The Income Tax Appellate Tribunal (ITAT) Delhi bench directed to compute addition towards 2% of profit on gold sold by assessee found during the course of search proceedings.
During the search & seizure operations at the premises of the assessee Anoop Kumar Soni, certain documents had been found. Search records showed that gold of 120 gms, 30.780 gms and 100.290 gms were sold. The AO held that the assessee has sold 251 gms of gold @ 2575 per gm and concluded the proceedings and made additions.
Aggrieved by the order, the assessee filed an appeal before the commissioner of Income Tax Appeal(CIT(A). Who upheld the addition .Thereafte the assessee filed second appeal before the tribunal.
Hiren Mehta, Counsel for the assessee submitted that the gold was sold by the assessee. It was done during the business practice of assessee.
P. Praveen Sidharth, Counsel for the revenue supported the decision of the lower authorities.
The tribunal observed that if the gold is considered to be sold, the same ought to have been purchased by the assessee. Hence, only the profit needs to be taxed.
After considering the facts and circumstances of the case and also explanation of the assessee two member bench of Saktijit Dey, (Vice President) and Dr. B. R. R. Kumar, (Accountant Member) directed the assessing officer to compute additions towards 2% of profit on Sale of Gold by assessee found out during the course of search proceedings.
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