The ITO, 4(1), Indore v. Smt. Shakuntala Devi Somani, Indore

ITA 302/IND/2011 | 2008-2009
Pronouncement Date: 21-02-2012 | Result: Dismissed

Appeal Details

RSA Number 30222714 RSA 2011
Assessee PAN AERPS2437L
Bench Indore
Appeal Number ITA 302/IND/2011
Duration Of Justice 3 month(s) 10 day(s)
Appellant The ITO, 4(1), Indore
Respondent Smt. Shakuntala Devi Somani, Indore
Appeal Type Income Tax Appeal
Pronouncement Date 21-02-2012
Appeal Filed By Department
Order Result Dismissed
Bench Allotted DB
Tribunal Order Date 21-02-2012
Assessment Year 2008-2009
Appeal Filed On 11-11-2011
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL INDORE BENCH INDORE BEFORE SHRI JOGINDER SINGH J.M. AND SHRI R.C.SHARM A A.M. PAN NO. : AERPS2437L I.T.A.NO. 289/IND/2011 A.Y. : 2008 - 09 SMT.SHAKUNTALA SOMANI ITO 470 JAWAHAR MARG INDORE. VS WARD 4(1 ) INDORE. APPELLANT RESPONDENT I.T.A.NO. 302/IND/2011 A.Y. : 2008 - 09 ITO SMT.SHAKUNTALA SOMANI WARD 4(1) INDORE. VS 470 JAWAHAR MARG INDORE. APPELLANT RESPONDENT ASSESSEE BY : SHRI P. D. NAGAR C. A. DEPARTMENT BY : SHRI ARUN DEWAN SR. DR DATE OF HEARING : 14 . 02 .201 2 DATE OF PRONOUNCEMENT : 21 . 0 2 .201 2 O R D E R PER R. C. SHARMA A.M. -: 2: - 2 THESE ARE CROSS APPEALS FILED BY THE REVENUE AND T HE ASSESSEE AGAINST THE ORDER OF CIT(A) DATED 22-08-20 11 FOR THE ASSESSMENT YEAR 2008-09 IN THE MATTER OF ORDER PASS ED U/S 143(3) OF THE INCOME-TAX ACT 1961. 2. GROUNDS TAKEN BY THE ASSESSEE READ AS UNDER :- O1) THAT THE LEARNED COMMISSIONER OF INCOME TAX (A) ERR ED IN LAW IN CONFIRMING THE ADDITION MADE AT RS.17 22 750/- BEING THE SALE PROCEEDS OF OLD ORNAMENTS AS UNEXPLA INED INVESTMENT U/S 69 OF THE ACT. HE ERRED IN NOT APPRE CIATING THE FOLLOWING :- A) THE GOLD ORNAMENTS WERE ACQUIRED BY THE APPELLANT AT THE TIME OF MARRIAGE AND ALSO AT THE TIME OF MARRIAGES OF HER CHILDREN IN LAST FORTY YEARS. B) EVIDENCE REGARDING SALE OF JEWELLERY I.E. COPIES OF INVOICES AND CHEQUES WHICH HAVE BEEN DOUBTED UPON WERE PRODUCED BECAUSE OF LAPSES ON THE PART OF THE BUYER. C) WEALTH TAX RETURNS WERE ALSO SUBMITTED BY THE APPELLANT FOR A. Y. 2007-08 & 2008-09 DECLARING SUCH ORNAMENTS. D) THE JEWELLERY AND ORNAMENTS REFLECTED IN THE BALANCE SHEET NEED NOT TO BE REDUCED BECAUSE THE GOLD ORNAMENTS ACQUIRED AT THE TIME OF MARRIAGE (40 YEARS AGO) HAVING NO COST TO THE APPELLANT HENCE THE SAME WAS NOT REFLECTED IN THE BALANCE SHEET. ADDITION OF RS.17 22 750/- U/S 69 OF THE ACT AND IT S CONFIRMATION AS ALLEGED UNEXPLAINED DEPOSIT IN BANK -: 3: - 3 ACCOUNT IS WHOLLY UNJUSTIFIED