TaxTMI 
TaxTMI 
2026 (9) TMI 33
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....t. 2) The Ld. CIT Appeals erred in law and on facts of the case making addition of Rs. 2 crores under section 68 of the IT Act as the amount of increase constituted the value of gold ornaments and silver utensils, mainly gifted to the assessee on his marriage way back in the year 1983, which was duly explained before the Ld. AO and to Ld. CIT Appeals. 3) The learned CIT Appeals failed to appreciate that section 68 applies only to cash credits and cannot be invoked in respect of introduction of capital represented by personal assets in kind gold jewelry and silver utensils, particularly when no cash was credited in the books during the year. The jewellery is related to the year 1983 and addition should be Rs. 12,90,000.00 approx not Rs. 2 crore which is as per current valuation. 4) The learned CIT Appeals failed to appreciate that receipt and holding of gold jewellery and silver utensils on the occasion of marriage, particularly in the year 1983, is a well recognized social custom in India and does not require contemporaneous documentary evidence, especially after the lapse of more than 4 decades. The investment as per the rates available for the year 1983....
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....furnish the copies of wealth tax returns in which value of jewellery and other precious items were declared along with copy of valuation report. As the assessee had not provided the same, the source of capital introduction on account of gold jewellery remained unverified and unexplained on his part. Therefore, he was required vide notice dated 28.11.2016 to show cause as to why the said amount of Rs. 2.0 crores should not be added u/s. 68 of the Income tax Act, 1961 to your total income for the A.Y. 2017-18. 4. In response to the same the assessee replied that ornaments weighing around 5.5 Kgs of Gold and Silver Utensils worth 4 Kgs were given to the assessee's son and his newly wedded wife by his mother on his marriage in the year 1982 and he has included these amounts in his balance sheet as his capital in FY 2016-17 at approximate value of gold and silver at that time. He has also submitted that he is in the process of valuation done as on date and shall submit the same once done. He assured that the reply will be filed by 5th of December, 2016. However, the assessee has not filed any documentary evidence in support of ownership of such Gold or jewellery by the date cho....
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....d over the years. Merely stating that the gold was received as a wedding gift decades ago is not sufficient proof. The claim of a gift received in 1982, without any supporting documentation, lacks credibility, especially given the significant value involved. Crucially, the appellant could not produce a wedding gift deed, records from the gifting ceremony, or any other proof of ownership that would establish the existence of the gold with him since 1982. Even, the appellant could not furnish the wealth tax return filed by her mother to establish that she had such quantity of gold and other precious item to gift the appellant & his wife at the time of his marriage. In view of the above discussion, I didn't find any infirmity in the addition of Rs. 2,00,00,000/- made by the AO u/s. 68 of the Act. Accordingly, the addition made by the appellant is upheld and the grounds of appeal are dismissed....." 6. We have heard rival submissions in the light of material placed on records. 7. The ld. Counsel for the assessee argued that the ld. Assessing Officer has made addition by recording wrong facts. It was argued that vide his reply dated 11.06.2019, assessee had submitted that....
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.... not, in the opinion of the Assessing Officer, satisfactory, the sum so credited may be charged to income-tax as the income of the assessee of that previous year: Provided that where the sum so credited consists of loan or borrowing or any such amount, by whatever name called, any explanation offered by such assessee shall be deemed to be not satisfactory, unless,- (a) the person in whose name such credit is recorded in the books of such assessee also offers an explanation about the nature and source of such sum so credited; and (b) such explanation in the opinion of the Assessing Officer aforesaid has been found to be satisfactory: Provided further that where the assessee is a company (not being a company in which the public are substantially interested), and the sum so credited consists of share application money, share capital, share premium or any such amount by whatever name called, any explanation offered by such assessee-company shall be deemed to be not satisfactory, unless- (a) the person, being a resident in whose name such credit is recorded in the books of such company also offers an explanation about the nature and source of such sum....