Income Tax Appellate Tribunal - Ahmedabad
Shri Jaswinder Singh Sethi,, Baroda vs The Dy.Cit, Central Circle-2,, Baroda on 27 September, 2018
आयकर अपील य अ
धकरण, अहमदाबाद यायपीठ - अहमदाबाद ।
IN THE INCOME TAX APPELLATE TRIBUNAL
AHMEDABAD - BENCH 'B'
BEFORE SHRI RAJPAL YADAV, JUDICIAL MEMBER
AND
SHRI WASEEM AHMED, ACCOUNTANT MEMBER
आयकर अपील सं./ ITA No. 3565/Ahd/2015
नधा रण वष /Assessment Year: 2005-06
Shri Jaswinder Singh Sethi DCIT, Cent.Cir.2
45, Green Park Society Vs Baroda.
Makarpura, Baroda.
PAN : ACBPS 278 J
अपीलाथ / (Appellant) यथ / (Respondent)
Assessee by : Shri Pankaj Kant Tandor, AR
Revenue by : Shri Mudit Nagpal, Sr.DR
सन
ु वाई क तार ख/Date of Hearing : 01/08/2018
घोषणा क तार ख /Date of Pronouncement : 27/09/2018
ORDER
PER RAJPAL YADAV, JUDICIAL MEMBER : Assessee is in appeal
before the Tribunal against order of the ld.CIT(A)-12, Ahmedabad dated 20.8.2015 for the assessment year 2005-06.
2. Solitary grievance of the assessee is that the ld.CIT(A) has erred in law and on facts in confirming addition of Rs.5,80,260/- which was added by the AO on account of unexplained investment in jewellery.
3. Brief facts of the case are that search under section 132 of the Income Tax Act, 1961 was carried out at the residential premises of the assessee on 9.9.2004. During the course of search, ornaments/jewellery ITA No.3565/Ahd/2015 -2- valuing at Rs.47,99,125/- was found from the locker of the assessee. Ownership of the jewellery was claimed by the wife of the assessee, Smt. Satwinder Kaur Sethi, and therefore, this amount was protectively added in the hands of the assessee. One round of litigation has already travelled upto the Tribunal in ITA No.2643/Ahd/2009 dated 31.1.2014 and the Tribunal remitted this issue for re-adjudication to the file of ld.CIT(A).
4. In order to take note of the facts more scientifically, we deem it appropriate to take note of the following details submitted by the assessee in tabular form, which reads as under:
Name Gross Valued@ Diamond Silver Total
weight of Rs.571 per jewellary Rupees
gold gram as on
jewellery In 21/09/2004
grams
J.S.Sethi (HUF) 789.00 4,50,419 7,10,000 NIL 11,60,419
Smt. Satwinder 1546.07 8,49,060 24,36,396 39,200 33,24,656
Sethi
ShJ.S.Sethi 150.00 85,650 NIL NIL 85,650
Ms.Avneet Kaur 250.00 1,42,750 NIL NIL 1,42,750
Mr. Jashanjit 150.00 85,650 NIL NIL 85,650
Sethi
Total 2885.07 16,13,659 31,46,396 39,200 47,99,125
5. As observed earlier, jewellery initially was owned and explained in the hands of Smt. Satwinder Kaur Sethi, who went before the Settlement Commission and declared ownership of the jewellery to the extent of ITA No.3565/Ahd/2015 -3- Rs.33,24,656/- out of total jewllery. The valuation was accepted to the extent of Rs.22 lakhs by the Settlement Commission. Dispute before us only relates to jewellery attributed or claimed as belonging to J.S.Sethi (HUF). The assessee has claimed 789 grams of jewellery was belonging to J.S. Sethi (HUF). The ld.CIT(A) has examined this issue in detail and observed that HUF has filed its return and on perusal of income-tax return for the assessment years 2002-03 to 2005-06, it would reveal that it was having ornaments/jewellery weighing 316 grams. The ld.CIT(A) has given credit of this jewellery and treated the balance as unexplained. The finding of the ld.CIT(A) on this issue is worth to note. It reads as under:
"5. I have given a careful consideration to the facts of the case. It is indeed true that the chart of the claim of the ownership of the gold ornaments seized as per the chart above was submitted before the Hon'ble Settlement Commission. It is also a fact that the addition is made only on protective basis in the case of the present assessee. The primary onus of explaining the ownership of the ornaments and substantiating the source thereof was therefore, that of Smt. Satvinder Kaur Sethi. Nevertheless, it is also true that Smt. Satvinder Kaur Sethi, before the Settlement Commission owned up only 33.20 lakhs worth of ornaments. Balance, as explained before the Settlement Commission, though impliedly accepted as explained by Settlement Commission, would need examination with respect to source there.). Therefore, leaving the permissible ownership claimed by the children (250 gms. and 150 gms.), the claim of ownership of Jaswinder Singh-, Sethi (HUF) only remains for examination, verification and decision by me. It is seen that an per the return of income filed for A.Ys, 2002-03 to 2005-06 available on page- 55 to 65 of paper book, the HUF was having gold ornaments/jewellery weighing 316 gms. as per the valuation report dated 20th May, 1980 enclosed with return of income. In view of these facts, I consider it fair and reasonable to grant a relief of 315 gms. rightly claimable as belonging to Jaswinder Singh(HUF). Accordingly, after considering the possible accretion/augmentation of HUF assets, I consider it ITA No.3565/Ahd/2015 -4- reasonable to hold half of the ornaments/jewellery worth Rs.5,80,260/- as reasonably explained in the hands of the HUF. In overall circumstances of the case, I therefore, also find it reasonable to hold that balance half, claimed neither by Smt. Satvinder Kaur Sethi nor reasonably claimable by the children or HUF, would need to be confirmed in the hands of the assessee. It is therefore, held that gold jewellery and diamond, valued at Rs.5,80,260/- is unexplained in the hands of the assessee and is hereby confirmed. The balance protective addition of Rs.42,18,865/-(Rs.47,99,125/- - Rs.5,80,260/-) is held to be explained in the hands of Smt. Satvinder Sethi or children or in the hands of the HUF and therefore, not required to be considered in the hands of the assessee."
6. With the assistance of the ld.representatives, we have gone through the record carefully. The ld.counsel for the assessee has taken various arguments including valuation in hands of HUF was of 10.5.1980. Thereafter a lot of jewllery must have been accumulated. He also contended that once the jewllery claimed by the wife was explained to the Settlement Commission who has confirmed the addition to the extent of Rs.22 lakhs, the remaining could be construed as explained by the assessee. On due consideration of these facts, we are of the view that the addition has not been confirmed by the ld.CIT(A) on account of valuation of jewellery in the hands of the assessee. The hard fact is that 786 grams of jewellery was belonging to the HUF. The ld.CIT(A) perused returns of income filed by the HUF upto the Asstt.Year 2005-06 and observed that only jewellery reflected in the returns of this HUF was 316 grams. The ld.CIT(A) has further granted relief to the assessee by treating half of 789 grams as explained in the hands of HUF. The balance was not belonged any family members or wife. It remained unexplained. The ld.CIT(A) has analyzed the facts in details and thereafter confirmed the addition. We do ITA No.3565/Ahd/2015 -5- not find any error in this order of the ld.CIT(A) on this issue, which is confirmed and the appeal of the assessee is dismissed.
7. In the result, the appeal of the assessee is dismissed.
Pronounced in the Open Court on 28th September, 2018.
Sd/- Sd/- (WASEEM AHMED) (RAJPAL YADAV) ACCOUNTANT MEMBER JUDICIAL MEMBER