ACIT, Central Circle-1(1), Hyd, Hyderabad V. Kandula Visveswara Rao, Hyd, Hyderabad

ITA 55/HYD/2016

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 2380 (ITAT-HYDERABAD)
• Duration Of Justice: 2 year(s) 2 month(s) 14 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-03-2018
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 01-03-2018
• Assessment Year: 2011-2012
• Appeal Filed On: 14-01-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: N SWAPNA
• Assessee Lawyers: V RAGHAVENDRA RAO
• Keywords: Unexplained investment; Gift; Source of fund
• Section: 143(3); 132

Judgement Text

ITA NO 55 OF 2016 KANDULA VISVESWARA RAO HYDERABAD . PAGE 1 OF 8 IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD B BENCH, HYDERABAD BEFORE SMT. P. MADHAVI DEVI, JUDICIAL MEMBER AND SHRI B.RAMAKOTAIAH, ACCOUNTANT MEMBER ITA NO.55/HYD/2016 (ASSESSMENT YEAR: 2011-12) ASSTT. COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE 1(1) HYDERABAD VS SRI KANDULA VISVESWARA RAO HYDERABAD PAN: AGDPK 4295 L (APPELLANT) (RESPONDENT) FOR REVENUE: SMT. N. SWAPNA, DR FOR ASSESSEE : SRI V. RAGHAVENDRA RAO O R D E R PER SMT. P. MADHAVI DEVI, J.M. THIS IS REVENUES APPEAL FOR THE A.Y 2011-12 AGAINS T THE ORDER OF THE CIT (A)-11, HYDERABAD, DATED 30.09 .2015. 2. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE, A N INDIVIDUAL AND THE MANAGING DIRECTOR OF M/S NCC INF RASTRUCTURE HOLDINGS LTD, WAS SEARCHED U/S 132 OF THE I.T. ACT AT HIS RESIDENTIAL PREMISES ON 6.10.2010. THE ASSESSEE FIL ED HIS RETURN OF INCOME ON 27.7.2011 ADMITTING AN INCOME OF RS.1,09, 32,450. DURING THE ASSESSMENT PROCEEDINGS U/S 143(3) OF THE ACT, THE AO OBSERVED THAT ON THE DAY OF SEARCH, GOLD JEWELLERY WEIGHING 3730.200 GRAMS (NET WEIGHT) AND SILVER ARTICLES WEI GHING 38.250 KGS WERE FOUND IN THE POSSESSION OF THE ASSESSEE AN D HIS FAMILY DATE OF HEARING: 01.03 . 201 8 DATE OF PRONOUNCEMENT: 28.03.2018 ITA NO 55 OF 2016 KANDULA VISVESWARA RAO HYDERABAD . PAGE 2 OF 8 MEMBERS AND THE REGISTERED VALUER HAD VALUED THEM A T RS.1,29,84,804 AND RS.13,38,750 RESPECTIVELY. AFTER CONSIDERING THE EXPLANATION OFFERED BY THE ASSESSEE AND AFTER C ONSIDERING THE PERMISSIBLE LIMIT OF GOLD AND DIAMOND JEWELLERY BY AN INDIVIDUAL AS PER THE CBDT GUIDELINES, IT WAS OBSERVED THE ASS ESSEE WAS IN POSSESSION OF EXCESS GOLD AND DIAMOND JEWELLERY WOR TH RS.1,05,00,000. WHEN THE ASSESSEE WAS ASKED TO SHOW CAUSE AS TO WHY IT SHOULD NOT BE TREATED AS HIS UNEXPLAINED INVESTMENT, THE ASSESSEE