TMI Blog2004 (4) TMI 265X X X X Extracts X X X X X X X X Extracts X X X X ..... y at Delhi. 2. That the addition of Rs. 70,000 in respect of household articles is also uncalled for. 3. That the addition on account of the gift as made by the Asstt. CIT to the tune of Rs. 52,000 is also uncalled for. 4. That the additions have been made against the facts and circumstances of the case. 5. That the appellant craves leave to add or amend the grounds of appeal before the appeal is finally heard or disposed off." 4. Brief facts relating to ground No. 1 are that the assessee had debited Rs. 1.41 lakhs in the books of account being the half share in the property, whereas the AO worked out the value at Rs. 3,97,897, on the basis of the report of the VO and estimated the investment by the assessee being half share at Rs. 1,98,948 and after allowing credit of Rs. 1.41 lakhs as disclosed in the books, added Rs. 57,948. It was further observed that the assessee had surrendered Rs. 30,000 on this account. 4.1 Before us, learned Authorised Representative strongly objected to the action of the assessing authority and submitted that the estimation of the property on the basis of the VO's report was not justified. He further submitted that the assessee had hers ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng at the figure of Rs. 70,000 is not based on any seized material during search or evidence on record, the same is liable to be restricted to Rs. 43,420 as surrendered by the assessee. We, therefore, accept the ground in this regard. 6. Coming to ground No. 3, the AO while framing the assessment observed that the assessee had received Rs. 52,000 as foreign gifts and the same was surrendered by her as undisclosed income. Before us, learned Authorised Representative strongly objected to the order of the AO and submitted that nowhere the assessee has surrendered this amount of foreign gifts as her undisclosed income, which is evident from the chart showing undisclosed income at p. 2 of the paper book. It was pointed out that NRI gifts received were genuine and the assessee had submitted all the details in respect of her plea of having received gifts along with return of income for asst. yr. 1994-95 on 31st Aug., 1994, i.e., well before the date of search. Learned Authorised Representative also filed a list of documents attached with the return filed on 31st Aug., 1994, for asst. yr. 1994-95 and it was pointed out that from the acknowledgement it was evident that the assessee had s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... details pertaining to NRI gifts. The observation of the AO that the assessee has surrendered this amount as undisclosed income does not get support from the chart showing undisclosed income as declared under s. 158BC(c) filed at p. 2 of the paper book, wherein no surrender on account of NRI gifts has been mentioned. The AO had also not brought any other evidence on record which could suggest that the NRI gifts received by the assessee were not genuine. Apart from this, the addition/disallowance has not been made on the basis of any seized material which strengthens the plea of the assessee in context with above cited cases that no disallowance could be made under s. 158BC when there was no material during search. We, therefore, considering the facts and circumstances of the case are of the opinion that the AO while completing the assessment and treating the NRI gifts as undisclosed income has given no reasons for his action, particularly when the same has been disclosed by the assessee under the regular return of income along with relevant documents well before the search. As such, his action is liable to be set aside. We, therefore, accept the ground and delete the impugned additi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... owed for statistics. 9. Coming to the third ground, the AO while completing the assessment observed that the assessee along with his family members had withdrawn household expenditure of Rs. 4,31,071. It was further observed that the assessee had himself surrendered Rs. 55,000 on account of household expenditure. During assessment proceedings, it was noticed that the assessee's family comprised of the assessee himself, his wife and three children. It had also been noted that the brother-in-law of the assessee and his family members were also staying with him. Keeping in view the social status, locality where the assessee was living, etc., the AO was of the view that the assessee had understated the household withdrawals and he made an addition of Rs. 3 lakhs on account of low withdrawals. 9.1 Before us, learned Authorised Representative strongly objected to the order of the AO and submitted that the estimation on account of household expenditure is not based on any material seized and the impugned addition was not justified. The assessee has himself shown reasonable expenditure of Rs. 4,31,071, apart from surrender of Rs. 55,000. The action of the AO, as per the learned Autho ..... X X X X Extracts X X X X X X X X Extracts X X X X
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