VINAY DUGAR,JAIPUR V. ACIT, CENTRAL CIRCLE-2, JAIPUR, JAIPUR

ITA 973/JPR/2025

AI Insights

The case involves a series of appeals by Vinay Dugar against the additions made by the Assessing Officer (AO) under sections 69A and 69C of the Income Tax Act, 1961, concerning unexplained investments in jewellery and unexplained household expenses for the assessment years 2014-15, 2015-16, and 2020-21. The Tribunal examined the evidence presented, including affidavits, VDIS declarations, and other documentary proofs, and found that the additions made were not justified. The Tribunal noted that the jewellery found during the search operations could be explained by the documents and that the household expenses were in line with the withdrawals made for such purposes. Consequently, the Tribunal set aside the findings of the CIT(A) and directed the deletion of the additions.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 776856 (ITAT-JAIPUR)
• Duration Of Justice: 2 month(s) 20 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-09-2025
• Order Result: Partly Allowed
• Bench Allotted: B
• Assessment Year: 2015-2016
• Appeal Filed On: 27-06-2025
• Other Referred Cases: Mehta Parikh & Co v CIT [1958] 30 ITR 181 (SC), Daulat Ram Rawatmull v. CIT (1973) 87 ITR 349 (SC), Shri Nirmal Kumar Kedia V/s DCIT (Vice-Versa) 2019 (6) TMI 467 - ITAT Jaipur, Dilip Kumar Rao Vs CIT (1974) 94 ITR 1 (Bom), Malwa Knitting Works Vs CIT (1977) 107 ITR 379, 381 MP, Sri Krishna Vs CIT (1983) 142 ITR 618 (All), Shri RadheyShyam Mittal ITA No 420/JP/2012 dated 26.08.2013, Shri Ram Prakash Mahawar v/s DCIT ITA No. 918/JP/2019 dated 20.02.2020
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: GAURAV AWASTHI
• Assessee Lawyers: VIJAY GOYAL; PRODUCING
• Keywords: Set aside; Business income; Unexplained investment; Income from undisclosed sources; Document seized; Documents seized; Gift; Retraction; Principle of natural justice; Search and seizure; Valuation report; Liquidation
• Section: 143(3); 11; 153A; 69; 90; 44AD; 69C; 139

Judgement Text

"vk;dj vihyh; vf/kdj.k] t;iqj U;k;ihB] t;iqj IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES,”B” JAIPUR Mk0 ,l- lhrky{eh] U;kf;d lnL; ,oa Jh xxu xks;y] ys[kk lnL;] ds le{k BEFORE: DR. S. SEETHALAKSHMI, JM & SHRI GAGAN GOYAL, AM vk;dj vihy la-@ITA No. 972 to 974/JPR/2025 fu/kZkj.k o\"kZ@Assessment Year : 2014-15, 2015-16 & 2020-21 Vinay Dugar D-275, Todarmal Marg, Banipark, Jaipur. cuke Vs. The ACIT, Central Circle-2, Jaipur. LFkk;hys[kk la-@thvkbZvkj la-@PAN/GIR No.: ABXPD6166E vihykFkhZ@Appellant izR;FkhZ@Respondent fu/kZkfjrh dh vksjls@Assesseeby : Shri Vijay Goyal, C.A. jktLo dh vksjls@Revenue by : Sh. Gaurav Awasthi, JCIT-DR lquokbZ dh rkjh[k@Date of Hearing : 10/08/2025 mn?kks\"k.kk dh rkjh[k@Date of Pronouncement: 17/09/2025 vkns'k@ORDER PER: DR. S. SEETHALAKSHMI, J.M. All these bunch of three appeals filed by the assessee are against the orders ld. CIT(A)-Jaipur 4, Jaipur for A.Y. 2014-15 dated 23.05.2025, AY 2015-16 dated 23.05.2025 and A.Y. 2020-21 dated 28.05.2025, which in turn arise from the Assessment orders for AY 2014-15 dated 24-09-2021, for AY 2015-16 dated 25- 09-2021 and for A.Y. 2020-21 dated 25-09-2021 passed u/s. 153A/143(3) of the Act by the ACIT, Central Circle-2, Jaipur. 2. The Grounds taken by the assessee in each appeal are as under: - Printed from counselvise.com 2 ITA No. 972 To 974/JPR/2025 Vinay Dugar, Jaipur. A.Y. 2014-15 (ITA No. 972/JPR/2025) “1 On the facts and in the circumstances of the case, the Ld. CIT(A) has erred in confirming the addition of Rs. 2,10,600/- made by Ld. AO u/s 69C of the I.T. Act, 1961 on account of alleged unexplained household expenses on the basis of diary found & seized vide exhibit-6 seized from residence of assessee situated at D-275, Todarmal Marg, Banipark, Jaipur and taxing the same as per provisions of section 115BBE of the Act. It is contented that: - (i) the addition was made solely & merely relying on the unreliable and non- speaking documents seized during search proceeding. (ii) the addition was made by ignoring the fact that the diary was containing the rough & memorandum notings regarding the expenses of household nature. The ld. AO made the addition by considering the rough and deaf & dumb jottings as speaking documents. (iii) the addition was made by ignoring the fact that the seized document, on the basis of which the addition was made, was being maintained by the wife of assessee Smt. Suman Dugar and thus the addition on the basis of noting made by wife of the assessee cannot be made in the hands of the assessee, more so when there is no evidence that the noted transaction pertaining to the assessee. (iv) the addition was made without taking into consideration that that the amount noted in seized documents are in the nature of Household expenses and the same incurred by the assessee group out of withdrawals made for household expenses. Therefore, addition of the same cannot be made. (v) the submission and evidences filed by the assessee during the course of assessment proceeding were not taken into consideration and the same were not proved to be false, thus such submission and evidences filed during assessment proceeding cannot be brushed aside. 2 The appellant prays for leave to Add, to amend, to delete, or modify all or any grounds of appeal on or before the hearing of appeal.” A.Y. 2015-16 (ITA No. 973/JPR/2025) “1 On the facts and in the circumstances of the case, the Ld. CIT(A) has erred in confirming the addition of Rs. 4,08,900/- made by Ld. AO u/s 69C of the I.T. Act, 1961 on account of alleged unexplained household expenses on the basis of diary found & seized vide exhibit-6 seized from residence of assessee situated at D-275, Printed from counselvise.com 3 ITA No. 972 To 974/JPR/2025 Vinay Dugar, Jaipur. Todarmal Marg, Banipark, Jaipur and taxing the same as per provisions of section 115BBE of the Act. It is contented that: - (i) the addition was made solely & merely relying on the unreliable and non- speaking documents seized during search proceeding. (ii) the addition was made by ignoring the fact that the diary was containing the rough & memorandum notings regarding the expenses of household nature. The ld. AO made the addition by considering the rough and deaf & dumb jottings as speaking documents. (iii) the addition was made by ignoring the fact that the seized document, on the basis of which the addition was made, was being maintained by the wife of assessee Smt. Suman Dugar and thus the addition on the basis of noting made by wife of the assessee cannot be made in the hands of the assessee, more so when there is no evidence that the noted transaction pertaining to the assessee. (iv) the addition was made without taking into consideration that that the amount noted in seized documents are in the nature of Household expenses and the same incurred by the assessee group out of withdrawals made for household expenses. Therefore, addition of the same cannot be made. (v) the submission and evidences filed by the assessee during the course of assessment proceeding were not taken into consideration and the same were not proved to be false, thus such submission and evidences filed during assessment proceeding cannot be brushed aside. 2 The appellant prays for leave to Add, to amend, to delete, or modify all or any grounds of appeal on or before the hearing of appeal.” A.Y. 2020-21 (ITA No. 974/JPR/2025) “1 On the facts, in the circumstances of the case and in law, the Ld. CIT (A) erred in not annulling the assessment order more so when the assessment proceeding completed u/s 153A r.w.s. 143(3) of the Act was bad in law, void-ab-initio, and deserves to be annulled for the reasons that i) The assessment order passed by the ld. assessing Officer is arbitrary, whimsical, capricious, perverse, against the law and principal of natural justice. (ii) the assessment order passed by Ld. A.O., demand notice issued by Ld. A.O. and approval given by Joint Commissioner of Income Tax do not contain the DIN and approval u/s 153D was not given as per law and also in mechanical manner without providing opportunity of hearing. Printed from counselvise.com 4 ITA No. 972 To 974/JPR/2025 Vinay Dugar, Jaipur. 2 On the facts and in the circumstances of the case, the Ld. CIT(A) has erred in confirming the addition of Rs.41,48,824/- u/s 69A of the Income Tax Act, 1961 and on a/c of alleged undisclosed investment in alleged excess/unexplained jewellery found during the course of search by rejecting the submission & evidences submitted by the assessee without any cogent reason. Further, the addition was made entirely in the hands of the assessee without proving the facts the whatever alleged excess Jewellery found during search pertaining to assessee only. 3 On the facts and in the circumstances of the case, the Ld. CIT(A) has erred in confirming the addition of Rs. 4,84,050/- u/s 69 of the I.T. Act, 1961 on account of alleged unexplained investment in construction of house on the basis of copy of bill of Shri Prabhu Dayal found & seized on page no. 31 to 35 of exhibit-3 from resident of assessee situated at D-275, Todarmal Marg, Banipark, Jaipur. It is contented that: - (i) the addition was made solely & merely relying on the non-speaking documents seized during search proceeding. iii) the addition was made by ignoring the fact the construction works actually done at Plot No. D-280, Todarmal Marg, Banipark, Jaipur and the same is not owned by the assessee, therefore the addition on construction of the property in the hands of assessee, which is not owned by him is completely wrong. (iv) the submission and evidences and valuation report of construction filed by the assessee during the course of assessment proceeding were not taken into consideration and the same were not proved to be false/defective, thus such submission and evidences filed during assessment proceeding cannot be brushed aside and no addition deserves to be made. 4 On the facts and in the circumstances of the case, the Ld. CIT(A) has erred in confirming the addition of Rs. 3,96,600/- u/s 69C of the I.T. Act, 1961 on account of alleged unexplained household expenses on the basis of diary found & seized vide exhibit-6 seized from resident of assessee situated at D-275, Todarmal Marg, Banipark, Jaipur. It is contented that: - (i) the addition was made solely & merely relying on the unreliable and non- speaking documents seized during search proceeding. (ii) the addition was made by ignoring the fact that the diary was containing the rough & memorandum noting regarding the expenses of household nature. Printed from counselvise.com 5 ITA No. 972 To 974/JPR/2025 Vinay Dugar, Jaipur. The ld. AO made the addition by considering the rough and deaf & dumb jottings as speaking documents. (iii) the addition was made by ignoring the fact that the seized document, on the basis of which the addition was made, was being maintained by the wife of assessee Smt. Suman Dugar and thus the addition on the basis of noting made by wife of the assessee cannot be made in the hands of the assessee, more so when there is no evidence that the noted transaction pertaining to the assessee. iv) the addition was made without taking into consideration that that the amount noted in seized documents are in the nature of Household expenses and the same incurred by the assessee group out of withdrawals made for household expenses. Therefore, addition of the same cannot be made. (v) the submission and evidences filed by the assessee during the course of assessment proceeding were not taken into consideration and the same were not proved to be false, thus such submission and evidences filed during assessment proceeding cannot be brushed aside. 5 The appellant prays for leave to Add, to amend, to delete, or modify all or any grounds of appeal on or before the hearing of appeal.” 3. The Ground No 1 in AY 2014-15 and AY 2015-16 and Ground No 4 in AY 2020-21 are against household expenses and common in these appeals are inter related and on identical facts except the difference in figure disputed in each year. These appeals were heard together and are being disposed off by this consolidated order and ITA No 974/JPR/2025 for AY 2020-21 is taken up as lead case in these appeals. 