EXPLAINED THAT THE GOLD AND DIAMOND JEWELL ERY FOUND DURING THE COURSE OF SEARCH BELONGED TO HIS WIFE, M OTHER AND DAUGHTER. THE ASSESSEE ALSO PRODUCED A RECEIPT FROM KRISHNA DAS & CO. FOR PURCHASE OF GOLD WORTH RS.2.00 LAKHS. THE ASSESSEE HAD STATED THAT THE GOLD JEWELLERY WAS GIFTED TO HIS FA MILY MEMBERS ON VARIOUS OCCASIONS AND FAMILY GET-TOGETHER, SUCH AS MARRIAGES, BIRTH DAYS ETC., AND HE PRODUCED THE PHOTOGRAPHS TA KEN ON FAMILY OCCASIONS TO SUBSTANTIATE THE SAID CONTENTION. HOWE VER, THE AO WAS NOT CONVINCED AND HE MADE THE ADDITION OF RS.1, 05,00,000 TO THE RETURNED INCOME OF THE ASSESSEE AND BROUGHT TO TAX. AGGRIEVED, THE ASSESSEE PREFERRED AN APPEAL BEFORE THE CIT (A), WHO GRANTED RELIEF TO THE ASSESSEE BY OBSERVING AS UNDER: 06.0 . ON THE DAY OF SEARCH GOLD JEWELLERY WEIGHIN G 3730.200 GRAMS (NET WEIGHT) AND SILVER ARTICLES WEI GHING 38.250 KGS. WERE FOUND IN THE POSSESSION OF THE ASS ESSEE AND HIS FAMILY MEMBERS. THE GOLD AND DIAMOND JEWELL ERY AND SILVER ARTICLES FOUND IN THE RESIDENCE AND IN T HE LOCKERS WERE AND VALUED BY THE REGISTERED VALUER AT RS. 1,29,84,804/- AND RS.13,38,750/-. A SUBSTITUTED SEI ZURE OF RS.1,05,OO,OOO/- WAS MADE OUT OF THE ABOVE JEWEL LERY FOUND. IN THE ASSESSMENT PROCEEDINGS, THE ASSESSEE WAS ASKED TO EXPLAIN WHY THIS AMOUNT OF RS.1,05,OO,OOO/ - SHOULD NOT BE TREATED AS VALUE OF UNACCOUNTED JEWEL LERY. THE ASSESSEE EXPLAINED THAT THIS JEWELLERY COMPRISE S OF ITEMS BELONGING TO HIMSELF, HIS MOTHER, WIFE AND DA UGHTER. IN ADDITION IT WAS EXPLAINED THAT SOME JEWELLERY BE LONGING TO HIS MOTHER-IN-LAW WAS RECEIVED BY HIS WIFE AND DAUGHTER BY WAY OF A DISTRIBUTION AFTER HER DEMISE. THE ASSESSEE MAINTAINED THAT HE STATED THIS POSITION FR OM THE VERY BEGINNING DURING THE SEARCH ITSELF, AND THAT H E CONSENTED TO THE SEIZURE UNDER PROTEST. THE ASSESSE E ITA NO 55 OF 2016 KANDULA VISVESWARA RAO HYDERABAD . PAGE 3 OF 8 FURTHER RELIED ON AN AFFIDAVIT DATED 19.4.2010 SIGN ED BY HIS FATHER-IN-LAW SRI P.V. RANGAIAH NAIDU FOR THE DISTRIBUTION OF JEWELLERY BELONGING TO HIS LATE MOT HER-IN- LAW. HE PRODUCED A COPY OF A BILL FROM M/S. KRISHNA DAS & CO AS EVIDENCE OF PURCHASE OF JEWELLERY PAID FOR BY CHEQUE. HE ALSO RELIED UPON PHOTOGRAPHS TAKEN DURIN G FAMILY FUNCTIONS TO CLAIM THAT THE JEWELLERY WAS VE RY SUBSTANTIALLY AVAILABLE IN THE HOUSE SINCE MANY YEA RS GOING BACK TO HIS WEDDING, BIRTH OF DAUGHTER AND OT HER FAMILY FUNCTIONS. 