Shri Babulal G.Sekhani, Ahmedabad V. The ACIT.,Cent.Circle-2(4), Ahmedabad

ITSSA 432/AHD/2012

• Counselvise Citation: [2016] 122 COUNSELVISE.COM (IT) 1664 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 year(s) 5 month(s) 21 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 24-02-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 15-02-2016
• Assessment Year: 2010-2011
• Appeal Filed On: 03-09-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: JAGDISH

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, AHMEDABAD , , BEFORE SHRI PRAMOD KUMAR, ACCOUNTANT MEMBER AND SHRI KUL BHARAT, JUDICIAL MEMBER ./ I.T(SS).A. NO.432/AHD/2012 ( / ASSESSMENT YEAR : 2010-11) BABULAL G.SEKHANI 62, NEW CLOTH MARKET OPP.RAIPUR GATE AHMEDABAD / VS. THE ACIT CENTRAL CIRCLE-2(4) AAYKAR BHAVAN ASHRAM ROAD AHMEDABAD ./ ./ PAN/GIR NO. : ACSPS 5963 J ( ' / APPELLANT ) .. ( #' / RESPONDENT ) ' $ / APPELLANT BY : SHRI TUSHAR P.HEMANI, AR #' % $ / RESPONDENT BY : SHRI JAGDISH,CIT-DR &'( % ) / DATE OF HEARING 15/02/2016 *+, % ) / DATE OF PRONOUNCEMENT 24/02/2016 / O R D E R PER SHRI KUL BHARAT, JUDICIAL MEMBER : THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST T HE ORDER OF THE LD.COMMISSIONER OF INCOME TAX(APPEALS)-III, AHMEDAB AD [CIT(A) IN SHORT] DATED 16/07/2012 PERTAINING TO ASSESSMENT Y EAR (AY) 2010-11. 2. THE SOLITARY EFFECTIVE GROUND OF APPEAL READS AS UNDER: IT(SS)A NO.432/ AHD/2012 BABULAL G.SEKHANI VS. ACIT ASST.YEAR 2010-11 - 2 - 1. THE LD.CIT(A) ERRED IN LAW AND ON FACT IN CONFIRMI NG THE ADDITION OF RS.5,23,349/- JEWELLERY AS UNEXPLAINED OUT OF AD DITION OF RS.9,79,064/- MADE BY THE ASSESSING OFFICER, THE A. O. MAY BE DIRECTED TO TREAT THE JEWELLERY AS EXPLAINED JEWELL ERY AND THE ADDITION SO MADE MAY KINDLY BE DELETED. 2.1. BRIEFLY STATED FACTS ARE THAT A SEARCH ACTION U/S.132 OF THE INCOME TAX ACT, 1961 (HEREINAFTER REFERRED TO AS THE ACT ) WAS CARRIED OUT IN THE GROUP CASES OF MANGAL GROUP ON 06/08/2009. THE CAS E OF THE ASSESSEE WAS CENTRALIZED WITH CENTRAL CIRCLE-2(4), AHMEDABAD FOR SCRUTINY ASSESSMENT AND THE ASSESSMENT U/S.143(3) R.W.S. 153 B(1)(B) OF THE INCOME TAX ACT,1961 (HEREINAFTER REFERRED TO AS TH E ACT) WAS FRAMED VIDE ORDER DATED 27/12/2011, THEREBY THE ASSESSING OFFICER (AO IN SHORT) MADE ADDITION OF RS.9,79,064/- AS UNEXPLAINED INVES TMENT IN JEWELLERY. THE ASSESSEE BEING AGGRIEVED BY THE ASSESSMENT ORDE R, PREFERRED AN APPEAL BEFORE THE LD.CIT(A), WHO AFTER CONSIDERING THE SUBMISSIONS OF THE ASSESSEE PARTLY ALLOWED THE APPEAL, THEREBY THE ADDITION OF RS.5,23,349/- WAS SUSTAINED. AGGRIEVED BY THE OR DER OF THE LD.CIT(A), THE ASSESSEE IS FURTHER IN APPEAL BEFORE US. 3. THE LD.COUNSEL FOR THE ASSESSEE REITERATED THE S