Shri Manoj B. Kulchandani, Bharuch V. The Dy.CIT, Bharuch Circle, Bharuch

ITA 217/AHD/2015

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 8725 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 6 month(s) 20 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-08-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Assessment Year: 2007-2008
• Appeal Filed On: 27-01-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MUKUND K RAO ALOK KUMA R R
• Keywords: Unexplained investment; Income from undisclosed sources; Cost of acquisition
• Section: 133A

Judgement Text

ITA NO.217 /AHD/ 201 5 ASSESSMENT YEAR : 20 07 - 08 PAGE 1 OF 3 IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD C BENCH, AHMEDABAD [CORAM: PRAMOD KUMAR , AM AND MAHAVIR PRASAD , JM] ITA NO. 217 / AHD / 2 0 1 5 ASSESSMENT YEAR: 20 07 - 08 MANOJ B. KULCHANDANI, ....... ...........APPELLANT PROP. OF CONSTRUCTION HOUSE , YASH KAMAL COMPLEX, DAHEJ BY P ASS, BHARUCH 392 001. [PAN : AEEPK 3151 Q] VS. DY. COMMISSIONER OF INCOME TAX, BHARUCH CIRCLE, BHARUCH. ............................RESPONDENT APPEARANCES BY: MUKUND K. RAO FOR THE APPELLANT ALOK KUMA R FOR THE RESPONDENT D ATE OF CONCLUDING THE HEARING : 2 4.07. 2017 DATE OF PRONOUNCING THE ORDER : 17 .08.2017 O R D E R PER PRAMOD KUMAR, AM: 1. BY WAY OF THIS APPEAL, THE ASSESSEE APPELLANT HAS CHALLENGED CORRECTNESS OF THE ORDER DATED 01.11. 201 4, PASSED BY THE L EARNED CIT(A) - V I, BARODA FOR THE ASSESSMENT YEAR 20 0 7 - 08 , ON THE FOLLOWING GROUND S : - 2. GRIEVANCES OF THE ASSESSEE ARE AGAINST LEARNED CIT (A) S UPHOLDING THE ADDITION OF RS.91,000/ - IN RESPECT OF INVESTMENT IN FIXED DEPO SIT AND OF RS.4,33,125/ - IN RESPECT OF PROFIT ON SALE OF GOLD ORNAMENTS. ITA NO.217 /AHD/ 201 5 ASSESSMENT YEAR : 20 07 - 08 PAGE 2 OF 3 3. TO ADJUDICATE ON THESE GRIEVANCES, ONLY A FEW MATERIAL FACTS NEED TO BE TAKEN NOTE OF. THE BUSINESS PREMISES OF THE ASSESSEE WAS SUBJECTED TO SURVEY UNDER SECTION 133A OF THE INC OME TAX A CT , 1961. DURING THIS SURVEY, THE ASSESSEE ADMITTED UNACCOUNTED INVESTMENT IN FIXED DEPOSIT WITH SYNDICATE B ANK TO THE TUNE OF RS.3,50,000/ - AND UNACCOUNTED SALE PROCEEDS OF GOLD ORNAMENTS TO TH E TUNE OF RS.4,33,125/ - . HOWEVER , WHEN THE ASSESSEE FILED HIS RETURN OF INCOME, HE DISCLOSED UNACCOUNTED INCOME REPRESENTING FD INVESTMENT AT RS.2,59,000/ - SINCE ACTUAL FD INVESTMENT WAS FOUND TO BE THIS FIGURE, AND UNACCOUNTED INCOME REPRESENTING S ALE PROCEEDS OF GOLD ORNAMENTS AT RS.2,76,031/ - AFTER DEDU CTING INDEXED COST OF ACQUISITION AT RS.2,76,031/ - . THE EXPLANATIONS GIVEN BY