Geetika Mudali, Bhubaneswar V. ACIT, Bhubaneswar

ITSSA 88/CTK/2011

• Counselvise Citation: [2012] 124 COUNSELVISE.COM (IT) 7529 (ITAT-CUTTACK)
• Duration Of Justice: 6 month(s) 11 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 25-04-2012
• Appeal Filed By: Assessee
• Bench Allotted: DB
• Next Hearing Date: 20-03-2012
• Assessment Year: 2001-2002
• Appeal Filed On: 14-10-2011
• Court: TRIBUNAL
• Department Lawyers: PARAMITA TRIPATHY
• Assessee Lawyers: BIBEK MOHANTY
• Keywords: Unexplained investment; Gift; Income from undisclosed sources; Search and seizure; Salary income; Onus to prove

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, CUTTACK BENCH, CUTTACK BEFORE : SHRI K.K.GUPTA, AM, AND SHRI K.S.S.PRASAD RAO, JM IT (SS) A NO S . 88,89,90,91,92,93 AND 94/CTK/2011 (AYS 2001 - 02, 2002 - 03,2003 - 04,2004 - 05, 2005 - 06,2006 - 07 AND 2007 - 08 GEETIKA MUDALI, PLOT NO.122, SAHID NAGAR,BHUBANESWAR, PAN: ABKPM 74212 L VERSUS ASST.COMMISSIONER OF INCOME - TAX , CIRCLE 2(2), BHUBANESWAR. (APPELLANT) (RESPONDENT) FOR THE APPELLANT: SHRI BIBEK MOHANTY, AR FOR THE RESPONDENT SMT. PARAMITA TRIPATHY, CIT - DR DATE OF HEARING : 20.03.2012 DATE OF PRONOUNCEMENT : 25.04.2012 ORDER PER BENCH : THESE APPEALS BY THE ASSESSEE ARE AGAINST THE ORDERS OF THE COMMISSIONER OF INCOME - TAX (APPEALS) DATED THE 30 TH JUNE, 2011 PERTAINING TO THE ASSESSMENTS MADE U/S.153A(B)/14 3 OF THE INCOME - TAX ACT, 1961 FOR THE AYS 2001 - 02, 2002 - 03, 2003 - 04, 2004 - 05, 2005 - 06,2006 - 07 AND 2007 - 08. ALL THESE APPEALS WERE HEARD TOGETHER AND ARE NOW DISPOSED BY THIS COMMON OR DER FOR THE SAKE OF CONVENIENCE AND BREVITY. 2. THE BRIEF FACTS ARE THAT THE ASSESSEE IS AN INDIVIDUAL. HE DERIVES INCOME FROM SALARY AND OTHER SOURCES BUT MAINTAINED NO BOOKS OF ACCOUNT. A SEARCH AND SEIZURE OPERATION WAS CONDUCTED IN THE MUDALI GROUP OF CASES U/S.132 OF THE INCOME - TAX ACT ON 23.8.2006 . NOTICE U/S.153A(A) WAS ISSUED BY THE ASSESSING OFFICER REQUIRING THE ASSESSEE TO FILE THE RETURN OF INCOME. THE ASSESSEE FILED RETURNS FOR ALL THE AYS UNDER CONSIDERATION. THE ASSESSING OFFICER COMPLETED THE ASSESSMENTS U/S.153A(B)/143(3) OF THE ACT BY MAKING VARIOUS ADDITIONS. AGGRIEVED, THE ASSESSEE FILED APPEALS BEFORE THE COMMISSIONER OF INCOME - TAX (APPEALS) AND THE LEARNED CIT(A) AFTER CONSIDERING THE ASSESSMENT ORDERS AND VARIOUS SUBMISSIONS OF THE ASSESSEE, CONFIRMED THE ADDITIONS MADE BY THE ASSESSING OFFICER IN EACH OF T HE AYS IT (SS)A NOS.88,89,90,91,92,93 AND 94/CTK/2011 2 UNDER CONSIDERATION. AGGRIEVED, THE ASSESSEE IS IN APPEALS HERE BEFORE THE TRIBUNAL. 