4. Succinctly, the facts as culled out from the records are that the assessee is an Individual and during the year under consideration he was engaged in the Printed from counselvise.com 6 ITA No. 972 To 974/JPR/2025 Vinay Dugar, Jaipur. business of manufacturing and trading of Jewellery. During the year under consideration the source of income of assessee was income from business and interest. The business income was declared u/s 44AD of the Act. The Search & seizure operations over the residence, business premises and lockers of the assessee as well as his other family members was carried out by the I.T. Department on 28.06.2019 and onwards. The income tax return u/s 139 of the Income Tax Act, 1961 of the year under consideration was filed on 11.09.2020 of declaring total income at Rs. 55,860/-. During the course of assessment proceeding the Ld. A.O. raised the queries regarding to the Jewellery and documents found during search and the assessee filed reply to that on 13-09-2021 and 15-09-2021along with copy of relied upon documents/evidences (Copy at PB page 173 to 267/Vol.2) . The assessment was completed u/s 143(3) of Income Tax Act, 1961 vide order dated 25.09.2021, wherein the total income of the assessee was assessed at Rs. 50,85,334/- by making the additions of Rs. 50,29,474/-, which were on account of (i) Addition of Rs. 41,48,824/- u/s 69A of Income Tax Act, 1961 on a/c of alleged undisclosed investment in Jewellery found during the course of search, (ii) Addition of Rs. 4,84,050/- u/s 69 of the Income Tax Act, 1961 on account of alleged unexplained investment in construction of house and (iii) Addition of Rs. 3,96,600/- u/s 69C of the I.T. Act, 1961 on account of alleged unexplained household expenses. Aggrieved from the order of Ld. AO, the Printed from counselvise.com 7 ITA No. 972 To 974/JPR/2025 Vinay Dugar, Jaipur. assessee filed the appeal before CIT(A) Jaipur 4, Jaipur, which was dismissed by Ld. CIT (A) vide order dated 28-05-2025 and being dissatisfied with that, the assessee filed the present appeal before the tribunal. 5. In ground No. 1 of the appeal for AY 2020-21 (ITA No 974/JPR/2025), the assessee challenged the validity of the assessment order. However, in his written submission as well as during the hearing of the case, the Ld. A.R. of assessee did not press this ground of appeal. Therefore, this ground of appeal is dismissed as not pressed. 6. In grounds No. 2 of the appeal for AY 2020-21 (ITA No 974/JPR/2025), the assessee has challenged the addition of Rs. 41,48,824/- made u/s 69A of the Act on account of alleged undisclosed Jewellery found during the course of search. 6.1 The finding of Ld. AO, in the light of which the addition was made in at Page 9-10 of the assessment order, which is as under: - “The submission of the assessee is considered but not found tenable because the assessee could not produce the source of the jewellery found at various premises during the search proceedings. Further the provisions of the section 69A are very explicit which reads as under: “Where in any financial year the assessee is found to be the owner of any money, bullion, jewelry or other valuable article and such money, bullion, jewelry or valuable article is not recorded in the books of account, if any, maintained by him for any source of income, and the assessee offers no explanation about the nature and source of acquisition of Printed from counselvise.com 8 ITA No. 972 To 974/JPR/2025 Vinay Dugar, Jaipur. the money, bullion, jewelry or other valuable article, or the explanation offered by him is not, in the opinion of the Assessing Officer, satisfactory, the money and the value of the bullion, jewelry or other valuable article may be deemed to be the income of the assessee for such financial year..” Also it is noteworthy that sec.69A per se uses the phrases like “is found to be the owner of any bullion, jewelry or other valuable article, and the Assessing Officer finds that the amount expended on making such investments or in acquiring such bullion, jewelry or other valuable article…” (as opposed to the word ‘reasons to believe’) which is very conclusive that there is no room for any taxation based on a mere suspicion has been duly taken into consideration that the Investments in jewellery has been valued by the registered and government approved valuer. So, there is no room for the addition being made on surmises basis. Also, the investment is not recorded in the books of the assessee. Therefore, the assessee’s case clearly falls under these provisions as the assessee has not offered any explanation to the satisfaction of undersigned even after providing many opportunities of being heard. Therefore, an amount of Rs.41,48,824/-(being the excess jewellery found after giving credit according to CBDT circular) is being added to the total income of the assessee u/s 69A of the Act, being the undisclosed investment from the unknown sources for the year under consideration. Further the addition is to be taxed at @ 60% as per provision of section 115BBE of the I.T. Act.” 6.2 The CIT (A) confirmed the addition in the light of findings given at para 5.2 at page 33-37 of his order, which is as under: - “5.2 I have considered the facts of the case and written submissions of the appellant as against the observations/findings of the AO in the assessment order for the year under consideration. The contentions/submissions of the appellant are being discussed and decided as under:- The fact is that during the course of search unexplained jewellery was found and after giving due benefit of CBDT Circular and explanation of the assessee the AO made an addition u/s 69A of Rs. 41,48,824/-. During the course of search gold jewellery weighing total 4820.055 gms valuing at Rs. 1,60,73,459/- was found out of which gold jewellery weighing 1334.141 valuing at Rs. 41,48,824/- was seized. After giving benefit of the CBDT Circular, 3450 grams of the gold jewellery was treated as explained on account of receipt of jewellery by individuals at times of birth, marriage Printed from counselvise.com 9 ITA No. 972 To 974/JPR/2025 Vinay Dugar, Jaipur. and other auspicious occasions and ancestral jewellery. For the remaining jewellery of Rs. 41,48,824/- weighing a total of 1334.141 gms, during the course of search none of the family members of the assessee could give any explanation for the same. Now later on during the assessment proceedings as well as appellate proceedings the assessee has submitted that the source of some of the jewellery is as below:- 2.2 Explanation of Jewellery found given during the course of search: - S. No. Name of the person to whom Jewellery belongs Net Weight of Gold Jewellery (In Gms) 1. Received at the time of birth, marriage and other auspicious occasions and ancestral (Entitlement as per board instruction No. 1916, dated 11.05.1994) Shri Kesari Singh Dugar 100.00 Smt. SampatDugar 500.00 Shri Vinay Dugar 100.00 Smt. Suman Dugar 500.00 Kumari Pragya 250.00 Master Shriyansh 100.00 Shri Vikash Dugar 100.00 Smt. Sweta Dugar 500.00 Kumari Shivani 250.00 Master Mohak 100.00 Shri Vivek Dugar 100.00 Smt. Rakhi Dugar 500.00 Kumari Preksha 250.00 Master Akshaya 100.00 2. Usha Devi Dugar W/o Late Shri U. S. Dugar (Bhabhi of Shri Kesari Singh Dugar). (Item at S. No. 1 to 4, S. No. 7 to 9 and S. No. 11 of inventory of Jewellery found from locker No. 30, Syndicate Bank of India, Subhash Marg, Jaipur) (The copy of sworn affidavit of this lady,which filed during assessment is at PB Page 200). 415.86 3. Declared by Smt. Shweta Dugar in VDIS.The copy of VDIS certificate, which filed during assessment is at PB Page 201 to 203. 628.00 Printed from counselvise.com 10 ITA No. 972 To 974/JPR/2025 Vinay Dugar, Jaipur. 4. Received to Smt. Suman Dugar and Shri Vinay Dugar as per will dated 08.03.2014 of Late Shri Dhanpat Lal Mehta (grandfather of Smt. Suman Dugar) (Item at S. No. 7 weighing 166.71 gms and item No. 3 weighing 143.35 gms of inventory of Jewellery found from locker No. 137, SBI, NRI Branch and out of item No. 13 weighing 8 gms of inventory of inventory of Jewellery found from locker No. 18, ICICI Bank).The copy of will, which filed during assessment proceeding is at PB Page 204 to 206. 318.06 5. Received to Smt. Suman Dugar and Shri Vinay Dugar as per will dated 15.11.2016 of Late Smt. Sajjan Bai Mehta (grand mother of Smt. Suman Dugar) (Item at S. No. 1 weighing 126.95 gms, S. No. 6 weighing 38.06 gms of inventory of Jewellery found from locker No. 137, SBI, NRI Branch and out of item at S. No. No. 2 weighing 56 gms, item No. 4 weighing 72.45 gms of inventory of Jewellery found from locker No. 18, SBI, NRI Branch). The copy of will, which file d during assessment proceeding is at PB Page 207 to 209. 293.46 6. Received by Shri Kesari Singh Dugar from his brother Shri U. S. Dugar as per agreement dated 07.09.1990 and 16.05.2011. The copy of agreement, which filed during assessment proceeding is at PB Page 210 to 211. 18 gold Ginni weighing 144 gms, which later on converted into Jewellery in FY 2017- 18 (Copy of bill of remaking and ledger a/c from books of account, which filed during assessment is at PB Page 212 to 213). Item at S. No. 5 weighing 143 gms, S. No. 6 weighing 90 Gms, S. No. 11 weighing 80 gms of inventory of Jewellery found from locker No. 73, ICICI Bank and item at S. No. 6 weighing 50 gms and S. No. 1 weighing 43.390 gms of inventory of Jewellery found from locker No. 537, Syndicate Bank. 550.39 Availability of Jewellery with assessee group which should be considered as explained 5,655.77 Printed from counselvise.com 11 ITA No. 972 To 974/JPR/2025 Vinay Dugar, Jaipur. During the search proceedings in none of the statements recorded the above position of source of jewellery was claimed. The initial statements recorded during the course of the search proceedings reflect and bring on record the actual initial version of the assessee giving broad contours of the actual position vis-à-vis the memory lane and practical reality. Nowhere during the search proceedings, any such claim was made or any such evidence found. During the course of the appellate proceedings pending before me the appellant has relied on sworn affidavits claiming receipt of jewellery from family members/relatives and on account of VDIS declaration by Smt. Shweta Dugar. Now this situation has to be seen in a holistic position. For the total jewellery found of 4820.055 gms, the appellant is giving explanation of 2205.70 gms on these five receipts as discussion above, meaning almost 45% of the jewellery found at home was on account of this explanation of receipt from family members and relatives and on account of VDIS and the appellant forgot to mention the same in the statements. This also coupled with the fact that no bills/vouchers/payments were found during search of any jewellery item. So, I find that this explanation of the appellant for the unexplained jewellery is too far stretched and cannot be accepted. Moreover, the explanation for the jewellery as per CBDT Circular is accepted because it is considered that various jewellery items are received during various important events /functions in life like birthday, birth of child, marriage etc. in accordance with the social and religious customs. So, while one receives jewellery at time of social, family and religious functions, one also gives/gifts jewellery on such functions. So, no doubt Smt. Shweta Dugar had declared such jewellery in 1997 when her name was Miss Sweta PremchandGoliyaprohably VDIS was done by her before marriage. Since she could not recall such fact during search when 4820.055 gms of jewellery was found with the assessee and his family it can clearly be inferred that she was not holding anymore this jewellery declared in VDIS as on the date of the search. Out of this jewellery found no bill or purchase details were found during the search proceedings nor any bills/details were provided by the appellant or his family members during the search proceedings. The jewellery of 3450 gms treated as explained was only on account of CBDT Circular w.r.t.jewellery to be treated as explained w.r.t. married /unmarried ladies, gents and children and the decision of Hon’ble Courts w.r.t. the Circular to treat the quantity mentioned therein the CBDT Circular as explained. Now the assessee is claiming that 2205.7 gms of the jewellery can be treated as explained because of these claim of receipt of jewellery from relatives and family members and on account of VDIS declared by Smt. Shweta Dugar. I find that nowhere during the proceedings there is a mention of any evidence with respect to the above claim to have been found during the search proceedings. If the documents were lying with the assessee and so was the position w.r.t. the jewellery found, the appellant would have immediately brought the same to the knowledge of the search team and would have mentioned in the statement. It is also noticed that no such claim was Printed from counselvise.com 12 ITA No. 972 To 974/JPR/2025 Vinay Dugar, Jaipur. made by any other family member