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TaxTMI 
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TaxTMI 
2014 (9) TMI 269
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.... to have appreciated the fact that the assessee had emphatically proved payment of Rs. 34,85,767/- towards electricity charges which fact was accepted both by the Assessing Officer as also the CIT(A). 4. The CIT(A) erred in enhancing the addition of Rs. 34,85,767/- on totally irrelevant considerations. 5. The CIT(A) ought to have appreciated that the liability towards electricity was crystallized and ascertained subsequent to take over of the unit by the assessee. 6. The CIT(A) failed to note that along with the liability, the electricity deposit of Rs. 78,70,191/- was also transferred to the assessee against which the liability for electricity can be adjusted." 3. The sum and substance of the said grounds relates to the enhancement of addition made by the CIT(A). 4. Briefly the facts relating the said grounds are that the assessee claimed electricity expenses of Rs. 34,85,767/-. The Assessing Officer disallowed 25% of the said expenditure by holding that the payment towards the electricity charges was not commensurate with the business activity of the assessee. 5. Before the CIT(A), it was submitted that it is an accepted legal principle that in the absence of any specific d....
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....e's claim in this regard is that since it had taken over the said Mahaveer Ferro Alloys with all assets and liabilities, the liability which is ascertained subsequent to its take over by the assessee had to be discharged by the assessee, appears reasonable and logical. In support of the admissibility of the said deduction, it was argued that discharge of liability crystallized during the relevant account is allowable as decided in the case of CIT Vs Veekay Engineering Corporation (2010) 323 ITR 252 (Chattisgarh). As could be made out of the above facts, the liability towards electricity charges has been crystallized during the FY 2008-09, relevant for the AY 2009-10 and an allowable expense, as it relate to the business paid by cheque and it is not justified in disallowing a portion of expenses, purely on estimation basis. 6.1 However, it was observed by the CIT(A) and found that the agreement between the assessee company and M/s Mahavir Ferro Alloys, the proprietary concern of Mr.Ramprasad Agarwal that deciding the liability of electricity charges. As per the agreement, the assessee company is responsible for all the liabilities standing in books as on 1.4.2008 alone and list....
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....he expenditure of Rs. 34,85,767/- is disallowable in its entirety as against the disallowance of Rs. 8,71,441 made by the Assessing Officer. 6.3 On the proposal for treating the entire amount of Rs. 34,85,767 as disallowable, for the reason that the liability do not pertain to the assessee since the said liability has arisen subsequent to the agreement dt.1.4.2008 by virtue of which the unit of Mahavir Ferro Alloys taken over by the assessee company and where agreement is clear about the liabilities and assets for which the assessee company is responsible for, the assessee furnished the written submissions dt.28.11.2011. It was submitted that the liability to pay electricity charges amounting to Rs. 34,85,767 was crystallized on 18.2.2009 and there is no way for the assessee to dishonor the payment of the same in which case the power supply will not be continued resulting in hampering of continued business activity. It was further submitted that as a prudent businessman and in view of the business expediency, the assessee had to make the payment to see the unit getting the regular power supply. Accordingly, the assessee has discharged the liability partly during the year with bala....
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....case if it is discharged by the assessee company, Mr.Ramprasad Agarwal would be indemnifying such payments. There is no undertaking by Mr.Ramprasad Agarwal nor there are any entries related to this, in the books of account. Even, on that count the liability would have been the expense of Mr.Ramprasad Agarwal, but not the company. Under the circumstances, such expenses cannot be treated as the liability of the assessee and as such it is not allowable as expenses being the expense not relatable to the business. Hence, the submission of the assessee is rejected on the basis of the facts and the entire amount stands disallowed as against only a part of it (Rs.8,71,441) which was disallowed by the Assessing Officer in assessment order. Accordingly, this addition stands enhanced by the CIT(A). 7. Aggrieved by the order of the CIT(A), the assessee is in appeal before us. 8. The learned AR of the assessee submitted that the liability for enhanced payment of electricity was crystallized vide letter dated 13/02/2009 of the AP Electricity Board, which is placed at page 46 of the paper book and the said electricity charges are debited to the P&L Account, which is placed at page 39 of the pap....
