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2017 (4) TMI 473 - AT - Income TaxAddition being foreign currency found at time of search action - Held that:- This issue has to be examined and verified by the Assessing Officer with reference to the submissions made by the assessee that the foreign currency is belongs to the company and it has been accounted for in company’s books as on 31.03.2011. The learned counsel for the assessee further submits that as per the RBI Rules and Regulations assessee can retained the foreign exchange for 180 days. Thus we restore this issue to the file of the Assessing Officer who shall examine the issue afresh in accordance with law. The assessee shall provide necessary details to the Assessing Officer to substantiate his claim. Deemed dividend addition u/s.2(22)(e) - Held that:- As the assessee submits that the assessee’s only plea is that the deemed dividend is to be restricted to the accumulated profits of the company. The DR has no serious objection in restricting the deemed dividend to the accumulated profits of the company. On hearing both sides in principle we hold that the CIT(A) is justified in sustaining the addition made u/s.2(22)(e) of the Act. However, such addition should be restricted only to the accumulated profits of the company as specified in the provisions of section 2(22)(e) of the Act. Therefore, for the limited purpose on verification and quantification of deemed dividend we restore this issue to the file of the Assessing Officer who shall quantify the disallowance u/s.2(22)(e) of the Act restricting to the accumulated profits of the company. Addition of Jewellery - Held that:- CIT(Appeals) considering the submission of the assessee and applying CBDT Instruction No.1916 dated 11.05.1994 and looking into the social status of the family, agreed with the assessee’s submission and partly allowed the ground of appeal. The CIT(A) restricted the addition to ₹ 15,44,780/- accepting the alternate contention that if at all it is to be treated as unexplained income it is only ₹ 15,44,780/- as per the working submitted in the course of appellate proceedings before the CIT(A). The assessee could not substantiate its claim that the jewellery was purchased in earlier years and its source. Therefore we do not see any good reason to hold that the assessee explained the sources for the jewellery found worth ₹ 15,44,780/-. Hence the CIT(A) order is sustained and ground raised by the assessee is rejected.
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