3. AS REGARDS THE ADDITION OF 2,50,000 MADE BY THE ASSESSING OFFICER AS UNEXPLAINED INVESTMENT BEING HER PERSONAL ASSETS AND CONFIRMED BY THE LEARNED CIT(A) IN THE ASSESSMENT YEAR 2001 - 02 , THE RELEVANT FACTS ARE THAT THE ASSESSEE CLAIMED TO HAVE PERSONAL ASSETS INCLUDING COMPUTER FOR 2,50,000 STATED TO HAVE BEEN PURCHASED BEFORE THE FINANCIAL YEAR 2000 - 01. ON THE OBSERVATION THAT THE ASSESSEE HAD NOT SHOWN THE SAME IN THE RETURN AND ALSO COULD NOT PRODUCE ANY EVIDENCE IN SUPPORT OF SUCH CLAIM, THE ASSESSING OFFICER HELD THE SAME AS U NEXPLAINED INVESTMENT AND MADE THE IMPUGNED ADDITION. 3.1 . THE LEARNED AR OF THE ASSESSEE SUBMITTED THAT THE ASSESSEE HAS DONE HER ENGINEERING DEGREE FROM OSMANIA UNIVERSITY, USA AND IS A QUALIFIED ONE SINCE 1993 - 04. SHE JOINED NIST AS FACULTY AND ALSO WAS LOOKING AFTER PLACEMENT. DURING THE SCRUTINY ASSESSMENT, THE ASSESSEE FILED CASH FLOW STATEMENT ALONG WITH PERSONAL BALANCE SHEET TO JUSTIFY ITS SOURCE AND UTILIZATION OF FUNDS WHEREIN COMPUTER AND PERSONAL ASSETS (INCLUDING JEWEELLERY) WORTH 2,50,000 WAS SHOWN IN THE BALANCE SHEET. IN THE YEARS PRIOR TO THE YEAR UNDER APPEAL, THE ASSESSEE WAS EMPLOYED IN USA AND NEW DELHI GOT MARRIED, JOINED NIST ETC. HER LAST FIVE YEARS INCO ME LESS EXPENSES IMPLIES SAVING AN AMOUNT TO PURCHASE JEWEELLERY , COMPUTER, KITCHEN EQUIPMENTS AND OTHER HOUSEHOLD ITEMS TO THE TUNE OF 2,50,000 . FURTHER THE LEARNED AR OF THE ASSESSEE SUBMITTED THAT THE ASSESSEE IS A HAILING FROM A WELL - TO - DO FAMILY. HE R FATHER SHRI V.K.BANSAL RAY WAS A DOCTOR IN INDIAN ARMY WHO HAILS TO MARWARI COMMUNITY OF MADHYA PRADESH. THE APPELLANT GOT MARRIED IN 1993 AND AT THAT TIME SHE HAD RECEIVED GIFT OF GOLD FOR WHICH THERE NO NEED TO POSSESS ANY BILL OF INVOICE FOR THE SAME. FINALLY, HE SUBMITTED THAT IT (SS)A NOS.88,89,90,91,92,93 AND 94/CTK/2011 3 THE ASSESSEE BEING AN INDIVIDUAL, ACCRETION OF ASSETS IN HER HAND IS NOT OUT OF UNTAXED PURCHASE BUT ACCUMULATED BALANCE OF LAST FEW YEARS INCLUDING GIFT DURING HER MARRIAGE, ANCESTRAL ETC. CONSIDERING THE ABOVE FACTS, THE LOWER AUTHORITIES ARE NOT JUSTIFIED IN MAKING THE IMPUGNED ADDITION AND THEREFORE, THE AR OF THE ASSESSEE PRAYED FOR DELETION OF THE SAID ADDITION. THE LEARNED DR ON THE OTHER HAND, SUPPORTED THE IMPUGNED ORDERS AND CONTENDED THAT SINCE THE ASSESSEE FAILED TO P RODUCE THE RELEVANT RECEIPTS FOR PURCHASE OF THE ASSETS, THE IMPUGNED ADDITION IS JUSTIFIED. 