UBMISSIONS AS WERE MADE IN THE SYNOPSIS. HE SUBMITTED THAT THE APPELL ANT MADE DISCLOSURE OF RS.42,50,000/- IN RESPECT OF UNEXPLAINED DIAMON DS ONLY SINCE JEWELLERY OF GOLD STOOD EXPLAINED. HE SUBMITTED THAT THE GOLD JEWELLERY OF 1300 GMS. (VALUED AT RS.16,71,800/-) AS EXPLAINE D IN THE IT(SS)A NO.432/ AHD/2012 BABULAL G.SEKHANI VS. ACIT ASST.YEAR 2010-11 - 3 - LIGHT OF INSTRUCTION NO.1916. HE SUBMITTED THAT THE AO ALSO ALLOWED CREDIT OF RS.8,00,000/- IN RESPECT OF JEWELLERY DIS CLOSED IN VDIS-1997 AND, ACCORDINGLY, ADDITION OF RS.9,79,064/- (I.E. R S.77,00,864 RS.42,50,000 RS.16,71,800 RS.8,00,000) CAME TO BE MADE IN RESPECT OF JEWELLERY TREATING THE SAME AS UNEXPLAINED. THE LD.COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE LD.CIT(A) FOUND THAT GO LD OF 2276.45 GMS. (I.E. 2824.35 547.9) FOUND DURING SEARCH STOOD EX PLAINED IN THE LIGHT OF BOARDS INSTRUCTION AND EXPLAINED GOLD AS PER VDIS/ WEALTH TAX RETURNS AS PER LD.CIT(A)S ORDER CONTAINED IN PARA-8.1. HO WEVER, THE LD.CIT(A) PARTLY CONFIRMED THE ADDITION TO THE EXTENT OF RS.5 ,23,349/- IN RESPECT OF DIAMONDS ON THE COUNT THAT ONE-TO-ONE CORRELATION B ETWEEN DIAMONDS FOUND DURING SEARCH AND DIAMONDS DISCLOSED IN RETUR NS AS WELL AS VDIS DID NOT MATCH. THE LD.COUNSEL FOR THE ASSESSEE S UBMITTED THE FOLLOWING TABLE WHICH SHOWS EXPLAINED DIAMOND JEWELLERY AS AG AINST DIAMOND JEWELLERY FOUND DURING THE COURSE OF SEARCH:- PARTICULARS DIAMOND JEWELLERY VALUE (RS.) CIT(A)S ORDER CTS. GMS.(GOLD) FOUND DURING SEARCH(A) 117.47 547.90 47,67,578/- AT PAGE 13 EXPLAINED (B) 51.35 57.95 13,57,578/- AT PAGE 13 EXCESS (A-B) 66.12 489.95 34,10,000/- AT PAGE 13 THE LD.COUNSEL FOR THE ASSESSEE SUBMITTED THAT BOT H THE LOWER AUTHORITIES FAILED TO APPRECIATE THAT DIAMOND JEWEL LERY DISCLOSED IN VDIS- 1997 AND/OR WEALTH TAX RETURNS (I.E. JEWELLERY CONT AINING 51.35 CTS. IT(SS)A NO.432/ AHD/2012 BABULAL G.SEKHANI VS. ACIT ASST.YEAR 2010-11 - 4 - DIAMONDS AND 57.95 GMS) MUST BE TREATED AS EXPLAINE D ON THE BASIS OF TOTAL WEIGHT KEEPING IN MIND THE OVERALL SCENARIO. HE SUBMITTED THAT AS EXPLAINED IN ABOVE TABLE, THE ASSESSEE HAS MADE SUF FICIENT DISCLOSURE (I.E. RS.42,50,000/-) SO AS TO COVER VALUE OF BALANCE UN EXPLAINED JEWELLERY (I.E. 66.12 CTS. DIAMONDS, 489.95 GMS. GOLD; TOTAL VALUE OF RS.34,10,000). HENCE, ANY FURTHER ADDITION IN RESP ECT OF THE SAME IS UNWARRANTED. HE SUBMITTED THAT IT IS ALSO NOT OUT OF PLACE TO MENTION THAT THE AO HAS GIVEN CREDIT OF RS.8,00,000/- IN RESPECT OF JEWELLERY DISCLOSED IN VDIS-1997, WHEREAS THE ASSESSEE HAS DISCLOSED JE WELLERY WEIGHING 880.400 GMS, 25.85 CTS. AND ASSESSEES WIFE HAS DIS CLOSED JEWELLERY OF 642.350 GMS. 22.25 CTS. (AS PER CIT(A)S ORDER IN P AGE NOS.12 & 13) COMBINED