TaxTMI 
TaxTMI 
2025 (6) TMI 131
X X X X Extracts X X X X
X X X X Extracts X X X X
.... The assessment order passed by the AO and confirmed by Id. CIT(A) is illegal, ab initio void inasmuch as the approval given by Id. JCIT u/s 153D is not in accordance with provisions of law. The assessment order is liable to be quashed in absence of valid approval u/s 153D. Ground No.3: The appellant reserves the right to amend, modify or add any of the ground/s of appeal." 2. Succinctly stated, the assessee was subjected to search and seizure proceedings u/s 132 of the Act on 17.09.2014. Notice u/s 142(1) of the Act was issued to the assessee for the year under consideration, i.e AY 2015-16 on 22.05.2015. In compliance, the assessee filed her return of income declaring an income of Rs. 4,05,760/-. Thereafter, the case of the assessee was selected for scrutiny assessment u/s 143(2) of the Act. 3. During the course of the assessment proceedings, it was observed by the A.O. that gold jewellery/ornaments and bullion was found lying in the Locker no. 49 with Dena Bank, Branch: Rajnandgaon which was jointly held by Smt. Asha Daga (assessee) and Shri. Vishal Daga (son of the assessee), viz. (i) gold jewelry/ornaments (wt. 1037.700 grams); and (ii). bullion (wt. 329 grams),....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ted to explain the sources of gold jewelleries and silver found from said Locker of the assessee. The assessee vide letter filed in this office on 11/08/2016 has explained the bullion found from the locker along with the self declaration. The explanation submitted by the assessee relating to bullion found has been carefully considered. However there is no merit in her explanation and therefore the same is not acceptable for the following reasons:- 1. Assessee could not produce any bills and vouchers in support of her claim of conversion of her old jewelleries into bullion. 2. Assessee has never filed wealth tax return for any of the A.Y. under consideration. As the assessee has failed to explain the sources of possession of gold bullion satisfactorily, therefore the entire amount of bullion found of 329 gms. amounting to Rs. 8,98,170/- is added to the total income of the assessee. During the course of search proceedings the assessee has explained the sources of gold jewelleries found of 1037.700 grms. The entire jewelleries found from the locker and her residence. The explanation submitted by the assessee has been carefully considered. H....
X X X X Extracts X X X X
X X X X Extracts X X X X
....confirmation confirming the above facts. Further, it is submitted that in our country, it is very common practice to convert old fashioned jewellery into bullion with a view that it would help the parents on the occasion of children's marriage. The appellant with the same mindset had converted old gold available with her into bullion. As regards bills and voucher, it is stated that because of passage of long time, the appellant does not possess evidence in respect of conversion of old gold into bullion. It is submitted that the appellant in such reply had explained the source of entire 1495.06 grams of jewellery found the locker and her residence which was inventoried vide annexure JF/1 dt. 17.09.2014 and JS/1 dt. 29.09.2014. Moreover, the appellant provided breakup of jewellery belonging to each member of her family. Such breakup of jewellery has also been reproduced on page 11 of the assessment order:- The details of jewellery found from locker no. 49 & from the residence of appellant are as follows:- Name of owner Quantity (net) (gms) Location Inventory Satyanarayan Daga 56.42 Bedroom of appellant & Satyanarayan Daga An....
X X X X Extracts X X X X
X X X X Extracts X X X X
....tatus Grams gold to considered as explained Satyanarayan Daga(Appellant, s husband) Married Male 100grams Asha Daga (Appellant) Married female 500 grams Vishal Daga(Appellant,s son) Married male 100 grams Shweta Daga (Appellant daughter in law Married female 500 grams Souryansh DAga (Son of Vishal) Unmarried male 100 grams Divyansh Daga (son of Sagar) Unmarried male 100 grams Rupali Daga (daughter of appellant Unmarried female 250 grams Sagar Daga Married male 100 grams Smt. Swati Daga (Appellant's daughter in law) Married female 500 grms Total 2250 grams As against the above explained gold of 2250 grams, total quantity of gold ornaments found during search at all places was 1247.90 grams(net) which was much within the limits prescribed CBDT. The fact that different jewellery items found during search belonged to different persons is also evident from the fact that various jewelleries were found at different place. As regards bills and vouchers, it is stated that because of passage of long time, the appellant and her family members do....