IMPROPER BAD IN LAW AND DESERVES TO BE SET ASIDE. ' 02) WITHOUT PREJUDICE TO ABOVE THE LEARNED COMMISS IONER OF INCOME TAX (A) CONFIRMED THE ADDITION ON THE PRESUM PTION FOR SUCH AMOUNT MIGHT HAVE BEEN RECEIVED ADDITIONAL LY FROM SALE PROCEEDS OF RESIDENTIAL HOUSE. PRESUMING BUT NOT ADMITTING THE CONCLUSION SO DRAWN THE BENEFIT OF INDEXATION SHOULD HAVE BEEN ALLOWED WHILE CONSIDERI NG THE SAME AS SALE PROCEEDS OF HOUSE INSTEAD OF ORNAMENTS . ADDITIONS U/S 69 OF THE ACT IS THEREFORE UNJUSTIF IED AND BAD IN LAW. 3. GROUNDS TAKEN BY THE REVENUE READS AS UNDER :- 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE THE ORDER OF THE CLT(A) IS CONTRARY TO THE FA CTS AND LAW. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE THE LD. CIT(A) ERRED IN LAW IN DELETING TH E ADDITION OF RS.24 20 100/- MADE BY THE ASSESSING OFFICER ON ACCOUNT OF LONG TERM CAPITAL GAIN RELYING ON THE DECISION OF MUMBAI BENCH IN THE CASE OF SMT . MANJULA J. SHAH PARTICULARLY WHEN PRIMA FACIE IT IS NOT ACCEPTABLE AND THE STATUTE DOES NOT PERMIT FOR TAKING THE YEAR OF INDEXATION EVEN PRIOR TO DATE ON WHICH IT HAS BEEN ACTUALLY TRANSFERRED IN THE NAME OF ASSESSEE AND NO EXPLANATION WAS FILED BY THE ASSESSEE BEFORE THE ASSESSING OFFICER. 3. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE -: 4: - 4 CASE THE LD. CIT(A) ERRED IN LAW IN DELETING THE ADDITION OF RS.24 20 100/- MADE BY ASSESSING OFFICER ON ACCOUNT OF LONG TERM CAPITAL GAIN ALTHOUGH THE YEAR OF INDEXATION IS RIGHTLY TAKEN BY THE AO IN VIEW OF SECTION 48 AND SECTION 55 OF IT A CT I.E. THE YEAR IN WHICH THE PROPERTY WAS FIRST ACQUI RED BY THE ASSESSEE. 4. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE THE LD. CIT(A) ERRED IN LAW IN DELETING THE ADDITION OF RS.26 35 000/- MADE BY ASSESSING OFFICER ON ACCOUNT OF UNEXPLAINED DEPOSITS PARTICULARLY WHEN THE ONUS TO PROVE THE DEPOSITS WAS NOT DISCHARGED BY ASSESSEE WITH COGENT AND RELIABLE DOCUMENTARY EVIDENCE. 4. RIVAL CONTENTIONS HAVE BEEN HEARD AND RECORDS PERUSED. DURING THE COURSE OF SCRUTINY ASSESSMENT THE ASSESSING OFFICER FOUND THAT UNDER THE HEAD LONG T ERM CAPITAL GAIN THE ASSESSEE HAS CLAIMED LOSS OF RS. 7 29 082/- AND DECLARED INTEREST INCOME OF RS. 3 11 273/-. WIT H REGARD TO THE CAPITAL GAIN WORKED OUT AS PER COMPUTATION OF I NCOME FILED THE ASSESSEE WAS ASKED TO SUBMIT THE DOCUMEN TARY EVIDENCES AND JUSTIFY COST OF ACQUISITION IN RESPEC T OF JEWELLERY -: 5: - 5 AND HOUSE PROPERTY SOLD DURING THE YEAR. BEING NOT SATISFIED WITH THE ASSESSEES SUBMISSION FOLLOWING ADDITIONS WERE MADE