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Income Tax Appellate Tribunal, DELHI BENCH: ‘F’ NEW DELHI
Before: SH. S.K. YADAV & SH. O.P. KANT
ORDER PER O.P. KANT, A.M.: These two appeals by the Revenue are directed against two separate orders dated 30/11/2009 of learned Commissioner of Income- tax (Appeals)-I, New Delhi, for assessment year 2005-06 and 2006-07 respectively. The issues involved in both the appeals being interconnected, the appeals were heard together and disposed of by this consolidated order for convenience and brevity. 2. The grounds raised
in are reproduced as under: “1. The order of the learned Commissioner of Income Tax (Appeals) is not correct in law and facts.
2. On the facts and circumstances of the case, the learned Commissioner of Income Tax (Appeals) has erred in law & facts in 2 & 528/Del/2010 AYs: 2005-06 & 2006-07 deleting the addition of Rs. 9 lacs made by the Assessing Officer on account of payment of ‘on money’ to the Mahajan Shree GHS on the basis of submission of the Group Housing Society and ignoring the entries in the seized documents.
3. The appellant craves leave to add, alter or amend any/all of the grounds of the appeal before or during the course of the hearing of the appeal.”
3. The grounds raised in ITA No. 528/Del/2010 are reproduced as under: “1. The order of the learned Commissioner of Income Tax (Appeals) is not correct in law and facts.
2. On the facts and circumstances of the case, the learned Commissioner of Income Tax (Appeals) has erred in law & facts in deleting the addition of Rs. 22 lacs made by the Assessing Officer on account of payment of ‘on money’ to the Mahajan Shree GHS on the basis of submission of the Group Housing Society and ignoring the entries in the seized documents.
3. The appellant craves leave to add, alter or amend any/all of the grounds of the appeal before or during the course of the hearing of the appeal.”
4. The Revenue revised its grounds in both the appeals, as under:
Revised grounds in :- i. The order of Learned CIT(A) is not correct in law and on facts. ii. On the facts and circumstances of the case, CIT(A) has erred in law & facts in deleting the addition of Rs.30 lacs made by the Assessing Officer on account of purchase of flat from Ms. Neelam Narula and addition of Rs.9 lacs on account of payment made for the purchase of flat Mahajan Shree CGHS on the basis of submission of Group Housing Society and ignoring the entries in the seized documents. (A.Y. 2005-06) iii. The appellant craves leave to add, amend any/all of the grounds of appeal before or during the course of hearing of the appeal.
Revised grounds in i. The order of learned CIT(A) is not correct in law and on facts. ii. On the facts and circumstances of the case, CIT(A) has erred in law & facts in deleting the addition of Rs.17.5 lacs made by the 3 ITA Nos. 527 & 528/Del/2010 AYs: 2005-06 & 2006-07 Assessing Officer on account of purchase of flat from Ms. Neelam Narula and addition of Rs.22 lacs on account of payment made for purchase of flat in Mahajan Shree CGHS on the basis of submission of the Group Housing Society and ignoring the entries in the seized doucuments. iii. On the facts and circumstances of the case, CIT(A) has erred in law & facts in deleting the addition of Rs.3,59,820/- made by the Assessing Officer on account of unexplained investment in Jewellery. iv. The appellant craves to add, amend any/all the grounds of appeal before or during the course of hearing of the appeal.
First we take up the appeal, namely, for adjudication.
At the time of hearing on 11.01.2017, the learned counsel of the assessee sought adjournment of hearing on the ground that the assessee has asked for copy of certain correspondence from the office of Commissioner of Income Tax (Central-I), New Delhi, with regard to preferring of second appeal before the ITAT by the department, which the assessee has not received so far. The learned counsel enclosed a copy of letter dated 05/07/2016 addressed to the Commissioner of Income Tax (Central)-I, New Delhi. In the said letter, the learned counsel mentioned that at the time of filing original grounds of appeal
, the Commissioner of Income Tax, Central-I, New Delhi after verifying the facts decided not to file any second appeal against the addition deleted by the learned Commissioner of Income Tax (Appeals) for investment in flat at Vishrantika Cooperative Group Housing Scheme (CGHS) and the appeal was filed only for the remaining amount of Rs.9 lacs only. The learned counsel further mentioned that now the Department has revised the grounds of appeal including the ground against the deletion of investment in flat at Visharntika CGHS and made the second appeal for Rs.39 Lacs and with reference to this revision of grounds, the learned 4 ITA Nos. 527 & 528/Del/2010 AYs: 2005-06 & 2006-07 counsel wanted to inspect the judicial records maintained in the office of learned Commissioner of Income Tax (Central –I), New Delhi.
