2016 (12) TMI 169 - AT - Income Tax

ITAT upholds addition of unexplained jewellery as income for AY 2012-13.

Mr. Shivaji R. Mohite Versus ACIT, Central Circle, Kolhapur

The ITAT Pune upheld the CIT(A)'s decision to confirm the addition of unexplained gold jewellery and silver articles as income for Assessment Year ... Unexplained gold jewellery and silver articles - additions appreciating the fact such as wealth tax return, VDIS disclosure, streedhan, CBDT Circular, gift on marriage application and inherited articles - Held that:- CIT(A) upheld the action of the AO on the ground that assessee could not produce any evidence in support of any of the claim made by him. The reason given by the CIT(A) while sustaining the addition made by the AO has already been reproduced in the preceding paragraph. Since the AO has already granted sufficient relief to the assessee on the basis of evidences produced before him despite the admission of the assessee during the course of search in his statement recorded u/s.132(4) and since no other evidence was produced before the CIT(A) or even before us, therefore, we do not find any infirmity in the order of the CIT(A) upholding the addition made by the AO. Accordingly, the order of the CIT(A) being a reasoned one is upheld and the ground raised by the assessee is dismissed. Issues:- Addition of unexplained gold jewellery and silver articles.Analysis:The appeal was against the order of the CIT(A) confirming additions made by the AO on account of unexplained gold jewellery and silver articles for the Assessment Year 2012-13. During a search under section 132 of the I.T. Act, cash and jewellery were found, with a portion seized. The assessee declared unexplained investments in gold jewellery and silver articles during the search, but later argued against the additions during assessment. The assessee provided explanations based on wealth tax returns, VDIS disclosure, Streedhan, CBDT Circular, gift on marriage, and inherited articles. However, both the AO and CIT(A) were not satisfied with the explanations provided by the assessee. The AO added the value of unexplained gold jewellery and silver articles as income, considering the lack of evidence to prove the source of the items. The CIT(A) upheld the AO's decision, noting the absence of documentary evidence supporting the assessee's claims. The CIT(A) emphasized that the assessee's initial disclosure during the search operation indicated awareness of undisclosed jewellery. The CIT(A) confirmed the additions made by the AO, leading to the dismissal of the appeal.The ITAT Pune considered the arguments presented and reviewed the material on record. The ITAT noted that the assessee had initially disclosed unexplained investments in gold jewellery and silver articles during the search but later sought to retract these disclosures during assessment. Despite the explanations provided by the assessee based on wealth tax returns, CBDT Circular, and other sources, the AO and CIT(A) found the evidence lacking to support the claims. The ITAT agreed with the lower authorities that the assessee failed to produce sufficient evidence to substantiate the origin of the jewellery and silver articles found during the search. Since the AO had already granted some relief to the assessee based on the evidence presented earlier, and no additional evidence was provided during subsequent proceedings, the ITAT upheld the CIT(A)'s reasoned decision to confirm the additions made by the AO. Consequently, the ITAT dismissed the appeal filed by the assessee, affirming the order of the CIT(A) regarding the addition of unexplained gold jewellery and silver articles.