TaxTMI 
TaxTMI 
2018 (11) TMI 1252
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.... 1. On the facts and in the circumstances of the case and in law, the Learned the CIT(A) erred in upholding the action of the Deputy Commissioner of Income Tax, Range - 24 & 26, Mumbai ('the AO') of adding a sum of Rs. 8,70,740/- on account of jewellery seized. 2. She failed to appreciate and ought to have held that: a. Various discrepancies having been noticed in Valuation Report of the Departmental Valuer, the credibility of the valuation was itself in doubt and thus the valuation of the Departmental valuer itself cannot be adopted. b. The jewellary seized is not a new jewellery but have been remade out of old items. 3. The Appellant therefore, prays that the addition on account of jewellery seized be deleted. GROUND II: Violation of the principles of Natural Justice: 1. On the facts and circumstances of the case and in law, the Learned CIT(A) erred in upholding the action of the AO of adding a sum of Rs. 2,67,401 under the head 'Income from House Property' without giving a fair and reasonable opportunity of hearing to the Appellant and thereby violating the principles of natural justice. 2. The A....
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....nd V Ground VII: 1. Even assuming (without accepting) that an ad-hoc amount has to be disallowed for personal use, then also rate of 10% adopted is without any basis, excessive and unreasonable under the circumstances. 2. The Appellant, prays that the rate of 10% be appropriately reduced. GROUND VIII: GENERAL The Appellant craves leave to add, amend, alter and/or delete any/all of the above grounds of appeal." 3. The assessee has raised as many as eight grounds in appeal filed with tribunal in ITA no. 7579/Mum/2014 for AY 2011-12. The brief background of the appeal is that a search operation u/s. 132 of the Income-tax Act, 1961 was conducted by Revenue on 30.11.2010 at the residential/business premises of Shri Samir Bhojwani group of cases and the assessee was also covered in the said search operations. The assessee is a fashion designer and carries on manufacturing and sale of designer garments through her proprietary concern , M/s Azzura International. 4. Coming to ground no. II raised by the assessee in the memo of appeal filed with the tribunal, the learned counsel for the assessee submitted before the Bench that the said ground of appe....
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....ed by the assessee in its appeal against the assessee. After hearing both the parties and keeping in view also that Ld. Counsel for the assessee has conceded before the Bench that these two grounds namely VI and VII are to be decided against the assessee, we decide these two grounds against the assessee. The assessee fails on these two grounds. We order accordingly. 8. Coming to ground no. VIII raised by the assessee in memo of appeal filed with the tribunal which is general in nature and does not require separate adjudication and is hereby dismissed as general in nature.We order accordingly. 9. Now , we are left with only one effective ground raised by the assessee in memo of appeal filed with the tribunal viz. ground no. I which challenges addition of Rs. 8,17,740/- made on account of jewellery seized during the course of search operations u/s 132 of the 1961 Act conducted by Revenue on 30.11.2010. 10. The AO observed during assessment proceedings that during the course of search and seizure operations conducted by Revenue u/s 132 of the 1961 Act, from the premises 20th floor, Chand Terraces, Saint Andrews Road, Opposite Holy Family Hospital, Bandra (W),Mumbai and Locker....
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....ought and consequently additions were made to the tune of Rs. 9,10,340/- u/s. 69A of the Act as an unexplained investments in the jewellery , vide assessment order dated 28.03.2013 passed by the AO u/s 143(3) of the 1961 Act. 12. Aggrieved by the assessment order dated 28.03.2013 passed by the AO u/s 143(3) of the 1961 Act, the assessee filed first appeal with learned CIT(A). The assessee furnished paper book containing valuation report of dated 30.11.2010 and 18.12.2010. The assessee also furnished letter dated 18.12.2010 written by Shri. Suraj Ratan Agrawal, Departmental Valuer to DDIT (Inv). The assessee submitted based on the said letter that there were some discrepancies in the valuation and therefore credibility of valuation is in doubt. It was pointed out by the assessee from letter dated 18.12.2010 written by the Departmental Valuer before the learned CIT(A) that gold jewellery worth Rs. 39,600/- is an item of artificial jewellery and hence the same cannot be included in the total income. The assessee also explained before learned CIT(A) that items of jewellery which were seized were re-made out of item of old jewelleries and hence addition cannot be sustained and need t....
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....he AO u/s. 143(3) r.w.s 153A of the 1961 Act are placed in separate/ supplementary paper book/ page no. 1 to 28 filed with the tribunal . The income declared in the return of income filed by the assessee for following assessment years viz. AY 2007-08 to 2011-12 , is as under:- Assessment Year Income Declared in Rs. 2011-12 Rs. 1,69,15,736/- 2010-11 Rs. 1,13,69,084/- 2009-10 Rs. 1,14,27,466/- 2008-09 Rs. 44,76,943/- 2007-08 Rs. 54,37,340/- The claim is made by learned counsel for the assessee before the tribunal that the jewellery is recycled jewellery which was remade out of old jewellery over a period of time and the assessee is also showing consistently high income over a period of time. It is also claimed that the assessee is a married women.It is claimed that on the touchstone of preponderance of probabilities, the said jewellery should be allowed to be sourced from known sources and additions made by authorities below should be deleted. 15. The Ld. DR submitted that it is a case of search and seizure operations conducted by the Revenue u/s 132 against the assessee on 30.11.2010 wherein jewellery which could not be reconciled with wealt....
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....ents which are manufactured and sold by her . The assessee has claimed that these jewelleries valued to the tune of Rs. 8,70,740/- were re-made by recycling of old jewellery over a period of time . It is the claim of the assessee that she is consistently declaring high income in its return of income filed with Revenue as detailed below :- Assessment Year Income Declared in Rs. 2011-12 Rs. 1,69,15,736/- 2010-11 Rs. 1,13,69,084/- 2009-10 Rs. 1,14,27,466/- 2008-09 Rs. 44,76,943/- 2007-08 Rs. 54,37,340/- It is also contended that no other incriminating material were found and seized during the course of search and seizure operations conducted by Revenue which could evidence that there is any other undisclosed sources of income of the assessee. The assessee has also made a claim that factors like that she being married women having declared higher income, that she is fashion designer, that it is recycled jewellery be also considered while adjudicating this issue on the touchstone of preponderance of probabilities. Now under these factual matrix of the case and also keeping in view that it is search case wherein jewellery to the tune of Rs. 8,70,740....