in their statement, I find it rather surprising that for the total jewellery found in the search proceedings she did not mention the VDIS fact and the consequent explanation. Moreover, apart from the perusal of the VDIS form it is seen that the name mentioned is Miss Sweta PremchandGoliya and in the column PAN/GIR Wd 24(2)/ 2243-S is mentioned and no other supporting document has been given by the appellant to correlate that this VDIS document pertains to Mrs. Shweta Dugar, it is also noticed that while in the appellate /proceedings the spelling is Shweta but in the VDIS certificate submitted the spelling is Sweta and so cannot be considered to be belonging to appellant’s wife for want of any other supportive evidence on this. Moreover the claim is not supported further by any Wealth Tax Return of Mrs. Shweta Dugar that she was holding this jewellery. Wealth tax returns would have become due on this but no such evidence/document has been given by the appellant in support of this claim. So, this justification does not merit consideration for explanation of unexplained jewellery. In the light of the above factual matrix and discussion thereon, I find that this ground of appeal is devoid of merit and cannot be upheld. This ground of appeal is rejected. “ 6.3 The ld. AR vehemently argued the case in the light of paper book in two volume filed by him which comprises Page No. 1 to 156 in Volume -1 and page 157 to 298 in Volume -2 and also filed written submission to support the various grounds raised in appeal. The written submission filed by A.R. of the assessee regarding this ground of appeal is as under: - (i) Elaborate submission along with evidences was filed during assessment proceeding. The Ld. A.O. made the huge addition by giving a single line finding that “the submission of the assessee is considered but not found tenable because the assessee could not produce the source of the jewellery found at various premises during the search proceedings.” However, the finding given by Ld. A.O. is perverse and dehors the material on record. During the course of assessment proceeding the assessee filed the elaborate submission coupled with evidences and copies of the same is at PB Page 176 to 194 and 200 to 213. Thesource of Jewellery so explained by the assessee was supported by the corroborative evidence, therefore the finding of Ld. A.O. that the assessee could not produce the source of Jewellery is not correct. Printed from counselvise.com 13 ITA No. 972 To 974/JPR/2025 Vinay Dugar, Jaipur. (ii) The detailed of Jewellery found during search viz a viz the source of availability of the Jewellery with assessee group is as under: - a) Detail of Jewellery found: - S. No. Place where from the Jewellery found Gold Jewellery found Gold Jewellery seized Net Weight (In Gms) Amount Net Weight (In Gms) Amount 1 D-275, Todarmal Marg, Bani Park, Jaipur (Inventory at PB page 10-11) a) Bed Room Suman Dugar w/o Vinay Dugar (Inventory at PB page 10) 511.950 16,52,552 0.00 0.00 b) Bed Room of Shri K.S. Dugar (Father of assessee) and SampatDugar w/o Shri K.S.Dugar (Inventory at PB page 11) 197.040 6,10,503 0.00 0.00 2 Locker No. 537, Syndicate Bank, Subhash Marg, C- Scheme, Jaipur in name of Rakhi Dugar and K.S. Dugar (Inventory at PB page 12) 371.940 10,66,927 343.300 9,66,18 5 3 Locker No. 18, ICICI Bank, Pareek College Branch, Jaipur in name of Suman Dugar and Vinay Dugar (Inventory at PB page 13) 1092.70 37,69,478 159.840 4,42,15 4 Locker No. 137, SBI Bank, NRI Branch, Ajmer Road, Jaipur in name of Suman Dugar and Vinay Dugar (Inventory at PB page 927.900 32,94,432 462.701 16,45,1 Printed from counselvise.com 14 ITA No. 972 To 974/JPR/2025 Vinay Dugar, Jaipur. 14-15) 5 Locker No. 73, ICICI Bank, Pareek College Branch, Jaipur in name of VikasDugar and Shweta Dugar (Inventory at PB page 17) 1323.32 39,17,183 368.300 10,95,3 6 Locker No. 30, Syndicate Bank, Subhash Marg Branch, C-Scheme, Jaipur in name of SmtSampatDugar(Inve ntory at PB page 18) 554.240 17,42,560 0.00 0.00 7 Locker No. 123, SBI Bank, NRI Branch, Ajmer Road, Jaipur 0.00 0.00 0.00 0.00 8 Locker No. 39, SBI Bank, NRI Branch, Ajmer Road, Jaipur in name of VikasDugar and Shweta Dugar (Inventory at PB page 20) 5.690 19,824 0.00 0.00 Total 4,984.7 8 1,60,73,4 59 1334.141 41,48,8 24 Out of total 4984.78 gram, the search party seized the jewellery weighing 1334.141 gram, which the ld AO treated as unexplained and balance jewellery 3650.639 giving credit according to CBDT circular was treated as explained. b) Explanation of Jewellery found given during the course of search: - All the below mentioned family members are living jointly and explanation of jewellery in the hands of the each family members is as under:- S. No. Name of the person to whom Jewellery belongs Net Weight of Gold Jewellery (In Gms) Relationship with assessee (Living jointly) 1. Received at the time of birth, marriage and other auspicious Printed from counselvise.com 15 ITA No. 972 To 974/JPR/2025 Vinay Dugar, Jaipur. occasions and ancestral (Entitlement as per board instruction No. 1916, dated 11.05.1994) Shri Kesari Singh Dugar 100.00 Father of Assessee Smt. SampatDugar w/o Shri Kesari Singh Dugar 500.00 Mother of assessee Shri Vinay Dugar 100.00 Assessee Smt. Suman Dugar W/o Shri Vinay Dugar 500.00 Wife Kumari Pragya d/o Shri Vinay Dugar 250.00 Daughter Master Shriyansh s/o Shri Vinay Dugar 100.00 Son Shri Vikash Dugar S/o Shri Kesari Singh Dugar 100.00 Brother Smt. Sweta Dugar W/o Shri Vikas Dugar 500.00 Wife of brother Kumari Shivani D/o Shri Vikas Dugar 250.00 Daughter of brother Master Mohak S/o Shri Vikas Dugar 100.00 Son of brother Shri Vivek Dugar S/o Shri Kesari Singh Dugar 100.00 Brother Smt. Rakhi Dugar W/o Shri Vivek Dugar 500.00 Wife of brother Kumari Preksha d/o Shri Vivek Dugar 250.00 Daughter of brother Master Akshaya s/o Shri Vivek Dugar 100.00 Son of brother 2. Usha Devi Dugar W/o Late Shri U. S. Dugar (Bhabhi of Shri Kesari Singh Dugar). (Item at S. No. 1 to 4, S. No. 7 to 9 and S. No. 11 of inventory of Jewellery found from locker No. 30, Syndicate Bank of India, Subhash Marg, Jaipur) (The copy of sworn affidavit of this lady, which filed during assessment is at PB Page 197/Vol -2). 415.86 Bhabhi of father Shri Kesari Singh Dugar 3. Declared by Smt. Sweta Dugar in VDIS. Name written in 628.00 Wife of brother Printed from counselvise.com 16 ITA No. 972 To 974/JPR/2025 Vinay Dugar, Jaipur. inventory wrongly as Shweta Dugar. The copy of VDIS certificate, which filed during assessment is at PB Page 198 to 200 /Vol -2). 4. Received to Smt. Suman Dugar and Shri Vinay Dugar as per will dated 08.03.2014 of Late Shri Dhanpat Lal Mehta (grandfather of Smt. Suman Dugar) (Item at S. No. 7 weighing 166.71 gms and item No. 3 weighing 143.35 gms of inventory of Jewellery found from locker No. 137, SBI, NRI Branch and out of item No. 13 weighing 8 gms of inventory of inventory of Jewellery found from locker No. 18, ICICI Bank).The copy of will, which filed during assessment proceeding is at PB Page 201 to 203/Vol -2). 318.06 Smt. Suman Dugar and Shri Vinay Dugar 5. Received to Smt. Suman Dugar and Shri Vinay Dugar as per will dated 15.11.2016 of Late Smt. Sajjan Bai Mehta (grand mother of Smt. Suman Dugar) (Item at S. No. 1 weighing 126.95 gms, S. No. 6 weighing 38.06 gms of inventory of Jewellery found from locker No. 137, SBI, NRI Branch and out of item at S. No. No. 2 weighing 56 gms, item No. 4 weighing 72.45 gms of inventory of Jewellery found from locker No. 18, SBI, NRI Branch). The copy of will, which filed during assessment proceeding is at PB Page 204 to 206 /Vol -2). 293.46 Smt. Suman Dugar and Shri Vinay Dugar 6. Received by Shri Kesari Singh Dugar from his brother Shri U. S. Dugar as per agreement dated 07.09.1990 and 16.05.2011. The 550.39 Shri Kesari Singh Dugar Printed from counselvise.com 17 ITA No. 972 To 974/JPR/2025 Vinay Dugar, Jaipur. Thus, during the course of search the department found Jewellery weighing 4,984.78gms as against to which the assessee explained the source of availability of Jewellery of 5655.77 gms with the assessee group, therefore the entire Jewellery so found is stand explained. The lower authorities without examining and considering the reply of the assessee and documents filed in support to that perversely held that the assessee failed to explain the source of Jewellery. The lower authorities brushing aside the documentary evidences filed by the assessee, considered the Jewellery to the extent of CBDT instruction as explained and balance Jewellery was treated as unexplained. (iii) Statements of various family members were recorded by search party and none of them stated to have purchased the jewellery from undisclosed sources. During the course of search, the statement of the members of the assessee group was also recorded u/s 132(4) of the Act and in such statement no person has said that the Jewellery so found is unexplained Jewellery. All the persons said that the supporting documents to explain the source of Jewellery will be submitted later on. Since, the major Jewellery was found from the lockers of the family and seizure was also made therefrom and at copy of agreement, which filed during assessment proceeding is at PB Page 207 to 210. 18 gold Ginni weighing 144 gms, which later on converted into Jewellery in FY 2017-18 (Copy of bill of remaking and ledger a/c from books of account, which filed during assessment is at PB Page 207 to 210). Item at S. No. 5 weighing 143 gms, S. No. 6 weighing 90 Gms, S. No. 11 weighing 80 gms of inventory of Jewellery found from locker No. 73, ICICI Bank and item at S. No. 6 weighing 50 gms and S. No. 1 weighing 43.390 gms of inventory of Jewellery found from locker No. 537, Syndicate Bank. Availability of Jewellery with assessee group which should be considered as explained 5,655.77 Printed from counselvise.com 18 ITA No. 972 To 974/JPR/2025 Vinay Dugar, Jaipur. the time of search at the lockers, the documents physically were not available with the respective persons. Further, since being the old matter, therefore the members of the family exactly and elaborately could not explain the source of Jewellery. However, from the statements recorded at the time of search, it is explicit clear that the documents regarding the source of Jewellery was available with them but since the matter was old and search was at the lockers; not at residence/office, therefore instantly they could not submit to the search party. It is also pertinent to mention here that the assessee group first time experienced the search proceeding and it is obvious that the atmosphere at the time of search always be tensed, thus the assessee instantly could not find out the record and could not recall the exact details. Further, if something for some reason could not produce before search party does not mean that the same was not available more so when there is no adverse finding regarding to the documents submitted by the assessee. It is also pertinent to mention here that the Income Tax department carried out intensive search over the assessee and during the course of search not single evidence was found that during the year under consideration the assessee or his family members purchased any Jewellery. a) Statement dated 29.06.2019 of Shri Kesari Singh Dugar recorded at residence (Q. No. 17 to 19) PB page 94-97/ Vol -1: - Printed from counselvise.com 19 ITA No. 972 To 974/JPR/2025 Vinay Dugar, Jaipur. Printed from counselvise.com 20 ITA No. 972 To 974/JPR/2025 Vinay Dugar, Jaipur. b) Statement dated 29.06.2019 of Smt. Suman Dugar recorded at residence (Q. No. 29) PB page 112/Vol-1: - Printed from counselvise.com 21 ITA No. 972 To 974/JPR/2025 Vinay Dugar, Jaipur. Printed from counselvise.com 22 ITA No. 972 To 974/JPR/2025 Vinay Dugar, Jaipur. c) Statement dated 25.07.2019 of Smt. Rakhi Dugar recorded at locker No. 537, Syndicate Bank, Subhash Marg, C-Scheme, Jaipur (Q. No. 8 to 10) PB page 117-119/Vol-1:- Printed from counselvise.com 23 ITA No. 972 To 974/JPR/2025 Vinay Dugar, Jaipur. Printed from counselvise.com 24 ITA No. 972 To 974/JPR/2025 Vinay Dugar, Jaipur. d) Statement dated 25.07.2019 of Shri Vinay Dugar recorded at locker No. 18, ICICI Bank Pareek College Branch, Jaipur (Q. No. 10 to 14) PB page 123-125/Vol-2: - Printed from counselvise.com 25 ITA No. 972 To 974/JPR/2025 Vinay Dugar, Jaipur. Printed from counselvise.com 26 ITA No. 972 To 974/JPR/2025 Vinay Dugar, Jaipur. e) Statement dated 25.07.2019 of Shri Vivek Dugar recorded at locker No. 18, ICICI Bank Pareek College Branch, Jaipur (Q. No. 6) PB page 128/Vol-1: - Printed from counselvise.com 27 ITA No. 972 To 974/JPR/2025 Vinay Dugar, Jaipur. f) Statement