3.2 . HAVING HEARD BOTH THE PARTIES AND PERUSING THE IMPUGNED ORDERS OF THE AUTHORITIES BELOW AND MATERIAL PLACED ON RECORD, WE FIND THAT THE MAIN CONTENTION OF THE ASSESSEE IS BRINGING TO TAX THE INCOMES PURPORTED TO HAVE BEEN CONSIDERED UNDER THE PROVISIONS OF SECTION 153A(B). THE ASSESSING OFFICER HOWEVER HAS PROCEEDED IN BRINGING TO TAX DISALLOWING THE SOURCE OF APPLICATION OF FUNDS WHEN THE MATERIAL FOUND DURING THE SEARCH INDICATE THE FACTUAL ASPECTS WHICH HAVE BEEN HITHERTO FILED BY THE ASSESSEE IN THE REGULAR RETURNS. THE ASSESSING OFFICER MERELY DENIED AS THE SOURCE OF THE FUNDS INVESTED IN THE PERSONAL ASSETS SUCH AS COMPUTER, JEWEELLERY WHEN JEWEELLERY FOUN D DURING THE TIME OF SEARCH REMAINED UN EXPLAINED. NO EFFORT HAS BEEN MADE BY THE ASSESSING OFFICER TO VALUE THE JEWEL LERY FOUND AT THE TIME OF SEARCH WHEN THE ASSESSEE HAD BEEN MARRIED TO A RENOWNED FAMILY AND BELONG ED TO A RICH FAMILY ON HER OWN WAS TO HO LD JEWEELLERY AND OTHER PERSONAL ASSETS WHICH HAVE BEEN ONLY MENTIONED AS CONTRIBUTION TO THE CAPITAL WHEN THE ASSESSEE STARTED RESIDING IN HER IN - LAW PLACE. THE CONTRIBUTION OF GOLD FROM HER FATHER AND FATHER - IN - LAW COMBINED DO NOT EXCEED THE QUANTITY WHI CH A LADY OF SUCH SOCIAL STATUS IS EXEMPTED FROM DECLARING AS PER THE CBDT CIRCULAR. THE ASSESSEE THEREFORE DID NOT COMMIT A MISTAKE HOLDING PERSONAL ASSETS AGAINST THE CAPITAL WHICH THE AUTHORITIES IT (SS)A NOS.88,89,90,91,92,93 AND 94/CTK/2011 4 BELOW HAVE MISDIRECTED THEMSELVES TO HOLD AS UNDISCLOSED INCOME IN THE HANDS OF THE ASSESSEE FOR RESPECTIVE EARLIER YEARS . IN THAT VIEW OF THE MATTER, THE IMPUGNED ADDITION ALLEGING UNDISCLOSED INVESTMENT IS NOT PROPER WHEN THE ASSESSING OFFICER AND THE LEARNED CIT(A) WERE EXPLAINED THE NATURE OF PURCHASES AND N ATURE OF GOLD ORNAMENTS HELD BY THE ASSESSEE IN COMPLIANCE TO THE REQUISITE VALUE WHEN THEY SATISFIED THEMSELVES THAT THE JEWEELLERY AND PERSONAL ASSETS HELD BY THE ASSESSEE COMMENSURATE WITH THE INCOME DECLARED BY WAY OF REGULAR RETURN DURING THE IMPUGNED ASSESSMENT YEAR. IN VIEW OF ABOVE, WE SET ASIDE THE IMPUGNED ORDER OF THE AUTHORITIES BELOW IN THIS REGARD AND DELETE THE ADDITION OF 2,50,000 MADE ON THIS SCORE. 