7. The learned counsel of the assessee also objected to the grounds revised by the Revenue.
8. The adjournment of hearing, sought by the learned counsel was not allowed by us due to following reasons: (i) that the hearing in case was fixed on 10/1/2017 and on the request of the CIT(DR), the hearing was adjourned to 11/1/2017 and with which the learned counsel also agreed and he did not mention any such facts on said date of the hearing. (ii) that the letter was filed before the learned Commissioner of Income Tax (Central-I), New Delhi, on 05/07/2016 and what correspondence thereafter has been made by the assessee with the Commissioner of Income-tax (Central –I), New Delhi, was not put up before us. (iii) that whatever may be the outcome of the letter addressed to the CIT (Central-I), New Delhi, in our opinion, the appellant or Respondent does not have any right to challenge as why the grounds of appeal have been revised by the other party. (iv) that in the proceedings before the ITAT, both the appellant and respondent can revise their grounds of appeal at any time before hearing of the appeal .
9. The objection of the learned counsel against filing revised grounds by the Revenue are found to be without any substance and not supported by any valid reasons.
10. We find that, in the assessment order, the Assessing Officer has made addition for unexplained investment in following two properties:
5 & 528/Del/2010 AYs: 2005-06 & 2006-07 (i) Rs. 30 Lacs for purchase of flat at ‘Vishrantika CGHS’ from Ms. Neelam Narula (ii) Rs. 9 Lacs for payment made for purchase of Flat in ‘Mahajan Shree CGHS’. 11. In the original grounds of appeal
, the Revenue only challenged deletion of addition of Rs.9 lacs in respect of flat in ‘Mahajan Shree’ CGHS but in the revised grounds, the Revenue has challenged the deletion of addition in respect of both the properties mentioned above.
12. The facts in respect of the addition of Rs. 30 lacs for flat purchased from Miss Neelam Narula are already available on record and the Revenue filed revised form No.36 alongwith the revised grounds of appeal and a copy of which was also provided to the counsel of the assessee well in advance.
13. In our considered opinion, in such circumstances, the Revenue cannot be barred from revising its grounds of appeal and we reject the objection of the learned counsel of the assessee admitting the revised grounds of appeal. Accordingly, both the parties were asked to advance their arguments on the issues involved in revised grounds.
14. The learned CIT(DR) submitted that during the assessment proceedings, the assessee did not file any documentary evidences in support of its claim before the Assessing Officer and all the documents were filed before the learned Commissioner of Income-tax (Appeals) as additional evidence. He further submitted that the learned Commissioner of Income-tax (Appeals) has only reproduced a part of remand report of the Assessing Officer, which is not containing comment of the Assessing Officer on the additional evidences. He also submitted that the learned Commissioner of Income-tax (Appeals) has not given any reasoning for rejecting the documents seized from the premises of the assessee, 6 & 528/Del/2010 AYs: 2005-06 & 2006-07 which clearly indicated payments for purchases of the properties. The learned CIT(DR) submitted that following the principles of natural Justice, the Assessing Officer should be given opportunity to comment on the documents submitted before the learned Commissioner of Income-tax (Appeals). Accordingly, he prayed that the matter may be remanded back to the Assessing Officer for deciding the issues afresh.
