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"I. DENIAL OF TELESCOPING EFFECT OF UNEXPLAINED ASSETS WITH THE CASH FUNDS AVAILABLE WITH SMT. CHANDRIKABEN C BHIMANI
1. The learned CIT(A) has erred in law and on facts while failing to give the telescoping effect of unexplained assets with the cash funds available with Smt. Chandrikaben C Bhimani on the observation that there is apparent fallacy in the appellant's contention and claim.
2. The learned CIT(A) as well as the A.O failed to consider the fact that the unexplained assets of Rs.2,00,000/- found during the course of search proceedings has been telescoped with the cash available with appellant's wife which was received from firm M/s. Shah Chemicals in the capacity of a partner and the necessary effect for the same has already been given in the books of account.
II. ADDITION ON ACCOUNT OF UNEXPLAINED ASSETS - RS.17,000/-
1. The learned CIT(A) has erred in law and on facts in partly confirming the addition of Rs.17,000/-/
2. The learned CIT(A) has erred in law and on facts while failing to give the telescoping effect of unexplained assets with the cash funds available with Smt. Chandraikaben C Bhimani, wife of the appellant, as against the addition being confirmed by the CIT(A)."

3. After hearing the rival contentions and going through the facts and circumstances of the case, we find that in the firm M/s. Shah Chemicals there was availability of funds to the extent of Rs.6,64,546/-, which is evident from the Tribunal's order in ITA No.2892/Ahd/2003 dated 31-03-2008 for assessment year 1995-96 and we find that the assessee has already availed the benefit of telescoping to the extent of Rs.4,51,500/- vide A'O's order dated 30-12-2009. The relevant directions of Tribunal in para-3 was as under:- 

 ITA No.2891 & 2832/Ahd/2003      A.Y. 1995-96
Sh. Champaklal P Bhimani v. ACIT CC-2(3) A'bd                                Page 3
The assessee has now claimed the available cash in hand as invested in the unexplained assets found during the course of search. From the order of the Tribunal in the case of Shah Chemicals, supra it is noticed that the Tribunal has given a definite finding (as reproduced above) that cash available on account of stock utilized for acquiring the excess was to the tune of Rs.6,38,398/- which is available on account of unaccounted sales. It is not the case of the Revenue that this cash in the hands of Shah Chemicals has been utilized by the firm M/s Shah Chemicals in acquiring any assets or which is utilized for any expenditure. The Tribunal's finding is very much available that cash to the extent of Rs.6,38,398/- is available which can explain the unexplained assets worth Rs.6,01,500/- and for the same the CIT(A) should have allowed the set off. In view of these facts and circumstances we fairly feel that the assessee should be given telescoping effect. However, as a matter of caution we set aside this issu9e to the file of Assessing Officer to verify whether M/s. Shah Chemicals has utilized this cash in hand on account of sale of unaccounted sales or not. Whether M/s. Shah Chemicals has spent this amount on account of unaccounted expenditure or not and the Assessing Officer will find from the search material in these group cases. In view of these directions we set aside this issue to the file of Assessing Officer for verification." 
 ITA No.2891 & 2832/Ahd/2003      A.Y. 1995-96
Sh. Champaklal P Bhimani v. ACIT CC-2(3) A'bd                                Page 4

"The assessee has disclosed Rs.1,83,000/- in the return of income consequent to search. There is no evidence indicating that there are unexplained assets over and above which were found during the course of search. Therefore, there is force in the learned counsel's contention that telescopic effect of this amount against unexplained assets should be given. In view of the above, only addition of Rs.17,000/- being difference of (Rs.2,00,000/- - Rs.1,83,000/-) is sustained as against addition of Rs.3,11,362/-. The assessee gets relief of Rs.2,94,362/-"