Smt. Urmila Gambhir, New Delhi V. ACIT, New Delhi

ITSSA 238/DEL/1997

• Counselvise Citation: [2015] 122 COUNSELVISE.COM (IT) 0634 (ITAT-DELHI)
• Duration Of Justice: 17 year(s) 3 month(s) 30 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 27-02-2015
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Next Hearing Date: 25-02-2015
• Assessment Year: misc
• Appeal Filed On: 28-10-1997
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: A MISRA
• Assessee Lawyers: P N MONGA; MANU MONGA ADVS
• Keywords: Unexplained investment
• Section: 132

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH A , NEW DELHI BEFORE SH. N. K. SAINI , AM AND SH. C. M. GARG , JM IT (SS) A NO. 238/DEL/1997 : BLOCK PERIOD : 01.04.1986 TO 29.08.1996 LATE SHRI SUBHASH GAMBHIR, THROUGH LEGAL HEIRS SMT. URMILA GAMBHIR , MS. NEENA MANCHANDA, MS. NEERA CHOPRA, MS. NEETA ANAND, MS. POOJA TALWAR & MS. BHAWNA CHOPRA C/O M/S K.R. BAJAJ, D. K. BAJAJ 2E/45, CONNAUGHT PLACE, NEW DELHI - 110001 VS ACIT, CENTRAL CIRCLE - I, MAYUR BHAWAN , CONNAUGHT PLACE, NEW DELHI (APPELLANT) (RESPONDENT) PAN NO. A ADPG5024F ASSESSEE BY : SH. P. N. MONGA & SH. MANU MONGA, ADVS. REVENUE BY : SH. A. MISRA , CIT DR DATE OF HEARING : 25 .02.2015 DATE O F PRONOUNCEMENT : 27 .02.2015 ORDER PER N.K . SAINI , A.M. THIS IS AN APPEAL BY THE L EGAL HEIR OF THE DECEASED ASSESSEE AGAINST THE ORDER DATED 30 .09.1997 OF THE AO FOR THE BLOCK PERIOD 01.04.1986 TO 29.08.1996. 2. EARLIER THIS APPEAL WAS DECIDED BY THE ITAT DELHI BEN CH A , NEW DELHI VIDE ORDER DATED 30.12.2004 . A GAINST T HE SAID ORDER, T HE LEGAL HEIR OF THE DECEASED ASSESSEE PREFERRED AN APPEAL TO THE HON BLE JURISDICTIONAL HIGH COURT IT(SS)A NO. 238 /DE L/1997 SUBHASH GAMBHIR 2 IN ITA 12/2006 WHEREIN FOLLOWING TWO QUESTIONS OF LAW WERE FRAMED: A. WHETHER ON T HE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND ON THE TRUE INTERPRETATION OF SECTION 158 BB(B) OF THE ACT, THERE WAS ANY MATERIAL FOR THE ITAT IN UPHOLDING THAT LOOSE PAPER ANNEXURE A - 6 PAGE 34 IN THE TOTAL OF WHICH WAS RS. 51,762/ - FOUND ON SEARCH REPR ESENTED THE SUM OF RS. 51,76,200/ - WAS THE ASSESSEE S UNDISCLOSED INCOME FOR THE BLOCK PERIOD RELATING THE SAME TO THE ASSESSMENT YEAR 1996 - 97. B. WHETHER ON THE FACT AND IN THE CIRCUMSTANCES OF THE CASE, THE ITAT WAS RIGHT IN LAW TO HOLD THAT THE SUM OF RS. 8,86,794/ - REPRESENTING THE ALLEGED UNEXPLAINED INVESTMENT IN THE PURCHASE OF JEWELLERY FOUND ON SEARCH REPRESENTED THE APPELLANTS UNDISCLOSED INVESTMENT FOR THE ASSESSMENT YEAR 1997 - 98. 