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2015 (7) TMI 603 - ITAT MUMBAI

2015 (7) TMI 603 - ITAT MUMBAI - TMI - Unexplained investment u/s.69 - assessee failed to substantiate that the jewellery worth ₹ 11,00,996/- belonged to the said ladies staying at his residence - Held that:- In view of the Instruction of the CBDT bearing No.1916 dated 11th May, 1994 the gold jewellery found from the premises of the assessee from five female members ought to have been accepted as explained as the same is much lesser than the limit of gold ornaments not to be seized in a ca .....

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e above facts and the mandatory instructions of the CBDT, the AO was not justified in adding the sum of ₹ 8,50,996/- to the income of the assessee on account of gold jewellery which represents Streedhan of family members of the assessee’s family. Accordingly, we direct the AO to delete the same.

The AO has also made an addition of ₹ 2,75,773/- on account of cash found during the course of search. From the record we found that during the said search action, cash of ₹ .....

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inite source of income. Accordingly, we confirm the addition of ₹ 2,25,000/- treated by the AO as unexplained cash. In respect of ₹ 80,773/-, we found that this amount was withdrawn by Anil Vanani, nephew of assessee from his bank account and was reflected in his books of account of M/s Niru Impex. Accordingly, we direct the AO to delete the addition of ₹ 80,773/- which was duly explained by documentary evidence. - Decided partly in favour of assessee. - ITA No.3271/Mum/2012 - .....

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the assessee s residence, as part of a search on the Niru Group. During the said action, gold and diamond jewellery worth ₹ 49,84,841/- was found, as per valuation report of Shri Suraj Ratan Agarwal. The AO noted that the entire diamond jewellery found during search has been explained by the assessee in the hands of his family members. As regards the gold jeweliery of 1,372.20 gms found during search, the assessee stated that it constitutes 'streedhan' of the female members staying .....

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worth ₹ 11,00,996/- belonged to the said ladies. He, therefore, treated the jewellery as unexplained investment of the assessee. However, since the said females, are mostly married, he gave a benefit of streedhan at ₹ 50,000/- per person (Rs.50,000 x 5) and added ₹ 8,50,996/- (i.e. 1100996 - 250000) as unexplained investment u/s.69 of the Act. 3. By the impugned order, the CIT(A) granted relief of ₹ 1 lakh per person in respect of members of the assessee s family in plac .....

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instruction no, 1916 was issued in recoqnttion of this reality, The instruction provides some acceptable benchmark ill respect of jewellery found, depending upon the social status/ customs/ practices of a family, This has been affirmed in a number of cases, including in the recent case of Ashok Chaddha (ITA/2011 dated 05,07,2011, Delhi), upon which reliance has been placed by the appellant. The appellant has claimed that in his case, the jewellery found is far below the 'acceptable benchmark .....

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e of the Investigation Wing/the Assessing Officer issued by the CBDT in this regard, it does not mean that any amount of jewellery has to be considered as explained, The appellant was required to furnish the details of belonging of each person and how and when the same were acquired, While considei ing such explanation, the AO could have been guided by the said instruction, It is fairly possible that some of the members of the family do not possess any jewellery arid the Id.AO is not obliged to .....

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77; 1,00,000/- per person which works out to ₹ 5,00,000/-, The appellant gets relief of ₹ 2,50,000/- and the remaining addition is confirmed, This ground of appeal is partly allowed. 4. Against the above order of CIT(A), the assessee is in further appeal before us. 5. We have considered rival contentions, carefully gone through the orders of the authorities below and found from the record that the assessee is a Gujarati businessman, engaged in the business of diamond trading. He has .....

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ticles - 4 kg 64,000.00 Total 49,84,841.00 The following are the female members staying at the residence as was noted by the DDI(Inv.) :- Smt. AmruLaben Variani - Wife Smt. Rarnubcn vanani - Mother Smt. Nidhi Devani - Daughter Smt. Asha A. Vanani - Daughter-in-law Smt. Kewal A. Vanani - Daughter-in-law Ms. Ruby Vanani - Unmarried daughter 6. The inventory of the jewellery found at the residence indicates that it was of primarily of female design/use and related to the women who resided there. It .....

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t presentation of jewellery and ornaments to the bride and also to some extent the bridegroom. Gifts and presents may come from the parents, parents in law, friends and other relations. Therefore it casts a responsibility in law on every authorised officer to give due weight to these established social customs of India. It was in recognition of this reality that the instruction no. 1916 was issued by the CSDT (supra), that the AO must accept a minimum quantum of 500 gms of gold jewellery in the .....

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ni, two daughters, viz., Ms. Nidhi G. Vanani (Mrs. Nidhi Devani) and Ms. Ruby G. Vanani and the assessee's nephew's wife, Smt. Kewal Anil Vanani. The gold jewellery belonging to the five female members of the assessee's family who were residing with the assessee in the same premises were as under: Sr.No. Name Gross Weight(Grams) Net Weight (Grams) Value (Rs) as per DVO 1. Amrita G. Vanani 233.300 233.300 1,86,640/- 2. Smt. Asha Amit Vanani 348.200 340.000 2,72,000/- 3. Ms. Nidhi G. V .....

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aring No.1916 dated 11th May, 1994 wherein the officers of the Department were directed not to seize gold jewellery and ornaments to the extent of 500 gms. per married lady, 250 gms. per unmarried lady and 100 gms. per male member of the family in the case of a person who is not assessed to wealth-tax. 7. In view of the aforesaid Instruction of the CBDT the gold jewellery found from the premises of the assessee from five female members ought to have been accepted as explained as the same is much .....

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cited by Ld. AR (supra). On careful considerations of said decisions of coordinate Benches, we are of the considered view that the intention of CBDT in issuing the said instruction is that jewellery to the extent of 500 gms in the case of a married lady and 100 gms per male member should be treated as explained and need not be considered as unexplained investments. Further, the department has also not brought any evidence on record that keeping in view the size and status of the family and also .....

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nsidered view that in the facts circumstances of the case and in view of CBDT Instruction N0.1916 dt. 11th May, 1994 and also considering the decisions of coordinate Benches (supra), the aggregate qty. of 1400 gms jewellery i.e. 500 gms in the case of each married lady i.e. two daughters-in-law, and 100 gms per male members of the family (names given at page 14 of Paper Book) is to be treated as explained. Thus we delete the confirmation of addition of ₹ 2,88,000/- made by Ld. CIT(A) on ac .....

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the limits specified in the said circular. Though it is true that the CBDT Instruction No. 1916, dtd. 11th May, 1994 lays down guidelines for seizure of jewellery and ornaments in the course of search the same take into account the quantity of jewellery be held by family members of an assessee belonging to an ordinary Hindu household. The approach adopted by the Tribunal in following the said circular and giving benefit to the assessee, even for explaining the source in respect of the jewellery .....

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u society. In the circumstances, unless the Revenue shows anything to the contrary, it can safely be presumed that the source to the extent of the jewellery stated in the circular stands explained. Thus, the approach adopted by the Tribunal in considering the extent of jewellery specified under the said circular to be a reasonable quantity, cannot be faulted with. In the circumstances, it is not possible to state that the Tribunal has committed any legal error so as to give rise to a question of .....

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