dated 16.07.2019 of Shri Vinay Dugar recorded at locker No. 137, SBI NRI Branch, Corporate Park, Ajmer Road, Jaipur (Q. No. 8 to 12) PB page 133-135/Vol-1: - Printed from counselvise.com 28 ITA No. 972 To 974/JPR/2025 Vinay Dugar, Jaipur. Printed from counselvise.com 29 ITA No. 972 To 974/JPR/2025 Vinay Dugar, Jaipur. g) Statement dated 23.07.2019 of Shri Vikas Dugar recorded at locker No. 73, ICICI Bank, Pareek College Branch, Jaipur (Q. No. 9 to 15) PB page 139- 141/Vol-1: - Printed from counselvise.com 30 ITA No. 972 To 974/JPR/2025 Vinay Dugar, Jaipur. Printed from counselvise.com 31 ITA No. 972 To 974/JPR/2025 Vinay Dugar, Jaipur. Printed from counselvise.com 32 ITA No. 972 To 974/JPR/2025 Vinay Dugar, Jaipur. h) Statement dated 28.06.2019 of Smt. SampatDugar recorded at locker No. 30, Syndicate Bank, Subhash Marg, C-Scheme, Jaipur (Q. No. 9) PB page 146/ Vol-1: - Printed from counselvise.com 33 ITA No. 972 To 974/JPR/2025 Vinay Dugar, Jaipur. i) Statement dated 16.07.2010 of Shri Vikas Dugar recorded at locker No. 39, SBI Bank, NRI Branch, Ajmer Road, Jaipur (Q. No. 10) PB page 155 Vol- 1: - Printed from counselvise.com 34 ITA No. 972 To 974/JPR/2025 Vinay Dugar, Jaipur. (iv) The explanation filed by the assessee is supported by the admissible evidences and admitted position of the law:- a) The Jewellery found during search was fully explained. Out of total 4984.78 gram, the search party seized the jewellery weighing 1334.141 gram, which the ld AO treated as unexplained and balance jewellery 3650.639 giving credit according to CBDT circular was treated as explained. b) Now if the assessee is found to be owner of Jewellery/Gold of more than to 3650.639 Gms, then in such a case he is required to be explain the same with documentary evidence. In this case the assessee filed the documentary evidence in support of holding of additional Jewellery, which was not disproved by Ld. A.O. The following evidences were filed by the assessee: - b.1) Jewellery pertaining to Smt. Usha Devi Dugar The Jewellery/Gold, weighing 415.860 Gms was pertaining to Smt. Usha Devi Dugar and found at the time of search from the residence of the assessee because she was residing with the family of the assessee. S. No. Name of the person from whom received Item No. Inventory at PB Net Weight of Gold Printed from counselvise.com 35 ITA No. 972 To 974/JPR/2025 Vinay Dugar, Jaipur. page Jewellery (In Gms) 1. Usha Devi Dugar W/o Late Shri U. S. Dugar (Bhabhi of Shri Kesari Singh Dugar). Found from locker No. 30, Syndicate Bank of India, Subhash Marg, Jaipur. 1 2 3 4 7 8 9 11 18 62.840 86.700 121.570 41.280 32.230 23.560 20.000 27.680 Total 415.860 Grams In support of this claim the sworn affidavit of Smt. Usha Devi Dugar was also submitted (Copy of affidavit at PB Page 197/Vol-2), which remained uncontroverted or unexamined. Neither any inquiry was made by Ld. A.O from Smt. Usha Devi Dugar nor the contents of the affidavits were proved as vague. It is an admitted position of the law that thecontents of affidavits, which are not vague, should be accepted correct. Reliance is placed on the following decisions: - (i) Mehta Parikh & Co v CIT [1958] 30 ITR 181 (SC) S.143(3): Assessment – Affidavit – When a statement is given in affidavit the same is proved to be correct unless proved otherwise. (ii) Daulat Ram Rawatmull v. CIT (1973) 87 ITR 349 (SC). Once an affidavit is furnished, it should be presumed to be a correct statement of facts. If these facts are to be controverted, either the deponent must be examined or evidence contrary to facts must be led. In the absence of these the affidavits could not be ignored. (iii) Shri Nirmal Kumar Kedia V/s DCIT (Vice-Versa) 2019 (6) TMI 467 - ITAT Jaipur 31. From the record we found that the assessee had submitted the affidavit of several parties, wherein they confirmed the payments made against purchases of plots. In case of any doubt the AO could have made the direct verification from parties but the same has not been made. The AO did not issue any summon to any of these party, therefore the sworn affidavit submitted by the parties confirming the amount paid to the assessee group for purchases of plot should be accepted as admissible evidence. (iv) Dilip Kumar Rao Vs CIT (1974) 94 ITR 1 (Bom); (v) Malwa Knitting Works Vs CIT (1977) 107 ITR 379, 381 MP Printed from counselvise.com 36 ITA No. 972 To 974/JPR/2025 Vinay Dugar, Jaipur. (vi) Sri Krishna Vs CIT (1983) 142 ITR 618 (All). After filing of the affidavit by the assessee before the assessing office, the ld AO remained silent on the face of it and did not carry out any inquiry thereon to verify the correctness thereof and he did not examine to the party. Assessee was, therefore, entitled to assume that the income tax authorities were satisfied with the affidavit as sufficient on this point. In this regard we will like to draw your kind attention towards the judgement of Hon’ble Jaipur ITAT in the case of Shri RadheyShyam Mittal ITA No 420/JP/2012 dated 26.08.2013, wherein Hon’ble ITAT held that: - After the affidavit was filed before the assessing authority, he remained silent on the face of it and carried no enquiry thereon to verify the correctness thereof. The assessee was also not cross examined on the point of retraction nor was required to produce any documentary evidence or any other evidence. Assessee was, therefore, entitled to assume that the income tax authorities were satisfied with the affidavit as sufficient on this point. The Hon'ble Allahabad High Court in the case of Sohan Lal Gupta vs. CIT (1958) 33 ITR 786 (All.), has made elaborate discussion on the evidentiary value of the affidavit. The relevant passage from the aforesaid judgment at page 791 of the report is reproduced as under: - “The most important points on which the Tribunal relied, is that mentioned at No. 2, viz., that, according to the Tribunal, the assessee had not satisfactorily established that the shares had to be sold as the purchaser of the Jaswant Sugar Mills was not willing to purchase that mill unless the shares in the Straw Board Mills Ltd. held by the family were also transferred to him at the same time. On this point, the only material available on the record is the affidavit which was filed by the assessee before the Income-tax Officer. The assessee in his affidavit, had definitely stated that the purchaser wanted to purchase both the going concerns, the Jaswant Sugar Mills and the Straw Board Mills Ltd., together and one of his conditions of purchase was that all the shares of Lala Jaswant Rai, his sons and other relatives had to be transferred to the purchaser. The Income- tax Appellate Tribunal rejected this affidavit of the assessee on the mere ground that there was no documentary evidence in corroboration in the form of any correspondence of otherwise on this point. Shri G.S. Pathak contended rightly before us that the Tribunal was not entitled to reject the affidavit on this point on such a ground. After the assessee had filed the affidavit, he was neither cross-examined on that point, nor was he called upon to produce any documentary evidence. Consequently, the assessee was entitled to assume that the Income-tax authorities were satisfied with the affidavit as sufficient proof on this point. Printed from counselvise.com 37 ITA No. 972 To 974/JPR/2025 Vinay Dugar, Jaipur. If it was not to be accepted as a sufficient proof either by the Income-tax Officer or by the Appellate Assistant Commissioner of Income-tax or by the Income-tax Appellate Tribunal, the assessee should have been called upon to produce documentary evidence, or, at least he should have been cross-examined to find out how far his assertions in the affidavit were correct.” (emphasis supplied) b.2) Jewellery pertaining to SmtShewtaDugar (Correct name is Sweta Dugar) 628 gram declared in VDIS:- The Gold Jewellery weighing 628 Gms was declared in VDIS by Smt. Shweta Dugar (name as mentioned in inventory prepared by search party and correct name is Sweta Dugar), when she was unmarried and in support of that the VDIS certificate was also filed (Copy of VDIS certificate at PB Page 198-200). However, the same also remained uncontroverted and no reason has been assigned in the assessment order that why the same should not accepted by Ld. A.O. The ld CIT(A) rejected the credit of gold jewellery declared in VDIS on the ground that in VDIS certificate, name is written as Miss Sweta PremchandGolia whereas the name written in appellate proceeding is Shweta so it cannot be considered to be belonging to appellant’s wife for want of supportive evidence on this. In this regard, we submit that ld CIT(A) never raised any query to clear the discrepancy. In this regard, we submit that in inventory of jewellery prepared by the search party, name of Sweta was wrongly spelled as Shewta in inventory. (PB page 20 & 21). The correct spelling is “Sweta”. The search party recorded the statement of Shri Vikas Dugar on 16/07/2019 and on 23/07/2019, wherein he stated the name of his wife is sweta(PB page 151 & 136) and ld CIT(A) ignored the facts stated in these statements. However, we are enclosing herewith the copy of her Passport and Adhar Card wherein the name written as Sweta Dugar and name of husband is written as Vikas Dugar address mentioned is D-275, Dugar House, Todarmal Marg, Banipark, Jaipur and in passport the father's name Shri PremChandGolia is written. Further, the ld CIT(A) mentioned that she could not recall the fact of jewellery declared in VDIS during search from which it can be inferred that she did not have jewellery declared in VDIS at the time of search. In this regard at the outset we submit the jewellery so found was not alone from assessee but from various family members and at the time of search, she was out of Jaipur so her statements at the time of search were not recorded, therefore no question arises to saying that she could not recall the jewellery declared in VDIS at the time of search. Ld CIT(A) further held that Mrs. Sweta Dugar has not filed any wealth tax return and jewellery declared in VDIS was not declared in wealth tax return. In this regard we submit that Wealth Tax Act abolished from AY 2016-17. Printed from counselvise.com 38 ITA No. 972 To 974/JPR/2025 Vinay Dugar, Jaipur. b.3) 318.06 gram Jewellery received from will of Shri Dhanpat Lal Mehta - Grand father of Suman Dugar (wife of assessee) and 293.46 gram from Smt Sajjan Bai Mehta – Grand mother of wife of assessee. The Jewellery weighing 611.52 gms was received as per will of Shri Dhanpat Lal Mehta (318.06 Gms) and Smt. Sajjan Bai Mehta (293.46 gms (grand mother of wife of assessee) and the same is supported by will of both the persons (Copy of will with death certificate is at PB Page 201 to 203 and 204 to 206 respectively). The will is executed on the stamp paper, witnessed by the independent persons and also notarized by the notary public. The Ld. A.O. did not make the inquiry from the witness of the will and without assigning any reason rejected the same. Shri Dhanpat Lal Mehta expired on 23/05/2014 and Smt Sajjan Bai Mehta expired on 24/12/2016, so these will cannot be after thought and cannot be prepared in back date. The details of jewellery received through will from Late Shri Dhanpat Lal Mehta is as under:- S. No. Name of the person from whom received Item No. Inventory at PB page Net Weight of Gold Jewellery (In Gms) 1 Received to Smt. Suman Dugar and Shri Vinay Dugar as per will dated 08.03.2014 of Late Shri Dhanpat Lal Mehta (grandfather of Smt. Suman Dugar). (i) Found from locker No. 137, SBI, NRI Branch, Jaipur (ii) Found from Locker No. 18, ICICI Bank, Jaipur 3 7 13 14 14 13 143.350 166.710 8.000 Total weight 318.06 gram The details of jewellery received through will from Late Shri Smt Sajjan Bai Mehta is as under 2. Received to Smt. Suman Dugar and Shri Vinay Dugar as per will dated 15.11.2016 of Late Smt. Sajjan Bai Mehta (grandmother of Smt. Suman Dugar) Found from locker No. 1 6 2 4 14 14 13 13 126.950 38.060 56.000 72.450 Printed from counselvise.com 39 ITA No. 972 To 974/JPR/2025 Vinay Dugar, Jaipur. 