3. THE FIRST QUESTION WAS DECIDED IN FAVOUR OF THE REVENUE AND AGAINST THE ASSESSEE BY THE HON BLE HIGH COURT VIDE ORDER DATED 23.12.2009 WHILE THE ISSUE RELATING TO THE ADDITION OF RS. 8,86,794/ - WAS REMITTED BACK TO THE ITAT . ACCORDINGLY, THE SAME IS DECIDED . T HE FACTS RELATING TO THIS ISSUE IN BRIEF ARE THAT A SEAR CH U/S 132 OF THE INCOME TAX ACT, 1961 (HEREINAFTER REFERRED TO AS THE ACT) WAS CONDUCTED ON 29.08.1996 AT THE RESIDENTIAL PREMISES OF THE DECEASED ASSESSEE AND CERTAIN INCRIMINATING DOCUMENTS WERE FOUND IT(SS)A NO. 238 /DE L/1997 SUBHASH GAMBHIR 3 AND SEIZED WHICH IN CLUDED INCRIMINATING PAPERS AND J EWELLERY FROM THE BANK LOCKERS. THE AO MADE AN ADDITION OF RS. 8,86,794/ - ON ACCOUNT OF UNEXPLAINED JEWELLERY ON THE BASIS THAT DURING THE COURSE OF SEARCH AT THE RESIDENCE AND OTHER LOCKERS OF THE DECEASED ASSESSEE, THE FOLLOWING JEWELLERY WAS FOUND : 1/ 14 WEST PATEL NAGAR 22,43,506.00 1/14 WEST PATEL NAGAR 3,33,053.00 LOCKER AT PUNJAB & SIND BANK PATEL 14,68,195.00 NAGAR (IN JOINT NAME WITH HIS WIFE) BANK OF INDIA, KAROL BAGH (IN THE NAME OF URMILA GAMBHIR AND HER BROTHER SHARAVAN KAP OOR) 14,25,309.00 54,70,063.00 4. THE AO TREATED THE JEWELLERY OF RS. 14,25,309/ - FOUND IN THE LOCKER IN BANK OF INDIA, KAROL BAGH BRANCH HELD BY THE WIFE OF THE ASSESSEE JOINTLY WITH HER BROTHE R , IN THE HANDS OF SM T . URMILA GAMBHIR ( WIFE OF THE ASSESSEE ) AND ASKED THE ASSESSEE TO EXPLAIN THE SOURCE FOR REMAINING JEWELLERY WORTH RS. 40 ,44,774/ - . THE AO REDUCED THE VALUE OF JEWELLERY AMOUNTING TO RS. 25,13,564/ - AS SHOWN IN THE WEALTH T AX RETURN O F SH. SUBHASH GAMBHIR ( DECEASED ASSESSEE), SMT. URMILA GAMBHIR AND MS. BHAVANA GAMBHIR. ACCORDINGLY, THE AO WORKED OUT THE UNEXPLAINED JEWELLERY AT RS. 15,31,210/ - AND AFTER REDUCING THE SURREN DERED AMOUNT OF RS. 6,44,416/ - , T HE REMAINING IT(SS)A NO. 238 /DE L/1997 SUBHASH GAMBHIR 4 AMOUNT OF RS. 8,8 6,794/ - WAS ADDED BY CONSIDERING THE SAME AS UNEXPLAINED JEWELLERY. THE AO DID NOT ACCEPT THIS CONTENTION OF THE ASSESSEE THAT THE JEWELLERY AMOUNTING TO RS. 10, 96,379/ - BELONGED TO HIS MOTHER - IN - LAW WHICH WAS MIXED IN THE JEWELLERY FOUND AT RESIDENCE AND IN THE LOCKER OF INDIAN BANK, KAR OL BAGH BY OBSERVING THAT THE SA M E DID NOT REQUIRE ANY FURTHER CONSIDERATION AS THIS ISSUE HAD BEEN CONSIDERED IN THE HAND OF SMT. URMILA GAMBHIR, THE WIFE OF THE DECEASED ASSESSEE. 5 . NOW THE ASSESSEE IS IN APPEAL. THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE AO WITHOUT APPRECIATING THE FACTS IN RIGHT PROSPECTIVE WRONGLY HELD THAT THE JEWELLERY AMOUNTING TO RS. 10,96,379/ - WHICH BELONGED TO SMT. RAJRANI KAPOOR, MOTHER - IN - LAW OF THE DECEASED ASSESSEE WAS CONSIDERED WHILE FRAMING THE ASSESSMENT OF SMT. URMILA GAMBHIR ( WIFE OF THE DECEASED ASSESSEE ) . IT WAS CONTENDED THAT SAID JEWELLERY AMOUNTING TO RS. 10,96,379/ - WAS TO BE CONSIDERED IN THE JEWELLERY F O UND FROM THE RESIDENCE OF THE ASSESSEE. SO, THERE WAS NO DIFFERE NCE OF RS. 8,86,794/ - AS WORKED OUT