2009 (5) TMI 998

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....m the appellant during the accounting year relevant for the assessment year 1989-90. A search was made by the Central Excise and Gold Control Authorities in the premises of the appellant on 28-4-1988 and seized unaccounted jewellery worth above Rs. 4 lakhs. In adjudication proceedings completed on 11-1-1989, the Central Excise authorities confiscated the gold imposing personal penalty of Rs. 75,000 which was reduced in appeal to Rs. 45,000 and allowed redemption of seized gold ornaments on payment of redemption fine of Rs. 1.5 lakhs. In view of search and seizure of gold ornaments, the income-tax assessment originally completed was reopened under section 147 of the Income-tax Act and the value of the seized gold ornaments was assessed under....

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....we are of the view that the assessee's claim for deduction is not maintainable because section 69A which is a provision under which the value of seized jewellery is added to the income of the appellant does not provide for deduction at all. For easy reference section 69A is extracted hereunder : "Where in any financial year the assessee is found to the owner of any money, bullion, jewellery or other valuable article and such money, bullion, jewellery or valuable article is not recorded in the books of account, if any, maintained by him for any source of income, and the assessee offers no explanation about the nature and source of acquisition of the money, bullion, jewellery or other valuable article, or the explanation offered by h....

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....tion to redeem the gold ornaments on payment of the redemption fine of Rs. 1.5 lakhs. It is admitted that the appellant actually redeemed the gold on payment of the redemption fine. So long as the assessment of seized gold ornaments under section 69A is concerned, its value being the unaccounted income of the financial year in which the seizure was made by virtue of section 69A it was rightly assessed as income for the relevant assessment year 1989-90. In our view, the subsequent development such as adjudication, confiscation and later redemption of the article on payment of the personal penalty and redemption fine will not affect the assessment of the value of the seized jewellery under section 69A. Since section 69A does not provide for a....