15. On the other hand, the learned counsel submitted that during the assessment proceeding, the queries were raised just few days before the completion of the assessment proceedings u/s 153A of the Act and the relevant seized material was also provided 3 or 4 days before finalization of the assessment, thus, no sufficient opportunity was provided to the assessee and, accordingly, the learned Commissioner of Income-tax (Appeals) was justified in admitting the additional evidences. He further submitted that all the additional evidences were forwarded by the learned CIT(A) to the Assessing Officer for his comments. According to him, the learned Commissioner of Income-tax (Appeals) has allowed relief to the assessee after considering the submissions and evidences produced by the assessee. The learned counsel prayed that in view of the submissions made, the matter might not be remanded back to the Assessing Officer for fresh assessment denovo and the order of the learned Commissioner of Income-tax (Appeals) might be upheld. In support of contention of not remanding the matter back to the Assessing Officer, the learned counsel relied on following decisions: (i) Delhi High Court Decision in the case of CIT V. Pradeep Kumar Gupta reported in 303 ITR 95 (ii) Delhi High Court Decision in the case of CIT V. Rajesh Kumar reported in 306 ITR 27 (iii) Tribunal Delhi Bench decision in the case of ACIT Vs. Anima Investment Ltd reported in 73 ITD 125 7 ITA Nos. 527 & 528/Del/2010 AYs: 2005-06 & 2006-07 (iv) Tribunal Chandigarh Bench decision in the case of Neena Syal Vs. ACIT reported in 70 ITD 62 (v) Tribunal Delhi Bench Third Member decision in the case of Zuari Leasing and Finance Ltd Vs. ITO reported in 115 TTJ 721
We have heard the rival submissions and perused the relevant material on record. The fact that search action on the residential premises of the assessee was carried out on 17/8/2005 is undisputed. We find that during assessment proceedings the Assessing Officer raised queries on the basis of document seized from the premises occupied by the assessee and observed that the assessee purchased two properties and made payment towards those properties which was recorded in the seized document. A summary of such payments as appearing in assessment order is reproduced as under:
Flat purchased from Miss Neelam Narula at Vishrantika CGHS.
Assessment Year Date Mode of payment Amount Rs. 2005-06 15/02/2005 Cash 10,00,000/- 22/02/2005 cheque 10,00,000/- 11/03/2005 cheque 9,00,000/- 11/03/2005 cash 1,00,000/- 2006-07 05/04/2005 cash 8,00,000/- 05/04/2005 cash 9,50,000/-
Flat purchased in Mahajan Shree CGHS Assessment Year Date Mode of payment Amount Rs. 2005-06 15/02/2005 Cash 9,00,000/- 22/02/2005 Cheque 4,75,000/- 2006-07 DD 22,00,000/- 8 & 528/Del/2010 AYs: 2005-06 & 2006-07 17. The Assessing Officer noted that against the above payments recorded in the seized documents, the assessee only shown payment of Rs.4.75 Lacs in its return of income against flat booked in Mahajan Shree CGHS. Regarding the other flat, the assessee submitted that it was purchased on behalf of IASE University and the payment was also made from account of the IASE. The assessee also filed affidavit from the IASE and Ms. Neelam Narula that the flat belonged to the IASE. 18. According to the Assessing Officer, the assessee did not file any satisfactory explanation in respect of the investments made in the properties, he made addition for unexplained investment in these two properties as under:
A.Y. Vishrantika Flat Mahajan Shree Fat Total 2005-06 Rs. 30.00 lakhs Rs. 9.00 lakhs Rs. 39.00 lakhs 2006-07 Rs. 17.50 lakhs Rs. 22.00 lakhs Rs. 39.50 lakhs
Before the learned Commissioner of Income-tax (Appeals), the assessee contended that the flat at Vishrantika CGHS was purchased by the IASE University, a unit of the Gandhi Vidhya Mandir (GVM) and the assessee was only a General Power of Attorney holder in the transaction. The assessee submitted documents in support of purchase of the property by the IASE. In respect of purchase of flat in Mahajan Shree CGHS the assessee submitted that the flat was purchased for a sum of Rs.31,94,500/- which was paid to the society on different dates through banking channels and the confirmation in support from the society was also filed. The assessee also filed other documents as additional evidence in support of its claim.