4. AS REGARDS THE ADDITION OF 17,000 ON ACCOUNT OF SALARY ADVANCE IN THE ASSESSMENT YEAR 2001 - 02, T HE ASSESSING OFFICER OBSERVED THAT THE ASSESSEE CLAIMED TO HAVE RECEIVED THE SALARY ADVANCE OF 50,000 FROM HER EMPLOYER SMCET/NIST OUT OF WHICH 33,000 HAD BEEN RECOVERED DURING THE ASSESSMENT YEAR 2001 - 02 BY HER EMPLOYER. THE ASSESSING OFFIC ER FURTHER OBSERVED THAT THE SALARY ADVANCE IS NOT INCORPORATED IN THE FORM 16 ENCLOSED WITH THE RETURN. THE ASSESSING OFFICER WAS OF THE VIEW THAT AS THE SALARY ADVANCE IS TAXABLE ON RECEIPT BASIS, TDS SHALL BE DEDUCTED BY THE EMPLOYER OUT OF THIS SALARY ADVANCE AND IT HAS TO BE INCORPORATED IN THE GROSS SALARY DURING THE RELEVANT FINANCIAL YEAR. THEREFORE, THE ASSESSING OFFICER ADDED THE BALANCE SUM OF 17,000 TO THE TOTAL INCOME. THE LEARNED CIT(A) CONFIRMED THE SAME. 5. HEARD BOTH THE PARTIES AND PERUS ED THE MATERIAL MADE AVAILABLE ON RECORD. THE LEARNED AR OF THE ASSESSEE CONTENDED THAT THE AO ADDED THE ADVANCE OF 17,000 WITHOUT ALLOWING CREDIT IN SUBSEQUENT YEARS FOR THE REPAYMENT OF ADVANCE SALARY. WE FIND THAT THE ASSESSEE HAS TAKEN THE ADVANCE OF 50,000 OUT OF WHICH SHE HAS REPAID TO THE EXTENT OF 33,000 IT (SS)A NOS.88,89,90,91,92,93 AND 94/CTK/2011 5 DURING THE ASSESSMENT YEAR ITSELF WHICH HAS BEEN ACCEPTED BY THE AUTHORITIES BELOW AND FURTHER THE ASSESSEE CLAIMED THAT THE BALANCE AMOUNT OF 17,000 HAS ALSO BEEN REPAID IN THE SUBSEQUENT AS SESSMENT YEAR. SINCE IT IS A SALARY ADVANCE DULY RECOVERED BY THE EMPLOYER, THE ADDITION OF 17,000 MADE BY THE ASSESSING AUTHORITIES IS NOT AT ALL JUSTIFIED AND AS SUCH, WE DIRECT DELETION OF THE SAID ADDITION BY ALLOWING THE GROUND OF THE ASSESSEE RAISED IN THIS REGARD. 6. AS REGARDS THE SUSTENANCE OF ADDITION OF 4,200 IN THE ASSESSMENT YEAR 2002 - 03 ON ACCOUNT OF ADVANCE SALARY, THE ASSESSING OFFICER OBSERVED THAT THIS AMOUNT WAS NOT INCORPORATED IN FORM 16, ISSUED BY THE EMPLOYER OF THE ASSESSEE. THE A SSESSEE STATED THAT THIS SALARY ADVANCE WAS ACTUALLY PAYMENT OF TDS PREMIUM AS MADE BY HER EMPLOYER ON HER BEHALF. THE ASSESSING OFFICER WAS OF THE VIEW THAT THE ADVANCE SALARY IS TAXABLE IN THE YEAR OF RECEIPT AND SINCE THE ASSESSEE HAS NOT CONSIDERED ADV ANCE SALARY FOR TAXATION PURPOSE IN THE ASSESSMENT YEAR 2002 - 03, HE ADDED THE SAID ADVANCE SALARY OF 4,200. THE LEARNED CIT(A) CONFIRMED THE SAME. 6.1. HERE AGAIN THIS IS A SALARY ADVANCE AND FOR THE REASONS DISCUSSED IN PARAGRAPH 5 ABOVE, THE SAID ADDIT ION OF 4,200 IS DIRECTED TO BE DELETED. 