TMI Blog2015 (1) TMI 925X X X X Extracts X X X X X X X X Extracts X X X X ..... out agricultural activities. Under these facts, we do not find any reason to interfere in the order of CIT(A) on this issue. - Decided against assessee. Unexpalined money - collection of cheque (received by the appellant on sale of jewellery) in his bank account of the appellant/his wife - Held that:- In assessment year 2005-06, we have already held that benefit should be allowed to the assessee to the extent of 100 gms. of gold jewellery as per CBDT Circular No. 1916 dated 11th May 1994 and on the same line, in the present year also, we hold that the benefit should be allowed to the assessee in respect of ownership of jewellery by his wife to the extent of entire jewellery because the same is less than 500 gms. However, the capital gain on sale of this jewellery has to be assessed and for this reason, we restore the matter back to the file of the Assessing Officer for fresh decision. The assessee has to bring evidence on record regarding cost and year of acquisition. If the assessee can establish that the said jewellery was acquired prior to 01/04/1981 then Fair Market Value as on 01.04.1981 should be accepted as cost of jewellery and thereafter indexation of benefit should be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee has raised the following grounds: 1. BECAUSE there existed no material/information which could lead to the formation of requisite reason to believe as was a prerequisite for issuance of warrant of authorization under section 132(1) and accordingly the appellant could not have been treated to be the person in whose case search had been initiated under section 132(1) of the Act . 2. BECAUSE the Assessing Officer could not have been treated to have assumed jurisdiction under section 153A, as the appellant's objection to the said initiation remained unresolved and accordingly the initiation of proceedings under section 153A as also the assessment made in pursuance thereof are void ab-initio. 3. BECAUSE the issue of assumption of jurisdiction under section 153A and assessment made in pursuance thereof, was justiceable in the appellate proceedings and merely because the Assessing Officer had rejected the appellant's objection in this respect, the CIT(A) could not have held that appeal on this issue was not maintainable. WITHOUT PREJUDICE TO THE AFORESAID 4. BECAUSE the authorities below have erred in law and on facts in treating agricultura ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of sale proceeds or incurring of expenses for agricultural operations was found in the course of the search. It has been held in CIT vs. R. Venkataswamy Naidu [1956] 29 ITR 529 (SC) that the assessee has to place before the income-tax authorities proper materials which will enable them to come to a conclusion that the income which is sought to be assessed, is agricultural income. It is not for the incometax authorities to prove that it is not agricultural income. It is also held in CIT v. Ramakrishna Deo [1959] 35 ITR 312 (SC) that a person who claims the benefit to an exemption has to establish it. Thus, burden of proof is on assessee to prove that his income is agricultural income which is exempt from tax. The net agricultural income has to be computed as per Part-IV of the First Schedule to the Finance Act and it is not correct to state that the appellant is not required to maintain such details and the land revenue record is sufficient to prove the carrying out of agricultural activity and thereby implying that the quantum of agricultural income cannot be disbelieved. As no evidence for the said agricultural income was filed before the Assessing Officer nor the details of sale ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... id initiation remained unresolved and accordingly the initiation of proceedings under section 153A as also the assessment made in pursuance thereof are void ab-initio. 3. BECAUSE the issue of assumption of jurisdiction under section 153A and assessment made in pursuance thereof, was justiceable in the appellate proceedings and merely because the Assessing Officer had rejected the appellant's objection in this respect, the CIT(A) could not have held that appeal on this issue was not maintainable. WITHOUT PREJUDICE TO THE AFORESAID 4. BECAUSE the authorities below have erred in law and on facts in treating agricultural income of ₹ 48,000/- as had been shown in the return, as income under the head Income from Other Sources , and in subjecting the same to assessment accordingly. 5. BECAUSE the appellant had been showing agricultural income in past and there being no material found during the course of search which could impinge upon or contradict the said disclosure, the treatment given to the income shown under the head Agricultural Income', by the authorities below is illegal and unjustified. 6. BECAUSE assessment of agricultural income shown at ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... urces , and in subjecting the same to assessment accordingly. 5. BECAUSE the appellant had been showing agricultural income in past and there being no material found during the course of search which could impinge upon or contradict the said disclosure, the treatment given to the income shown under the head Agricultural Income', by the authorities below is illegal and unjustified. 