X X X X Extracts X X X X
X X X X Extracts X X X X
....justified the making addition of Rs. 20,93,091/- (Rs. 8,98,170 + Rs. 11,94,921), is hereby confirmed. Therefore, appeal on these grounds is dismissed. 3. In the result, appeal are Dismissed." 6. The assessee being aggrieved with the order of the Ld. CIT(A) has carried the matter in appeal before us. 7. We have heard the learned authorized representatives of both parties, perused the orders of the lower authorities and the material available on record, as well as considered the judicial pronouncements that have been pressed into service by the Ld. AR to drive home his respective contentions. 8. Controversy involved in the present appeal hinges around two issues, viz. (i). that as to whether or not the approval granted by the Jt. CIT (Central), Raipur u/s 153D of the Act is in accordance with the provisions of law?; and (ii). that as to whether or not the lower authorities are right in law and facts of the case in treating the gold jewellery/ornaments (Wt. 437.700 grams) and bullion (Wt. 329 grams) as an unexplained investment in the hands of the assessee? 9. Apropos the Ld. AR's contention that the assessment framed by the A.O vide his order passed u/s. 143(3) o....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ircle-1, Raipur, TAXC No.76/2024, dated 10.04.2024. The Hon'ble High Court in its aforesaid order, after deliberating upon the similarly worded approval granted by the Jt. CIT, Range- Central, Raipur, had observed, that as the A.O. in the case before them had obtained a prior approval of the Jt. CIT, therefore, the mandate of Section 153D of the Act was duly complied with. It was further observed by the Hon'ble High Court that in a given case, it cannot be presumed on the mere say of the assessee that no application of mind was there while granting the approval. The Hon'ble High Court had further observed that the language used in the letter granting the approval revealed the subjective satisfaction that was arrived at based on the documents that were produced before the Jt. CIT. It was further observed, that on a perusal of the language of the approval letter, it cannot be presumed that there was no application of mind as the approval need not be a detailed assessment order. The Hon'ble High Court after pressing into service Section 114 of the Evidence Act had observed that in case where the official act had been done in accordance with official procedure, then it would lead to pr....
X X X X Extracts X X X X
X X X X Extracts X X X X
....held by the assessee and Shri. Vishal Daga (supra), but as the assessee had owned the bullion (Wt. 329 grams) and had even attempted to explain the source of acquisition of the same, therefore, the A.O had rightly not drawn any adverse inference as regards the same in the hands of the other joint holder of the locker, viz. Shri. Vishal Daga (supra). We find that the AO in the assessment order, had observed, that as the assessee had neither produced the bills/vouchers in support of her claim of conversion of her old jewellery into bullion nor had filed any wealth tax return in the course of proceedings to substantiate the veracity of her said claim, therefore, in absence of any explanation forthcoming regarding the source of acquisition of bullion (Wt. 329 grams) it was rightly held as her unexplained investment u/s 69 of the Act. 15. As the assessee had neither before lower authorities nor before us placed on record any material/documentary evidence which would substantiate her claim that it was her old jewellery that was got converted into bullion (Wt. 329 grams), therefore, we are of the view, that treating the value of the same of Rs. 8,89,170/- as the assessee's unexplained ....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... 350.5 gms in her possession, which is much below the prescribed limit of 500 gms. We are of the considered opinion that no addition can be held to be sustainable on this count and the learned CIT(A), was justified in deleting it " B). Smt. Sulochana Devi Jaiswal vs. DCIT (supra) "35. We have considered the rival submissions. The Board vide its Circular No. 1916, dt. 11th May, 1994, has prescribed the limit of 500 gms. for gold jewellery which is not to be seized. In other words, the Board has considered the issue and felt that gold jewellery to the extent of 500 gms, could be possessed by an ordinary family. The intention behind such circular was, therefore, very clear. As the unexplained jewellery found during the course of search was much less than 500 gms., we have no hesitation in holding that the addition on account of unexplained investment in jewellery is not justified and the same is deleted." 17. We shall in the backdrop of the aforesaid CBDT instructions No.1916 (supra) read along with the aforesaid judicial pronouncements look into the view taken by the lower authorities which had held that the gold jewellery/ornaments (Wt. 437.700 grams) found lyin....
X X X X Extracts X X X X
X X X X Extracts X X X X
....aid locker no. 49 (supra) is also very much possible. We shall considering the CBDT instruction No. 1916, dated 11.05.1994 as analyzed in the aforesaid judicial pronouncements, as per which 500 grams of gold jewellery/ornaments per married lady and 100 grams per male member of the family is not to be held as an unexplained investment, thus, in the backdrop of the gold jewellery/ornaments that were found from the residence (bedrooms) of the aforesaid joint owners of locker no. 49 (supra) and their family members look into the availability of the balance gold jewellery/ornaments with them to explain that found in the aforesaid locker. 21. As observed by us hereinabove, 178.450 grams of gold jewellery/ornaments, Annexure JF/Page No. 01, dated 17.09.2014 (APB-Page 46) were found during the course of the search proceedings from the bedroom of Shri Satyanaryan Daga (assessee's husband) and Smt. Asha Daga (i.e assessee). Accordingly, the assessee and her spouse could safely be held to be in possession of 421.55 grams of gold jewellery/ornaments [i.e 600 grams (minus) 178.450 grams] acquired from their explained sources. Also, as noticed by us herein above, 109.774 grams of gold jewelle....