BY THE ASSESSING OFFICER TO THE RETURNED INCOME :- RS. 1. ON ACCOUNT OF UNEXPLAINED CASH U/S 69 17 22 750/- 2. ON ACCOUNT OF LONG TERM CAPITAL GAIN 24 20 100/ - 3. ON ACCOUNT OF UNEXPLAINED DEPOSITS 26 35 000/- 5. THE ADDITION MADE ON ACCOUNT OF SALE OF JEWELLERY AMOUNTING TO RS. 17 22 750/- WAS CONFIRMED BY THE L D.CIT(A) WHEREAS HE DELETED THE ADDITION MADE ON ACCOUNT OF LONG TERM CAPITAL GAIN ON SALE OF HOUSE BY ALLOWING CLAIM OF INDEXATION U/S 49. THE LD. CIT(A) ALSO DELETED ADDITION OF RS. 26 35 000/- MADE BY THE ASSESSING OFFICER IN RESPECT OF SALE PR OCEEDS OF HOUSE PROPERTY DEPOSITED IN BANK ACCOUNT OF ASSESSE E BY TREATING THE SAME AS UNEXPLAINED DEPOSIT IN BANK U/ S 69 OF THE ACT. 6. AGAINST THE ABOVE ORDER OF CIT(A) BOTH THE ASSESSE E AND REVENUE ARE IN APPEAL BEFORE US. -: 6: - 6 7. FIRST WE TAKE GROUND RAISED BY THE REVENUE IN ITS APPEAL WITH REGARD TO ALLOWING CLAIM OF INDEXATION U/S 49 OF THE INCOME-TAX ACT 1961. 8. FACTS OF THE CASE ARE THAT THE ASSESSEE HAS ACQUIRE D A HOUSE PROPERTY ON THE PARTITION OF HUF. AS THE HOUS E PROPERTY WAS ACQUIRED BY HUF PRIOR TO 1.4.1981 THE ASSESSEE HAS TAKEN BENEFIT OF CLAIM OF INDEXATION FROM 1.4.1981. HOWEVER THE ASSESSING OFFICER WAS OF THE VIEW THAT THE ASSE SSEE HAS ACQUIRED THE HOUSE PROPERTY ON THE DATE OF PARTITIO N I.E. ON 2.4.2007 THEREFORE THE PROFIT ON SALE OF HOUSE PR OPERTY WAS SHORT TERM CAPITAL GAIN AND NO INDEXATION WAS ALLOW ED WITH RESPECT TO INCREASE IN ITS COST SINCE 1 ST APRIL 1981. IN THIS REGARD THE ASSESSING OFFICER OBSERVED THAT THE ASS ESSEE HAS SOLD PROPERTY SITUATED AT 3 MAHESH NAGAR STREET N O.3 INDORE FOR RS. 31 LACS ON 19.9.2007. THE PROPERTY WAS RECEIVED BY ASSESSEE ON ACCOUNT OF PARTITION OF HUF ON 02.04.2007 THE COPY OF PARTITION DEED IS SUBMITTED . NO REGISTERED DOCUMENT WAS EFFECTED FOR TRANSFER OF PR OPERTY IN THE NAME OF ASSESSEE. THIS PROPERTY WAS SOLD BY KAR TA WITH CONSENT OF ASSESSEE ON 19.09.2007. THE ASSESSEE HAS -: 7: - 7 DISCLOSED LONG TERM LOSS OF RS. (-) 646249/- IN THE PROPERTY. THE LONG TERM CAPITAL LOSS IS WORKED OUT BY WORKING THE ACQUISITION COST OF PROPERTY AS ON 1.4.1981 AT RS. 6 79 900/- WITH RESPECT TO INDEXATION COST APPLICABLE FOR THE YEAR 1281- 82. WITH REGARD TO VALUE TAKEN AS ON 1.4.1981 THE ASSESSEE HAS SUBMITTED VALUATION REPORT OF AUTHORIZED VALUER WHICH IS PLACED ON RECORD. 9. AS PER THE ASSESSING OFFICER THE PROPERTY WAS ACQUIRED BY THE ASSESSEE IN THE YEAR ITSELF AND WAS HELD FOR ONLY FEW MONTHS THEREFORE AFTER APPLYING EXPLANAT ION 3 BELOW SECTION 48 HELD THAT COST OF INDEXATION IS TO BE WO RKED OUT WITH RESPECT TO THE AMOUNT WHICH BEARS THE COST OF ACQUISITION THE SAME PROPORTION AS COST OF INFLATI ON INDEX FOR THE YEAR IN WHICH ASSETS TRANSFERRED BEARS TO THE C OST INFLATION INDEX FOR THE YEAR IN WHICH THE ASSETS WERE FIRST H ELD BY THE ASSESSEE OR FOR THE YEAR BEGINNING ON 1.4.1981 WHIC HEVER IS LATER. 10. BY THE IMPUGNED ORDER THE CIT(A) DIRECTED FOR TAKI NG THE COST OF ACQUISITION AND INDEXING THEREON W.E.F. 1 ST APRIL -: 8: - 8 1981 SINCE THE HOUSE PROPERTY WAS OWNED BY HUF PRI OR TO ASSESSEE BECAME ITS OWNER. 11. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND FOUND FROM RECORD THAT DURING THE YEAR UNDER CONSIDERATIO N THE ASSESSEE HAD SOLD HOUSE PROPERTY WHICH WAS ACQUIRE D BY HER ON PARTITION OF HIS HUF. AS THE HOUSE PROPERTY WAS ACQUIRED ON DISTRIBUTION OF ASSETS ON THE PARTITION OF HUF COST OF SUCH HOUSE FOR THE PURPOSE OF CAPITAL GAIN IS REQUIRED T O BE COMPUTED AS PER PROVISIONS OF SECTION 49(1)(I). SIN CE PROPERTY WAS NOT ACQUIRED BY THE ASSESSEE AT HIS OWN BUT WAS ACQUIRED UNDER THE MODE SPECIFIED IN SECTION 49(1) THE INDE X COST OF ACQUISITION IS TO BE COMPUTED WITH REFERENCE TO THE YEAR IN WHICH HUF HAS ACQUIRED THE PROPERTY AND NOT THE YEA R IN WHICH THE PROPERTY CAME TO THE ASSESSEE ON PARTITIO N. 12. AS PER OUR CONSIDERED VIEW CLAUSE (IV) OF EXPLANA TION TO SECTION 48 PERMITS INDEXATION OF COST AND IMPROV EMENT IF ANY MADE IN SUCH COST WHEN READ WITH SECTION SECTI ON 55(1)(B)(2) WHICH ALLOWS DEDUCTION FOR COST OF IMPR OVEMENT INCURRED BY A PREVIOUS OWNER. THUS THE COST OF ANY IMPROVEMENT TO CAPITAL ASSET INCURRED BY THE PREVIO US OWNER -: 9: - 9 IS ALSO ELIGIBLE FOR INDEXATION. IF WE ACCEPT THE R EASONING GIVEN BY THE ASSESSING OFFICER CLAUSE (III) OF EXPLANATI ON TO SECTION 48 IT WOULD LEAD TO SUCH WORKING OF INDEX COST OF ACQUISITION WHICH IS TOTALLY ILLOGICAL AND UNREASONABLE. FOR EX AMPLE WHERE CAPITAL ASSET HAS BECOME PROPERTY OF THE ASSESSEE U NDER A GIFT PRIOR TO CUT OFF DATE OF 1 ST APRIL 1981 BUT THE SAME IS TRANSFERRED BY HIM ONLY AFTER 1 ST APRIL 1981 I.E. IN FINANCIAL YEAR 1987-88. THE YEAR TO BE ADOPTED FOR INDEXATION AS PER THE ASSESSING OFFICER WOULD BE FINANCIAL YEAR 19887-88. HOWEVER THE COST OF ACQUISITION OF CAPITAL IN SUCH CASE WOU LD BE TAKEN AS FAIR MARKET VALUE ON 1 ST APRIL 1981 BEING THE CUT OFF DATE EMBEDDED IN THE INDEXATION SCHEME. THUS A SITUATIO N WILL ARISE WHERE THE COST OF ACQUISITION OF CAPITAL WOU LD BE TAKEN A 1 ST APRIL 1981 WHEREAS THE COST OF INFLATION INDEX F OR THE YEAR 1987-88 WOULD BE APPLIED TO THE SAID COST TO WORK O UT THE INDEXED COST OF ACQUISITION. 13. THE ISSUE IS ALSO COVERED BY THE DECISION OF THE I. T.A.T. SPECIAL BENCH IN THE CASE OF MANJULA J. SHAH 126 T TJ 145 WHEREIN IT WAS HELD THAT FOR THE PURPOSE OF COMPUTI NG LONG TERM CAPITAL GAIN ARISING FROM TRANSFER OF CAPITAL ASSETS WHICH -: 10: - 10 HAD BECOME PROPERTY OF THE ASSESSEE UNDER A GIFT T HE FIRST YEAR IN WHICH THE CAPITAL ASSET WAS HELD BY THE ASS ESSEE HAS TO BE DETERMINED TO WORK OUT THE INDEX COST OF ACQUISI TION AS ENVISAGED IN EXPLANATION (III) TO SECTION 48 AFTER TAKING INTO ACCOUNT THE PERIOD FOR WHICH THE SAID CAPITAL ASSET WAS HELD BY THE PREVIOUS OWNER I.E. INDEX COST OF ACQUISITION O F SUCH CAPITAL ASSET HAS TO BE COMPUTED WITH REFERENCE TO THE YEAR IN WHICH THE PREVIOUS OWNER FIRST HELD THE ASSETS. IT WAS AL SO OBSERVED THAT WHEN THE COST OF ACQUISITION OF THE PREVIOUS O WNER AS ON THE DATE OF ACQUISITION OF CAPITAL ASSETS BY HIM IS TO BE ADOPTED AS COST OF ACQUISITION TO THE ASSESSEE EVEN FOR THE PURPOSE OF WORKING OUT INDEX COST OF ACQUISITION AS PER THE ME ANING GIVEN IN EXPLANATION (III) TO SECTION 48 IT DOES NOT SOU ND LOGICAL TO ADOPT THE COST OF INFLATION INDEX FOR THE YEAR IN W HICH THE CAPITAL ASSET BECAME THE PROPERTY OF THE ASSESSEE A ND NOT THAT FOR THE YEAR IN WHICH THE ASSET WAS ACQUIRED BY THE PREVIOUS OWNER. THE LEGISLATIVE INTENT TO INTRODUCE THE CONC EPT OF INDEX COST OF ACQUISITION AND INDEX COST OF IMP ROVEMENT IN THE STATUTE HAS BEEN TO ALLOW DEDUCTION WHILE COMPU TING THE -: 11: - 11 CAPITAL GAINS ON THE BASIS OF LENGTH OF PERIOD OF H OLDING OF THE CAPITAL ASSET. 14. ACCORDINGLY WE DO NOT FIND ANY INFIRMITY IN THE OR DER OF CIT(A) FOR TAKING THE COST OF ACQUISITION AS ON 1 ST APRIL 1981 AND THEREAFTER ALLOWING INDEXATION FROM 1981 ITSELF . 15. IN THE RESULT THE GROUND NO.2 OF THE REVENUES APP EAL STANDS DISMISSED. 16. THE ASSESSING OFFICER HAS ALSO MADE ADDITION OF RS. 26.25 LAKHS IN RESPECT OF THE AMOUNT DEPOSITED IN T HE BANK ACCOUNT OF THE ASSESSEE. THE ASSESSING OFFICER OBSE RVED THAT THE ASSESSEE IN ITS BANK ACCOUNT IN STANDARD CHARTE RED BANK DEPOSITED CHEQUE NO. 382358 DATED 21.9.2007 OF RS. 26 35 000/- AGAINST WHICH LIC HOUSING FINANCE IS ME NTIONED. BY OBSERVING THAT AS PER BALANCE SHEET OF THE ASSES SEE NO LOAN WAS APPEARING IN THE NAME OF LIC HOUSING AS ON 31.3.2007 THE ASSESSING OFFICER ADDED THE SAME IN THE ASSESSEES INCOME. 17. BY THE IMPUGNED ORDER THE CIT(A) DELETED THE ADDIT ION BY OBSERVING THAT AMOUNT OF RS. 26.35 LAKHS WAS REC EIVED BY THE ASSESSEE AS SALE CONSIDERATION OF THE PROPERTY SOLD AT RS. -: 12: - 12 31 LAKHS AND CHEQUE ISSUED BY LIFE INSURANCE HOUSIN G FINANCE LIMITED WAS PART AND PARCEL OF THE SALE CON SIDERATION SO RECEIVED BY THE ASSESSEE WHICH HAS BEEN DULY OF FERED FOR TAXATION AND SUCH AMOUNT BEING NOT A LOAN RECEIVED BY THE ASSESSEE FROM LIFE INSURANCE HOUSING FINANCE LIMITE D. 18. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND FOUND FROM RECORD THAT THE ASSESSEE HAS SOLD HER HOUSE FO R RS. 31 LACS AND DEPOSITED THE SALE CONSIDERATION OF HOUSE PROPERTY IN HER BANK ACCOUNT. AS THE BUYER WHO HAS PURCHASED TH E HOUSES FROM THE ASSESSEE HAS GOT FINANCE OF RS. 26 35 000 FROM THE LIFE INSURANCE HOUSING FINANCE LIMITED CH EQUE OF RS. 26 35 000/- WAS ISSUED BY LIFE INSURANCE HOUSIN G FINANCE LIMITED IN FAVOUR OF THE ASSESSEE WHICH WA S DEPOSITED BY HER IN HER BANK ACCOUNT. THE HOUSING L OAN WAS NOT AVAILED BY THE ASSESSEE BUT IT WAS AVAILED BY T HE BUYER OF THE HOUSE THEREFORE THE ASSESSEE CANNOT BE ASKED FOR THE LOAN SANCTIONED BY LIFE INSURANCE HOUSING FINANCE L IMITED. WHATEVER SALE CONSIDERATION WAS RECEIVED BY THE ASS ESSEE WAS DULY ACCOUNTED FOR AS INCOME WHILE COMPUTING THE L ONG TERM CAPITAL GAIN AND ALSO DEPOSITED IN HER BANK ACCOUNT . WE -: 13: - 13 THEREFORE DO NOT FIND ANY INFIRMITY IN THE ORDER O F CIT(A) FOR DELETING THE ADDITION MADE BY THE ASSESSING OFFICER ON ACCOUNT OF AMOUNT DEPOSITED IN HER BANK ACCOUNT IN RESPECT OF SALE PROCEEDS OF HOUSE PROPERTY. 19. THE ASSESSEE IS AGGRIEVED BY ACTION OF ASSESSING OFFICER FOR NOT ACCEPTING CAPITAL GAIN SHOWN ON SAL E OF GOLD JEWELLERY AMOUNTING TO RS. 17 22 750/-. 20. FACTS OF THE CASE ARE THAT THE ASSESSEE IS 70 YEARS OLD LADY BELONGS TO MAHESHWARI COMMUNITY WAS IN RESPECT OF JEWELLERY AND ORNAMENTS SINCE HER BIRTH AND AT THE TIME OF HER MARRIAGE 40 YEARS BACK FROM HER PARENTS AS WELL AS FROM IN LAWS AND MARRIAGE OF HER CHILDREN. AS THE JEWELLERY WAS RECEIVED AS A GIFT WITHOUT INCURRING ANY COST THE SAME WAS NOT REFLECTED BY THE ASSESSEE IN HER BALANCE SHEET. HOW EVER THE ASSESSEE HAS FILED WEALTH TAX RETURN FOR THE ASSESS MENT YEAR 2006-07 WHEREIN VALUE OF THE JEWELLERY RECEIVED IN GIFT AS WELL AS SELF ACQUIRED JEWELLERY WAS SHOWN AS PER SCHEDUL E III. DURING THE YEAR UNDER CONSIDERATION THE ASSESSEE H AS SOLD THE JEWELLERY WHICH WAS ACQUIRED AS GIFT SINCE LON G BACK. AFTER CLAIMING INDEXATION LONG TERM CAPITAL GAIN WAS SHO WN ON THE -: 14: - 14 SALE OF JEWELLERY WHICH WAS NOT ACCEPTED BY THE AS SESSING OFFICER ON THE PLEA