6. BECAUSE assessment of agricultural income shown at ₹ 52,000/- as income under the head Income from Other Sources , is beyond the ambit and scope of the said section and accordingly taxation of the same in terms of the assessment order dated 28.12.2010 is wholly illegal. 7. BECAUSE the CIT(A) has erred in law and facts in upholding an addition of ₹ 2,63,400/- representing the collection of cheque (received by the appellant on sale of jewellery) in his bank account, by invoking the provisions of section 69A of the Act. 8. BECAUSE looking to the quantity of jewellery that has been subjected to sale (proceeds of which had been collected/credited in the bank account of the appellant) the ownership of the appellant/his wife over the same could not have been legitimately disput ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vs. Income Tax Officer [1999] 240 ITR 727 (Kar) (ii) Dr. Sushil Rastogi vs. Director of Investigations, Income Tax Department Ors. [2003] 260 ITR 249 (All) (iii) CIT vs. Kailash Chand Sharma [2005] 198 CTR (Raj) 201 (iv) CIT vs. M. S. Agarwal (HUF) [2008] 11 DTR (MP) 169 (v) CIT vs. Ratanlal Vyaparilal Jain [2011] 339 ITR 351 (Guj) (vi) ACIT vs. Chandmal Soni [2008] 6 DTR (Jd) (Trib) 571 (vii) Sadhna Rani vs. ACIT [2012] 34 CCH 143 (Del) (Trib.) (viii) Smt. Neena Syal vs. ACIT [1999] 70 ITD 62 (Chd) (ix) Income Tax Officer vs. Manilal S. Dave [2001] 70 TTJ (Ahd) 801 (x) Ideal Plot Vikri Kendra Ors. Vs. ACIT [2000] 74 ITD 117 (Pune) (TM) (xi) P. C. Mundra vs. ACIT [2003] 80 TTJ (Jp) 945 (xii) Smt. Sulochana Devi Jaiswal vs. DCIT [2004] 90 TTJ (Jab) 974 (xiii) Jai Kumar Jain vs. ACIT [2006] 99 TTJ (Jp) 744 16. We have considered the rival submissions. We find that this issue was decided by CIT(A) as per 5.3.2 of his order, which is reproduced below for the sake of ready reference:- 5.3.2 I have considered the reply. As the evidence for safe of jewellery to the jeweler was found in the course of the search, hence in view of the provision ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e contents of the CBDT Circular No. 1916 dated 11th May 1994 but no benefit in this regard was allowed by him on the basis that the assessee has not explained the nature and source of acquisition of jewellery. In our considered opinion, since the assessee is a male member, it should be accepted that 100 gms of gold jewellery was owned by him out of explained sources even in the absence of any details and evidence regarding nature and source of acquisition because it is undisputed fact that the assessee is married and this is the claim of the assessee that the jewellery was received at the time of marriage. Receipt of jewellery to the extent of 100 gms. on account of marriage should be accepted in the facts of the present case. We hold that jewellery to the extent of 100 gms. should be accepted subject to computation of Long Term Capital Gain on sale of this jewellery and the addition as unexplained jewellery should be restricted to the balance amount of jewellery being 378.900 gms. The Assessing Officer should work out the proportionate amount of addition. Accordingly, ground No. 7 to 9 are partly allowed in the terms indicated above. 17. Regarding ground No. 10, we are of the c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e under the head Income from Other Sources , and in subjecting the same to assessment accordingly. 5. BECAUSE the appellant had been showing agricultural income in past and there being no material found during the course of search which could impinge upon or contradict the said disclosure, the treatment given to the income shown under the head Agricultural Income', by the authorities below is illegal and unjustified. 6. BECAUSE assessment of agricultural income shown at ₹ 45,000/- as income under the head Income from Other Sources , is beyond the ambit and scope of the said section and accordingly taxation of the same in terms of the assessment order dated 28.12.2010 is wholly illegal. 7. BECAUSE the order appealed against, to the extent the same has been impugned in this appeal, is contrary to the facts, law and principles of natural justice. 20. Ground No. 1, 2 3 were not pressed by Learned A.R. of the assessee in this year also and hence, the same are rejected as not pressed. 21. Regarding ground No. 4 to 7, it was submitted by Learned A.R. of the assessee that this issue was decided by CIT(A) as per Para 6.2 6.2.1 of his order and in these Par ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Income from Other Sources , and in subjecting the same to assessment accordingly. 5. BECAUSE the appellant had been showing agricultural income in past and there being no material found during the course of search which could impinge upon or contradict the said disclosure, the treatment given to the income shown under the head Agricultural Income', by the authorities below is illegal and unjustified. 6. BECAUSE assessment of agricultural income shown at ₹ 48,000/- out of ₹ 98,000/- disclosed as agricultural income by the appellant under the head Income from Other Sources , is beyond the ambit and scope of the said section and accordingly taxation of the same in terms of the assessment order dated 28.12.2010 is wholly illegal. 