BY THE AO. HE FURTHER SUBMITTED THAT THE MATTER MAY BE SENT BACK TO THE AO FOR VERIFICATION FROM THE RECORD AND IF IT IS FOUND THAT THE BENEFIT OF T HE JEWELLERY WORTH RS. 10,96,379 / - BELONGING TO SMT. RAJRANI KAPOOR WAS NOT GIVEN TO SMT. URMILA GAMBHIR THEN THE SAID JEWELLERY IS TO BE CONSIDERED AS A PART IT(SS)A NO. 238 /DE L/1997 SUBHASH GAMBHIR 5 OF THE TOTAL JEWELLERY FOUND DURING THE COURSE OF SEARCH I.E. JEWELLERY VALUING RS. 51,76,200/ - . 6 . IN HER RIVAL SUBMISSIONS THE LD. CIT DR STRONGLY SUPPORTED THE ORD ER OF THE AO AND FURTHER SUBMITTED THAT THE ASSESSEE COULD NOT EXPLAIN TO THE AO DURING THE COURSE OF ASSESSMENT PROCEEDINGS , ABOUT THE SOURCE OF THE JEWELLERY VALUING RS. 8,86,794/ - , THEREFORE, THE IMPUGNED ADDITION WAS RIGHTLY MADE BY THE AO. 7 . WE HAVE CONSIDERED THE SUBMISSIONS OF BOTH THE PARTIES AND CAREFULLY GONE THROUGH THE MATERIAL AVAILABLE ON THE RECORD. IN THE PRESENT CASE, IT APPEARS THAT THE AO MADE THE IMPUGNED ADDITION ON THE BASIS THAT THE JEWELLERY BELONGING TO MOTHER - IN - LAW OF THE ASSESS EE HAD BEEN CONSIDERED IN THE HANDS OF SMT. URMILA GAMBHIR, WIFE OF THE ASSESSEE. ON THE CONTRARY THE CONTENTION OF THE LD. COUNSEL FOR THE ASSESSEE WAS THAT THE SAID JEWELLERY WAS NOT CONSIDERED IN THE HANDS OF SMT. URMILA GAMBHIR RATHER IT WAS MIXED UP I N THE JEWELLERY FOUND DURING THE COURSE OF SEARCH FROM THE RESIDENCE OF THE DECEASED ASSESSEE. IN THE PRESENT CASE, THE FACTS AS TO WHETHER THE JEWELLERY VALUING RS. 10,96,379/ - WAS CONSIDERED IN THE HANDS OF SMT. URMILA GAMBHIR ARE NOT CLEAR FROM THE MATE RIAL AVAILABLE ON THE RECORD PARTICULARLY IT(SS)A NO. 238 /DE L/1997 SUBHASH GAMBHIR 6 IN THE ABSENCE OF THE ASSESSMENT ORDER OF SMT. URMILA GAMBHIR ( IN HER INDIVIDUAL CAPACITY ) AND THE WEALTH TAX RETURNS OF SMT. RAJRANI KAPOOR. WE, THEREFORE, DEEM IT APPROPRIATE TO SET ASIDE THIS ISSUE BACK TO THE F ILE OF THE AO TO BE DECIDED AFRESH IN ACCORDANCE WITH LAW AFTER MAKING PROPER VERIFICATION AND IF IT IS FOUND THAT THE JEWELLERY WORTH RS. 10,96,379/ - BELONGING TO MOTHER - IN - LAW OF THE DECEASED ASSESSEE WAS NOT CONSIDERED WHILE FRAMING THE ASSESSMENT OF SM T. URMILA GAMBHIR IN HER INDIVIDUAL CAPACITY THEN THE EXPLANATION GIVEN BY THE ASSESSEE AT THE RELEVANT TIME THAT THE SAID JEWELLERY MIXED WITH THE JEWELLERY FOUND AT HIS RESIDENCE AND IN THE LOCKER DESERVES TO BE ACCEPTED. IN THAT VIEW OF THE MATTER, THE SAID ISSUE IS SET ASIDE TO THE FILE OF THE AO. 8 . IN THE RESULT, APPEAL OF THE ASSESSEE IS PARTLY ALLOWED FOR STATISTICAL PURPOSES . ( ORDER PRON OUNCED IN THE COURT ON 27 /02/ 2015) . SD/ - SD/ - ( C. M. GARG ) ( N. K. SAINI ) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 27 /02/2015 *SUBODH* COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGISTRAR