Unexplained jewellery addition under section 69A failed where evidence showed the seized items belonged to the daughter.

Additions for unexplained jewellery under section 69A were held unsustainable where a jointly held locker contained jewellery identified by the assessee as belonging to her daughter, and the daughter's affidavit supported that claim. The record did not contain material to discredit either the assessee's statement at search or the affidavit explaining that the jewellery had been received from parents and relatives on family occasions. Mere regular operation of the locker by the assessee was insufficient, on these facts, to presume exclusive ownership in her name, so the addition was deleted.

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Issues: Whether the addition made under section 69A of the Income-tax Act, 1961 towards jewellery found in a jointly held locker was sustainable when the assessee's statement and the daughter's affidavit stated that the jewellery belonged to the daughter.

Analysis: The locker was jointly held by the assessee and her daughter. At the time of search, the assessee stated that the jewellery belonged to her daughter, who was residing in the United Kingdom. The daughter also filed an affidavit stating that the seized jewellery belonged to her and had been received from her parents and relatives on family occasions. No material was brought on record to discredit the statement or the affidavit. Mere regular operation of the locker by the assessee did not, on these facts, justify a presumption that the jewellery exclusively belonged to the assessee.

Conclusion: The addition under section 69A was not justified and was deleted.

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