Jewellery seizure limits under CBDT Circular 1916 applied in assessment; unexplained investment addition deleted

Jewellery and silver articles found during search were held to be within the limits contemplated by CBDT Circular No. 1916 dated 11.05.1994, which provides non-seizure norms for married ladies, unmarried ladies and males and may also guide assessment proceedings. On the facts, the family included three lady members and the jewellery was treated as falling within the permissible norm. The presumption that the jewellery was unexplained was therefore not sustainable, and the addition sustained by the lower appellate authority was deleted.

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Issues: Whether the addition sustained in respect of jewellery and silver articles found during search was justified in view of CBDT Circular No. 1916 dated 11.05.1994.

Analysis: The Circular contemplates non-seizure of jewellery up to specified limits for married ladies, unmarried ladies and males, and the same guideline is to be taken into account in assessment proceedings as well. The family comprised three lady members, and the jewellery found was considered within the permissible norm. On that basis, the presumption that the jewellery was unexplained was not sustainable.

Conclusion: The addition of Rs. 2,00,000 sustained by the lower appellate authority was deleted and the assessee succeeded on the issue.

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