06.1 THE ASSESSING OFFICER DID NOT ACCEPT THESE EXPLANATIONS. NEITHER THE ASSESSEE NOR THE FAMILY MEMBERS HAD ANY WEALTH TAX RETURNS EVIDENCING THE POSSESSION OF JEWELLERY AND PHOTOGRAPHS WERE NOT ACCEPTABLE AS EVIDENCE. THE DECLARATION OF SRI P.V. RANGAIAH NAIDU WAS NOT A REGISTERED DOCUMENT AND THEREFORE HELD TO BE A SELF-SERVING DECLARATION. IN RESPECT OF THE EVIDENCE FOR PURCHASE OF JEWELLERY FROM M/S KRI SHNA DAS & CO. THE ASSESSING OFFICER HELD THAT SINCE ORI GINAL BILL WAS NOT PRODUCED FOR VERIFICATION A PHOTOCOPY COULD NOT BE ACCEPTED AS EVIDENCE. THE ASSESSING OFFICER THER EFORE NOTED THAT THE ASSESSEE MERELY REPEATED HIS STATEME NT BEFORE THE SEARCH TEAM AND HAD NO FRESH EVIDENCE TO EXPLAIN THE NATURE AND SOURCE OF ACQUISITION OF JEW ELLERY. AN AMOUNT OF RS.1,05,OO,OOO/- WAS THEREFORE ADDED T O THE RETURNED INCOME AS UNEXPLAINED INVESTMENT IN GO LD JEWELLERY. 06.2 THE FACTS OF THE CASE EMERGING FROM THE ORAL & WRITTEN SUBMISSIONS OF THE ID. AR AND THE RECORD OF THE ASS ESSING OFFICER ARE CAREFULLY CONSIDERED. IN BRINGING TO TA X RS.1,05,00,000/- AS UNEXPLAINED INVESTMENT IN JEWEL LERY THE ASSESSING OFFICER HELD THAT THE ASSESSEE COULD NOT PRODUCE ANY EVIDENCE THAT COULD CONSTITUTE SATISFAC TORY EXPLANATION OF THE JEWELLERY FOUND AND SEIZED. THE ASSESSING OFFICER IS RIGHT INSOFAR AS HE CONCLUDES THAT SOME OF THE EVIDENCE RELIED UPON BY THE ASSESSEE SU CH AS PHOTOGRAPHS CANNOT BE ACCEPTED AS EVIDENCE. PHOTOGR APHS CAN NEVER BE CONCLUSIVE BECAUSE THEY DON'T NECESSAR ILY INDICATE, MUCH LESS ESTABLISH OWNERSHIP. HOWEVER, I T IS THE REST OF THE REASONING RELIED UPON BY THE ASSESSING OFFICER THAT MERITS A CLOSER LOOK. 06.3 REGARDING WEALTH TAX RETURNS IT IS STATED BY T HE ASSESSEE THAT THEY WERE NOT FILED OWING TO A BONAFI DE BELIEF THAT THE INDIVIDUAL ASSESSEES IN THE FAMILY WERE HOLDING ASSETS BELOW THE TAXABLE LIMITS. IN ANY CAS E IT WAS MAINTAINED THAT THEY WERE EXPLAINABLE WITH REFERENC E TO THEIR RESPECTIVE SOURCES FOR INVESTMENT. WITH REGAR D TO THE PURCHASE EFFECTED FROM M/S KRISHNADAS & CO. HYDERAB AD, THE ASSESSING OFFICER HELD THAT A PHOTOCOPY OF THE BILL IS NOT ACCEPTABLE UNLESS THE ORIGINAL WAS PRODUCED. TH E PAYMENT IS SEEN TO HAVE BEEN MADE BY CHEQUE AND TO THAT ITA NO 55 OF 2016 KANDULA VISVESWARA RAO HYDERABAD . PAGE 4 OF 8 EXTENT COULD NOT HAVE BEEN UN-VERIFIABLE. IN ANY CA SE THE PURCHASE IN QUESTION ON 28-03-2010 WAS FOR A MERE R S 2 LAKHS, AS AGAINST THE AGGREGATE AMOUNT OF JEWELLERY VALUED AT RS 1,29,84,804/-. THE MOST SIGNIFICANT FA CT, HOWEVER, IS THAT THE SEIZED JEWELLERY VALUED AT RS 1,05,00,000/AND PROPOSED FOR ASSESSMENT IN THE HAND S OF THE ASSESSEE, IS ALMOST ENTIRELY CLAIMED TO BELONG TO PERSONS OTHER THAN THE ASSESSEE IN QUESTION. THIS C LAIM OF THE ASSESSEE IS NOT EVEN ADDRESSED, MUCH LESS CONTROVERTED IN THE ASSESSMENT. 