137, SBI, NRI Branch, Jaipur Found from Locker No. 18, ICICI Bank, Jaipur Total 293.46 b.4) 550.39 gram Jewellery From Shri U.S Dugar brother of father of assessee which received by adjustment against loan The Jewellery/Gold, weighing 550.39 Gms was adjusted against the loan, which was given by Shri Kesari Singh Dugar to his brother Shri Umed Singh Dugar. Father of assessee Shri Kesari Mal Dugar gave loan of Rs. 2,00,000/- on 25-11-89 to his brother Shri Umed Singh Dugar and certain jewellery was mortgaged by him as security with Kesari Singh Dugar. The copy of agreement on stamp paper is at PB page 207. The agreement is duly witnessed and notarized. Shri Umed Singh Dugar could not repay the loan so in consideration of the liquidation of the loan amount, he surrendered his mortgaged jewellery in favour of Shri Kesari Singh Dugar by executing an agreement dated 16-03-2011. The copy of this agreement is at PB page 208. Shri Umed Singh Dugar has expired in Feb 2019 much before the date of search, so these agreements cannot be after thought or back dated. The Ld. A.O. did not make the inquiry from the witness of the will or Notary Public and without assigning any reason rejected the same. The details of jewellery received from Shri Umed Singh Dugar is as under :- S. No. Name of the person from whom received Item No. Invento ry at PB page Net Weight of Gold Jewellery (In Gms) Received by Shri Kesari Singh Dugar from his brother Shri U. S. Dugar as per agreement dated 07.09.1990 and 16.05.2011. Found from locker No. 73, ICICI Bank, Jaipur Found from locker No. 537, Syndicate Bank, Jaipur 5 6 11 1 6 17 17 17 12 12 143.000 90.000 80.000 43.390 50.000 (v) The documentary evidence filed in support of explanation of the assessee cannot be rejected or brush aside only on the basis of surmises and conjecture. Printed from counselvise.com 40 ITA No. 972 To 974/JPR/2025 Vinay Dugar, Jaipur. The Ld. A.O. completed the assessment by strictly allowing the credit of the Jewellery as per the CBDT Instruction 1916 dated 11.05.1994. The minimum Qty. as mentioned in the CBDT instruction No. 1916 is not the sacrosanct and this instruction considering the status of the family and the customs and practices of the community to which the family belongs and other circumstances of the case, itself allow to authorize officer to decide to exclude a larger quantity of jewellery and ornaments from seizure. Therefore, in the case of the assessee if the assessee group is found to be owner of Jewellery/Gold of more than to 3650.639 Gms, then in such a case he is required to be explain the same with documentary evidence. In this case the assessee filed the documentary evidence in support of holding of additional Jewellery, which was not disproved by lower authorities, therefore the same cannot be considered as unexplained. The claim of the assessee is supported by the admissible documentary evidences, which remained uncontroverted, therefore the same cannot be treated as unexplained investment of the assessee. In the case of ITO vs. Daya Chand Jain Vaidya (1975) 98 ITR 280 the Allahabad High Court held that “When a particular explanation furnished by the assessee and evidence in support thereof is adduced, the onus shifts on the Assessing Officer to falsify the said material or bring new material on record. Mere rejection of good explanation does not convert \"good proof into no proof”. Genuineness of vouchers/bills of jewellery/gold purchased claimed by assessee is not disproved by causing enquiry/verification by AO, then there cannot be any addition on the same as held in the case of Dy. Commissioner of Income Tax, Central Circle-1, Udaipur Versus Ashok Jain - 2024 (3) TMI 1003 - ITAT Jodhpur. In this regard we would like to place the reliance of following cases : - Shri Ram Prakash Mahawar v/s DCIT ITA No. 918/JP/2019 dated 20.02.2020, wherein Hon’ble Jaipur ITAT held as under: - 2.6 We have considered the rival submissions as well as the relevant materials available on record. The first issue is regarding the addition sustained by the ld. CIT(A) to the tune of ₹ 4,57,404/- on account of unexplained gold jewellery by rejecting the claim of the assessee being acquisition of the said jewellery by way of purchases made from time to time and also recorded in the books of account of the assessee. There is no dispute regarding the fact that jewellery to the extent 343.328 gms. represents the purchases made by the assessee from time to time which is duly supported by the purchase bills found during the search and seizure action. The said quantity of jewellery is duly recorded in the balance sheet/ books of account of the assessee and his family members. Once the AO has not disputed the purchases made by the assessee of the said quantity of jewellery then the same cannot be treated as unexplained jewellery of the Printed from counselvise.com 41 ITA No. 972 To 974/JPR/2025 Vinay Dugar, Jaipur. assessee. The AO has denied the benefit of the said quantity of jewellery on the ground that since the benefit of reasonable jewellery to the extent of 850 gms. as per CBDT Instruction No. 1916 dated 11- 05-1994 is already granted, therefore, to that extent, no further benefit can be granted. It is pertinent to note that CBDT Instruction No. 1916 dated 11-05-1994 has explained in case of gold jewellery found in the possession of the assessee during the course of search and seizure action and the assessee is not able to explain the same then the quantity prescribed under the said CBDT Instruction No. 1916 in respect of married female member, unmarried female member and male member of the assessee would be treated as a reasonable holding of jewellery on account of acquisition of that much jewellery on various occasions of marriages, other social & customary occasions as prevailing in the society. Therefore, reasonable possession of the jewellery as per the customs prevailing in the society is the basis for allowing the benefit of certain quantity of jewellery explained by the CBDT Instruction No. 1916 dated 11- 05-1994 which means that the assessee need not to explain the source of jewellery found in his possession to the extent of specified quantity treated as reasonable possession by family members of the assessee. The said CBDT Instruction No. 1916 allowing the specific quantity as reasonable and need not to be explained, does not include the jewellery which is otherwise explained by proof of documents of acquisition as well as declared/ recorded in the books of account of the assessee. Hence, the quantity of jewellery which is otherwise explained by the assessee by producing the purchase bills as well as recorded in the books of account of the assessee and the AO had not disputed the said explanation then the quantity which is explained otherwise by producing the purchase bills and books of account would not be treated as part of the quantity of reasonable possession as prescribed under the said CBDT Instruction No. 1916 dated 11-05-1994.Therefore, the benefit of CBDT Instruction No. 1916 dated 11-05-1994 will not take away the benefit of the explained jewellery acquired by the assessee. Accordingly, in the facts and circumstance of the case, the quantity of jewellery to the extent of 343.328 gms. has to be allowed separately as explained jewellery and no addition can be made to that extent. (vi) The entire alleged unexplained/excess Jewellery cannot be treated as income of the assessee alone. It is also pertinent to mention, that the Ld. A.O. perversely treated the alleged excess Jewellery as pertaining to the assessee, while apart from the assessee there are other members in the family of the assessee and the jewellery was found from the possession of various family members and also from the lockers in the name of various family members-. There is no Printed from counselvise.com 42 ITA No. 972 To 974/JPR/2025 Vinay Dugar, Jaipur. evidence that the investment in the alleged excess Jewellery was made by the assessee. Therefore, without identifying the owner of the Jewellery the same cannot be treated as pertaining to the assessee and the same cannot be treated as income of the assessee. In view of above submission, the humble assessee prays your honor kindly to delete the addition of Rs. 41,48,824/- made by ld. A.O. and confirmed by ld CIT(A) as the same is unwarranted and deserve to be deleted. 6.4 Per contra, the ld. DR submitted that there is no infirmity in the Assessment orders passed by ld AO. He relied upon the findings made by ld. CIT(A). The ld. DR submitted that the assessee has stated nothing in search statement about the documents later on submitted by the assessee during the course of assessment. Therefore, no reliance should be placed on these documents filed before the ld AO. Further, the assessee has not filed the balance sheet disclosing the jewellery. Therefore, the addition made by the ld. AO deserves to be sustained. 7. We have heard the rival contentions and perused the material available on record. We noted the Income Tax department carried out search over the assessee and his family members on 28.06.2019 and onward. During the course of search, the Jewellery was found from the residence of the assessee as well as from various bank lockers in name of assessee and his family members. The assessee is living in joint family consisting his father-mother, Taiji, family of three brothers in the house and the bank lockers from which jewellery was found are also in the name Printed from counselvise.com 43 ITA No. 972 To 974/JPR/2025 Vinay Dugar, Jaipur. of various family members. During the course of search from residence/bank lockers total 4984.78 Gms Jewellery was found, out of which jewellery of 1334.141 gram valuing Rs. 41,48,824/- were seized by the search party. During the course of assessment proceeding the explanation of the same was sought from the assessee and the assessee submitted detailed reply with documentary evidences. However, the ld AO out of the total jewellery of 4984.78 Gms, jewellery to the extent of 1334.41 gram valuing Rs. 41,48,824/- (being the excess jewellery found after giving credit according to CBDT circular) was considered as unexplained and the balance jewellery 3650.639 gram considered as explained. Against the alleged unexplained jewellery of 1334.41 gram valuing Rs. 41,48,824/- the assessee explained as under:- (i) The Jewellery to the extent of 628 gms explained as being declared by Smt. Sweta Dugar in VDIS and in support of that the copy of VDIS certificate (PB page 198/Vol-2) and copy of valuation report of the approved valuer (PB page 199-200) was filed. (ii) The Jewellery to the extent of 318.06 explained as being received through theWill of Shri Dhanpat Lal Mehta (grandfather of Smt. Suman Dugar, wife of assessee) and 293.46 Gms received from Smt. Sajjan Bai Mehta (Grandmother of Smt. Suman Dugar, wife of assessee ) and in support to that the copy of Will of these persons with death certificateswere filed (PB page 201-203 and 204-206). Printed from counselvise.com 44 ITA No. 972 To 974/JPR/2025 Vinay Dugar, Jaipur. (iii) The Jewellery to the extent of 550.39 was explained as being received by father of assessee Shri Kesari Singh Dugar from his bother late Shri Umed Singh Dugarin liquidation of loan and in support of this loan agreement dated 07-09- 1990 of Rs. 2,00,000/- (PB page 207) which was given on mortgage of jewellery and a further agreement dated 16-03-2011 (PB page 208) for surrender of jewellery in favour of Shri Kesari Singh Dugarin consideration of liquidation of loan was filed . (iv) The Jewellery weighing 415.86 explained as pertaining to widow aunt of assessee Smt. Usha Devi Dugar as she was residing at the house of assessee and in support to that the affidavit of Smt. Usha Devi was filed (PB page 197/Vol-2). However, the Ld. A.O. considered the Jewellery to the extent of allowable as per board instruction as explained and rest of the Jewellery was treated as unexplained and added to income of assessee considering the same as undisclosed investment of assessee. The ld AO has not considered the documentary evidences filed by the assessee and rejected the same without pointing out defects therein. It was submitted by the assessee that during the course of search statement of various family members were recorded and none of them has stated that they have purchased the jewellery from undisclosed sources. Rather all the persons said the jewellery so found is pertains to family of the assessee/ishtridhan of ladies/ supported by documents and which will be submitted later on. The assessee submitted that in respect of jewellery found in excess to board instruction he was required to prove the source of the same, which has been done by the assessee by filing the admissible documents but the ld AO and Ld CIT(A) disregarded the same without pointing out any defects therein. Printed from counselvise.com 45 ITA No. 972 To 974/JPR/2025 Vinay Dugar, Jaipur. Upon perusal the entire facts of the case and also material placed on record it is clear that the while considering the source of Jewellery found during search, Ld. A.O. restricted to her up-to board instruction and Jewellery found over and above to that was considered as unexplained. In this regard the ld AR of the assessee cited the decision of Jaipur bench of ITAT in the case of Ram PrakashMahawar v/s. Deputy Commissioner of Income-tax, Central Circle Alvar (Raj) [2020] 115 taxmann.com 241 (Jaipur - Trib.)