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....d a successor to the business with all assets and liabilities is entitled to write off the amounts as bad debt. According to the assessee, as per MOU, the assessee has taken all assets and liabilities including electricity deposit , being so, the liability incurred towards electricity charges of erstwhile firm to be allowed as an expenditure. After going through the agreement entered by the assessee with M/s Ramkumar Agarwal on 01/04/2008, the assessee has taken all assets and liability as per Annexure-A to the agreement. There is no mentioning of this liability, which Ramkumar Agrwal is required to be incurred towards business taken over by the assessee. Assessee is entitled for assets mentioned in the Annexure-A to the agreement and the assessee is liable for liabilities mentioned therein. In our opinion, the assessee cannot claim any liability other than the mentioned in the Annexure-A to the agreement. Being so, the judgment relied upon by the assessee's counsel in the case of T. Veerabhadra Rao, T. Koteswara Rao & Co. cited supra cannot be applied to the facts of the case. Further, there is no question of adjusting this liability with electricity deposit as this deposit is ind....
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....in his mind; and that he had merely assumed the said amount of Rs. 1,31,00,000/- as unexplained deposit received during the previous year that too against the sales which is factually incorrect and brought the same to tax. 15. After considering the submissions of the assessee, the CIT(A) observed that the facts relating to this transaction is that M/s Mahavir Ferro Alloys leased its unit to Team Ferro Alloys Pvt Ltd and received a deposit of Rs. 1,31,00,000/-. But with effect from 1-4-2008, the said Mahavir Ferro Alloys unit was taken over by the assessee as per agreement dated 1-4-2008 and taken over the liabilities along with the assets which include the amounts under reference. Copy of the deed dated 1-4-2008 executed between the assessee and Mahavir Ferro Alloys while taking over the plant, has been obtained and perused by CIT(A). Clause (1) of the said agreement stipulate that "the running business of Mahavir Ferro Alloys which has been given on lease to Team Ferro Alloys Pvt Ltd by the second party shall stand transferred and vested in Sri Shiva Spinning Mills Pvt Ltd with effect from 1-4- 2008 with all its assets, obligations and liabilities as stated in Annexure - A annexe....
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....rro Alloys Pvt Ltd and received lease amount of Rs. 96,00,000/- for the period of one year starting from 1.4.2008. The assessee treated the receipt of Rs. 96 lakhs as business income and after meeting the expenses, the resultant net income of Rs. 35,04,318/- was offered to tax. However, the Assessing Officer treated the entire amount of lease rent of Rs. 96 lakhs and brought it to tax by disallowing all the expenses that have been claimed by the assessee. Since income of Rs. 35,04,318/- was already admitted by the assessee, the difference of Rs. 60,95,683/- was brought to tax as income from other sources. 19.1 While treating the said lease rent as 'income from the other sources', the Assessing Officer made the following/findings vide para no.4.1 of assessment order : "In the audit report in Form 3CD, the assessee has claimed that it has also started lease rent business and this is the first of such business. However, no documentary evidence like minutes of share holders meeting, alteration to the memorandum of articles of the association of the company have been produced. It is a clear case where assessee has only let out a part of its property. Hence, the rental amount r....
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.... temporary period mainly because it is the first year of acquisition; and the assessee-company requires the necessary wherewithal to run the unit on its own." 21. Further, the AR submitted that the lease by M/s Sri Shiva Spinning Mills Pvt Ltd with that of Team Ferro Alloys Pvt Ltd is not supported by written lease agreement and the term of the lease is stated to be one year starting from 1.4.2008. The assessee company stated to have reduced such agreement into writing, only on 1.7.2009 with the stipulation of lease rent for a period of three years from the date of signing of lease deed. It is also stated that the unit was acquired by the assessee on 1-4-2008 and before its takeover, the previous owner of the unit i.e. Mr.Ramprasad Agarwal had also leased the said unit to the existing lessee i.e. Mls Team Ferro Alloys Pvt Ltd. It has been submitted that in view of the practical difficulties such as inexperience in setting-up and running of the business, the assessee decided to continue the lease for a temporary period of one year with the existing lessee of Mr.Ramprasad Agarwal immediately after taking over of the unit. It is further submitted that in the first year of take over i....
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.... the manufacturing activity is continued with the wear and tear of the plant & machinery. Further, this year being the transit year for the assessee, for commencement of business of manufacturing with the unit was taken over on 1st of April, 2008 was leased out on short term basis but converted to long lease, subsequently in the year 2009-10. Even otherwise, should the said income to be taxed as income from other sources, the assessee is entitled for the expenses such as depreciation and interest on bank loan, etc. which are directly related to the income, as per the provisions of sec.S7 of the I.T. Act,1961. This aspect was completely ignored by the Assessing Officer. 22.1 The CIT(A) further observed that assuming that lease rent to be treated as income from property/rent, as per the provisions of sec.194-I of the I.T. Act, 1961, under which the TDS was made for the payments related to the said lease rent, as referred in the assessment order, the assessee is eligible for standard deductions as per sec.24 of the I.T. Act,1961. This was also not taken into consideration while making the additions by the Assessing Officer. Further, the expenses to the tune of Rs. 34,85,767, under th....
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....essee company has leased its whole unit consisting of land, plant & machinery and was fetching it the lease rent. Against the lease rents received, the assessee company shown to have incurred some expenses mainly falling under the head 'depreciation' (Rs.27,87,107), 'interest on bank loan' (Rs.9,30,609) and 'electrical charges' (Rs.34,85,767) and claimed in arriving at the profit under the head 'business income'. However, the Assessing Officer concluded that the lease rent was received on account of letting out part of its property alone. Whereas the CIT(A) observed that assuming that lease rent to be treated as income from property/rent, as per the provisions of sec.194-I of the I.T. Act, 1961, under which the TDS was made for the payments related to the said lease rent, as referred in the assessment order, the assessee is eligible for standard deductions as per sec.24 of the I.T. Act,1961. This was also not taken into consideration while making the additions by the Assessing Officer. Further, the expenses to the tune of Rs. 34,85,767, under the head 'electrical charges' claimed by the assessee has already been disallowed for the year under ....
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....na Steel Centre, which were issued in terms of S.194-Iof the Act, showing the income under the head 'rent '. But for the reliance on the said TDS certificates, the assessing officer has not made any serious effort to ascertain the intention behind the leasing out of the assets, nexus of the business of the assessee with the exploitation of the assets, and composition of the total income of the assessee, and such other factors which clinch the issue relating to determination of the head under which the lease rental is assessable. In the appellate proceedings, the assessee explained these factors to support its stand for assessing the lease rental income under the head 'business' only. We find that the impugned orders of the CIT(A) are based on mere appreciation of thematerial available on record, and no specific material amounting to additional evidence, entertained by the CIT(A) in violation of Rule 46A of the Act, has been brought to our notice by the Learned Departmental Representative. It is evident from record that the assessee has leased out part of its commercial assets only for a temporary period of three years and the lease rentals received consisted of only a portion of it....
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.... appeal is directed against the order of the CIT(A)-VII, Hyderabad dated 30/11/2011. 32. Ground Nos. 1, 6 & 7 are general in nature. 33. Ground No. 2 to 5 are that the CIT(A) ought to have deleted the entire addition of Rs. 6,10,00,000/- made towards unexplained investment in M/s Maa Sachiya Sponge Iron (P) Ltd., Jalna instead of retaining addition to the extent of Rs. 18,25,000/- as unexplained. 34. The facts relating to this issue are that during the course of search proceedings, loose sheets containing certain notings were seized, marked as Annexure MIP/A/2. Mr. Ramprasad Agarwal, son of the assessee was examined on oath on the contents of the same. As per the contents of the seized document, the assessee group proposed to purchase the steel unit located at Jalna. On being questioned about the nature and details of the contents on the said document, it was confirmed as a document related to the proposal for taking over the sponge iron unit by name M/s. Maa Sachiya Sponge Iron (P) Ltd at Jalna and it was answered that an amount of Rs. 5.51 crores was the agreed amount against which some amounts were paid in the financial year 2007-08 & 2008-09. It was also submitted that the d....