06.4 THE JEWELLERY FOUND IS 3800 GMS. APPROX. OUT O F WHICH 2210 GMS. WERE CLAIMED TO BELONG TO HIS WIFE SMT K. SESHUKUMARI, 940 GMS. TO DAUGHTER MISS K PRIYANK A, 500 GMS TO ASSESSEE'S MOTHER, AND 150 GMS TO THE ASSESSEE. THE STATED DISTRIBUTION OF JEWELLERY FOUN D IS RECORDED IN THE ASSESSMENT ORDER WITHOUT QUESTION O R COMMENT, WHICH INDICATES THAT THE ASSESSING OFFICER DID NOT COME ACROSS ANY MATERIAL TO QUESTION THE SAME. THE ASSESSEE HAD STATED SO ON THE DATE OF SEARCH (06-10 - 2010), IN THE COURSE OF THE SEARCH PROCEEDINGS ON T HE DATE (03-12-2010) OF LIFTING THE PROHIBITORY ORDER PLACE D U/S 132(3), AS WELL AS ON 06-02-2013 DURING THE ASSESSM ENT PROCEEDINGS. FAR FROM FAILING TO PRODUCE 'AN IOTA O F FRESH EVIDENCE' AND MERELY REITERATING HIMSELF AS HELD BY THE ASSESSING OFFICER, IT HAS TO BE APPRECIATED THAT TH E ASSESSEE HAS CONSISTENTLY DENIED ANY LIABILITY TO B E TAXED, PARTICULARLY HIS LIABILITY TO BE TAXED ON THE JEWEL LERY FOUND AT HIS RESIDENCE. THE ASSESSMENT ORDER DOES NOT MAK E OUT ANY CASE TO THE EFFECT THAT THE JEWELLERY EITHER BE LONGS TO THE ASSESSEE OR HAS BEEN PURCHASED BY THE ASSESSEE. IT DOES NOT REPUDIATE THE FACT THAT THERE WERE OTHER ASSESSEES IN THE HOUSEHOLD TO WHOM THE OWNERSHIP OF THE JEWELLERY WAS BEING ATTRIBUTED. 06.5. THE TAXABILITY OF THE VALUE OF JEWELLERY ADDE D IN THE ASSESSEE'S HAND HAS BEEN DENIED BECAUSE OF THREE REASONS WHICH HAVE NOT BEEN ADDRESSED OR APPRECIATE D BY THE ASSESSING OFFICER. FIRSTLY, FOR REASONS OF THEI R ANTIQUITY; SECONDLY ON ACCOUNT OF IDENTIFIED PURCHA SES FROM ACCOUNTED SOURCES; AND, THIRDLY, BECAUSE THE JEWELLERY BELONGS TO OTHER ASSESSEES IN THE HOUSEHO LD, VIZ SPOUSE, DAUGHTER AND MOTHER. 06.5.1 REGARDING THE ANTIQUITY OF THE JEWELLERY, IT IS CLAIMED THAT MUCH OF IT GOES BACK TO 1982 BEING THE YEAR OF HIS MARRIAGE, OR LITTLE LATER WHEN HIS DAUGHTER WAS BORN. SIMILARLY, IT IS URGED THAT JEWELLERY BELONGING TO HIS DECEASED MOTHER-IN-LAW (AND THEREFORE OF SIMILAR, I F NOT GREATER ANTIQUITY) TO THE EXTENT OF 1432 GMS WAS PA RT OF THE TOTAL JEWELLERY FOUND. IN SUPPORT, A DECLARATIO N ON A RS 100 NON JUDICIAL STAMP PAPER MADE BY HIS FATHER-IN- LAW SHRI P.V. RANGAYYA NAIDU ON 19-04-2010 