7. BECAUSE the CIT(A) has erred in law and facts in upholding an addition of ₹ 3,43,150/- representing the collection of cheque (received by the appellant on sale of jewellery) in his bank account, by invoking the provisions of section 69A of the Act. 8. BECAUSE looking to the quantity of jewellery that has been subjected to sale (proceeds of which stood collected/credited in the bank account of the appellant/his wife) t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f 500 gms. of gold jewellery owned by the wife of the assessee as per CBDT Circular No. 1916 dated 11th May 1994. In assessment year 2005-06, we have already held that benefit should be allowed to the assessee to the extent of 100 gms. of gold jewellery as per CBDT Circular No. 1916 dated 11th May 1994 and on the same line, in the present year also, we hold that the benefit should be allowed to the assessee in respect of ownership of jewellery by his wife to the extent of entire jewellery because the same is less than 500 gms. However, the capital gain on sale of this jewellery has to be assessed and for this reason, we restore the matter back to the file of the Assessing Officer for fresh decision. The assessee has to bring evidence on record regarding cost and year of acquisition. If the assessee can establish that the said jewellery was acquired prior to 01/04/1981 then Fair Market Value as on 01.04.1981 should be accepted as cost of jewellery and thereafter indexation of benefit should be allowed to the assessee and long term capital gain, if any, should be computed. With these observations, the matter is restored to the file of the Assessing Officer. These grounds are allowed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ry to the facts, law and principles of natural justice. 31. Ground No. 1, 2 3 were not pressed by Learned A.R. of the assessee and hence, the same are rejected as not pressed. 32. Regarding remaining grounds, it was agreed by both the sides that the facts in this year are also identical and therefore, the issue can be decided on similar line as in assessment year 2006-07 and 2007-08. In the present year, the assessee has declared ₹ 1,15,000/- as agricultural income out of which the Assessing Officer accepted ₹ 50,000/- and rejected the balance claim of ₹ 65,000/- for the same reason that the assessee did not bring any evidence for the receipt of sale of agricultural produce and regarding the expenses incurred for agricultural activities. Since the facts are identical in the present year, we decline to interfere in the order of CIT(A) as in the preceding two years. These grounds of the assessee are rejected. 33. In the result, the appeal of the assessee stands dismissed. 34. Now we take up the appeal of the assessee for assessment year 2009-10 i.e. I.T.A. No.241/Lkw/2012. In this appeal the assessee has raised the following grounds: 1. BECAUSE se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rned A.R. of the assessee and hence, the same is rejected as not pressed. 36. Regarding ground No. 2 in respect of agricultural income, it was agreed by both the sides that facts in the present year are identical to the facts in preceding three years. In the present year, we find that the assessee has declared agricultural income of ₹ 95,000/- out of which, the Assessing Officer accepted to the extent of ₹ 50,000/- and rejected the balance claim for the same reasoning that the assessee could not bring evidence regarding receipt of sale proceeds of agricultural produce and expenses incurred for carrying out agricultural activities. Since the facts in the present year are identical, we decline to interfere in the order of CIT(A) in the present year also. Ground No. 2 is rejected. 37. Regarding ground No. 3 4, it was submitted by Learned A.R. of the assessee that cash found in course of search, was included by Shri K. N. Singh Patel in his disclosure of ₹ 10 crores. He drawn our attention to the assessment order dated 31/12/2010 for assessment year 2009-10 in the case of Shri K. N. Singh Patel appearing on page No. 215 to 235 of the paper book and in particul ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n page No. 220 of the paper book. The name of the assessee is also appearing in that list at S.No. 13 but it is not shown to us or to any of the authorities below that how much cash was found and seized at these 19 places where searches were carried out. If the assessee could have shown that the cash found and seized were ₹ 25 lac or less then it can be accepted that the entire cash found and seized in all searches were covered in the disclosure made by Shri K. N. Singh Patel but in the absence of that, it cannot be said that all the cash found and seized in course of all these 19 searches were included in the disclosure made by Shri K. N. Singh Patel on account of cash found. Hence, we do not find any merit in this explanation of the assessee regarding the cash found and seized in the hands of the present assessee. Benefit to the extent of ₹ 65,375/- is already allowed by the authorities below because against the cash found of ₹ 8,65,365/-, addition of ₹ 8 lac only was made. Considering all these facts, we do not find any reason to interfere in the order of CIT(A) on this issue also. Accordingly, ground No. 3 4 are rejected. 40. In the result, the appe ..... X X X X Extracts X X X X X X X X Extracts X X X X
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