7. AS REGARDS ADDITION OF 10,000 EACH IN ALL OF THE AYS UNDER CONSIDERATION ON THE BASIS OF ESTIMATED DRAWALS, THE ASSESSING OFFICER OBSERVED THAT THE ASSESSEE STATED IN HER SUBMISSION DT.3.11.2008 THAT HER PERSON AL DRAWINGS PER MONTH WERE 4,000 IN THE AYS 2000 - 01 TO 2003 - 04 AND 5,000 IN THE AYS 2004 - 05 TO 2007 - 08 . SIMULTANEOUSLY, IT WAS ALSO STATED THAT THE EXPENSES ON ACCOUNT OF PERSONAL CREDIT CARD WAS AROUND 10,000. ON THE OBSERVATION THAT THE ASSESSEE DI D NOT SPECIFY THE SOURCE OF SUCH CREDIT CARD EXPENSES SEPARATELY, THE ASSESSING OFFICER CAME TO CONCLUDE THAT THE ASSESSEES PERSONAL DRAWINGS WOULD BE MORE THAN 4,000 / 5,000 PER MONTH IT (SS)A NOS.88,89,90,91,92,93 AND 94/CTK/2011 6 IN THE RESPECTIVE AYS . ACCORDINGLY, THE ASSESSING OFFICER ADDED THE SUM OF 10,000 IN EACH OF THE AYS UNDER CONSIDERATION, OBSERVING THAT THE SOURCE OF EXPENDITURE O N ACCOUNT OF CREDIT CARD REMAINED UNEXPLAINED. THE LEARNED CIT(A) HAS UPHELD SUCH ADDITIONS. 7.1. HEARD BOTH THE PARTIES AND PERUSED THE IMPUGNED ORDERS OF TH E AUTHORITIES BELOW. THERE IS NO DISPUTE TO THE FACT THAT THE ASSESSEE HAS DISCLOSED THE DRAWALS AND THE ASSESSEE STATED TO HAVE BEEN MET THE CREDIT CARD EXPENSES. WHEN THE ASSESSEE HAS DISCLOSED DRAWALS OF 4,000 / 5,000 PER MONTH AND THUS 48,000 / 60, 000 IN A YEAR, THE CLAIM OF THE ASSESSEE TO HAVE MET THE CREDIT CARD EXPENSES OF 10,000 OUT OF THE WITHDRAWALS CANNOT BE BRUSHED ASIDE AND IN THAT VIEW OF THE MATTER, WE ARE OF THE CONSIDERED VIEW, THAT THERE WAS NO REASON FOR THE ASSESSING AUTHORITIES T O MAKE FURTHER ADDITION OF 10,000 TO THE WITHDRAWALS. THEREFORE, WE DIRECT DELETION OF THE ADDITION OF 10,000 MADE IN EACH OF THE AYS UNDER CONSIDERATION. 8. AS REGARDS THE ADDITION OF 38,100, 52,000, 40,000 AND 15,000 MADE IN THE AYS 2003 - 04, 2004 - 05, 2005 - 06 AND 2006 - 07 HOLDING THE SAME AS INCOME FROM UNDISCLOSED SOURCES, WE FIND THAT THESE ADDITIONS HAVE BEEN MADE BY THE ASSESSING OFFICER DISALLOWING THE AGRICULTURAL INCOME CLAIMED BY THE ASSESSEE, WHEN HE OBSERVED THAT THE ASSESSEE DID NOT FILE/PRODUCE ANY EVIDENCES IN SUPPORT OF HER AGRICULTURAL INCOME AND THUS DID NOT PROVE THE SOURCE OF SUCH RECEIPTS FROM AGRICULTURAL OPERATIONS, IF ANY. BEFORE THE LEARNED CIT(A) THE ASSESSEE CONTENDED THAT THE AGRICULTURAL OPERATIONS IN THE LAND BELONGIN G TO HER IN - LAWS WERE BEING SUPERVISED BY HER AND THE NET RECEIPTS THAT WAS BEING RECEIVED BY HER WAS OFFERED TO TAXATION. AS IT APPEARS, THE ASSESSEE HAS NOT PRODUCED ANY EVIDENCE IN SUPPORT OF THIS CONTENTION AND EVEN BEFORE THIS TRIBUNAL SUBSTANTIATING SUCH CONTENTION. THEREFORE, IN ABSENCE OF ANY MATERIAL EVIDENCE PRODUCED BY THE ASSESSEE, WE IT (SS)A NOS.88,89,90,91,92,93 AND 94/CTK/2011 7 ARE OF THE CONSIDERED VIEW THAT THE AUTHORITIES BELOW WERE JUSTIFIED IN DISALLOWING THE CLAIM OF AGRICULTURAL INCOME AND IN MAKING THE IMPUGNED ADDITIONS BY HOLDIN G THE SAME AS INCOME FROM UNDISCLOSED SOURCES. THE GROUND RAISED BY THE ASSESSEE IN THIS REGARD IS DISMISSED. 