/[2020] 182 ITD 55 (Jaipur - Trib.)[20- 02-2020], wherein it is held that “CBDT Instruction No. 1916 allowing the specific quantity as reasonable and need not to be explained, does not include the jewellery which is otherwise explained by proof of documents of acquisition as well as declared/recorded in the books of account of the assessee. Hence, the quantity of jewellery which is otherwise explained by the assessee by producing the purchase bills as well as recorded in the books of account of the assessee and the AO had not disputed the said explanation then the quantity which is explained otherwise by producing the purchase bills and books of account would not be treated as part of the quantity of reasonable possession as prescribed under the said CBDT Instruction No. 1916 dated 11-05-1994. Therefore, the benefit of CBDT Instruction No. 1916 dated 11-05-1994 will not take away the benefit of the explained jewellery acquired by the assessee.” Thus, the Ld. AO is wrong in not considering the other evidences filed by the assessee to explain the source of Jewellery found and restricting her up-to board instruction only without any reason. We have gone thoroughly to the documentary evidences filed by the assessee in support of his claim and our findings are as under:- Printed from counselvise.com 46 ITA No. 972 To 974/JPR/2025 Vinay Dugar, Jaipur. “i) Jewellery 628 gram claimed to being Jewellery declared by Sweta Dugar in VDIS when she was unmarried and is duly supported by the certificate issued by the department and Valuation Report of jewellery made by the approved valuer for the VDIS purpose. Sweta Dugar is wife of Shri Vikas Dugar and Shri Vikas Dugar is brother of assessee. The ld AO has not pointed any defect in the documents submitted by the assessee. However, the ld CIT(A) mentioned that the spelling in VDIS certificate is Sweta and in appellate proceeding the spelling mentioned is Shewta. The ld CIT(A) further mentioned that she has not recalled the fact of declaration of jewellery in VDIS during the course of search statement and also mentioned that the said jewellery has not been declared in Wealth Tax Return. The ld AR of the assessee submitted the ld CIT(A) never raised any query to assessee and opportunity to explain the alleged discrepancy in name was not given. The ld AR submitted that the search party has wrongly spelled the name by writing Shewta as against Sweta in the inventory prepared by them (Copy at PB page 20-21). The ld AR submitted copy of her passport and adhar card before the Bench, and we noted that in the passport the name is spelled as Sweta and husband’s name is written as Vikas Dugar and father’s name is written as PremChandParasmalGolia. In VDIS certificate the name is written as MISS. SWETA PREMCHAND GOLIYA. Therefore, this lady is family member of the assessee and she has declared jewellery of 628 gram in VDIS. The ld AR submitted that her statements were not recorded by search party as she was out of Jaipur so question of recalling of fact regarding declaration of jewellery in VDIS in search statement does not arise. As regard the declaration of jewellery in Wealth Tax, the ld AR of assessee submitted that the Wealth Tax Act has been abolished w.e.f. AY 2016-17. Thus, in our considered view the documents submitted by the assessee in support of jewellery declared in VDIS are validly acceptable documents and therefore, on the facts and in the circumstances of the case, jewellery to the extent of 628 gram claimed to being Jewellery belongs to Sweta Dugar which was declared by her in VDIS should be treated as explained. i) The Jewellery 318.06 gram claimed to be received from DhanpatLal Mehta (grandfather of Suman Dugar, wife of assessee) and 293.46 gram from Smt. Sajjan Bai (grandmother of Suman Dugar, wife of assessee) totalling to 611.52 gram;is supported by their will, which was executed on stamp paper and duly notarized. Shri Dhanpat Lal Mehta executed a Will on 08-03-2014 on Stamp Paper dated 07-03-2014 in favour of Suman Dugar(PB page 201-202) which is witnessed and notarised. Shri Dhanpat Lal Mehta expired on 23/05/2014 and his death certificate was filed at PB page 203.Similarly, Smt Sajjan Bai Mehta executed a Will on 15-11-2016 on Stamp Paper dated 13-11-2016 in favour of her granddaughter Suman Dugar (PB page 204-205) which is witnessed and notarised. Smt Sajjan Bai Mehta expired on 24/12/2016 and her death certificate was filed at PB page 206.Therefore, the validity of these will cannot be Printed from counselvise.com 47 ITA No. 972 To 974/JPR/2025 Vinay Dugar, Jaipur. disregarded without any enquiry or material. Further, both the persons expired much before the date of search, therefore otherwise also theseWills cannot be executed in back date and cannot be after thought and sanctity of these wills cannot be doubted. Thus, in our considered view the documents submitted by the assessee in support of jewellery of 611.52 gram received through Will of Shri Dhanpat Lal Mehta and Smt Sajjan Bai Mehta are validly acceptable documents and therefore, on the facts and in the circumstances of the case,jewellery to the extent of 611.52 gram claimed to have been received by Smt Suman Dugar from her grandfather and grandmother should be treated as explained. iii) The jewellery of 550.39 gram claimed to being received by Shri Kesari Singh Dugar from his brother is supported by the agreement, which was executed on stamp paper and duly notarized. Shri Kesari Singh Dugar gave loan of Rs. 2,00,000/- on 25-11- 1989 to his brother Shri Umed Singh Dugaron the basis of mortgage of jewellery and for this purpose an agreement was executed by Shri Umed Singh Dugaron 07-09-1990 on stamp paper dated 07-09-1990 issued by Stamp Vendor Shri Vishnu Jhalani Jalibi Chowk and 56, Gopal Badi, Jaipur and duly witnessed and notarised on 07-09-1990. Thereafter, a further agreement was executed by Shri Umed Singh Dugar on 16-03-2011 on stamp paper dated 16-03-2011 which is also witnessed and notarised. In this agreement Shri Umed Singh Dugar expressed his inability to repay the loan and surrendered the mortgaged jewellery in favour of Shri Kesari Singh Dugar in consideration of liquidation of loan. Shri Umed Singh Dugar expired on 25-02-2019 much before the date of search, therefore otherwise also these agreements cannot be back dated or after thought and sanctity of these agreements cannot be doubted and the validity of theseagreements cannot be disregarded without any enquiry or material.Thus, in our considered view the documents submitted by the assessee in support of jewellery of 550.39 gram received by father of assessee Shri Kesari Singh Dugar from his brother late Shri Umed Singh Dugarare validly acceptable documents and therefore, on the facts and in the circumstances of the case, jewellery to the extent of 550.32 gram claimed to have been received by Shri Kesari Singh Dugar from his brother Shri Umed Singh Dugarshould be treated as explained. (iv) In support of 415.860 gram jewellery claimed to be belonging Smt. Usha Devi Dugar. Smt Usha Devi Dugar is wife of Late Shri Umed Singh Dugar and she is living in same house. The assesseefiled sworn affidavit of this lady (PB page 197/Vol-2). She stated in the sworn affidavit that the conduct of his only son is not good and after the death of his husband Shri Umed Singh Dugar,she is living with Shri Kesari Singh Dugar and she also listed out her jewellery in the affidavit. The reconciliation of the listed jewellery was made with the jewellery inventoried by the search party. The sworn affidavit is duly notarised and on stamp paper. The ld AO has not controverted the Printed from counselvise.com 48 ITA No. 972 To 974/JPR/2025 Vinay Dugar, Jaipur. contents of the affidavit nor made any inquiry thereon. Therefore, the sworn affidavit submitted should be accepted as admissible evidence and in this regard the AR of the assessee placed reliance on several decisions including decision of Jaipur ITAT in the case of Shri Nirmal Kumar Kedia ITA Nos. 124 to 126/JP/2019 And 286 to 288/JP/2019 order dated 06-06-2018. Therefore, on the facts and in the circumstances of the case, the jewellery to the extent of 415.860 gram claimed to belonging to Smt Usha Devi Dugar should be treated as explained. Thus, in our considered view all the documents submitted by the assessee are validly acceptable documents. We have gone through the statements of various family members recorded by search party and we noted that no one has said that jewellery was purchased from undisclosed source. The assessee has not produced the documents at the time of search but the fact remains that the existence of these documents at the time of search cannot be doubted. The VDIS certificate is dated 24-02-1998 and issued by Income Tax department. Will of Shri Dhanpat Lal Mehta and Smt Sajjan Bai Mehta are on stamp paper duly witnessed and notarised and both the persons have expired much before the date of search. The agreements executed by Shri Umed Singh Dugar were also on stamp paper, duly witnessed and notarised and he has also expired much before the date of search. Further, the ld AO treated the jewellery 1334.141 gram of the value of Rs. 41,48,824/- as unexplained whereas the assessee has explained the jewellery more than 1334.141 gram on the basis of documents filed before the ld AO. Further, the assessee filed his return declaring business income u/s 44AD which has been accepted by ld AO so the assessee is not required to maintain books of account Printed from counselvise.com 49 ITA No. 972 To 974/JPR/2025 Vinay Dugar, Jaipur. and file copy of Balance sheet as contended by ld DR. Therefore, under the facts and circumstances of the case we hold that the ld AO has not justified in making the addition of Rs. 41,48,824/- and we set aside the findings of ld CIT(A) in this regard and direct the A.O. to delete the addition of Rs. 41,48,824/- made on account of alleged unexplained jewellery found at the time of search. 8. In grounds No. 3 of the appeal for AY 2020-21 (ITA No 974/JPR/2025) the assessee has challenged the addition of Rs. 4,84,050/- made u/s 69 of the Act on account of unexplained investment in construction of house. 8.1 The finding of Ld. AO, in the light of which the addition was made is at Page 11 of the assessment order, which is as under: - “8 Various incriminating documents, related to the construction of house, were seized from D-275, Todarmal Marg, Bani Park, Jaipur, i.e. residence of Sh. Vivek, Vinay & Vikas Dugar. On perusal of the Page 31 to 35 of Exhibit 3 it is seen that the assessee has made cash payment of Rs. 4,84,050 /- to contractor for carrying out Extra Work related to ‘Boundary Wall’ and ‘KachaPakka’. Therefore, during the course of assessment proceedings, the assessee was asked to produce the source of the same. In response to that the assessee vide his reply dated 13.09.2021 submitted as under: “This is bill raised by contractor Shri Prabhu Dayal against some extra work. The final payment made to/for ParbhuDayal is mentioned at Page 53-54 of Exhibit 3. The amount mentioned on this page is not separate and not over & above from the amount mentioned at page 53-54 of Exhibit-3. The submission of the assessee is considered but not found acceptable because the bill raised by Shri Prabhu Dayal (Page 43, Exhibit 3) clearly mentions regarding Extra Work related to ‘Boundary Wall’ and ‘KachaPakka’. Further Page No 35 clearly mentions the items billed below as Extra Work. The total of this is given on page 31 which is Rs. 4,84,050. Thus the same is not part and parcel of the contract work and separate charges were paid by assessee for the extra work. In view of the above an amount of Rs. Rs. Printed from counselvise.com 50 ITA No. 972 To 974/JPR/2025 Vinay Dugar, Jaipur. 4,84,050/- is being added to the total income of the assessee considering the same as unexplained investment u/s 69 of the Act. Further the addition is to be taxed at @ 60% as per provision of section 115BBE of the I.T. Act.” .” 