. in making an addition of Rs.56,55,380/- on account of jewellery found in the search.
2. That in any case and in any view of the matter, action of Ld.CIT(A) in confirming the action of Ld.AO in making an addition of Rs.56,55,380/- is bad in law and against the facts and circumstances of the case.
3. That having regard to the facts and circumstances of the case, Ld.CIT(A) has erred in law and on facts in upholding the action of the Ld. A.O. in making an addition of Rs.3,50,000/- u/s 69A of the Income Tax Act, 1961 on account of cash found during the search.
4. That in any case and in any view of the matter action of Ld.CIT(A) in confirming the action of Ld. A.O. in making the impugned additions are bad in law and against the facts and circumstances of the case.”
Facts giving rise to the present appeal are that a search action was carried out at M/s. SRS Group on 09.05.2021. The premises of the assessee was also covered under the search action. Thereafter, notices u/s 143(2) and 142(1) of the Income Tax Act, 1961 (“the Act”) were issued. In response to the notices, Authorized Representatives of the assessee atended the assessment proceedings and the issues were discussed with him. The Assessing Officer while framing the assessment, noted that during the course of search, statement of brother of the assessee, Sh. Sunil Jindal was recorded. The Assessing Officer further recorded that jewellery amounting to Rs.1,04,08,109/- belong to the assessee was found during the course of search. However, no documentary evidence was produced in support of the source of purchase of jewellery. The assessee filed explanation regarding the source of jewellery. However, the Assessing Officer did not accept the explanation fully offered by the assessee and proceeded to make additions partly on this issue. It was also observed by the Assessing Officer that the assessee could explain the genuineness of the jewellery to the extent of Rs.24,84,406/-. The Assessing Officer made addition of Rs.15,52,818/- and Rs.41,02,5622/- respectively. Further, the Assessing Officer made addition on account of cash found during the course of search of Rs.3,50,000/-. Hence, the Assessing Officer assessed the income at Rs.2,23,14,890/- against the returned income of Rs.1,63,09,510/-. Aggrieved against this, the assessee preferred appeal before Ld.CIT(A) who after considering the submissions of the assessee, dismissed the appeal and sustained the additions so made by Assessing Officer. Aggrieved against the order of Ld.CIT(A), the assessee is in further appeal before this Tribunal.
Ground Nos.1 & 2 raised by the assessee are against the sustaining addition of Rs.56,55,380/- qua the unexplained jewellery found during course of search at the premises of the assessee.
The Ld. Counsel for the assessee, Sh. Rakesh Gupta vehemently argued that the authorities below have failed to consider the facts in right perspective. He submitted that the assessee is living in joint family consisting of his parents and brother and his family. He drew our attention to the assessment order wherein the members of family are mentioned. He further contended that before Ld.CIT(A), certain evidences which were not available at the time of assessment proceedings were placed. However, Ld.CIT(A) did not consider the same.
He drew our attention to para 4.2 of the impugned order in support of the contention that a specific submission was made before the Ld.CIT(A), to consider the evidences so filed before him. He further contended that in the interest of justice, matter to be restored back to the Assessing Officer to decide the issue afresh in the light of the additional documents filed by the assessee and he further submitted that even the authorities below has not given effect to the CBDT Circular in letter and spirit.
Ld. DR opposed these submissions. He fairly conceded that he has no objection, if the matter is restored back to the file of Assessing Officer, for verifying genuinity of the claim of the assessee.
We have heard the rival contentions and perused the material available on records and the submissions made at bar. Having heard the parties, we deem it proper in the interest of principles of natural justice to afford an opportunity to the assessee to place the relevant evidences that were not available with him at the time of assessment proceedings for verification. Further, the Assessing Officer would also consider the claim of the assessee taking into account the CBDT Circular. We, therefore, set aside the findings of authorities below and restore the issue to file of Assessing Officer for decision afresh. Ground Nos. 1 & 2 are allowed for statistical purposes only.
Ground No.3 raised by the assessee is against the sustaining addition on account of unexplained cash of Rs.3,50,000/- added u/s 69A of the Act. Ld. Counsel for the assessee argued that the authorities below have not taken into account that the assessee has having sufficient source to explain the availability of cash. He submitted that the cash was withdrawn from the bank account of the assessee and other family members. Hence, the cash found during the course of search is fully explained.
Ld. Sr. DR opposed the submissions.
We have heard both Ld. representatives of the assessee and the Revenue and material available on record. We find that there is withdrawal from the bank accounts of the assessee as well as other family members as reflected in their respective bank statements.
Considering the same, the finding of the orders of the authorities below are set aside and the issues are restored back to the Assessing Officer to verify the availability of funds at the time of search. If the Assessing Officer finds that the withdrawal was made prior to the search and the amount withdrawn was not utilized for any other purpose, he would delete the addition. Ground No.3 of the assessee’s appeal is allowed in the terms indicated herein above.
Ground No.4 raised by the assessee is general in nature and needs no adjudication.
In the result, the appeal of the assessee is allowed for statistical purposes as per terms indicated above.
Above decision was pronounced on conclusion of Virtual Hearing in the presence of both the parties on 08th April, 2021.