9. AS REGARDS THE ADDITION OF 28,500 IN THE AY 2006 - 07 MADE ON ACCOUNT OF UNEXPLAINED INVESTMENT PERSONAL ASSETS, HAVING HEARD THE PARTIES AND PERUSING THE MATERIAL MADE AVAILABLE TO THE TRIBUNAL, WE FIND THAT THE ASSESSING OFFICER OBSERVED THAT THE ASS ESSEE PURCHASED JEWELLERY AND PERSONAL ASSETS TO THE TUNE OF 48,500 DURING THE FINANCIAL YEAR RELEVANT TO THE ASSESSMENT YEAR UNDER CONSIDERATION OUT OF WHICH SHE COULD EXPLAIN THE SOURCE OF EXPENDITURE TO THE TUNE OF 20,000 OUT OF CASH WITHDRAWALS FROM HER BANK ACCOUNT AND THEREFORE, HE HELD THE BALANCE AMOUNT OF 28,500 AS UNEXPLAINED. WE MAY MENTION HERE THAT WE HAVE UPHELD THE ORDERS OF THE AUTHORITIES BELOW IN DISALLOWING THE CLAIM OF AGRICULTURA L INCOME OF 52,000, 40,000 AND 15,000 IN THE ASSESSMENT YEARS 2004 - 05, 2005 - 06 AND 2006 - 07 AND HELD THE SAME AS INCOME FROM UNDISCLOSED SOURCES. IF THIS AMOUNT IS CONSIDERED AVAILABLE TO THE ASSESSEE FROM UNDISCLOSED SOURCES, THE AMOUNT OF 28,500 C ANNOT BE REMAINED UNEXPLAINED, AS RIGHTLY CONTENDED BY THE LEARNED AR OF THE ASSESSEE. IN SUCH VIEW OF THE MATTER, WE HOLD THAT THE ADDITION OF 28,500 MADE BY THE AUTHORITIES BELOW CANNOT BE SUSTAINED AND AS SUCH, WE DIRECT DELETION OF THE SAID ADDITION. 10. AS REGARDS THE ADDITION OF 7,84,805 MADE IN THE ASSESSMENT YEAR 2007 - 08 ON ACCOUNT OF UNEXPLAINED INVESTMENT ON JEWELLERY AND CASH FOUND DURING THE COURSE OF SEARCH AND SEIZURE OPERATION, THE ASSESSING OFFICER OBSERVED IN HIS ORDER THAT THE ASSESSEE DID NOT FILE ANY EXPLANATION IN THIS REGARD. THE LEARNED CIT(A) CONFIRMED THE SAME. IT (SS)A NOS.88,89,90,91,92,93 AND 94/CTK/2011 8 10.1. THE LEARNED AR OF THE ASSESSEE REITERATED THE SUBMISSIONS AS WERE RAISED BEFORE THE LEARNED CIT(A) THAT DURING THE COURSE OF SEARCH AND SEIZURE OPERATION, CASH OF 4 0,725 WAS FOUND FROM GUEST HOUSE AT GOPALPUR, GOLD AND JEWEELLERY APPROXIMATELY OF 195 GRAMS AT GOPALPUR AND GOLD & JEWELLER APPROXIMATELY 600 GRAMS FROM LOCKER MAINTAINED WITH SBI, BHANJAVIHAR. THE CASH WAS CLARIFIED TO BE PERSONAL CASH OF THE ASSESSEE, H ER FATHER - IN - LAW AND MOTHER - IN - LAW WHICH WERE THERE OUT OF THE DAY TO DAY EXPENSES. IN RESPECT OF GOLD AND JEWEELLERY IT WAS SUBMITTED BY THE ASSESSEE THAT THOSE BELONGED TO THE ASSESSEE AND OTHER