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....dence that the assessee incurred substantial expenditure in the process of acquiring the company. " 34.3 The assessee contended that noting under the said document is a planning paper for acquisition of the unit, provided all the conditions are fulfilled. It was further submitted that during the course of search proceedings Mr. Ramprasad Agarwal was examined on the notings of the said loose sheet vide the sworn statement dt.22.5.2009, in which it was categorically stated that the proposal for taking over the company at Jalna was dropped because of some litigations, but an arrount of Rs. 15 lakhs was paid during the financial year 2007-08 and Rs. 23.5 lakhs paid during the financial year 2008- 09 and the said amount was recorded in the books of accounts. The further submissions of the assessee are reproduced, which are as under: "The Assessing officer disregarded the information furnished by the assessee even during the course of search and brought to tax the entire value of the Unit amounting to Rs. 6.10 crores as If the assessee invested the entire amount for acquisition of the said Company. The liability due to the Bank which should be discharged by the assessee if the Company ....
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....idence of cash payments ete. was purely on mere suspicion. As such, the said addition should be deleted. 34.4 It has been further contended that the assessment order is silent as to what was the evidence in the possession of the Assessing Officer to conclude involvement of substantial expenditure by the assessee when the contents of the document clearly indicate a bank liability. 35. After considering the findings/observations of the Assessing Officer and the submissions of the assessee along with the documents furnished, the CIT(A) observed that the Assessing Officer has arrived at some conclusions, based on the mere contents of the loose sheet, without enquiries and corroborative evidences and also while ignoring some of the contents of the said document. On the other hand, the assessee also do not appear to have concrete evidence to explain the transactions of the said document. Though the additions resorted to by the Assessing Officer are based on the documents that formed part of the seized material as referred above, the addition of entire amount of Rs. 6.10 crores, appear prima facie, do not stand on a ground that has been clearly established. The addition of entire propos....
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....ied by taking the other aspects such as the amounts actually paid and the embedded liabilities such as bank loans related to the purchase of the unit, into consideration. It is also found that some amounts were reduced from the agreed consideration such as the value towards the cost of the land retained by the owners of the unit, which has been confirmed by assessee and not disputed by the Assessing Officer either. On this basis, the net consideration agreed to be paid by the assessee was quantified at Rs. 1,43,20,245, in absence of any claims or counter claims and related information thereto computation is as under; Agreed consideration 6,00,00,000 Less: Cost of the land retained by owner of the unit 30,00,000 5,70,00,000 Less: Bank loan 4,26,79,755 1,43,20,245 35.3 The CIT(A) noted that the next issue remained unresolved is the amount paid or payable out of the said agreed consideration, with reference to notings in the seized material, as well as the contents of the sworn statements, apart from the submissions/information furnished by the assessee. As referred above, if the said consideration was to be taken at Rs. 6.0 crores as per the loose sheet, the balance amount paid o....
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....oned on the loose sheet which was nothing but copy of the fax sent by the other party, giving their offer. It was further explained that after reducing the figure of Rs. 30 lakhs towards the cost of the land retained by the owner and the bank loan of Rs. 4.26 crores, the net consideration payable or paid would be Rs. 1.33 crores after considering further amount of Rs. 10 lakhs shown to have paid through demand draft as per loose sheet. The assessee further stressed on the relevance of other liabilities that are reflected on the right side of the loose sheet under reference. Regarding the nature and details of the figures of Rs. 70,75,900 appearing on the right side of the loose sheet, the assessee has explained that they are the liabilities to be provided and discharged by the owner of the property. While explaining the details, it was indicated that Rs. 4 lakhs was shown as value of the generator set to be provided by the owner, Rs. 39.75 lakhs are the payments due to pollution, excise and was made by the owner, Rs. 11 lakhs is the payment to be made to ,Mr.Nanduji, the broker who arranged the deal, to whom the owner is to pay and Rs. 16.05 lakhs is the bank interest on existing l....
