TaxTMI 
TaxTMI 
2015 (7) TMI 603
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....e female members staying at his residence viz. Smt. Amruta Vanani, Smt. Nidhi Devani, Ms. Ruby Vanani, Smt. Asha A. Vanani and Smt. Kewal A. Vanani. During the assessment proceedings, the Id.AO directed the assessee to produce evidence with respect to purchase of jewellery by the said ladies. While no documentary evidence was produced to explain the source of the jewellery, individual details of jewellery of each person were filed. The AO, therefore, concluded that the assessee failed to substantiate that the jewellery worth Rs. 11,00,996/- belonged to the said ladies. He, therefore, treated the jewellery as unexplained investment of the assessee. However, since the said females, are mostly married, he gave a benefit of streedhan at Rs. 50,000/- per person (Rs.50,000 x 5) and added Rs. 8,50,996/- (i.e. 1100996 - 250000) as unexplained investment u/s.69 of the Act. 3. By the impugned order, the CIT(A) granted relief of Rs. 1 lakh per person in respect of members of the assessee's family in place of relief of Rs. 50,000/- granted by the AO. Thus, the addition was further reduced by Rs. 2,50,000/- after having the following observation :- " 3.4 I have considered the assessment o....
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.... the remaining addition is confirmed, This ground of appeal is partly allowed." 4. Against the above order of CIT(A), the assessee is in further appeal before us. 5. We have considered rival contentions, carefully gone through the orders of the authorities below and found from the record that the assessee is a Gujarati businessman, engaged in the business of diamond trading. He has a traditional family background and lives in a joint Family with his Family as well of that of his son and nephew, at 101/201-B Vikas Tower, Walkeshwar Road, Mumbai, where a search was carried out on 04.10.2006. The following was the valuation of jewellery, as inventorised/valued by Shri Suraj Ratan Aqarwa, Govt. valuer, vide his report dated 04.10.2006 : Description Gross Weight (gm) Net Weight (gms) Value (Rs.) Gold Jewellery 1468 1372.30 11,00,896.00 Diamond jewellery - - 38,19,945.00 Silver Articles - 4 kg 64,000.00 Total 49,84,841.00 The following are the female members staying at the residence as was noted by the DDI(Inv.) :- Smt. AmruLaben Variani - Wife ....
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.... 348.200 340.000 2,72,000/- 3. Ms. Nidhi G. Vanani 454.100 454.100 3,60,000/- 4. Ms. Ruby G.Vanai 88.600 88.000 72,756/- 5. Mrs. Kewal Anil Vanani 343.800 343.800 2,09,500- From the aforesaid chart, it is clear that each of the female members of the family of the assessee is holding less than 500 gms. of gold jewellery and therefore, the same should have been accepted as explained jewellery considering the status of the assessee and the business of dealing in diamonds for more than three decades. In this respect Instructions of the CBDT bearing No.1916 dated 11th May, 1994 wherein the officers of the Department were directed not to seize gold jewellery and ornaments to the extent of 500 gms. per married lady, 250 gms. per unmarried lady and 100 gms. per male member of the family in the case of a person who is not assessed to wealth-tax. 7. In view of the aforesaid Instruction of the CBDT the gold jewellery found from the premises of the assessee from five female members ought to have been accepted as explained as the same is much lesser than the limit of gold ornaments not to be seized in a cas....
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....f the family members was below the limits specified in the said circular. Though it is true that the CBDT Instruction No. 1916, dtd. 11th May, 1994 lays down guidelines for seizure of jewellery and ornaments in the course of search the same take into account the quantity of jewellery be held by family members of an assessee belonging to an ordinary Hindu household. The approach adopted by the Tribunal in following the said circular and giving benefit to the assessee, even for explaining the source in respect of the jewellery being held by the family is consonance with the general practice in Hindu families whereby jewellery is gifted by the relatives and friends at the time of social functions, viz., marriages, birthdays, marriage anniversary and other festivals. These gifts are customary and customs prevailing in a society cannot be ignored. Thus although the circular had been issued for the purpose of non-seizure of jewellery during the course of search, the basis for the same recognizes customs prevailing in Hindu society. In the circumstances, unless the Revenue shows anything to the contrary, it can safely be presumed that the source to the extent of the jewellery stated in th....