8.2 The CIT (A) confirmed the addition in the light of finding given at para 6.2 at page 41-42 of his order, which is as under: - “The fact is that a bill was found and annexurised at page nos. 31 to 35 of Exhibit AS-3 which was seized from D-275, Todarmal Marg, Bank Park, Jaipur. Another bill was found and annexurised at page nos. 47 to 52. The claim of the appellant is that these are not separate bills but copies of the same bill raised by one Sh. Prabhu Dayal for work done at the appellant’s place on account of extra work. Then the appellant claims that instead of original amount of Rs. 5,10,132/- mentioned in the bill it was corrected for Rs. 4,84,050/- by the site supervisor on account of extra work for the construction done at Plot No. D-280, Todarmal Park, Bani Park, Jaipur. I have gone through the Exhibits and the reply and the following conclusion is made :- 1) The papers at page nos. 31 to 35 and 47 to 52 are same papers as at pages 31 to 35 but these have been corrected by the site supervisor and the amount reduced from Rs. 5,10,132/- to Rs. 4,84,050/-. 2) The final amount to be treated for addition of Rs. 4,84,050/- has been rightly taken by the ld. Assessing Officer on account of the above discussion of correction of figures by the site supervisor. 3) The same paper was considered in the AY 2018-19 for Rs. 5,10,132/- and that would have tantamounted to double addition and since it has been considered in the year under discussion to which it belongs , hence it has been rightly considered as pertaining to AY 2020-21. The resultant effect to not consider in AY 2018-19 is being dealt accordingly in the appeal for AY 2018-19 4) The rest of the submission and details for reduction of the extra amount work to Rs. 1,24,000/- do not hold merit because the extra work estimate has been found with the assessee and corrected to the real amount by the site supervisor and all the details mentioned therein and the bill raised by Shri Prabhu Dayal (Page 43, Exhibit-3) clearly mentioning extra work related to ‘Boundary Wall and ‘KatchaPakka’ make it abundantly clear that the final amount paid out of books for extra work done was of Rs. 4,84,050/- and hence this ground of appeal does not hold merit on account of above factual matrix and consequent discussion and deserves rejection. Hence, this ground of appeal is rejected. Printed from counselvise.com 51 ITA No. 972 To 974/JPR/2025 Vinay Dugar, Jaipur. 8.3 The ld. AR vehemently argued the case in the light of paper book filed by him and also detailed written submission to support the various grounds raised in appeal. The written submission filed by A.R. of the assessee regarding this ground of appeal is as under: - 1. The impinged addition was made on the basis of noting of seized document marked as Page No. 31 to 35 of seized Exhibit AS-3, which was seized from D-275, Todarmal Marg, Bani Park, Jaipur. The copy of seized page is at PB Page 23 to 33. This seized document is bill submitted by Shri Prabhu Dayal Sharma for extra work. On the basis of amount found noted at the bottom of Page 31 Rs. 4,84,050/- (Copy at PB Page 27) was presumed by Ld. A.O. that the assessee made this much of unaccounted payment to Shri Prabhu Dayal. 2. The bill raised by the contractor for Rs. 4,84,050/- was not correct and this amount was not payable by the assessee. Ultimately, the amount against the extra work was settled for Rs. 1,24,000/- . The assessee filed sworn affidavit of the contractor Prabhu Dayal copy of which is at PB page 259-261. The copy of the payment vouchers filed before the ld AO is at PB page 262-267. The ld AO did not make any further inquiry and rejected the explanation and evidence filed before the ld AO in summary manner. In view of above submission, the humble assessee prays your honor kindly to delete the addition of Rs. 4,84,050/- made by ld. A.O. and confirmed by ld CIT(A) as the same is unwarranted and deserve to be deleted. 8.4 Per contra, the ld. DR submitted that there is no infirmity in the Assessment orders passed by ld AO. He relied upon the findings made by ld CIT(A). Printed from counselvise.com 52 ITA No. 972 To 974/JPR/2025 Vinay Dugar, Jaipur. 9. We have heard the rival contentions and perused the material available on record. We noted that the impugned addition was made solely on the basis of the bill submitted by the contractor. Initially, the contractor made bill for extra work for Rs. 5,10,132/- which was revised to Rs. 4,84,050/-There is no evidence on record, which may show that the bill raised by the contractor was paid. Therefore, the addition made by Ld. A.O. is sheer presumption, whereon the ld AO presumed that the payment of bill was made in cash and the same is out of unaccounted income of the assessee. On the other hands, the claim of assessee i.e. the bill of Rs. 4,84,050/- was finally settled for Rs. 1,24,000/- only and the payment of the same was made which is duly recorded in books of accounts and supported by the documents and the ld AO has not pointed out any defect in the documents submitted by the assessee. The assessee filed the payment vouchers and sworn affidavit of contractor Shri Prabhu Dayal, wherein he affirmed the facts of settling the bill of Rs. 4,84,050/- at Rs. 1,24,000/- only. The contents of the affidavits were neither controverted nor any inquiry was made thereon. Therefore, the sworn affidavit submitted should be accepted as admissible evidence and in this regard the reliance is placed on several decisions including decision of Jaipur ITAT in the case of Shri Nirmal Kumar Kedia ITA Nos. 124 to 126/JP/2019 And 286 to 288/JP/2019 order dated 06-06-2018. Therefore, once the submission of the assessee is supported by the admissible evidence, then there remains no reason to Printed from counselvise.com 53 ITA No. 972 To 974/JPR/2025 Vinay Dugar, Jaipur. make the addition by disregarding to the same. Therefore, under the facts and in the circumstances of the case, we hold that the ld AO has not justified in making the addition of Rs. 4,84,050/- and we set aside the findings of ld CIT(A) in this regard and direct the A.O. to delete the addition of Rs. 4,84,050/- made on account of alleged unexplained expenses in house construction. 10. In grounds No. 4 of the appeal for AY 2020-21 (ITA No 974/JPR/2025) the assessee has challenged the addition of Rs. 3,96,000/- made u/s 69C of the Act on account of unexplained household expenses. 10.1 The finding of Ld. A.O., in the light of which the addition was made is at Page 12 to 17 of the assessment order. At Page 12 to 16 of the assessment order, the Ld. A.O. tabulated the transactions found noted in seized Exhibit- AS-6 and on the basis of that the addition of Rs. 3,96,600/- was made for this year. Further, the noting on which the date was not mentioned, has been treated as the expenses made during the year under consideration. The concluding finding given by Ld. A.O. in support of the addition is as under: - “Therefore, during the course of assessment proceedings, the assessee was asked to furnish the source of these household expenses. But the assessee has not furnished anything in this regard. As assessee has not furnished any explanation for the source of these household expenses, the provisions of section 69C automatically comes into effect which reads as under: Printed from counselvise.com 54 ITA No. 972 To 974/JPR/2025 Vinay Dugar, Jaipur. Where in any financial year an assessee has incurred any expenditure and he offer no explanation about the source of such expenditure or part thereof, or the explanation, if any, offered by him is not, in the opinion of the Assessing Officer, satisfactory, the amount covered by such expenditure or part thereof, as the case may be, may be deemed to be the income of the assessee for such financial year.” In view of the above, an amount of Rs.3,96,600/- is being added to the total income of the assessee. Further the addition is to be taxed at @ 60% as per provision of section 115BBE of the I.T. Act.” 10.2 The CIT (A) confirmed the addition in the light of finding given at para 7.2 at page 48-50 of his order, which is as under: - “The fact remains that during the course of the search a diary was seized which contained the details of household and other expenses. It is noticed from the assessment order that the ld. Assessing Officer has tabulated all the details of the diary in a running format giving details of the narration of the entry with amounts and the pertaining financial year. During the assessment proceedings the ld. Assessing officer asked the assessee to provide the details for the same but no explanation was provided by the assessee in this regard. For want of any proper explanation, the ld. Assessing Officer made an addition u/s 69C on this account. Now during the appellate proceedings, the assessee’s A/R has submitted that the diary was containing rough and memorandum noting regarding the expenses of household nature and was being maintained by the wife of the assessee. He has further contended that the ld. Assessing officer did not take into consideration the fact that the amount noted in seized documents are in the nature of household expenses and the same are incurred by the assessee group out of withdrawls made for household expenses. It will be appropriate to refer to sub section (4A) of section 132, which states that where any books of account are found at the time of search are presumed to be true and that these belong to the person from whose residence the same are seized. Relevant portion of 132(4A) is reproduced as below:- “……..Sec(4A) Where any books of account, other documents, money, bullion, jewellery or other valuable article or thing are or is found in the possession or control of any person in the course of a search, it may be presumed – (i) that such books of account, other documents, money, bullion, jewellery or other valuable article or thing belong or belongs to such person; Printed from counselvise.com 55 ITA No. 972 To 974/JPR/2025 Vinay Dugar, Jaipur. (ii) that the contents of such books of account and other documents are true ; and (iii) that the signature and every other part of such books of account and other documents which purport to be in the handwriting of any particular person or which may reasonable by assumed to have been signed by…………” Thus the Act itself provides for the truth fullness of the seized documents. The appellant has himself conceded that the entries made in the said diary are in the handwriting of Smt. Suman Dugar, wife of the appellant and has also submitted that in usual practice in the house, husband gives lump sum money to the wife for incurring day to day household expenses. Therefore the notings being on the handwriting of the appellant’s wife is not unusual and the appellant’s stand that no addition should be made in his hands on this issue is contradictory to his own submissions. I have noticed that the narration in the diary is in the nature of household expense like school fees, teacher fees, servant advances, etc. and the nature of narration of the entries are considered in the same manner both by the ld. Assessing Officer as well as the assessee. While the assessee claims these to be expenses out of the withdrawls of the assessee’s family, no such details have been provided by the assessee either at the assessment stage or now during the appellate proceedings. I have noted that the assessed has merely made the above contention without supporting it with any evidence of corresponding withdrawls or supportive explanation. In view of the above discussion and for want of any supportive evidence from the assessee to explain these household expenses entries from corresponding withdrawls, I find that the explanation of the assessee is far from satisfactory to say the least and the addition of Rs. 3,96,900/- made by the ld. Assessing Officer on this ground is on strong footing and deserves no relief. This ground of appeal is rejected.” 10.3 The Ld. AR vehemently argued the case in the light of paper book filed by him and also detailed written submission to support the various grounds raised in appeal. The written submission filed by AR of the assessee regarding this ground of appeal is as under: - 1. The Income Tax department carried out search & seizure operation over the assessee and his family members on 28.06.2019. During the course of search a diary marked as Exhibit-6 was found & seized from the residence of the assessee Printed from counselvise.com 56 ITA No. 972 To 974/JPR/2025 Vinay Dugar, Jaipur. group. Such diary was being maintained by the wife of the assessee in which she was making the memorandum noting, majorly regarding the household expenses. Since, the diary was pertaining to the wife of the assessee and the noted payments are pertaining to the entire family of the assessee, therefore the same without any reason cannot be added in the hands of the assessee. 