The Allahabad Bench of Income Tax Appellate Tribunal (ITAT) has while deleting the addition observed thatthe mother keeping jewellery of married daughter is not uncommon in India.
The Assessee Shakun Devi, is an individual and derives income from salary and interest on capital from partnership firm of Kesarwani Distributors. On search and seizure conducted in the assessee’s residence gold jewellery weighing 1,796 grams was found. The assessee explained the source of acquisition of gold jewellery as it belongs to the assessee, her two daughters and some of the jewellery belongs to her mother Indra Devi. She further submitted that she had received jewellery from both sides at the time of marriage on many occasions.
The assessee further stated that her husband deposited 623-gram gold under tax free gold bond scheme and rest of the jewellery was claimed as stridhan of the assessee as well as her two daughters. Assessing Officer made addition.
Praveen Godbole, on behalf of the assessee submitted that, He has also relied upon the judgement of Hon’ble Rajasthan High Court in the case of CIT vs. Satya Narain Patni and submitted that the Hon’ble High Court has held that as per the CBDT instruction dated 11th May, 1994, the jewellery to the extent of 500 grams per married lady, 250 grams per unmarried lady and 100 grams per male member of the family need not be seized and therefore, to that extent, the jewellery found in the possession of the assessee could not be questioned about its source and acquisition.
He further submitted that explanation of the assessee was duly supported by the documentary evidence in the shape of gold bond certificate wherein the quantity of the gold bar was matching with the quantity found during search as well as the affidavit of the mother of the assessee confirming the jewellery about 504 grams belongs to her and kept with the assessee.
A.K. Singh, on behalf of the revenue submitted that, the explanation of the assessee could not be accepted as the quantities of the jewellery explained by the assessee were not tallying with the actual jewellery found during the course of search.
The Allahabad Bench of Vijay Pal Rao, (Judicial Member) And Ramit Kochar (Accountant Member) deleted the addition and observed that, “if the undisputed quantity of the jewellery / gold bars of 623 grams as well as the benefit of the CBDT Circular dated 11th May, 1994 in respect of 250 grams gold jewellery of each daughter and 100 grams for the husband of the assessee is given then no addition on account of unexplained investment in the jewellery is called for. Hence, the addition sustained by the CIT(A) on account of 499.85 grams jewellery is liable to be deleted.”
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