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....n contrast to the other presumption where the consideration is taken at Rs. 5.5l crores leaving excess payments as against the consideration payable. Under the circumstances, the CIT(A) observed that the consideration determined can be safely taken at Rs. 6.00 crores. 35.6 Regarding the issue of conclusion/stalemate on the takeover of the Jalna Unit, the CIT(A) noted that it has been explained by the assessee with the help of returns of income of the group, saying that there is no mention of the machinery or the generation of income by such unit. in any of the years, in the hands of any concerns or individuals of the assessee group. It was also submitted that, since the matter in dispute, it was not possible to obtain the confirmations from the other party to the deduction/agreement. 35.7 The CIT(A) held that in absence of any conclusive proof as regard to the transaction under reference, it is held that action of the Assessing Officer in assuming and coming to the conclusion that a transaction completed will only amounts to an hypothetical belief, not supported by any concrete evidence. Similarly, the action of the Assessing Officer in determining the cost of the transaction at ....
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.... financial year 2009-10, cannot be considered as explainable source for the above investment, as it has been paid in the subsequent year. Thus, the unexplainable investments with reference to the sources of income can be quantified at Rs. 18,25,000/- falling in two assessment years viz. AY 2008-09 and AY 2009-10. As the assessee Mr.Kantilal Agarwal, has undertaken to pay tax on the amounts as quantified above. The Assessing Officer is directed to recompute the income of the assessee by taking the said incomes in the relevant assessment years. 36. Aggrieved by the order of the CIT(A), the assessee is in appeal before us. 37. Before us, the learned AR submitted that the CIT(A) had not given credit for Rs. 15 lakhs investment shown in the return filed by the assessee for the AY 2009-10 on the ground that it was paid in the subsequent year. The learned AR further submitted that in the sworn deposition dated 22/05/2009, Sri Ramprasad while answering Q.No. 18 had clearly stated that during the process of negotiations payment of Rs. 15.00 lakhs made during FY 2007-08 and Rs. 23,50,000/- during the FY 2008-09. Therefore, the investment of Rs. 15 lakhs made in FY 2008-09 relevant to AY 20....
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....ile rejecting the contention of the assessee, the Assessing Officer has added the said amount in the hands of the assessee on protective basis. 43. Before the CIT(A), the assessee had submitted that this position is very much clear from the said bank account and after depositing the cash, cheques were issued by the assessee towards discharge of electricity dues pertaining to the said company. As such, the assessee submitted, that the deposits as well as the outgoings from the said Bank account pertain to the transactions of the M/s Mahavir Ispat Pvt Ltd. Thus, it was contended that it is relevant to treat the said deposits in the hands of the company and the addition of Rs. 58,42,800/- made on protective basis in the assessee's hands is to be deleted. In support of the said contention and submission, the assessee has furnished the confirmation letter from M/s Mahavir Ispat Pvt Ltd stating that the company is also in appeal for the said assessment year before CIT(A)-VII, Hyderabad in ITA No.1210/DCIT CC- 4/CIT(A)-VII/2010-11 and requested to consider the matter in the hands of company only and ignore the protective addition made in the hands of Sri Kantilal Agarwal. 44. After ....
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.... turnover. However, in our opinion, instead of applying rate of profit at 2.76% as income on unaccounted turnover, it is appropriate to determine the net profit on the basis of mean rate of net profit which was worked at 2.06%, as recorded by the CIT(A) in his order. This view of ours is supported by the decision of Vizag Bench of this Tribunal in the case of Prakash Arts Moving Media in ITA No. 305-308 and 348-351/Vizag/2008 dated 23.11.2010. Accordingly, we direct the AO to recompute the net profit on unaccounted turnover at Rs. 13,98,08,035 by applying the mean rate of net profit as mentioned in CIT(A)'s order at 2.06%. This ground of the assessee is allowed." 45.2 In view of the categorical finding given by the Tribunal in the said case, protective addition cannot be made in the hands of the Assessee as the addition on this count was made in the case of Mahavir Ispat Pvt. Ltd. Therefore, the ground raised by the revenue is dismissed. 46. In the result, appeal in ITA No. 250/Hyd/2012 of the revenue is dismissed. ITA NO. 266/HYD/2012 - Appeal by revenue for AY 2008-09 in case of M/s Shiva Spinning Mills P. Ltd. 47. The revenue has raised the following substantial grounds ....