HAS BEEN FIL ED. THE ASSESSING OFFICER DISMISSES THIS DOCUMENT AS A 'SELF- SERVING DECLARATION' BECAUSE IT IS NOT A REGISTERED ITA NO 55 OF 2016 KANDULA VISVESWARA RAO HYDERABAD . PAGE 5 OF 8 DOCUMENT. THIS DOCUMENT IS APPARENTLY NOT PART OF T HE SEIZED MATERIAL THOUGH DATED 19-04-2010. IT IS NOT PROPERLY VERIFIED OR NOTARISED, AND THEREFORE, MAY BE LACKING THE EVLDENTLARV VALUE OF AN AFFIDAVIT, BUT IT IS A CLAIM NEVERTHELESS, CALLING FOR AN EVALUATION ON PROBABILITIES AT LEAST. 06.5.2 THE CLAIM OF PURCHASE FROM ACCOUNTED SOURCES WAS A SINGLE BILL FOR A MERE RS.2 LAKHS. THIS IS NOT A VERY SIGNIFICANT DETERMINANT OF OUTCOMES FOR THREE REASO NS. FIRSTLY, AS NOTICED EARLIER, NOTWITHSTANDING THE FA CT THAT THE ORIGINAL BILL WAS NOT AVAILABLE A PHOTOCOPY WAS AVAILABLE WITH DETAILS OF CHEQUE PAYMENT AND FOR TH IS REASON ALONE THIS CANNOT BE SEEN AS AN UNVERIFIABLE CLAIM. SECONDLY, THIS IS AN INSIGNIFICANT COMPONENT OF THE TOTAL JEWELLERY FOUND. THIRDLY, IT WOULD BE HIGHLY IMPROB ABLE THAT THE ASSESSEE DID NOT EFFECT ANY PURCHASES OTHE R THAN THIS. 06.5.3 IT IS SEEN FROM THE RECORDS OF THE ASSESSING OFFICER THAT THE INVENTORY OF JEWELLERY FOUND AND VALUED CO MPRISES OF 23 ITEMS VALUED AT RS 1,01,80,770/- IN THE NAME OF SMT. SESHU KUMARI, W/O SRI K VISWESWARA RAO (THE ASSESSEE), AND 9 ITEMS VALUED AT RS 28,04,034/- IN THE NAME OF MISS K. PRIYANKA, D/O SRI K VISWESWARA RAO, AGGREGATING TO RS 1,29,84,804. THIS INVENTORY MADE ON THE DATE OF SEARCH IS THE EARLIEST DOCUMENT OF STATED OWNERSHIP ON RECORD, AND HAS NOT BEEN FAULTED. THEIR INTER SE ATTRIBUTION TO MOTHER AND SELF IS A PART OF THE ASSESSEE'S SUBMISSIONS. S UFFICE IT TO NOTE THAT THIS HAS NOT BEEN QUESTIONED BY THE AS SESSING OFFICER. SECONDLY, BOTH THE SPOUSE AS WELL AS THE D AUGHTER OF THE ASSESSEE ARE RETURN-FILING INDEPENDENT ASSES SEES UNDER THE INCOME TAX ACT. 06.6 IN ARGUING FOR ANTIQUITY OF THE JEWELLERY, THE ASSESSEE IS SEEKING TO PLACE IT BEYOND THE RANGE OF ASSESSAB LE YEARS ON THE ASSESSING OFFICER'S HORIZON. THE CLAIM THAT THE JEWELLERY BELONGED TO SPOUSE GOING BACK TO DATE OF MARRIAGE, GIFTS RECEIVED ON FESTIVE OCCASIONS BY SP OUSE & DAUGHTER, RECEIVING A SHARE OF DECEASED MOTHER-IN-L AW'S JEWELLERY ARE PERFECTLY PLAUSIBLE, PARTICULARLY IN THE SOCIETAL CONTEXT. PURCHASE OF SPECIFIC ITEMS FROM A CCOUNTED SOURCES IS EQUALLY PLAUSIBLE. THE DIFFICULTY, HOWEV ER, IS THE INABILITY OF THE ASSESSEE TO LEAD WITH ANY ITEMISED LISTING OF SUCH ITEMS, PARTICULARLY WHEN