VALUE OF WHICH AS OF THE DATE OF SEARCH EX CEEDS RS.30,00,000/-. THE LD.COUNSEL FOR THE ASSESSEE SUBMITTED THAT HAD THE AO GIVEN CORRECT CREDIT IN RESPECT OF THE SAME, NO ADDITION WOULD HA VE BEEN MADE BY THE AO. EVEN ON THAT SCORE, NO ADDITION IS CALLED FO R IN RESPECT OF ANY ALLEGED UNEXPLAINED JEWELLERY. HE SUBMITTED THAT I N THE LIGHT OF ABOVE SUBMISSION, THE LD.CIT(A) OUGHT TO HAVE DELETED THE IMPUGNED ADDITION IN TOTO. 3.1. ON THE OTHER HAND, THE LD.CIT-DR OPPOSED THE SUBMISSIONS MADE BY THE LD.COUNSEL FOR THE ASSESSEE AND SUPPORTED TH E ORDER OF THE AO. IT(SS)A NO.432/ AHD/2012 BABULAL G.SEKHANI VS. ACIT ASST.YEAR 2010-11 - 5 - 4. WE HAVE HEARD THE RIVAL SUBMISSIONS, PERUSED THE MATERIAL AVAILABLE ON RECORD AND GONE THROUGH THE ORDERS OF THE AUTHORITIES BELOW. WE FIND MERIT INTO THE CONTENTION OF THE LD.COUNSEL FOR THE ASSESSEE THAT THE AUTHORITIES BELOW LOST THE SIGHT OF THE FACT AN D IT IS NOT POSSIBLE TO ESTABLISH ONE-TO-ONE CORRELATION BETWEEN DIAMOND JE WELLERY FOUND DURING SEARCH AND DIAMOND JEWELLERY DISCLOSED IN VDIS. T HE ASSESSEE HAS MADE SUFFICIENT DISCLOSURE OF RS.42,50,000/- SO AS TO COVER THE VALUE OF BALANCE UNEXPLAINED JEWELLERY. THESE FACTS ARE NO T CONTROVERTED BY THE REVENUE BY PLACING ANY MATERIAL ON RECORD. THEREFO RE, WE HEREBY DIRECT THE AO TO DELETE THE ADDITION. THUS, GROUND RAIS ED BY THE ASSESSEE IS ALLOWED. 5. IN THE RESULT, ASSESSEES APPEAL IS ALLOWED. ORDER PRONOUNCED IN THE COURT ON WEDNESDAY, THE 24 TH DAY OF FEBRUARY, 2016 AT AHMEDABAD. SD/- SD/- ( ) ( ) ( PRAMOD KUMAR ) ( KUL BHARAT ) ACCOUNTANT MEMBER JUDICIAL MEMBER AHMEDABAD; DATED 24/ 02 /2016 0)..& , '.&../ T.C. NAIR, SR. PS IT(SS)A NO.432/ AHD/2012 BABULAL G.SEKHANI VS. ACIT ASST.YEAR 2010-11 - 6 - !'#$%&%# / COPY OF THE ORDER FORWARDED TO : 1. ' / THE APPELLANT 2. #' / THE RESPONDENT. 3. 123 4 / CONCERNED CIT 4. 4 ( ) / THE CIT(A)-III, AHMEDABAD 5. 5'6 &23 , ) 23 , , 1 / DR, ITAT, AHMEDABAD 6. 689 :( / GUARD FILE. / BY ORDER, #5 //TRUE COPY// / ( DY./ASSTT.REGISTRAR) , / ITAT, AHMEDABAD 1. DATE OF DICTATION .. 18.2.16 (DICTATION-PAD 5+ PAGES ATTACHED AT THE END OF THIS FILE) 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER ..19.2.16 3. OTHER MEMBER... 4. DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR.P. S./P.S.. 5. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE D ICTATING MEMBER FOR PRONOUNCEMENT 6. DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR.P .S./P.S. 24.2.16 7. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK 24.2.16 8. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK ... 9. THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT RE GISTRAR FOR SIGNATURE ON THE ORDER.. 10. DATE OF DESPATCH OF THE ORDER