THE ASSESSEE WITH RESPECT TO THESE VARIATIONS WERE, HOWEVER, REJECTED. THE ASSESSING OFFICER PROCEEDED TO MAKE ADDITIONS ON THE BASIS OF DECLARATIONS, AND LEARNED C I T(A) CONFIR MED THE SAME. THE ASSESSEE IS AGGRIEVED AND IS IN APPEAL BEFORE US. 4. WE HAVE HEARD THE RIVAL SUBMISSIONS, PERUSED THE MATERIAL ON RECORD AND DULY CONSIDERED FACTS OF THE CASE IN THE LIGHT OF THE APPLICABLE LEGAL POSITION. 5. AS REGARDS THE INVESTMENT IN FDS, WE HAVE NOTED THAT THE INVESTMENT IN FD IS TAKEN AT RS.3,50,000/ - ON THE BASIS OF A CHIT FOUND DURING THE SURVEY BUT THEN THE SAID FIGURE IS NOT CORROBORATED BY THE SYNDICATE BANK S CERTIFICATE DATED 24.12.2 0 05 WHICH SHOWS PAYMENT AT RS.2,80, 932/ - INCLUDING INTEREST. IN THESE CIRCUMSTANCES, THE ASSESSING O FFICER CANNOT MAKE ADDITION SIMPLY ON THE BASIS OF SURRENDER OF INCOME DURING SURVEY UNDER SECTION 133A. SUCH STATEMENT DOES NOT HAVE ANY EVIDENTIARY V ALUE AND THE ADDITION, THEREFORE, HAS TO BE ON THE BASIS OF COGENT MATERIAL I.E. ACTUAL INVESTMENT WITH FD. SIMILARLY, ENTIRE SALE PROCEEDS OF JEWELLERY CANNOT BE TREATED AS INCOME EITHER. WHAT CAN BE BROUGHT TO TAX IS O NLY THE INCOME ELEMENT ON SALE OF ITA NO.217 /AHD/ 201 5 ASSESSMENT YEAR : 20 07 - 08 PAGE 3 OF 3 JEWELLERY WHICH WAS NOT FOUND WITH THE ASSES SEE, EVEN IF IT IS ASSUMED, AS IS ASSUMED IN THIS CASE, THAT GOLD JEWELLERY NOT FOUND WITH THE ASSESSEE IS SOLD BY THE ASSESSEE . HAVING HELD SO, WE MAY CLARIF Y THAT IT IS FOR THE ASSESSEE TO GIVE REASONABLE DETAILS ABOUT ACTUAL INVESTMENT IN FD AND THE YE AR I N WHICH GOLD JEWELLERY IN QUESTION W A S PURCHASED. THE ASSESSEE HAS TO FURNISH THESE DETAILS TO THE ASSESSING O FFICER, AND IT IS ONLY AFT ER EXAMINING SUCH DETAILS THAT THE ASSESSING OFFICER HAS TO DECIDE THE MATTER AFRESH IN THE LIGHT OF OUR ABOVE OBSE RVATIONS, IN ACCORDANCE WITH THE LAW AND NOT SOLELY ON THE BASIS OF STATEMENT MADE BY THE ASSESSEE DURING THE SURVEY PROCEEDINGS. WITH THESE DIRECTIONS, THE MA T TER STANDS RESTORED TO THE FILE OF THE ASSESSING O FFICER FOR FRESH ADJUDICATION . 6. NO OTHER I SSUE WAS PRESSED BEFORE US. 7. IN THE RESULT, THE APPEAL IS ALLOWED FOR STATISTICAL PURPOSES. PRONOUNCED IN THE OPEN COURT TODAY ON THE 17 TH DAY OF AUGUST, 2017. SD/ - SD/ - MAHAVIR PRASAD PRAMOD KUMAR (JUDICIAL MEMBER) (ACCOUNTANT MEMBER) AHMEDABAD, THE 17 TH DAY OF AUGUST, 2017 PBN/* COPIES TO: (1) THE APPELLANT (2) THE RESPONDENT (3) COMMISSIONER (4) CIT(A) (5) DEPARTMENTAL REPRESENTATIVE (6) GUARD FILE BY ORDER TRUE COPY ASSISTANT REGISTRAR INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCHES, AHMEDABAD