FAMILY MEMBERS I.E., HUSBAND, IN - LAWS AND CHILDREN AND IF IT IS MADE INTO AVERAGE EACH ONES SHARE COMES TO AROUND 32 GRAMS WHICH IS A MEAGER ONE. THE ASSESSEE HAS FURNISHED RECONCILIATION OF THE TOTAL GOLD ALL APPROXIMATELY AS FOLLOWS : GOLD AT GOPALPUR 195 GMS GOLD AT LOCKER INBANK 600 GMS 795 GMS LESS:PUR CHASED DURING F.Y. 2005 - 06 65 GMS. 730 GMS LESS: KEPT IN THE HOUSE TO BE USED IN DAY TO DAY FUNCTIONS ETC. 195 GMS TOTAL: 535 GMS. IT WAS SUBMITTED THAT ASSUMING THE LATEST PURCHASE OF 65 GRAMS WERE WITHIN THE USABLE LOT OF 195 GRAMS QUANTITY OF GO LD WEIGHING APPROXIMATELY 600 GRAMS IS ATTRIBUTABLE TO GOLD OWNED BY THE ASSESSEE ALONG WITH HER SPOUSE PRIOR TO FINANCIAL YEAR 200 0 - 01 AND WAS ACQUIRED OUT OF THEIR REGULAR INCOME, GIFT DURING MARRIAGE, GIFT DURING BIRTHDAYS, ANCESTRAL GIFTS, GIFTS TO CHI LDREN ETC. THE GOLD AND JEWEELLERY FOUND IN THE LOCKER WERE ALL PURCHASES OF PRIOR PERIOD OF SEARCH AND HENCE, THEY SHOULD NOT BE ADDED DURING THE SEARCH PERIOD. FURTHER IT WAS SUBMITTED THAT ASSUMING THOUGH NOT CONCEDING THAT THE ADDITIONS ARE TO BE EFFEC TED AND CONSIDERING THAT LATEST PURCHASES HAVE BEEN MADE, THE VALUATION WAS SUPPOSED TO BE MADE AT THE PREVAILING MARKET RATE IT (SS)A NOS.88,89,90,91,92,93 AND 94/CTK/2011 9 DURING THE 1990 DECADE BY APPLYING THE AVERAGE RATE OF 3,100 PER GRAM DURING THAT PERIOD AND BY SO DOING, THE VALUE OF GOLD FOR 7 35 GRAMS WORKS OUT TO 2,19,000 WHICH HAS ALREADY BEEN TAXED IN APPELLANTS HAND IN THE ASSESSMENT YEAR 2001 - 02. THE LEARNED AR OF THE ASSESSEE FILED THE COPIES OF PANCHANAMA, LIST/INVENTORY OF JEWEELLERY AND THE COPY OF CERTIFICATE FROM THE SBI INDICATING THE ALLOTMENT OF LOCKER NO.53 IN THE NAME OF SRI SANGARAM MUDALI ON 21.11.1997. HE FURTHER SUBMITTED THAT THE FAMILY OF THE ASSESSEE IS OF MARWARI COMMUNITY. THE ASSESSEE GOT MARRIED IN 1993, WHEN SHE RECEIVED GOLD JEWEELLERY AS GIFTS FROM HER FAMILY BOTH FROM THE SIDE OF HER FATHER AND ALSO IN - LAWS. THEREFORE, THE LEARNED AR OF THE ASSESSEE SUBMITTED THAT THE ADDITION OF 7,84,805 MADE IN THE ASSESSMENT YEAR 2007 - 08 ON ACCOUNT OF UNEXPLAINED INVESTMENT ON JEWELLERY AND CASH FOUND DURING THE COURSE OF SEA RCH AND SEIZURE OPERATION IS NOT JUSTIFIED AND AS SUCH , HE PRAYED TO DELETE THE SAME. THE LEARNED DR, ON THE OTHER HAND, SUPPORTED THE IMPUGNED ORDERS OF THE AUTHORITIES BELOW. 