2019 (2) TMI 1466 - AT - Income Tax

Tax Appeals Decisions: Partial Relief Granted for Unexplained Income & Jewellery

Narinder Mohan Jain, Meetu Jain, Shakuntala Jain And Vivek Jain Versus DCIT, Central Circle-5, New Delhi

Narinder Mohan Jain, Meetu Jain, Shakuntala Jain And Vivek Jain Versus DCIT, Central Circle-5, New Delhi - TMI Issues Involved:1. Addition of unexplained income in the form of cash found from the locker.2. Addition of unexplained jewellery found from the residence and locker.3. Addition of unexplained income in the form of cash found from the residence.Issue-wise Detailed Analysis:1. Addition of Unexplained Income in the Form of Cash Found from the Locker:The primary issue in ITA No. 2928/Del/2017 pertains to the addition of Rs. 1,70,000 made by the Assessing Officer (AO) under Section 69A of the Income Tax Act, 1961, which was upheld by the Commissioner of Income Tax (Appeals) [CIT(A)]. The cash was found in a locker belonging to the appellant and his wife during a search conducted on 30/09/2013. The appellant provided multiple explanations for the source of the cash, including savings from family members and proceeds from the sale of a car. However, these explanations were found to be contradictory. The appellant also submitted bank statements showing regular withdrawals. The Tribunal concluded that the appellant should be given credit for Rs. 1,20,000 based on these withdrawals, reducing the addition to Rs. 50,000. Thus, the appeal was partly allowed.2. Addition of Unexplained Jewellery Found from the Residence and Locker:In ITA No. 2929/Del/2017, the issue revolves around the addition of Rs. 19,60,439 out of a total of Rs. 38,49,749 made by the AO for unexplained jewellery found during the search. The jewellery was valued at Rs. 29,63,213 from the residence and Rs. 8,86,536 from a locker. The appellant argued that the jewellery was received as gifts during various occasions and submitted affidavits from family members to support this claim. The CIT(A) granted an allowance for 600 grams of jewellery but confirmed the balance addition. The Tribunal directed the AO to follow the Gujarat High Court's decision in CIT vs. Ratanlal Veparilal Jain and grant the benefit of CBDT Instruction No. 1916, which provides guidelines for non-seizure of jewellery. The appeal was partly allowed for statistical purposes.Similarly, in ITA No. 2930/Del/2017, the issue was the addition of Rs. 12,24,625 out of Rs. 17,68,012 for unexplained jewellery found from Mrs. Shakuntala Jain. The Tribunal directed the AO to grant the benefit of CBDT Instruction No. 1916, following the Gujarat High Court's decision, and partly allowed the appeal for statistical purposes.3. Addition of Unexplained Income in the Form of Cash Found from the Residence:In ITA No. 2931/Del/2017, the issue pertains to the addition of Rs. 1,03,800 made by the AO under Section 69A for unexplained cash found at the residence of Mr. Vivek Jain. The appellant claimed the cash was from gifts received on various occasions. The AO and CIT(A) found the explanation unsatisfactory. The appellant also argued that during demonetization, deposits up to Rs. 2,50,000 were not questioned, but the Tribunal rejected this argument, stating it was not applicable to the case. The Tribunal confirmed the addition, dismissing the appeal.Conclusion:All four appeals were disposed of accordingly, with partial relief granted in some cases and dismissals in others. The Tribunal's decisions were pronounced in the open court on 19/02/2019.