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Income Tax Appellate Tribunal, DELHI BENCH “B”: NEW DELHI
Before: Ms. MADHUMITA ROY & SHRI NAVEEN CHANDRA
O R D E R
PER Ms. MADHUMITA ROY, JM:
The instant appeal, preferred by the Revenue, is directed against the order dated 05.10.2023 passed by the Ld. CIT(A), Delhi-27, in Appeal No. CIT(A), Delhi-27/10727/2018-19, arising out of the order dated 29.12.2018 passed by the ACIT, Central Circle-17, New Delhi, under Section 143(3) of the Income Tax Act, 1961 (hereinafter referred to as “the Act”) for Assessment Year 2017-18.
Grounds of appeal raised by the Revenue read as under:
1. Whether on the facts and in the circumstances of the case and in law, the Ld. CIT(A) has erred, in deleting addition of Rs. 1,11,15,429/- on account of unaccounted investment in jwellery u/s 69A of the Act? 2 Whether on the facts and in the circumstances of the case and in law, the Ld. CIT(A) has erred, in deleting addition of Rs. 37,57,693/- on account of unaccounted investment in jwellery u/s 69A of the Act? 3. That the department craves to add or amend the grounds of appeal before Hon'ble ITAT is finally heard or disposed off.
3. Facts of the case, in brief, as emerging from the records, are that a search & seizure operation u/s 132 of the Act was conducted by the Investigation Wing of the Department on 22.10.2016 in Sukhija Group of cases along with other cases at various residential and business premises including the premises of the instant assessee Smt. Gurpreet Kaur Kochar. The assessee’s case along with other cases of the Sukhija Group was centralized. The assessee filed her return of income on 01.08.2017 declaring total income of Rs.18,87,080/-. Thereafter, the assessee’s case was selected for scrutiny assessment. The Ld. AO completed the scrutiny assessment at an income of Rs. 1,72,98,552/- as against returned income of Rs.
18,87,080/- by making various additions as under:
Addition on account of unaccounted investment in jewellery = Rs. 1,11,15,429/-
Addition on account of cash found from locker No. 983 at Punjab & Sindh Bank = Rs. 1,64,500/- Addition on account of unaccounted cash found At 5- Kasturba Gandhi Marg, New Delhi = Rs. 1,23,850/-
Unaccounted investment in jewellery found
Unaccounted cash deposited during Demonetization period = Rs. 2,50,000/- 3.1 In appeal the Ld. CIT(A) partly allowed the appeal by deleting the additions of Rs. 1,11,15,429/-; and Rs. 37,57,693/- made by the Ld. AO on account of unaccounted investment in jewellery and investment in jewellery found from locker No. 983. Aggrieved against the deletion of the impugned additions by the Ld. CIT(A) the Revenue is in appeal before us.
4. We have heard the rival submissions and perused the material available on record. The Ld. CIT(A) has deleted
“5. Ground of Appeal
Nos. 2 to 2.5 & 5 to 5.1 relate to addition of Rs. 1,11,15,429/-being the amount of unexplained jewellery out of the jewellery of Rs. 1,24,80,429/- found from the possession of the appellant under section 69. (A) of the Income Tax Act, 1961 and of Rs. 37,57,693/- being unexplained jewellery found from the locker no. 983, Punjab and Sind Bank, Malkaganj. New Delhi jointly held by appellant and Mrs. Gurmeet Kaur. 5.1 The main objection of the AO was that the appellant was not able to give one to one reconciliation between the declared jewellery and jewellery found during search and since all the members of the family stay under one roof and exchange of jewellery among the family members is a common practice therefore total jewellery found should be considered as jewellery of the family. 5.2 Regarding first contention, ideally speaking each item of jewellery should match by description & weight of metal/stones/diamonds. However, considering the social set up & culture of India where the jewellery alterations are very common and prevalent in the society, as per the standard methodology, the next best possible methodology of comparing the jewellery items would be i. to compare the Gross Weight of gold jewellery including gold jewellery studded with precious stones found during the search with declared jewellery ii Loose diamonds to be considered separately. 5.3 The second contention of the appellant is found to be correct as all the Panchnamas have same address of 5. KG Marg, New Delhi. Analysis and Findings 5.4 It is well settled law hat when the gold jewellery in which the diamonds are studded has been accepted by the department as the jewellery received at the time of marriage or other occasion, then, it cannot be said that the diamond studded in the said jewellery were out of the undisclosed income of the appellant. It is also well settled law that where gross weight of jewellery disclosed in regular returns was in excess of gross weight of jewellery found in search, no seizure/addition is permissible. However, the value of diamond studded in gold jewellery is determined only by estimation and actual value of demand studded cannot be determined. ……………. 5.6 It is observed that the jewellery declared/acquired by the appellant or his family members residing with him at the time of search, in any of the following manner can be considered as source of declared jewellery, in the absence of any specific detect pointed by the AO.
5.11 On the basis of above discussion, It is observed that the declared jewellery is more than the jewellery found during search operation. 5.12 Therefore, addition of Rs.1,70,73,279/- made by the A.O. under section 69A on account of unexplained jewellery, is deleted and these grounds of appeal are hereby allowed.”
