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Facts
A search operation under Section 132 led to the seizure of jewellery worth Rs.1,88,74,635. The Assessing Officer (AO) made an addition for unexplained jewellery in the assessee's hands, despite the assessee's claim that it belonged to her daughter, Ms. Vasudha Lodha. The CIT(A) deleted this addition, noting that the jewellery was subsequently taxed in the daughter's hands under Section 143(3). The Revenue filed an appeal against the CIT(A)'s order.
Held
The Tribunal affirmed the CIT(A)'s decision, holding that the jewellery rightfully belonged to Ms. Vasudha Lodha, the assessee's daughter, and had already been taxed in her hands through an order dated 30.12.2019 under Section 143(3). Consequently, the deletion of the addition in the assessee's hands by the CIT(A) was deemed lawful and upheld.
Key Issues
Whether the CIT(A) erred in deleting the addition of unexplained jewellery in the assessee's hands, and whether the jewellery belonged to the assessee or her daughter and was already taxed in the daughter's assessment.
Sections Cited
Section 69A, Section 115BBE, Section 132, Section 143(2), Section 143(3), Section 132(4)
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, DELHI BENCH ‘E’, NEW DELHI
Before: Dr. B. R. R. KumarShri Yogesh Kumar US
ORDER Per Dr. B. R. R. Kumar:- The present appeal has been filed by the Revenue against the order of Ld.CIT-XXVI, New Delhi dated 23.10.2019. 2. The Revenue has raised the following grounds of appeal:-
1. Whether the Ld. CIT(A) has erred in law and on facts in deleting the addition of Rs.1,88,74,635/- made by A.O. on account of unexplained jewellery u/s 69A r.w.s. 115BBE of the Act ?
2. Whether the Ld. CIT(A) has erred in law and on facts of the case, in deleting the entire addition by accepting the plea of the assessee that impugned jewellery belongs to her daughter i.e. Ms. Vasudha Lodha?
3. Whether the Ld. CIT(A) has erred in ignoring the fact that impugned seized jewellery from Locker No. 27 amounting to Rs.1,10,38,505/- only, out of total addition of Rs. Rs.1,88,74,635/- made by A.O on account of unexplained jewellery ?
2 Madhu Lodha 4. (a) The Ld. Commissioner of Income Tax (Appeals) is erroneous and not tenable in law and on facts. (b) The appellant craves leave to add, amend any/all of the grounds of appeal before or during the course of the hearing of the appeal.
A search and seizure operation u/s 132 of the I.T. Act, 1961, was carried out at the business / residential premise of Paras Mal Lodha Group on 28.06.2016 and during the course of search, certain documents belonging to the assessee were also seized. During the course of search, jewellery items amounting to Rs.1,88,74,635 were found and seized. As per statement of assessee it was noticed that the all the jewellery which were seized during the course of Search & Seizure was related to Ms. Vasudha Lodha, daughter of the assessee. On this basis, a notice u/s 143(2) of Income Tax Act, 1961 was issued to the Ms. Vasudha Lodha on 12.12.2019. The jewellery has been taxed in the hands of Smt. Vasudha Lodha vide order passed u/s. 143(3) dated 30.12.2019. The Assessing Officer considered the statement of Ms. Vasudha Lodha recorded u/s. 132(4) at the time of search.
Thus, we find that the revenue has dutifully and rightfully taxed this jewellery in the hands of Ms. Vasudha Lodha who is the rightful owner of the jewellery vide order dated 30.12.2019 passed u/s. 143(3). The ld. CIT(A) deleted the addition in the hands of the assessee of considering the entire facts on record. Hence, the addition made in the hands of the assessee, who is the mother of Ms. Vasudha Lodha, was lawfully deleted by the ld. CIT(A). The order of the ld. CIT(A) is hereby affirmed.
In the result, the appeal of the Revenue is dismissed. Order Pronounced in the Open Court on 23/01/2024.