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Income Tax Appellate Tribunal, “D” Bench, Mumbai
Before: Shri Shamim Yahya (AM) & Shri Amarjit Singh (JM)
O R D E R Per Shamim Yahya (AM) : This appeal by the assessee is directed against the order of learned CIT(A) dated 27.3.2017 and pertains to A.Y. 2013-14.
2. Grounds of appeal read as under :- On the facts and in the circumstances of the case the learned CIT (A)-50, Mumbai has erred in law in confirming addition made of Rs.16,35,668/- made in the assessment order u/s. 143(3) of the Act based on surmises and conjectures and made without appreciation of the facts of the case .
Brief facts of the case are that pursuant to search in assessee’s premises gold and diamond ornaments were found. As regards gold ornaments the Assessing Officer accepted the assessee’s submission that in view of CBDT circular and number of family members of the assessee the gold jewellery found was within the mandate of the CBDT circular. Hence, he granted relief for the gold ornaments found.
As regards diamond jewellery found the Assessing Officer observed as under :-
2 Rajan Manik Bhavani
As regards diamond jewelry, it is seen that the assessee and his wife had made following withdrawals in the previous three years;-
Sr.No. A.Y. Income as per capital Withdrawals as per account capital account
Rajan Caroline Rajan Caroline
201142 14,47,780 17,71,430 1,30,000 7,84,868
2012-13 22,25,720 24,74,540 3,00,000 8,53,498
3. 2010-14 65,28,020 37,35,740 8,92,421 10,20,000
A& the assessee arid Ms wife has withdrawals of Rs.20,68,366/- during tfefe assessment years 2011-12 & 2012-13 and withdrawals of R8,39,SO,7t7/- from A.Y.-2011-12 to 2013-14. Total diamond jewellery found was Rs. 31,35,668/-. Looking at the income and withdrawals of the and his wife, I hold diamond jewellery to the extent of Rs. 15,00,000/- is treated as explained. Hence investment in balance diamond Jewellery of Rs. 16,35,668/- is treated as unexplained and added hack to the total income of the assessee as unexplained investment u/s 69 of the Act. Penalty proceedings u/s 27'IAAB of the IT Act is initiated separately.
Upon assessee’s appeal learned CIT(A) inter alia noted that assessee’s claim of gold jewellery with reference to the family member was not correct and he went on to uphold the order of the Assessing Officer. Against the above order assessee is in appeal before us.
We have heard learned Departmental Representative. An adjournment petition has been moved from the assessee which has been rejected.
Upon careful consideration we find that as per the detail of drawing given by the assessee in the chart referred by the Assessing Officer hearing above the withdrawals were Rs. 39,80,787/-. We fall to understand that in light of withdrawal of Rs. 39,80,787/-, why the Assessing Officer held that only Rs. 15 lakhs of jewellery is justified. On query in this regard, learned Departmental Representative submitted that the Assessing Officer may not 3 Rajan Manik Bhavani have granted further relief because of drawing for other purposes by the assessee. In this regard we find that in absence of any finding by the Assessing Officer this plea cannot be sustained. We find that as per the chart made out by the Assessing Officer himself there was sufficient source with the assessee to justify the aforesaid jewellery. Hence, we find that the addition is not justified. As regards the order of learned CIT(A) we find that he has suggested that the relief granted by the Assessing Officer on account of gold jewellery was not justified. Hence learned CIT(A) is suggesting an enhancement, which cannot be sustained in absence of any notice in this regard. Be as it may we find that the assessee had sufficient drawing to support the aforesaid jewellery. Hence we set aside the orders of authorities below and delete the addition for jewellery.
In the result, assessee’s appeal is allowed. Order has been pronounced in the Court on 13.5.2019.