ASSESSEE-WISE WEAL TH TAX RETURNS FOR SUCCESSIVE ASSESSMENT YEARS ARE NOT AVAILABLE. THE SIGNIFICANT ISSUE, HOWEVER, IS THAT OWNERSHIP, SOURCE OF ACQUISITION, AND TAXABILITY AR E ISSUES THAT SHOULD BE CONSIDERED IN THE HANDS OF THE ASSES SEE CONCERNED. IN THE EXPLANATION FURNISHED BEFORE THE ASSESSING OFFICER, AS WELL AS IN APPELLATE PROCEEDI NGS, THE JEWELLERY CLAIMED TO BELONG TO THE ASSESSEE IS ONLY 150 GMS. WHILE THIS IS A MERE CLAIM THAT DOES NOT BIND THE ITA NO 55 OF 2016 KANDULA VISVESWARA RAO HYDERABAD . PAGE 6 OF 8 DEPARTMENT INSOFAR AS IDENTIFICATION OF AN INVESTME NT IS CONCERNED, THE FACT NEVERTHELESS IS THAT IT HAS NOT BEEN CALLED INTO QUESTION BY THE ASSESSING OFFICER. A FI NDING THAT CERTAIN JEWELLERY IS DEEMED TO HAVE BEEN ACQUI RED FROM UNACCOUNTED SOURCES HAS TO BE MADE IN THE HAND S OF PERSON TO WHOM IT CAN BE ASCRIBED WITH REASONABLE CERTAINTY. FACED WITH A DENIAL THAT THE JEWELLERY B ELONGED TO HIM, IN THE ABSENCE OF ANY FINDING THAT IT HAS B EEN PURCHASED BY ASSESSEE DURING THE YEAR OF ACCOUNT, O R A FINDING OF THE IMPROBABILITY OF SUCH OTHER PERSON(S ) ACQUIRING OR OWNING SOME OR ANY OF THE IMPUGNED ASS ETS, THE ASSESSING OFFICER HAS MISDIRECTED HIMSELF IN SE EKING AN EXPLANATION FOR SOURCES FROM THE ASSESSEE FOR AS SETS CLAIMED TO BELONG TO ANOTHER PERSON(S). 06.7. THE ASSESSEE'S CONTENTION THAT THE JEWELLERY VERY SUBSTANTIALLY BELONGED TO HIS SPOUSE AND DAUGHTER H AS NEVER BEEN TESTED WITH REFERENCE TO THEIR RESPECTIV E SOURCES. IN THE ABSENCE OF BOOKS OF ACCOUNT OR WEAL TH TAX RETURNS THE ASSESSEE'S CLAIM THAT THESE JEWELS BELO NGED LARGELY TO SPOUSE AND DAUGHTER RESTS MERELY ON PHOTOGRAPHS AND THE 'AFFIDAVIT'. BOTH THESE 'PROOFS ' ARE NOT EVIDENCE WHICH BY ITSELF PERMITS ANY ITEMISED DEDUC TION FROM THE AMOUNT ASSESSED IN THE HANDS OF THE ASSESS EE. THEY ARE AT BEST AN ATTESTATION OF PROBABILITIES. 06.8 ANY ARGUMENT ON PROBABILITIES CANNOT BE DIVORC ED FROM THE SOCIETAL CONTEXT, PARTICULARLY THE SOCIAL STRUCTURE AND THE INDIAN FAMILY CONTEXT IN WHICH JEWELLERY IS CUSTOMARILY LAVISHED UPON THE BRIDE AT HER WEDDING AND THE CHILD AT BIRTH, AND IN THE COURSE OF FAMILY FUN CTIONS. SIMILARLY, INCIDENTAL GIFTS DURING THE VARIOUS RITE S OF PASSAGE MARKING AN INDIVIDUAL'S IIFE-CYCLE ARE ALSO PART OF THE LOCAL TRADITION. THE SCALE, EXTENT AND VALUE WI LL VARY IN PROPORTION TO RELATIVE AFFLUENCE AND ADHERENCE TO S OCIAL MORES BY THE FAMILY, BUT BY NO MEANS CAN THEY BE SE EN AS UNCOMMON EVENTS. IN THIS