2009 (8) TMI 32

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....L) - In all these cases, only one question of law has arisen for consideration under the same factual back drop. 2. Admit. 3. Following substantial question of law arises for consideration in all these cases. "Whether on the facts and in the circumstances of the case the Tribunal was right in law in upholding the addition as an unexplained investment in jewellery of the assessee during the block period in spite of its finding that the disputed jewellery stood fully explained?" 4. Filing of paper book is dispensed with. 5. With the consent of the parties, we have heard the matters finally and proceed to decide the aforesaid question of law. For the sake of convenience, we shall take note of all the facts as they appear in ITA ....

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....sessee also mentioned that in order to buy peace and avoid litigation, she was offering 20% in respect of such excess jewellery worked out at Rs.22,96,000/- i.e a sum of Rs.4,59,200.00 and was ready to pay tax thereupon. 8. The Assessing Officer, however, did not accept the aforesaid explanation given for the jewellery recovered. He accepted only the gift of jewellery of Rs.3,16,000/- from relatives as proved. The value of the unexplained jewellery was added as undisclosed income by the A.O in his orders dated 21.1.2004. The assessee preferred appeal thereagainst before the Commissioner of Income Tax (Appeals). 9. The CIT(Appeals) examined the issue on the basis of records and was of the opinion that the assessee had been able to sati....

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....s were not received, as claimed by the appellant. The fact that appellant did not declare the impugned jewellery in the regular returns of W.Tax is also not relevant to decide the issue. Regarding this, suitable remedial action can be taken under the Wealth Tax Act. The A.O. has not controverted the reasoning of the appellant that among the entire family, a cash of Rs.1,14,77,500/- was available for purchase of jewellery and other articles. He has also not been able to establish that the gifts received by appellant are not sufficient to cover the disputed jewellery. In fact the undisclosed income of the Sh. B.R.Magu and Sh. V.K.Magu has been assessed at "NIL"." 10. It is clear from the aforesaid discussion contained in the order of CIT(A....

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.... and passed the orders which compelled the assessee to file the appeal before the CIT(A). It was also submitted that once CIT(A) returned the finding that the source of entire jewellery was explained, merely because such an offer was made before the Assessing Officer, could not be held against the assessee. The ITAT, by dismissing the appeal of the revenue accepted the findings of the CIT(A) to the effect that the entire source of jewellery was duly and satisfactorily explained by the assessee. However, the Tribunal also proceeded to retain the addition of Rs.4,59,200/- on the ground that this was the amount offered by the assessee herself. At this stage, we may point out that in so far as revenue is concerned, it has not challenged the ord....

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.... for the possession is quite adequate. 4) The assessee therefore, desire to buy peace and avoid litigation the assessee is offering 20% in respect of such excess jewellery worked out at Rs.22,96,000.00. Thus a sum of Rs.4.59,200.00 is offered and the tax due thereon at Rs.2,81,030.00 may please be adjusted out of seized cash of RS.15 lakhs from the group." 12. A conjoint reading of these two notes clearly demonstrates that assessee maintained her stand that she had been able to account for the entire jewellery including the source thereof. Notwithstanding the same only with a desire to buy peace and avoid litigation, she had offered 20% of the excess jewellery i.e., a sum of Rs.4,59,200/-. This offer was thus conditional. She would ha....

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....e of it should not be given." 13. That apart, it is trite law that the principle of estoppels has no application in the Income Tax Act. Exactly, this very issue came up for consideration before this court in Commissioner of Income Tax Vs. Bharat General Reinsurance Co. Ltd. 80 ITR 303 and the position was explained in the following manner. "It is true that the assessee itself had included that dividend income in its return for the year in question but there is no estoppel in the Income -tax Act and the assessee having itself challenged the validity of taxing the dividend during the year of assessment in question, it must be taken that it had resiled from the position which it had wrongly taken while filing the return. Quit apart from ....