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2020 (1) TMI 1660 - ITAT MUMBAIAddition u/s. 69A - unexplained jewellery - preponderant improbability brought by the AO - CIT(A) deleted the addition - case of the assessee was selected for scrutiny assessment u/s 143(2) - in course of the search and seizure proceedings conducted on the assessee diamond jewellery of a value of Rs. 2,70,72,255/- was found - HELD THAT:- As finding no infirmity in the view taken by the CIT(A) who in our considered view had rightly concluded that as the assessee by placing on record supporting documentary evidence viz. purchase bills of diamonds, remaking bills for conversion of diamonds into jewellery and payment details in respect of its acquisition, both at the time of post-search proceedings and the assessment proceedings had duly explained the source of acquisition of the diamond jewellery of a value of Rs. 1,23,95,850/-, therefore, the A.O. was in error in treating the same as an unexplained investment of the assessee u/s 69A of the Act, we uphold his order to the said extent. Claim of the assessee that part of the diamond jewellery found in the course of the search proceedings belonged to his NRI son and daughter-in-law - We find no infirmity in the view taken by the CIT(A). In our considered view, though the assessee had placed on record supporting documentary evidence in the form of 'valuation reports' pertaining to the jewellery owned by NRI son and NRI daughter-in-law which was stated to have been kept by the said respective persons with him for safe custody during their absence from India, the A.O. on the other hand had summarily discarded the said claim of the assessee and had without placing on record any material which could evidence the falsity of the said claim, had drawn adverse inferences. In fact, we find that the A.O. had not even recorded any reasoning for disbelieving the aforesaid claim of the assessee. As such, we are unable to persuade ourselves to subscribe to the aforesaid view taken by the A.O. and uphold the observations of the CIT(A) in context of the issue under consideration. For balance diamond jewellery CIT(A) in all fairness, in the totality of the facts of the case, adopting a balanced approach had fairly concluded that 50% of the aggregate value of the diamond jewellery of a value of Rs. 49,37,444/- could safely be held to have been acquired by the assessee out of the withdrawals which were made by him from his disclosed sources in the preceding years. Accordingly, we are of the considered view that the sustaining of the addition on a fair estimation by the CIT(A) to the extent of Rs. 24,68,722/- [50% of Rs. 49,37,444/-] cannot be held to be suffering from any infirmity. Accordingly, finding no infirmity in the aforesaid view taken by the CIT(A), we uphold the same.
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