LIGHT OF THE MATTER, TO' O VERLOOK ENTIRELY THE ASSESSEE'S CLAIM THAT THE JEWELLERY BE LONGED TO OTHER PERSONS IN THE HOUSEHOLD IS NOT CORRECT. IN T HE GIVEN SITUATION, HOWEVER, THIS AMOUNT(S) IS NOT CAPABLE O F PRECISE QUANTIFICATION. THE MATTER, THEREFORE, HAS TO BE AS CERTAINED BY EVALUATING REASONABLE PROBABILITIES AND CANNOT B E WISHED AWAY. 06.9 FROM THE ASSESSEE'S PERSPECTIVE IT HAS TO BE S EEN THAT THE ENTIRE JEWELLERY VALUED AT RS.1,05,00,000/- HAS BEEN ASSESSED IN HIS HANDS WITHOUT HEEDING THE INVENTORY OR THE AVERMENT THAT THE JEWELLERY WAS NOT HIS. EVEN I F SEVERAL ITEMS DID NOT BELONG TO THE ASSESSEE (AS WO ULD BE OBVIOUS FROM THE DESCRIPTION IN THE INVENTORY), THE ASSESSEE COULD HAVE PURCHASED JEWELLERY FROM TIME T O TIME IN HIS CAPACITY AS HEAD OF THE FAMILY, FOR WHICH HE ALONE COULD BE ASKED TO EXPLAIN. THE SOLITARY INSTANCE OF THIS NATURE DETECTED WAS A PAYMENT FOR PURCHASE OF JEWEL LERY ITA NO 55 OF 2016 KANDULA VISVESWARA RAO HYDERABAD . PAGE 7 OF 8 WORTH RS.2.00 LAKHS FROM M/S KRISHNADAS & CO. IT IS A VERY REASONABLE PROBABILITY THAT THE ASSESSEE WOULD HAVE EFFECTED OTHER PURCHASES FOR WHICH THERE IS NO VERI FIABLE RECORD. THE QUESTION THEREFORE, IS WHAT PART OF THE JEWELLERY FOUND ON 06-10-2010 CAN BE REASONABLY ATTRIBUTED TO PURCHASES EFFECTED BY THE ASSESSEE AF TER 01- 04-2004, IN RESPECT OF WHICH ALONE, AN IMPUTATION O F UNEXPLAINED INVESTMENT IN JEWELLERY CAN BE FASTENED ON THE' ASSESSEE. HAVING REGARD TO THE PROBABILITY OF FAMILY JEWELLERY HANDED DOWN BEING PART OF THE JEWELLERY F OUND ON 06-10-2010 IT WOULD BE REASONABLE TO ASSUME 30% OF THIS ACCUMULATION, INCLUSIVE OF THE 150 GMS CLAIMED TO BELONG TO HIM, TO ' BE THE AGGREGATE INVESTMENT BY THE ASSESSEE. VALUED PRO RATA, THIS AMOUNTS TO ABOUT RS 39 LAKHS. THIS AMOUNT HAS TO BE EXPLAINED WITH REFEREN CE TO AVAILABLE SOURCES- IN THE YEAR OF DETECTION, ONLY F OR WANT OF YEAR-WISE PURCHASE DETAILS. IT HAS TO BE RECALLED I N THIS CONTEXT THAT THE RETURNED INCOME OF THE ASSESSEE IN HIS INDIVIDUAL CAPACITY FROM AY 2005-06 TO AY 2011-12 AGGREGATES TO A LITTLE UNDER RS 4 CRORES. THE RETUR NED INCOME IN AYS 2008-09, 2009-10, 2010-11 AND 201112 IS RS 64.97 LAKHS, RS 101 LAKHS, RS 101 LAKHS, AND RS 109 LAKHS RESPECTIVELY. THIS IS A SIGNIFICANT MULTIPLE OF THE AMOUNT THAT THE ASSESSEE CAN BE REASONABLY CALLED U PON TO EXPLAIN. 