The learned counsel of the assessee contended before us that no opportunity was provided by the Assessing Officer to explain the seized 9 & 528/Del/2010 AYs: 2005-06 & 2006-07 documents which amounted to violation of principles of natural Justice. In the case of CIT Vs. Pradeep Kumar Gupta (supra) cited by the learned counsel, the Hon’ble High Court, in absence of providing cross- examination to the assessee, held reopening of the assessment as not valid. 21. In the case of Commissioner of Income Tax Vs. Rajesh Kumar (supra), the Revenue having collected material behind the back of the assessee and used the same against him without disclosing the matter to the assessee or giving opportunity to cross-examine the person whose statement has been used against the assessee for making the addition, was held to be clear violation of natural justice justifying the deletion of the additions. 22. In the instant case, however, we find that the learned Commissioner of Income-tax ( Appeals) has provided the due opportunity to the assessee for producing evidence in support of its claim. In the case of the assessee addition was made by the Assessing Officer on the basis of document seized from the residence of the assessee itself and the assessee was required to explain those documents. The addition was not made on the basis of any statement of third-party. In view of the facts of the assessee, the ratio of the decision cited by the learned counsel above, is not applicable in the case of the assessee. In view of the sufficient opportunity already provided by the learned CIT(A), the contention of the assessee of denial of natural Justice is rejected. 23. The another contention was made by the learned counsel that matter may not be restored back to the Assessing Officer for de novo assessment as requested by the learned CIT(DR). We find that in the impugned order the learned Commissioner of Income-tax (Appeals) has produced a part of the remand report sent by the Assessing Officer, and in the said part of the remand report, we do not find any comment of the 10 & 528/Del/2010 AYs: 2005-06 & 2006-07 Assessing Officer on the additional evidences. However, the learned CIT(DR) did not file any evidence before us which could support his claim that those additional evidences were not made available to the Assessing Officer for his comments and there was a denial of natural Justice to the Assessing Officer. The learned CIT(DR) also did not file the copy entire remand report before us which could substantiate his claim. On the other hand, the learned counsel referred to para-4 of the impugned order of the learned Commissioner of Income-tax (Appeals), wherein he has specifically mentioned that application under Rule 46A of the Income Tax Rules for production of additional evidence along with a copy of the written arguments was forwarded to the Assessing Officer calling for a remand report. In our opinion, once the learned Commissioner of Income-tax (Appeals) has forwarded the additional evidences to the Assessing Officer for his comment, he has made compliance of Rule 46A of Income Tax Rules. If, the Assessing Officer has not availed of the opportunity granted by the learned Commissioner of Income-tax (Appeals), he cannot be faulted for violation of principles of natural Justice. In the decisions cited by the learned counsel, the Tribunal in similar circumstances has not approved of remanding the matter to the Assessing Officer.
In the case of ACIT Vs. Anima Investment Ltd. (supra) the Tribunal held that the powers of the Tribunal in the matter of setting aside in assessment are large and wide, but these cannot be exercised to allow the Assessing Officer an opportunity to patch up the week part of his case and appeal of the omissions. The Tribunal further held that a party guilty of remissness and gross negligence is not entitled to indulgence being shown and, therefore, remand/setting aside order could not be made in the case to enable the Assessing Officer to make up his earlier 11 & 528/Del/2010 AYs: 2005-06 & 2006-07 deficient work by initiating assessment proceeding for third time after a lapse of considerable time.
In the case of Smt. Neena Syal Vs. ACIT (supra), the Tribunal held that the power of remand under section 254 is required to be exercised in the disciplined and reasonable manner and the same cannot be invoked in a case where the AO has not cared to follow the basic provisions of section 69/69B of the Act.
In the case of Zuari Leasing and Finance Ltd. Vs. ITO (supra), the Tribunal observed that the incident power to remand is only an exception and should be sparingly used when it is not possible to dispose of the appeal for want of relevant evidence, lack of finding or investigation warranted by the circumstances of the case.
In the light of the decisions cited above, we are of the opinion that the Assessing Officer has not availed of opportunity granted by the learned Commissioner of Income-tax (Appeals) for commenting on additional evidences and, thus, the matter cannot be remanded back to the Assessing Officer for deciding the assesment afresh.
In the revised grounds the Revenue has challenged the deletion of the addition of Rs.30 lacs on account of purchase of flat in Vishrantika CGHS from Ms. Neelam Narula and addition of Rs.9.00 Lacs on account of payment made for purchase of flat in Mahajan Shree CGHS.
In respect of addition of Rs. 30 lacs on account of purchase of flat from Ms. Neelima Narula, the learned Commissioner of Income-tax (Appeals) after considering the additional evidences, held that the flat in question situated at Vishrantika CGHS was owned by the IASE University of GVM and, therefore, the amount invested in said property cannot be by any stretch of imagination added in the hands of the assessee and accordingly he deleted the addition with following observations:
12 & 528/Del/2010 AYs: 2005-06 & 2006-07 “On perusal of the documents submitted during the course of appellate proceedings, copies of which forwarded to the A.O. for comment at the time of Remand report, it is apparent that the said flat in Vishrantika Society is not owned by the appellant but by IASE University of GCM. On examination of the copy of sale deed registered on 19.04.2005, it is clear that Smt. Neelam Narula, the seller of the flat, had sold the said property to IASE University of GVM which was registered on 19.04.2005 much before the date of search and seizure operation dt.12.8.2005. The other evidences like purchase of stamp paper by IASE University of GVM i.e. 24.2.2005, execution of Will by Smt. Neelam Narula in favour of IASE university dt.19.4.2005 and copy of possession letter given by Smt. Neelam Narula to IASE university on 19.4.06 and the receipt issued to the university by Neelam Narula on 19.4.05 and other relevant documents clearly establish the said flat was purchased buy IASE university of GVM and the consideration of the amount was also paid by the university. I have also examined the bank account No.670 of Oriental Bank of Commerce, Dwarka of IASE university. It is clearly reflected in the statement of their account that the university has paid Rs.10 lacs on 22.2.05, Rs.9 lacs on 12.3.05 and Rs.1,50,000/- on 23.2.05 for stamp paper. Smt. Namita Kothari was only a GPA holder which is confirmed from para No.ll of the copy of GPA executed on 19.4.2005 by Smt. Neelam Narula in favour of IASE University which is a part of seized documents also. On the basis of the documents cited above there is no doubt that the said flat situated at Vishrantika Society was owned by IASE university of GVM and therefore the amount invested in the said property cannot be by any stretch of imagination added in the hands of the appellant. Therefore, A.O. is directed to delete the addition of Rs.30 lacs on this account. The appeal of the appellant on this ground is allowed.
In our opinion, the action of the learned Commissioner of Income- tax (Appeals) was justified because: (i) that the assessee submitted all the documents in support of the claim that the property in question was purchased by the IASE University and not by the assessee, thus, the assessee discharged its onus regarding the ownership of the property. The sale deed of the property was registered on 19/04/2005, which is much before the date of the search action and the 13 & 528/Del/2010 AYs: 2005-06 & 2006-07 payment for purchase of the said property was also reflected in the bank account of IASE University. (ii) that the Assessing Officer has reproduced the query letter in the Assessment order. In the query letter, the Assessing Officer has mentioned details of the seized document. On page 2 of the Assessment order, the AO has mentioned that page-15 of Annexure A-1 of the Party OP-2 shows noting that Rs.10.00 lacs have been obtained from the head office and Rs. 8.00 lacs from OBC Bank and out of which Rs.17.50 lacs have been paid to Ms. Neelam Narula regarding flat. This observation of the Assessing Officer proves that money was received from the head office, which in the case of the assessee is the IASE University. Thus, the source on money is also explained from seized papers. In our opinion, in such circumstances, on money payments for investment in the said property, if any, cannot be added in the hands of the assessee.
As regard to the another addition of Rs. 9 Lacs on account of payment made for purchase of flat in Mahajan Shree CGHS is concerned, the learned Commissioner of Income-tax (Appeals) after considering the submission of the assessee deleted the addition with following observations: “During the course of appellate proceedings the appellant had produced a copy of affidavit from the Secretary of Mahajan Shree CGHS according to which the to which the total amount received from Namita Kothari (Membership No. 4544) till the date of affidavit i.e. 24.05.2008 was of Rs.30,94,000/- in 13 installations on different dates. The appellant argued that till the date of search, payments made by the appellant was only Rs.4,75,000/-. Copies of the bank statement of the appellant were produced for verification. Demand letter of Mahajan of Mahajan Shree CGHS dt. 08.08.05 also indicate 14 & 528/Del/2010 AYs: 2005-06 & 2006-07 the payment of Rs.4,75,000/- by the appellant and the appellant was asked to pay the balance amount upto 20.08.05. Even the payment schedule of Mahajan Shree CGHS also indicate that the payments have to be made in installments. On examination of the documents cited above clearly indicate that the appellant has paid only Rs.4,75,000/- till the date of search and the balance amounts were paid in subsequent dated which is clearly indicated in the affidavit of the Secretary and bank statements filed by the appellant. Therefore, the additions, made by the A.O. Rs.9 lacs is based on wrong appreciation of the facts and therefore same is directed to be deleted. The appeal of the appellant on this ground is allowed.”
Before the learned Commissioner of Income-tax (Appeals), the assessee submitted a certificate from Mahajan Shree Society. The said certificate is available on page -13 of the Paper book of the asseseee. According to the certificate, the payment of Rs.30,94,000/- was received by the Society from the assessee as under: Sr. No. Ch. No./Date Cheque Amount 01. 264949/25.02.05 4,75,000.00 02. 270591/02.05.06 2,00,000.00 03. 217357/02.05.06 3,00,000.00 04. 270592/21.06.06 1,00,000.00 05. 217358/21.06.06 2,00,000.00 06. 270593/08.09.06 1,75,000.00 07. 217359/11.09.06 1,75,000.00 08. 217366/18.11.06 1,25,000.00 09. 270594/18.11.06 2,50,000.00 10. 270595/03.03.07 4,44,875.00 11. 270598/23.05.07 3,06,625.00 12. 270816/17.04.08 1,08,000.00 13. 270819/20.09.08 2,35,000.00 Total Rs. 30,94,500.00 Total amount in words (Rupees thirty lacs ninety four thousand five hundred only.) 33. From above payment schedule, we find that before the date of search only first payment of Rs.4.75 lakh has been made by cheque and the balance payment of Rs.26,19,500/- by cheque has been shown as made after the date of search. The first payment of Rs.4.75 lakhs has 15 & 528/Del/2010 AYs: 2005-06 & 2006-07 been shown by the asseseee in the return of income and, thus, it has not been disputed by the Assessing Officer. As against this certificate of payment, we find that in the seized documents payments of Rs.9 lakhs is recorded on 15/02/2005, cheque payment of Rs.4.75 Lacs on 25/02/2005 and balance payment of Rs. 22 lakh through demand draft has been recorded. The preponderance of the probability in such circumstances says that once the payment made through cheque of Rs. 4.75 lakhs mentioned in the seized document getting confirmed, then the other transactions recorded on the same seized documents must have also been executed. On this issue, learned Commissioner of Income Tax (Appeals) has not carried out any enquiry from the assessee as why the payments other than Rs.4.75 lakhs recorded in the seized document were not actually paid by the assessee. The learned Commissioner of Income-tax (Appeals) has also not given any reasons for rejection of this vital evidences gathered during the course of search from the premises of the assessee. The learned Commissioner of Income-tax (Appeals) has not made any inquiry from the bank accounts or other records of the society about of money recorded in the seized documents as paid by the assessee. We find that the Assessing Officer has not given any comment in respect of the documents and the learned Commissioner of Income-tax (Appeals) has accepted the submission of the assessee without any enquiry. In the case of CIT Vs. Jan Sampark Advertising & Marketing (P) Ltd. in ITA No. 525/2014, the Hon’ble Delhi High Court observed that the CIT(A) having noticed want of proper inquiry could not have closed the chapter simply by allowing appeal and deleting the additions made.
In view of above observations, we feel it appropriate to restore this issue of addition of Rs. 9.00 lakhs to the file of the Assessing Officer for deciding afresh in the light of our observation above after providing 16 ITA Nos. 527 & 528/Del/2010 AYs: 2005-06 & 2006-07 sufficient opportunity of hearing to the assessee and considering the evidences submitted by the assessee. The ground of appeal is accordingly allowed partly for statistical purposes.
ITA No. 528/Del/2010 35. In the revised ground No.1 of appeal in the Revenue has challenged addition of Rs.17.5 lakhs on account of purchase of flat in Vishrantika CGHS from Ms. Neelam Narula and addition of Rs. 22 lakhs on account of payment made for purchase of flat in flat in Mahajan Shree CGHS. Investment made in both the properties has already been decided by us in the foregoing paras while deciding the appeal in . Accordingly, we direct the Assessing Officer to delete the addition of Rs.17.5 lakhs on account of purchase of flat from Miss Neelam Narula and restore the issue of addition of Rs. 22 lakhs on account of payment made for purchase of flat in Mahajan Shree CGHS for deciding afresh as directed in ITA No. 527/Del/2010.
In revised ground No. 2, the Revenue has challenged addition of unexplained investment in jewellery of Rs.3,59,820/- deleted by the learned Commissioner of Income Tax (Appeals).
We have heard the rival submission of the parties on the issue in dispute and perused the relevant material on record. We find that the Assessing Officer made addition of Rs.3,59,820/- for jewellery found in possession of the assessee. Before the Commissioner of Income Tax (Appeals), the authorized representative of the assessee submitted as under:- “The assessee was married in 1989 and as she belongs to a well- to-do Marwari family where highly valuable gifts are given at the time of marriage. At the time of marriage assessee was presented as ISTRIDHAN reasonably good jewellery, by her parents and in- laws, which as per the rough estimate was approx 70 to 80 total and some diamond items. Further from the time of marriage till 17 & 528/Del/2010 AYs: 2005-06 & 2006-07 date, she acquired some jewellery on various occasions and otherwise from time to time. She also purchased jewellery worth Rs. 1,300,705/- in the year 1997-98. Apart from the above, she had disclosed bullion i.e. 45.5 kgs, silver utensil and 176 gram gold items, in the VDS 1997. Besides, the assessee holds the jewellery of whole composite family, which comprises of Assessee, her husband, children and mother in law. In the light of the above, it is submitted that the jewellery items purchased from time to time since very long are not considered as undisclosed investment in purchase of jewellery for the Assessment Year under question. The jewellery items accumulated in this manner cannot be declared as undisclosed investment and it is further clearly stated that no jewellery items have been purchased in the last seven accountable years.”
The learner Commissioner of Income-tax (Appeals) after considering the submission of the assessee decided the issue as under: “I have considered the observation of the A.O. and the submissions made by the appellant. The appellant is working as OSD in the IASE University. The appellant is married since 1989 and belongs to a well to do Marwari Family. Considering the submissions made by the appellant and the status of the appellant and also considering the customs and traditions of Indian family I consider it fair and reasonable to estimate that a lady of such standard can receive ISTRIDHAN and other gifts on social occasions upto an amount of 500 gms. of Gold and jewellery, the value of which is approx Rs.4 lacs in 2005. Moreover, the appellant had also declared gold items of 176 gms. under VDIS schme. Under the circumstances, in my considered opinion the addition made on account of unexplained jewelley in the hands of the appellant is not called for. Therefore, the same is directed to be deleted.”
The learned Commissioner of Income Tax (Appeals) after considering the family background, gold jewellery of 176 gm. declared under VDIS and fair estimate of jewellery which could be in possession of the assessee, has deleted the addition made by the Assessing Officer. In our opinion, the finding of learned Commissioner of Income-tax (Appeals) on the issue in dispute is well reasoned and no interference on our part is required. Accordingly, the ground of the appeal is rejected.
18 & 528/Del/2010 AYs: 2005-06 & 2006-07 40. In the result, both the appeals of the Revenue are allowed partly for statistical purposes. The decision is pronounced in the open court on 15th February, 2017.