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....from this, during the course of the scrutiny proceedings also, the Assessing Officer did not call for any information relating to this transaction. It is also totally incorrect on his part to say that the information was filed for the first time. Notwithstanding the A.O's observation, the assessee's wishes to explain the factual position relating to the transactions with Rain Calcining (RCL). RCL is a power supplying unit from whom the assessee purchases power. It had regular transactions with the RCL since several yeaRs. As on 31-3-2008 the assessee is due to pay an amount of Rs. 34,23,143/- to the said company for supply of power. The figure which is a liability was wrongly assumed by the A.O. as cash credit. The said liability was brought forward as on 1-4-2008 and the same was discharged by 31-3-2009 and the account was closed. In proof of trade transactions with the said RCL we are producing herewith copy of an invoice dated 29-3-2008 issued by the said RCL showing the amount due to them. As a matter of fact it may be stated that the entire liability of Rs. 34,23,143/- was discharged during the F. Y. 2008-09 relevant for the AY 2009- 10. The same is verifiable from th....
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....sessing officer did not ask for any information or clarification before resorting to the addition and the assessment order is also silent on this. Thus it cannot be said that the assessee failed to discharge the onus on it. As stated by the Assessing officer the balance sheet available before him indicated the amount due to the said RCL. In this regard, it is submitted that this liability was discharged in the financial year 2008- 09 (relevant for the AY 2009-10) and evidenced through copies of the relevant ledger accounts. Thus liability of Rs. 34,23,143/- to be discharged at the end of the accounting year cannot be considered as a credit within the meaning of section 68. The CIT(A) held that the facts further reveal that the liability is not an one time credit, but is the running account for an expense incurred for the business purpose. Being the power supplier to one of the units of the company, the liability arisen during the year, which has been discharged in the subsequent year. Under these circumstances, it cannot be treated as credit for the purpose of section 68 or the unexplained cash credit. Hence, the addition of Rs. 34,23,143/- is deleted. 52. Aggrieved, the revenue i....
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.... search & seizure proceedings, the Jewellery found belonging to assessee himself as well as the family members, was inventorised and valued. There is no dispute as regards to the quantum of the jewellery and silver ware found. The dispute is mainly related to the basis for quantification of the excess jewellery and the method 'of valuation of the jewellery as adopted by the Assessing Officer. On the issue of quantification of excess jewellery, the observation of the Assessing Officer indicate that the relevant details pertaining to the individuals of the family with reference to their wealth tax returns were stated to have been considered before arriving at the excess jewellery which has been taxed in the hands of the assessee. It is a fact that the Assessing Officer has not elaborated the details as regards to the jewellery in possession of each of the individual with reference to their income tax / wealth tax returns. But on verification, it was found that none of them were filing the wealth tax returns except by MRs. Prabha Devi who also found to have filed her wealth tax return for the AY 2008-09 on 6.2.2009 which is subsequent to the date of search and after expiry of the ....
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....at the excess jewellery based on some calculations which were not brought on record, though it is a fact that Assessing Officer has considered the jewellery equivalent to as much as Rs. 69,38,208 as explained jewellery. On the issue of valuation and quantification of silver in the hands of the assessee alone, the argument of the assessee appears to have some strength and accordingly, a portion of the jewellery not more than 25% of such silver articles consisted of silver plates, may be treated as the silver articles belonging to the other members since one individual cannot presumed to have so many silver plates to his name, as against nil in case of other 22 members of family. Accordingly, the assessee got relief, being 25% of the value of the silver articles which can be termed to be belonging to the other members of family whose wealth would be below the taxable limits and explainable in their hands, which was not considered in detail by Assessing Officer. Such value is taken as Rs. 6,47,497/- based on the valuation adopted by the Assessing Officer which is equivalent to 25% of the total value of silver articles of Rs. 25,89,990, which appears to have taken into consideration in....