5. Learned Counsel appearing for the assessee submitted that during the appellate proceedings before the Learned CIT(A) the assessee had given complete details and as per wealth tax return assessee had declared 1511.260 grams of jewellery and 20698.51 grams of jewellery by the whole family of the assessee and that the total jewellery found during the course of search was much less than the jewellery declared by the family of the assessee in the wealth tax return. He further submitted that in the group cases of the assessee, this issue has been duly adjudicated by the coordinate benches in favour of the assessee in ITA No.
401/D/2024, dated 09.07.2025 ITO vs. Jasmine Kaur kochar; and dated 29.08.2025 Harshit Kochar vs. ACIT. In support of his pleading Learned Counsel has filed synopsis. For the sake of clarity, the Synopsis filed by the assessee is reproduced as under:
“1. This appeal arises from an order of the learned Commissioner of Income Tax (Appeals)-27. New Delhi dated 05.10.2023. 2. Ground 1 and 2 of Grounds of appeal raised by revenue relates to the addition of Rs. 1,48,73,122/- (1,11,15,429/- and 37,57,693/-) representing alleged unaccounted investment in jewellery during the year under consideration and brought to tax under section 69A of the Act.
3. It is submitted that the search and seizure operation u/s 132 of the Act was conducted by the investigation wing on 22.10.2016 on "Sukhija Group of cases" including the assessee.
It is submitted that the assessee was living in the joint family and during the course of search jewellery weighing 325.848 gms valued at Rs. 1,24,80,429/- belong to the assessee found from the premises of the assessee and jewellery amounting to Rs. 37,97,693/- was found from the locker no. 983 at Punjab & Sindh Bank, Malka Ganj, Delhi. (Page 2 of the Assessment order).
It is submitted that the learned Assessing officer considered the CBDT Instruction No. 1916 and press release dated 01.12.2016 and partly granted relief of Rs. 13,65,000/-(2730*500 grams) as mandated by the CBDT instruction and proceeded with making addition amounting to Rs. 1,48,73,122/-(1,11,15,429/- and 37,57,693/-) u/s 69A of the Act.
6. It is submitted that during the appellate proceeding's assessee had given the complete details and as per wealth tax return assessee had declared 1511.260 grams of jewellery and 20698.51 grams of jewellery by the whole family of the assessee. (Page 29 of CIT order).
7. Further, it is submitted that total jewellery found during the course of search is much less than the jewellery declared by the family of the assessee in the wealth tax return.(Page 29 of CIT order) S. No. Description Gross weight of Gold Jewellery in Grams 1 Total Jewellery found during the search 13989.00 (Para 5.7) 2 Total Jewellery as per Wealth Tax 20698.51 Return (Para 5.9) 3 Jewellery allowed as per Instruction no. 1800 1916 of family member (Para 5.8) 4 Total Jewellery allowed 22498.51
It is further submitted that learned Commissioner of Income Tax(A), vide order dated 05.10.2023 has allowed the appeal of the assessee by considering the documentary evidences placed on record and holding that the declared jewellery is more than the jewellery found during the search operation and there is no specific defect pointed by the learned Assessing officer.
9. Further, it is submitted that this issue is no longer res integra, as in the group cases of the assessee, this issue has been duly decided by the coordinate benches of Hon’ble Tribunal in favour of the assessee in the cases of (Deptt.) dated 09.07.2025 ITO vs. Jasmine Kaur kochar and (Assessee) dated 29.08.2025 Harshit Kochar vs. ACIT.
In view of the aforesaid addition made of Rs. Rs. 1,48,73,122/- and deleted by the learned Commissioner of Income Tax (Appeals) may kindly be upheld and grounds raised by the revenue may kindly be rejected.
In light of the aforesaid, it is thus prayed that appeal filed by the revenue may kindly be dismissed.”
On the other hand, Learned DR supported the order of Assessing Officer.
We have heard rival submissions and perused the material available on record. It is noticed that identical issue in the group case has been adjudicated in favour of the assessee by the Coordinate Bench vide order dated 09.07.2025 – ITO v. Jasmine Kaur Kochar, inter alia, by observing as under:
“9. Considered the rival submissions and material placed on record. We observe that during search proceedings, gross weight of the jewellery found during search are 13,989 gms. as per the chart reproduced at para 5.7 of the ld. CIT (A)'s order also reproduced above at page 6 of this order and similarly jewellery declared by the family members including the assessee in their wealth tax return are 20,698.51 gms., refer chart reproduced at para 5.9 of ld. CIT (A)'s order reproduced above at page 7. From the above, it is clear that the assessee along with her family members had declared more in their wealth tax return and what was found during search is much less. Since the declaration of the jewellery in the wealth tax return is nothing but jewellery declared to the Revenue. Ld. DR submitted that assessee has filed additional evidences under Rule 46A and Id. CIT (A) has not followed the due procedure. We observe that jewellery under wealth tax return cannot be considered as additional evidence, therefore, it is part of the record as far as Revenue is concerned, therefore, Id. CIT(A) has elaborately discussed and brought on record the declared gross quantity of jewellery under wealth tax return and what was found during search is much less. Therefore, there is no room to make any additions. Accordingly, we do not see any reason to disturb the findings of the ld. CIT(A) and Ground Nos. 1 to 4 raised by the Revenue are dismissed.”
7.1 No distinction in facts in the instant case has been pointed out by either of the parties so as to take a contrary view. Therefore, taking the consistent view we uphold the order of Ld. CIT(A) on the issue in question. Consequently, Revenue’s appeal is hereby dismissed.
Order pronounced in open court on 07.11.2025.