Sh. Ram Chander Soni, New Delhi V. ACIT, New Delhi

ITSSA 34/DEL/2010

• Counselvise Citation: [2015] 122 COUNSELVISE.COM (IT) 0728 (ITAT-DELHI)
• Duration Of Justice: 4 year(s) 9 month(s) 29 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 20-05-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: F
• Next Hearing Date: 01-04-2015
• Assessment Year: misc
• Appeal Filed On: 22-07-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: VIKRAM SAHAY
• Assessee Lawyers: DR RAKESH GUPTA
• Keywords: Unexplained investment; Search and seizure; Valuation report; Block assessment

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCHES : F NEW DELHI BEFORE SHRI G.C.GUPTA, VICE PRESIDENT AND SHRI J.SUDHAKAR REDDY, AM ITA NO: 34 /DEL/20 1 0 BLOCK PERIOD: 01.04.1996 TO 14.5.2002 SHRI RAM CHANDER SONI VS. ACIT, CC 16 11799/6, SAT NAGAR, KAROL BAGH NEW DELHI NEW DELHI PAN: AAOPS 8815M (APPELLANT) (RESPONDENT) APPELLANT BY : DR.RAKESH GUPTA, ADV. RESPONDENT BY : SH. VIKRAM SAHAY, SR. D.R. O R D E R PER J.SUDHAKAR REDDY, ACCOUNTANT MEMBER THIS APPEAL IS FILED BY THE ASSESSEE DIRECTED AGAINST THE ORDER OF THE LD.CIT(A) - XXIX, NEW DELHI DT. 21.9.2006. 2. FACTS IN BRIEF: - THE ASSESSEE IS AN INDIVIDUAL. A SEARCH AND SEIZURE OPERATION WAS CARRIED OUT ON THE BUSINESS PREMISES OF THE FIRM M/S RC JEWELLERS, OF WHICH THE ASSESSEE SHRI RAM CHANDER SONI WAS A PARTNER. M/S R C JEWELLERS IS IN T HE MANUFACTURING AND TRADING OF GOLD AND DIAMOND JEWELLERY. THE RESIDENTIAL PREMISES WAS ALSO COVERED IN THE SEARCH. NOTICE U/S 158 BC OF THE ACT DT. 11.2.2003 WAS ISSUED AND DULY SERVED ON THE ASSESSEE. IN RESPONSE THE ASSESSEE FILED ITS RETURN OF INC OME ON 11.9.2003 DECLARING UNDISCLOSED INCOME OF RS.7,30,000/ - . THE AO VIDE HIS ORDER DT. 31.5.2004, FOR THE PERIOD 1.4.1996 TO 14.8.2002 PASSED AN ORDER U/S 158 BC OF THE ACT DETERMINING THE TOTAL INCOME AT RS.23,38,228/ - AFTER MAKING AN ADDITION OF RS. 15,08,228/ - ON ACCOUNT OF UNEXPLAINED INVESTMENTS IN JEWELLERY. AGGRIEVED THE ASSESSEE CARRIED THE MATTER IN APPEAL BEFORE THE ITA 34/DEL/2010 BLOCK PERIOD: 01.04.1996 TO 14.05.2002 SH. RAM CHANDER SONI, NEW DELHI 2 FIRST APPELLATE AUTHORITY WITHOUT SUCCESS. FURTHER AGGRIEVED THE ASSESSEE IS BEFORE US ON THE FOLLOWING GROUNDS. 1. ON THE FACT S AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD.CIT (A) WAS INCORRECT AND UNJUSTIFIED IN SUSTAINING THE ADDITION OF RS.15,88,228/ - IN A BLOCK ASSESSMENT INCORRECTLY AND WRONGLY MADE BY THE AO. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE C ASE AND IN LAW, THE LD.CIT (A) WAS INCORRECT AND UNJUSTIFIED IN REJECTING VARIOUS SUBMISSIONS MADE BY THE ASSESSEE DURING APPEAL PROCEEDINGS. 4. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD.CIT (A) WAS INCORRECT AND UNJUSTIFIED IN SUSTAINING THE ADDITION IN THE HANDS OF THE ASSESSEE WHERE AS EVEN AS PER THE VALUATION REPORT THE JEWELLERY FOUND BELONGED TO TWO PERSONS, 4. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT (A) WAS INCORRECT AND UNJUSTIFIED IN HOLDING THAT THE JEWELLERY FOUND BELONGED TO THE ASSESSEE WHERE AS THERE IS A COMMON SEARCH WARRANT I THE NAME OF VARIOUS PERSONS. 5. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD.CIT (A) WAS INCORRECT AND UNJUSTIFIED IN APPLYING T HE PRINCIPLE OF IDEAS AND ESTIMATE IN A BLOCK ASSESSMENT. 6. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD.CIT (A) WAS INCORRECT AND UNJUSTIFIED IN SUSTAINING THE ADDITION IN THE BLOCK ASSESSMENT WHEREAS NOTHING WAS FOUND DURING SEA RCH TO PROVE OR EVEN ANY EVIDENCE THAT THE JEWELLERY BELONGED TO THE ASSESSEE AND HE HAD INVESTED ANY UNDISCLOSED INCOME IN THE PURCHASE OF THIS JEWELLERY. 2.1. AN ADDITION AL GROUND WAS FILED ON 12.4.2012 AND IT READS AS FOLLOWS. LD.CIT(A) ERRED IN LAW AND ON FACTS IN NOT ADJUDICATING THE MAIN ARGUMENT OF THE ASSESSEE THAT LD.AO OUGHT TO HAVE GIVEN CREDIT FOR THE JEWELLERY DISCLOSED BY THE FAMILY MEMBERS IN THE WEALTH TAX RETURN AGGREGATING TO RS.22,84,949/ - (TO BE FURTHER INCREAS ED FOR THE CURRENT VALUE) AND FOR THE AMOUNT OF CAPITAL GAIN DISCLOSED BY OTHER FAMILY MEMBER SH.ARUN KUMAR SONI FOR RS.10,75,000/ - OUT OF WHICH JEWELLERY WAS PURCHASED. 2.2. A PRAYER WAS MADE FOR ADMISSION OF THE SAME. 3. WE HAVE HEARD DR.RAKESH GUPTA, THE LD.COUNSEL FOR THE ASSESSEE AND SHRI V IKRAM SAHAY, THE LD.SR.D.R. ON BEHALF OF THE REVENUE. ITA 34/DEL/2010 BLOCK PERIOD: 01.04.1996 TO 14.05.2002 SH. RAM CHANDER SONI, NEW DELHI 3 4. ON A CAREFUL CONSIDERATION OF THE FACTS AND CIRCUMSTANCES OF THE CASE, ORDERS OF AUTHORITIES BELOW, MATERIAL ON RECORD AND CASE LAWS CITED, WE HOLD AS FOL LOWS. 5. THE ASSESSEE HAS MADE DETAILED SUBMISSIONS BEFORE THE FIRST APPELLATE AUTHORITY. THESE SUBMISSIONS WERE ALSO MADE IN WRITING AND THEY ARE FROM PAGES 64 TO 70 OF THE ASSESSEE S PAPER BOOK. A PERUSAL OF THE ORDER OF THE FIRST APPELLATE AUTHORITY DEMONSTRATES THAT HE HAS NOT ADVERTED TO ANY OF THESE SUBMISSIONS MADE BY THE ASSESSEE. THE ARGUMENTS HAVE TO BE DEALT WITH BY THE FIRST APPELLATE AUTHORITY. 5.1. HENCE WE SET ASIDE THE ISSUE TO THE FILE OF THE FIRST APPELLATE AUTHORITY FOR FRESH ADJUDICATION IN ACCORDANCE WITH LAW. THE FIRST APPELLATE AUTHORITY SHALL CONSIDER AND DEAL WITH EACH AND EVERY SUBMISSION MADE BY THE ASSESSEE BEFORE HIM AND PASS A SPEAKING ORDER. 6. IN THE RESULT THE APPEAL BY THE ASSESSEE IS ALLOWED FOR STATISTICAL PU RPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 20 TH MAY, 2015 . SD/ - SD/ - ( G.C.GUPTA ) (J.SUDHAKAR REDDY) VICE PRESIDENT ACCOUNTANT MEMBER DATED: THE 20 TH MAY, 2015 *MANGA ITA 34/DEL/2010 BLOCK PERIOD: 01.04.1996 TO 14.05.2002 SH. RAM CHANDER SONI, NEW DELHI 4 COPY OF THE ORDER FORWARDED TO: 1. APPELLANT; 2.RESPONDENT; 3.CIT; 4.CIT(A); 5.DR; 6.GUARD FILE BY ORDER ASST. REGISTRAR