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.... been put the value at Rs. 1,13,06,576/-. Thus, there is difference of Rs. 3,78,268/- being the variation in two valuations. The Assessing Officer adopted the figure of Rs. 1,13,06,576/- for the purpose of determining the value of undisclosed jewellery. It was contended that, as both the valuations were carried out at the instance of the Department and the valuation as on the date of search i.e. 29.1.2009 should be adopted since the latter valuation was made after a period of two months. The assessee, thus, requested that the difference in value amounting to Rs. 3,78,268/- brought to tax by the Assessing Officer is incorrect and requires to be deleted. 59.1 Regarding the quantification of the excess jewellery of Rs. 43,00,000/- which was treated and added as unaccounted investment in the hands of the assessee, it was submitted that jewellery belonged to the entire family and the same is substantiated by the fact that valuers in the reports dt.29.1.2009 & 17.3.2009 had clearly mentioned the position that jewellery belonged to Mr.Kantilal Agrwal and family. It was also submitted that gold was received by two of the assessee's daughters-in-law from their fathers who has submitted....
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.... support of her filing of Wealth Tax Returns even prior to search. The other family members did not file the wealth tax returns for the reason that the value of possession of jewellery by each family member was below the taxable . He, therefore, requested that not to treat the value of gold ornaments as income of any family members as it belong to different persons and requested to release the jewellery. He stated that no investment was made from 01/04/2002 till the date of search i.e. 29th January, 2009 in the acquisition of any additional jewellery or gold ornaments excepting small quantum of jewellery etc. received as gift/presents etc. form other maternal parents and parents of ladies. He drew our attention to the affidavit from Sri Murarilal Goyal, father of Smt. Radha Devi, (W/o Sri Ramprashad) and Vijay Kumar Goyal of Kanpur father of Smt. Vanita Devi (W/o Sri Shivram) wherein they confirmed that at the time of marrying of their daughter, they have given jewellery. 61.2 In view of the above, we incline to hold that minimum amount of jewellery to be considered in each hand of the family members of the assessee as per the CBDT Instruction No. 1916, dated 11/05/1994, wherein i....
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....and the Assessing Officer had not rebutted the other things did not bring any evidence on record to disprove various evidences, addition could not be sustained. The Tribunal also took into account the facts like status, custom, gifts at the time of marriage, child birth and held that the entire jewellery in possession of the assessee was well explained. Further, in the case of Stm. Neena Sayal Vs. ACIT, 70 ITD 62 (Chand.), the Tribunal considered the same CBDT Circular (supra) and remitted the issue to recompute the addition and allow proper relief to the assessee on the basis of the said CBDT Circular. In view of the above, the Assessing Officer is directed to decide the issue in the light of the aforesaid CBDT Circular and in accordance with law. 61.4 Further, the other objections of the assessee's counsel is that there is no granting of cross-examination to the deponent in the affidavit though the donor of the gold jewellery to the assessee has confirmed giving the gift. For this purpose, he relied on the judgment of the Hon'ble Supreme Court in the case of Mehta Parikh and Co. Vs. CIT, 30 ITR 181 (SC) the argument of the assessee is not considered. In the said case the Hon'ble....
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.... judgment also, we are inclined to remit the issue to the file of the Assessing Officer to reappraise possession of the jewellery and give corresponding relief on the basis of the holding of each person of family and the family members are staying under single roof, if it is supported by documentary evidence. Accordingly, this ground is allowed for statistical purposes. 62. Ground No. 5 regarding action of the CIT(A) in holding that an amount of Rs. 9,75,000/- is assessable on account of unexplained investment in M/s Maa Sachiya Sponge Iron (P) Ltd., Jalna, does not arise out of the order of the CIT(A) and, therefore, the same is dismissed. 63. In the result, appeal of the assessee in ITA No. 209/H/12 is partly allowed for statistical purposes. ITA No. 251/H/12 for AY 2009-10 by the revenue in case of Sri Kantilal Agarwal 64. In this appeal, the Revenue has raised the following grounds of appeal: "2. The ld. CIT(A) has erred in granting relief or Rs. 6,47,497/- being 25% of the total value of silver articles of Rs. 25,89,990/- as the unaccounted jewellery seized during the course of search which was added in the assessment order did not include silver articles. 3. The Ld. CIT....