2019 (1) TMI 850 - AT - Income Tax

Tribunal Decides on Undisclosed Payments & Jewellery in Tax Appeal

Smt. Archana Agrawal Versus DCIT Central-1, Bhopal

Smt. Archana Agrawal Versus DCIT Central-1, Bhopal - TMI Issues:1. Undisclosed on-money payment for purchase of immovable property.2. Addition for undisclosed jewellery.3. Unexplained cash found during search.Issue 1: Undisclosed on-money payment for purchase of immovable propertyThe appeals were filed by the assessee against the orders of the Ld. Commissioner of Income Tax (Appeals) pertaining to Assessment Year 2008-09, 2011-12, and 2012-13. The appeals were directed against the orders under section 153A read with section 143(3) of the Income Tax Act, 1961. The assessee, an individual earning income from salary and business, faced allegations of paying on-money for the purchase of land without proper documentation. The Tribunal noted that the sellers had made statements about receiving on-money, but the assessee was not provided with an opportunity for cross-examination. In the interest of justice, the Tribunal decided to set aside the issues related to on-money payment and directed the Assessing Officer to summon the alleged sellers for cross-examination. The Tribunal emphasized the importance of providing a reasonable opportunity for the assessee to be heard. The appeals were allowed for statistical purposes.Issue 2: Addition for undisclosed jewelleryDuring a search, gold jewellery was found and seized from the assessee's residence and bank locker. The assessee failed to explain the source of the gold jewellery, leading to an addition. The Ld. CIT(A) granted a benefit of 800 grams of gold jewellery based on CBDT instructions, attributing portions to the assessee, her husband, and sons. The remaining addition for 1227 grams of gold jewellery was challenged by the assessee. The Tribunal, after considering the facts and circumstances, upheld the addition of unexplained gold jewellery of 1127 grams. However, regarding the addition for unexplained cash, the Tribunal found no justification for the addition of Rs. 64,815, considering the customs, savings habits, and regular income tax filing of the assessee. Therefore, the addition for unexplained cash was deleted, and the appeal was partly allowed.Issue 3: Unexplained cash found during searchThe Tribunal found no justification for the addition of Rs. 64,815 in unexplained cash found in the bank locker. Considering the savings habits and regular income tax filing of the assessee, the Tribunal deleted the addition. Ground No.3, which was general in nature, was not adjudicated upon. As a result, ITA No.189 & 190/Ind/2017 were allowed for statistical purposes, and ITA No.503/Ind/2017 was partly allowed.