TMI Blog2006 (2) TMI 136X X X X Extracts X X X X X X X X Extracts X X X X ..... n the Department?" - Revenue authorities have not placed any convincing materials to disallow the claim of the assessee. The assessee disclosed the purchase of jewellery weighing five sovereigns in each of the assessment years, viz., 1987-88, 1988-89 and 1989-90 and also the purchase of diamond jewellery. Hence, accepting the explanation offered by the assessee, the Tribunal correctly allowed claim of the assessee. - - - - - Dated:- 15-2-2006 - Judge(s) : P. D. DINAKARAN., P. P. S. JANARTHANA RAJA. JUDGMENT The judgment of the court was delivered by P. D. DINAKARAN J.-The tax case appeal is directed against the order of the Income-tax Appellate Tribunal dated June 18, 2002 in I.T.A. No. 1381/Mad/1995 for the assessment year 1990-91. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... facts and circumstances of the case, the Appellate Tribunal was right in holding that the assessee was eligible for the benefit of section 53 or section 54 of the Income-tax Act? (ii) Whether, on the facts and circumstances of the case, the Appellate Tribunal was right in holding that the Department had erred in making an addition on account of investment in jewellery without adequate proof? (iii) Whether, on the facts and circumstances of the case, the Appellate Tribunal was right in casting the burden of proof for source of funds for the jewellery purchased on the Department?" Issue No.1: "Whether, on the facts and circumstances of the case, the Appellate Tribunal was right in holding that the assessee was eligible for the benefi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ithin a period of three years of its purchase or construction, as the case may be, the cost shall be nil; or (ii) if the amount of the capital gain is equal to or less than the cost of the new asset, the capital gain shall not be charged under 45; and for the purpose of computing in respect of the new asset any capital gain arising from its transfer within a period of three years of its purchase or construction, as the case may be, the cost shall be reduced by the amount of the capital gain. (2) The amount of the capital gain which is not appropriated by the assessee towards the purchase of the new asset made within one year before the date on which the transfer of the original asset took place, or which is not utilised by him for the p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d the same. He also admits that he purchased a property at Madras in the name of his wife Smt. Meera out of the money obtained by him by sale of the property at Bangalore. Section 54 of the Act clearly says that if the assessee is the owner of the property, he is entitled for exemption. In the instant case, the assessee purchased a house at Anna Nagar in the name of his wife Smt. Meera after selling the property at Bangalore. But the same was assessed in the hands of the assessee. Hence, as correctly held by the Commissioner of Income-tax (Appeals) as well as by the Tribunal that the assessee is entitled for exemption under section 54 of the Act. The assessee sold a property at Bangalore and purchased a property at Anna Nagar in the n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the findings of the Assessing Officer as well as the Commissioner of Income-tax (Appeals) that suspicion itself cannot be a ground to reject the explanation offered by the assessee particularly in the context that the assessee had two wives and their father was a landlord and the jewels in question, namely, 60 sovereigns, were gifted to them during the marriage and on various ceremonies. While dealing that suspicion cannot be a ground to reject the explanation, the Punjab High Court, in the case of Indo-European Machinery Co. v. CIT reported in [1955] 28 ITR 493 held that (headnote): "Where there is a credit entry of an amount in the bank account of one of the partners of a firm, there is a duty on the firm to explain the nature of the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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