The Income Tax Appellate Tribunal (ITAT), Delhi bench, in ‘ Raj Kumar Kakrania v. DCIT ’ held that a sum of Rs 2,25,000/- seized from the appellant cannot be treated as unaccounted cash since the amount was partly from the old savings of the housewife and partly the sum in the hands of Assessee for house hold expenses.
A search and seizure action u/s.132 was carried out on 21.01.2011 in DS Group of companies and assessee was also covered under the search and seizure operation. During the course of search at the residence of the assessee and bank locker, jewellery was found in the possession of the assessee which was valued by the Government approved valuer at Rs.21,54,497/- on the jewellery found from the residence and Rs.15,63,395/- on the jewellery found from the locker. The total jewellery found from the assessee weighing 1383.90 gms (wrongly taken as 1583.90 gms by the Assessing Officer) which was valued at Rs.37,17,892/-. Apart from that, cash amounting to Rs.5,25,000/- was also found.
The Assessee presented before the Assessing Officer (AO) that he should be given the benefit of the CBDT circular. The Assessee also stated that the gold was received as a result of the partial partition of the jewellery held by a bigger HUF between him and his brother. He also explained that the amount of cash found was the pin money of his wife and the savings from his salary over a period of time. The assessing officer rejected the contentions of the assessee and added the entire jewellery amounting to Rs.37,17,892/-.and added the amount of Rs.5,25,000/- as unexplained u/s.69A.
In the appeal filed by the assessee, the CIT(A) observed that merely by the fact that the appellants wife Bimla Devi Kakrania had filed the wealth tax returns 19-20 years ago , do not explain the source of the jewellery. However the CIT (A) accepted the claim of the appellant that the jewellery should be treated as explained atleast as per the instruction no 1914 ,in view of the judicial pronouncement relied upon by him. Accordingly it was directed to give relief for the value of 600 gm of jewellery and the balance addition was confirmed.
In the case of the cash amount the CIT(A) Confirmed the entire addition observing that the cash withdrawal from the bank and the cash income of the are in anyways sufficient to meet the household expense and cannot explain the source of the cash found.
Aggrieved by the order of CIT(A),The appellants preferred anappeal before the ITAT.
In case of the cash found, the appellants produced a table which explained the availability of cash out of bank withdrawal, house hold’s expenditure and cash available with his wife. The ITAT after considering the submissions by the parties found that, no proper explanation was given by the appellants regarding the availability of cash and the bank withdrawal, household expenditure, and the contribution made by wife is not subject to proper verification. The ITAT held that inspite of the above facts, the possibility of some availability of the cash with the housewife and some with the assessee cannot be ruled out. Therefore the ITAT allowed a part relief of Rs 2,25,000 and the balance of 3 lac was confirmed as unaccounted cash.