10.2. AFTER PERUSING THE MATERIAL AVAILABLE ON RECORD WE ARE OF THE CONSIDERE D VIEW THAT THE HOLDING OF JEWELLERY AND CASH WAS THE SUM TOTAL OF TAXABLE INCOME OVER THE PAST SEVERAL YEARS WHICH CANNOT BE TAXED IN ASSESSMENT YEAR 2007 - 08 AS UNDISCLOSED INCOME ALONE. NO SPECIFIC EFFORT HAS BEEN MADE TO HOLD THE SAME AS UNDISCLOSED IN THE IMPUGNED YEAR. HOLDING OF ASSETS AGAINST INCOME RENDERED TO TAX ALREADY CANNOT BE TAXED AGAIN. IN THIS VIEW OF THE MATTER, WE DIRECT THE DELETION OF THE ADDITION OF 7,84,.805. 11. AS REGARDS THE ADDITION OF 1 ,50,000 IN THE ASSESSMENT YEAR 2007 - 08 ON ACCOUNT OF UNSECURED LOAN, THE ASSESSING OFFICER HAS OBSERVED THAT THE ASSESSEE IN HER SUBMISSION STATED THAT SHE PAID A SUM OF 1,50,000 AGAINST REPAYMENT OF LOAN TO HER FRIENDS AND RELATIVES. SHE FILED ONLY LOAN CONFIRMATIONS IN RESPECT OF THIS REPAYM ENT OF LOAN. THIS LOAN WAS REPAID IN IT (SS)A NOS.88,89,90,91,92,93 AND 94/CTK/2011 10 CASH AND THE ASSESSEE DID NOT EXPLAIN THE SOURCE OF THIS CASH. THE ASSESSEE DID NOT DISCHARGE HER ONUS TO PROVE THE GENUINENESS OF THESE TRANSACTIONS . THEREFORE, HE ADDED THE SAME TO THE TOTAL INCOME AS UNEXPLAINED EXP ENDITURE. THE LEARNED CIT(A) HAS CONFIRMED THE SAME. 11.1. THE LEARNED AR OF THE ASSESSEE CONTENDED BEFORE US THAT THE ASSESSEE HAD SUFFICIENT FUNDS AVAILABLE WITH HER TO REPAY THE UNSECURED LOAN AMOUNTING TO 1,50,000. HE FURTHER SUBMITTED THAT THE DETA ILS OF LOAN REPAID WHICH WERE BORROWED IN EARLIER YEARS AND AS OBSERVED FROM THE CASH FLOW STATEMENT THE APPELLANT HAD ADEQUATE SOURCES OF FUND TO REPAY HER UNSECURED LOAN. FROM THE CASH/BANK FLOW STATEMENT FURNISHED BY THE ASSESSEE, WHICH HAS BEEN EXTRACT ED IN PARAGRAPH 3 OF THE ORDER OF THE LEARNED CIT(A), WE FIND THAT THE ASSESSEE HAD SUFFICIENT BALANCE TO MEET THE ABOVE REPAYMENT OF 1,50,000. THE SOURCE OF SUCH REPAYMENT HAVING BEEN DULY DISCLOSED BY THE ASSESSEE, WE ARE OF THE CONSIDERED VIEW THAT TH E ADDITION OF 1,50,000 MADE IN THIS REGARD CANNOT BE SUSTAINED AND AS SUCH, WE DIRECT DELETION OF THE SAME BY ALLOWING THE GROUND RAISED BY THE ASSESSEE. 12. IN THE RESULT, THE APPEALS OF THE ASSESSEE ARE PARTLY ALLOWED. (K.S.S.PRASAD RAO) JUDIC IAL MEMBER (K.K.GUPTA) ACCOUNTANT MEMBER DATE: 25.04.2012 H.K.PADHEE, SENIOR PRIVATE SECRETARY. COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT: GEETIKA MUDALI, PLOT NO.122, SAHID NAGAR,BHUBANESWAR, 2. THE RESPONDENT: ASST.COMMISSIONER OF INCOME - TAX , CIRCLE 2(2), BHUBANESWAR. 3. THE CIT, 4. THE CIT(A), 5. THE DR, CUTTACK 6. GUARD FILE (IN DUPLICATE) TRUE COPY, BY ORDER, SENIOR PRIVATE SECRETARY. IT (SS)A NOS.88,89,90,91,92,93 AND 94/CTK/2011 11