06.10 TO CONCLUDE, ENTIRE JEWELLERY FOUND CANNOT BE CONSIDERED EXPLAINABLE BY THE ASSESSEE. THE JEWELLE RY TO BE ATTRIBUTED TO OTHERS IN THE HOUSEHOLD- AND THERE FORE EXCLUDED FROM CONSIDERATION IN THE HANDS OF THE ASS ESSEE, HAS TO BE ESTIMATED BASED ON REASONABLE PROBABILITI ES BECAUSE OF THE NON- FILING OF WEALTH TAX RETURNS. S UCH AN ASSESSMENT OF PROBABILITIES HAS TO GIVE DUE WEIGHTA GE TO SOCIAL TRADITION AND FAMILY BONDS. THE RESIDUARY AM OUNT IS WHAT THE ASSESSEE SHOULD TO BE HELD TO ACCOUNT FOR, AND WITH REFERENCE TO HIS DISCLOSED SOURCES OF INCOME. ON A CONSIDERATION OF THE BALANCE OF PROBABILITIES IN TH E ABOVE MANNER, IT WOULD BE DIFFICULT TO SUSTAIN THE VIEW T HAT ANY PART OF THE JEWELLERY FOUND ON 0610-2010 REPRESENTS UNEXPLAINED INVESTMENT TAXABLE IN THE HANDS OF THE ASSESSEE. 06.11 THE ASSESSING OFFICER IS, THEREFORE, DIRECTED TO DELETE THE ADDITION OF RS.1,05,00,000/-. 3. WHILE THE LEARNED DR SUPPORTED THE ORDER OF THE AO, THE LEARNED COUNSEL FOR THE ASSESSEE SUPPORTED THE ORDER OF THE CIT (A). 4. HAVING REGARD TO THE RIVAL CONTENTIONS AND THE M ATERIAL ON RECORD, WE FIND THAT THE LEARNED CIT (A) HAS TAK EN NOTE OF THE ITA NO 55 OF 2016 KANDULA VISVESWARA RAO HYDERABAD . PAGE 8 OF 8 SOCIETAL PATTERN IN INDIA AND ALSO THAT THE JEWELLE RY WAS CLAIMED TO BE BELONGING TO OTHER FAMILY MEMBERS OF THE ASSESSE E WHO ARE ALSO INCOME TAX ASSESSEES. THEREFORE, HE HAS RIGHTLY HEL D THAT THE ENTIRE JEWELLERY FOUND DURING THE COURSE OF SEARCH CANNOT BE CONSIDERED AS EXPLAINABLE BY THE ASSESSEE ALONE AND ALSO THAT THE ASSESSEE HAD RESOURCES OVER THE PAST YEARS TO EXPLA IN THE SOURCES FOR INVESTMENT IN JEWELLERY AS NOT EXPLAINED; AND T O BE BELONGING TO THE FAMILY MEMBERS. WE FIND THAT THE CIT (A) HAS APPRECIATED THE FACTUAL ASPECT OF THE ISSUE AT LENGTH AND THE L EARNED DR HAS NOT BEEN ABLE TO REBUT THESE FINDINGS OF THE CIT (A ) WITH ANY MATERIAL TO THE CONTRARY. IN VIEW OF THE SAME, WE D O NOT SEE ANY REASON TO INTERFERE WITH THE ORDER OF THE CIT (A). REVENUES APPEAL IS ACCORDINGLY DISMISSED. 5. IN THE RESULT, REVENUES APPEAL IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 28 TH MARCH, 2018. SD/- SD/- (B. RAMAKOTAIAH) ACCOUNTANT MEMBER (P. MADHAVI DEVI) JUDICIAL MEMBER HYDERABAD, DATED 28 TH MARCH 2018. VINODAN/SPS COPY TO: 1 ASSTT. COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE 1(1) 3 RD FLOOR, POSNETT BHAVAN, TILAK ROAD, RAMKOTI, HYDERABAD 5000 01 2 SHRI KANDULA VISVESWARA RAO, PLOT NO.324, ROAD NO .79, JUBILEE HILLS , HYDERABAD 3 CIT (A)-11, HYDERABAD 4 PR. CIT CENTRAL, HYDERABAD 5 THE DR, ITAT HYDERABAD 6 GUARD FILE BY ORDER