SUDARSHAN KUMAR BANSAL,NEW DELHI vs. JCIT,CENTRAL CIRCLE-16, NEW DELHI

That the order of learned Commissioner of income Tax (Appeals) is bad in law as well as on the facts and in the circumstances of the case 2. That the learned Commissioner of Income Tax (Appeals) has erred in dismissing the contention of the appellant that proper opportunity of being heard was not provided by the Id. AO. 3. That the learned Commissioner of Income Tax (Appeals), has erred in upholding that the assessee has not been able to provide the documentary proof acquiring of gold jewellery weighing 609.94 gms (shown as the opening balance as on 01.04.2006) and valuing the same at Rs. 28,04,895/- as per the rates prevalent on 17.11.2021 (Rs. 4598.64 per gm). 4. That the learned Commissioner of Income Tax (Appeals), has erred in upholding the value of gold jewellery including 22 carat gold coins weighing 609.94 gms at rates prevalent on 17.11.2021 and not at rates prior to 2006 5. That the learned Commissioner of Income Tax (Appeals), has erred in ignoring the contention of the assessee that the alleged unexplained jewellery was part of the jewellery shown at the purchase value of Rs. 50,95,894/- in the asset liability statement of the return filed for AY 2020-21 the details of which were provided to him in the copy of ledger account of jewellery 6. That the learned Commissioner of Income Tax (Appeals), has erred in upholding the finding of the Id. AO that the source of 609.94 gms of jewellery remains unexplained. 7. That the learned Commissioner of Income Tax (Appeals), has erred in upholding the addition of Rs. 28,04,895/-made by the Id. AO on account of it being unexplained income by applying the provisions of section 698 of the Act on the basis of presumptions and surmises 8 That the learned Commissioner of income Tax (Appeals), has erred in upholding the invocation of the provisions of section 115BBE of the Act.”

Both the learned representatives next invite our attention to CIT(A)’s detailed discussion upholding the Assessing Officer’s action treating the assessee’s jewellery weighing 609.94 gms. as unexplained, reading as under: “6. Ground no. 2 and 3: These grounds of appeal have been raised on the legal issues The appellant submitted that the juri iction in the case of the appellant was transferred to DCIT, CIT2(Central), Central Circle 16, New Delhi vide order New Delhi by Pr.CIT u/s 127 dated 15.09.2022 Appellant has contended that he had not been given opportunity at the time of centralization of the case and therefore, the juri iction assumed by the Id. AO is bad in law Further, the appellant submitted that the Assessing Officer has only provided 3 months time to file his replies and submissions in a search matter involving data to be submitted in connection with the queries made which was a very bulky and that it was not possible to submit the same within such short period and if submitted the time left for framing the assessment order was very little and thus the assessing officer could not have done justice to the case, which ultimately resulted in additions which ought not to have been made in the facts of the case of the appellant. The show cause notice was issued on 27.03. 2023 the appellant did not get enough time to submit the reply as the case was getting barred by limitation and accordingly the assessment order was passed on 31.03.2023 Le. within 4 days of the service of the notice. Even though the appellant filed the reply on 28.03.2023 but it cannot be said that a proper opportunity was provided to the appellant and thereby the principles of natural justice were violated: 6.1 I have considered the facts of the case and submissions filed by the appellant On perusal of the assessment order, the juri iction has been assumed by the Assessing Officer as per the provisions of IT Act, 1961 after passing of order u/s 127 of the Act by the Pr.CIT and, therefore, the contention of the appellant is not acceptable being devoid of ment. Further, the Assessing Officer has also provided several opportunities to the appellant by way of issuing notice u/s 142(1) of the IT Act, 1961 followed by a show cause notice. Hence, the issue raised by the appellant before undersigned are, untenable and accordingly is liable to be dismissed.

Ground no. 4 to 9: These grounds of appeal have been raised by the appellant against the addition of Rs. 28,04,895/- made by the Assessing Officer on account of unexplained income. The appellant submitted that during the assessment proceedings explained the gold jewellery, gold bullion diamonds and silver articles/ornaments found during the course of search. The AD after considering the submissions made by the appellant on the issue of jewellery found during the course of search made an andition of Rs. 28,04,895/- being value of 609.94gms of gold as on 17.11.2021. 7.1 The ledger account submitted during the assessment proceedings was for the period from 01.04.2006 to 31.03.2020. The ledger account (jewellery) of the appellant maintained in the books of accounts (pg. 10 of paper book filed with submissions dated 25.03.2023) refers to the jewellery purchased by the appellant through the declared sources of income and does not represent jewellery disclosed in VDIS and customary possession (stri dhan). The account maintained by the appellant are not disputed by the AO. It is only the opening balance of the value of jewellery of Rs. 15,73,638.77/- as on 01.04.2006 (represented by 609.94 gms of gold valued at the rate of Rs. 2580 per gram as on 31.03.2015) thất has been disputed on the ground that the appellant was not able to pruvisle the documentary proof of acquiring of the jewellery from known sources of Incoine 7.1.1 It is submitted that the books of accounts by themselves are a documentary proot. The opening balance of jewellery as on 31.03.2006 of Rs. 15,73,638.77/-(represented by 609.94 gms of gold valued at the rate of Rs. 2580 per gram as on 31.03.2015) does not require any further proof. Further, it contended that there was no obligation of the assessee under law to maintain any records of evidence for period beyond ten years. The only exception u/s 34 of the Indian Evidence Act is that the books of accounts alone are not sufficient to charge any third person with a liability which does not apply to a person maintaining the books of accounts in the regular course of business. In AY 2020-21 in the return of income filed prior to the date of search, the appellant has onclosed jewellery and bullion etc., in Schedule AL a sum of Rs. 50,95,894/- and the closing balance as per the copy of ledger account of jewellery tallies with disclosed figure in the return of income meaning

2.2 Appellant contended further that as per the Provisions of Section 698 of the Act the addition can be made only when the amount expended in acquiring gold jewellery exceeds the amount recorded in this behalf in the books of account maintained by the assessec. However, the appellant has failed to substantiate as to how the said the jewellery is accounted. On the contrary, in the absence of any documentary evidences, it can be inferred that the said jewellery has not been accounted for. Therefore, the contention of the appellant is not found acceptable and hence, the grounds taken by the appellant are dismissed.”

This is what leaves the assessee aggrieved. 4. We have given our thoughtful consideration to the assessee’s and the Revenue’s respective vehement submissions against and in support of both the learned lower authorities’ action making the impugned addition. We find no reason to sustain the same in entirety. We make it clear first of all that although the assessee’s learned counsel has taken pains to refer to the case record all along, we hardly see any reason to express our agreement with his stand given the fact that it is a “search” case wherein he has failed to plead and prove all the corresponding facts both during assessment as well as in the lower appellate proceedings. The fact also remains that possibility of some unintentional errors in gold purity, rate and weight etc. could not be altogether ruled out. Be that as it may, we are of the considered view in this factual backdrop that the assessee deserves further relief of 200 gms. gold herein with a rider that the same shall not be treated as a precedent. We accordingly confirm both the learned lower authorities’ action treating his gold