2. So far as the noting of the pages, on the basis of addition has been made, we may submit as under: - Page No. Copy at PB Page Amount as per seized record Amount which reflects actual transaction (i.e. not rough noting or repetition) Explanation 1 35 30,000 5,500 (i) The page does not contain any date, however since the noting of the subsequent pages is pertaining to F. Y. 2010-11, therefore this noting cannot be pertaining to A.Y. 2020-21. (ii) The noting of the page reflects that the amount of Rs. 30,000/- was payable to the servant against which only payment of Rs. 5500/- was made, the seized record nowhere shows the noting regarding the balance payment. (iii) Otherwise also, this noting is regarding the payment to domestic servant and payment of which always be part of household expenses, which of the year under consideration was Rs. 12.95 lacs, which is much more than to this payment. back side 58 3,600 3,600 The page does not contain any date, however on this page the Printed from counselvise.com 57 ITA No. 972 To 974/JPR/2025 Vinay Dugar, Jaipur. of 22 month July-August and September has been written and since the year under consideration is a search year, which carried out in the month of June-2019, therefore the noting cannot be pertaining to the year under consideration. 24 60 1,68,000 1,68,000 (i) As per the noting of the page no payment towards the salary of 2019 was made to this person and only payment due/payable in future against salary is only written for memorandum purpose. There is no material that whether this amount was actually been paid or if paid on which date the same was paid. (ii) Further, memorandum amount Rs. 1,68,000/- of salary of the entire year 2019 has been written and since the department carried out search in June-2019 and only two months of the year were only passed, therefore the salary of the year was due Rs. 18,000/- only and in no case the addition of Rs. 1,68,000/- can be made. (iii) Otherwise also, this noting is regarding the payment to domestic servant and payment of which always be part of household expenses, which of the year under consideration was Rs. 12.95 lacs, which is much more than to this payment. Printed from counselvise.com 58 ITA No. 972 To 974/JPR/2025 Vinay Dugar, Jaipur. 32 68 40,000 - The page does not contain any date, however on this page the month March has been written and since the year under consideration is a search year, which carried out in the month of June-2019, therefore the noting cannot be pertaining to the year under consideration. 32 68 48,000 - The page does not contain any date, however on this page the month July to November has been written and since the year under consideration is a search year, which carried out in the month of June-2019, therefore the noting cannot be pertaining to the year under consideration. back side of 33 70 8,700 8,700 (i) The page does not contain any date, however since the noting of the subsequent pages is pertaining to F. Y. 2015-16 and 2016-17, therefore this noting cannot be pertaining to A.Y. 2020-21. (ii) Otherwise also, this noting is regarding the payment to domestic servant and payment of which always be part of household expenses, which of the year under consideration was Rs. 12.95 lacs, which is much more than to this payment. 35 72 5,000 5,000 The page does not contain any date, however on this page the month July and August has been written and since the year under consideration is a search year, which carried out in the month of June-2019, therefore the noting cannot be pertaining to the year under consideration. Printed from counselvise.com 59 ITA No. 972 To 974/JPR/2025 Vinay Dugar, Jaipur. 41 78 61,200 17,200 The page does not contain any date, however on this page the month May to August has been written and since the year under consideration is a search year, which carried out in the month of June-2019, therefore the noting cannot be pertaining to the year under consideration. 51 88 10,000 10,000 The page itself does not contain any date, however since the noting of the previous and subsequent pages is pertaining to F. Y. 2011-12 to 2015-16, therefore this noting cannot be pertaining to A.Y. 2020-21. 51 88 18,000 - i) Only due payment is written on this page. ii) The page itself does not contain any date, however since the noting of the previous and subsequent pages is pertaining to F. Y. 2011-12 to 2015-16, therefore this noting cannot be pertaining to A.Y. 2020-21. iii) Otherwise also, this noting is regarding the payment to domestic servant and payment of which always be part of household expenses, which of the year under consideration was Rs. 12.95 lacs, which is much more than to this payment. 52 4,100 4,100 The date is explicitly written on this page, which is 18.02.2012 i.e. A.Y. 2012-13, hence the same does not pertaining to the year under consideration. Printed from counselvise.com 60 ITA No. 972 To 974/JPR/2025 Vinay Dugar, Jaipur. 3. On perusal of these pages your honour will find that the noting on the pages are rough memorandum noting and on the basis of most of the pages the actual payment which were finally made, cannot be ascertained from this rough diary, therefore no adverse cognizance can be taken on the basis of these papers. The ld. AO added the amount noted as payable as well as amount noted as paid. This shows that the addition was made in hypothetical and mechanical manner, without ascertaining the actual payments and this also resulted the double addition of same transaction. 4. As submitted earlier, the seized diary was being maintained by the wife of the assessee and the same is in her handwriting. In this diary she made the rough memorandum noting, which includes the noting made regarding the household expenses, which were incurred out of the funds made available by the assessee against household expenses. It is usual practice in house, that family members give lump sum money to wife against household expenses and out of that wife incurs day to day expenses. The total withdraws against the household expenses were much more that the expenses recorded in the diary. Therefore, the addition on the basis of this diary in the hands of the assessee is not justified and tenable. It is also pertinent to mention here that apart from the assessee, there were seven other earnings members in the family, whose assessments were also completed by the same AO. Therefore, the presumption taken by ld. AO that the entire payments, as presumed to be made on the basis of seized record, was made by assessee alone and out of undisclosed income is not justifiable more so when the department has carried out intensive search over the assessee and no source of undisclosed income was found as the result of intensive search and rummage of all corners of house and office. 5. The total drawings of the family of the assessee for Household etc., of the year under consideration, was of Rs. 12.95 lacs, which is much more then to the amount worked out by ld. AO on the basis of seized diary. Therefore, the presumption taken by ld. AO that these payments were made over & above to withdrawals made towards household expenses is not correct. In view of above submission, the humble assessee prays your honor kindly to delete the addition of Rs. 3,96,000/- made by ld. A.O. and confirmed by ld CIT(A) as the same is unwarranted and deserve to be deleted.” Printed from counselvise.com 61 ITA No. 972 To 974/JPR/2025 Vinay Dugar, Jaipur. 10.4 Per contra, the ld. DR submitted that there is no infirmity in the Assessment order passed by ld. AO. He relied upon the findings made by ld CIT(A). 11. We have heard the rival contentions and perused the material available on record. We noted that the impugned addition was made on the basis of a diary which was being maintained by the wife of the assessee, in which she was making the memorandum noting, majorly regarding the household expenses. On the basis of noting of such diary the payments of Rs. 3,96,000/- were worked out by Ld. AO and presuming to same as unexplained the same was treated as income of assessee. It was submitted that in this diary, the wife of the assessee made the memorandum noting of payment made for house hold expenses, which were incurred out of the funds made available to her by the assessee and his other family members against household expenses. It is also submitted that it is a usual practice in house, that lump sum money is given to ladies of the house for household expenses and out of that the ladies incurs day to day expenses. The Ld. AR of the assessee submitted that during the year total household withdrawals of the assessee and his family members were of Rs. 12.95 lacs, which is much more than to the payment found noted in the diary and out of such withdrawal the payment noted in the diary was made. It is also submitted that apart from the Printed from counselvise.com 62 ITA No. 972 To 974/JPR/2025 Vinay Dugar, Jaipur. assessee, there were seven other earnings members in the family, whose assessments were also completed by the same AO. Therefore, the presumption taken by ld. AO that the entire payments, as presumed to be made on the basis of seized record, was made by assessee alone and out of undisclosed income of the assessee is not justifiable. On perusal of the facts of the case it is an undisputed fact that the diary on the basis of which the addition was made was in the handwriting of wife of assessee and in such diary the payment of household expenses was made. The assessee submitted the detail of household withdrawals of the family and such withdrawal are much more than to the payments noted in such diary. Therefore, in absence of any contra material the sheer presumption which one can take is that the payments were made out of withdrawals made by the family for their household expenses. There is no finding or evidence on record that the payment noted in the diary were not meet out from the household withdrawal recorded in books of accounts. Therefore, under the facts and in the circumstances of the case we hold that the ld AO has not justified in making the addition of Rs. 3,96,000/- against unexplained household expenses u/s 69C of I. Tax Act and we set aside the findings of ld CIT(A) in this regard and direct the A.O. to delete the addition of Rs. 3,96,000/- made on account of alleged unexplained household expenses u/s 69C of the Act . Printed from counselvise.com 63 ITA No. 972 To 974/JPR/2025 Vinay Dugar, Jaipur. 12. In the result, the appeal in ITA no. 974/JPR/2025 filed by the assessee is partly allowed. 13. Ground No 1 in AY 2014-15 (ITA No 972/JPR/2025) and AY 2015-16 (ITA NO 973/JPR/2025) is against addition of Rs. 2,10,600/- and Rs. 4,08,900/- respectively against household expenses u/s 69C. The Ground No 1 in AY 2014-15 and AY 2015-16 and Ground No 4 in AY 2020- 21 are against addition against household expenses u/s 69C of the Act and is common in these appeals and are inter related and on identical facts except the difference in figure disputed in each year. Therefore, we are not repeating the facts, various grounds raised by the assessee and the arguments of both the parties in these appeals. We noted that the withdrawals against the household expenses by all the family members of the assessee were Rs. 13.25 Lacs in AY 2014-15 and Rs. 14.62 lacs in AY 2015-16 as against the household expenses of Rs. 2,10,600/- and Rs. 4,08,600/- respectively found noted in seized documents which is much more than what found recorded in the seized documents. Therefore, our findings in Ground No. 4 of ITA No. 974/JPR/2025 for the Assessment Year 2020-21 shall apply mutatis mutandis in the case of assessee for ITA Nos. 972/JPR/2025 and 973/JPR/2025 and in view of the finding given for ground No. 4 of ITA No. 974/JPR/2025 the addition of Rs. 2,10,600/- made in A.Y. 2014-15 and Rs. Printed from counselvise.com 64 ITA No. 972 To 974/JPR/2025 Vinay Dugar, Jaipur. 4,08,900/- made A.Y. 2015-16 are directed to be deleted. Accordingly, the grounds No. 1 of the appeal for AY 2014-15 (ITA No 972/JPR/2025) and for AY 2015-16 (ITA No. 973/JPR/2025) is allowed. In the result, the appeals of the assessee are partly allowed. Order pronounced in the open court on 17/09/2025. Sd/- Sd/- ¼ xxu xks;y ½ ¼MkWa-,l-lhrky{eh½ (Gagan Goyal) (Dr. S. Seethalakshmi) ys[kk lnL; @Accountant Member U;kf;d lnL;@Judicial Member Tk;iqj@Jaipur fnukad@Dated:- 17/09/2025 *Santosh vkns'k dh izfrfyfivxzsf’kr@Copy of the order forwarded to: 1. The Appellant- Vinay Dugar, Jaipur, Jaipur. 2. izR;FkhZ@ The Respondent- ACIT, Central Circle-2, Jaipur. 3. vk;djvk;qDr@ The ld CIT 4. foHkkxh; izfrfuf/k] vk;djvihyh; vf/kdj.k] t;iqj@DR, ITAT, Jaipur 5. xkMZQkbZy@ Guard File ITA No. 972 to 974/JPR/2025) vkns'kkuqlkj@ By order, lgk;d iathdkj@Asstt. Registrar Printed from counselvise.com "