THAT THE ASSESSEE HAD NOT SHOWN ANY REDUCTION IN THE VALUE OF JEWELLERY IN HER BALANCE SHEET. THE ASSESSING OFFICER ALSO ALLEGED THAT IT IS NOT CLEAR FROM THE WEALTH TAX RETURN OF THE ASSESSEE THAT THE GOLD JEW ELLERY AND SILVER ARTICLES RECEIVED AS GIFT BY HER WERE REFLEC TED IN HER BALANCE SHEET. THE ASSESSING OFFICER ALSO REFERRED TO THE INQUIRY MADE BY HIM WHEREIN IT WAS ALLEGED THAT JE WELER WHO HAD PURCHASED THE JEWELLERY FROM ASSESSEE HAS NOT F URNISHED HIS CASH BOOK AND THE LEDGER AND THE STATUS OF HIS AUDIT. ACCORDINGLY THE SALE PROCEEDS RECEIVED WAS BROUGHT TO TAX U/S 69 AS UNEXPLAINED INVESTMENT. BY THE IMPUGNED ORDER THE LD. CIT(A) CONFIRMED THE ACTION OF THE ASSESSING OFFICE R AGAINST WHICH THE ASSESSEE IS IN APPEAL BEFORE US. 21. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND HAVE GONE THROUGH THE ORDERS OF THE AUTHORITIES BELOW AN D FOUND FROM RECORD THAT THE ASSESSEE BELONGS TO MAHESHWARI COMMUNITY WHEREIN RECEIPT OF JEWELLERY ON MARRIAGE FROM PARENTS AND IN LAWS CANNOT BE DISPUTED. THUS THE T RADITION OF THE FAMILY AND STATUS OF THE ASSESSEE HAS TO KEEP I N MIND -: 15: - 15 WHILE DECIDING THE FACTUM OF RECEIPT OF SUCH JEWELL ERY. THE ASSESSEE HAD SHOWN THESE JEWELLERY IN HER WEALTH TA X RETURN OF 2006-07:- A.Y.2007-087 A.Y. 2008-09 NATURE OF ASSET BOOK VALUE/COST WHETHER AN ASSET LIABLE TO W. T. U/S 2(EA) VALUE AS PER SCHEDULE III NATURE OF ASSET BANK VALUE/COST WHETHER AN ASSET LIABLE TO W. T. U/S 2(EA) VALUE AS PER SCHEDULE III GOLD & JEWELLERY 4 58 500 YES 23 77 046 GOLD & JEWELLERY 5 78 500 YES 13 37 287 SILVER UTENSILS & ARTICLES NIL YES 3 18 449 SILVER UTENSILS & ARTICLES NIL -- NIL 22. AS THE SAID JEWELLERY WAS RECEIVED BY THE ASSESSEE AT THE TIME OF HER MARRIAGE 40 YEARS BACK FROM HER MOT HER-IN-LAW AND MOTHER THE COST THEREOF IN THE HANDS OF THE AS SESSEE WAS NIL AND THE SAME WAS NOT APPEARING IN HER BALANCE S HEET. HOWEVER WHATEVER JEWELLERY WAS ACQUIRED BY THE ASS ESSEE HERSELF BY PAYING CONSIDERATION WAS DULY REFLECTED IN HER BALANCE SHEET. SINCE THE ASSESSEE HAD ONLY SOLD THE JEWELLERY RECEIVED IN GIFT THE VALUE OF SELF ACQUIRED JEWELL ERY AS SHOWN IN THE BALANCE SHEET WAS NOT EFFECTED. THUS THE OBJEC TION OF THE ASSESSING OFFICER TO THE EFFECT THAT SINCE THERE WA S NO REDUCTION IN THE VALUE OF JEWELLERY SHOWN IN THE BA LANCE SHEET THE SALE OF SUCH JEWELLERY CANNOT BE ACCEPTED DOES NOT HAVE MUCH SUBSTANCE. ON GOING THROUGH THE WEALTH TAX RET URN FILED -: 16: - 16 BY THE ASSESSEE WHICH WAS REPRODUCED BY THE LD.CIT (A) IN HIS APPELLATE ORDER IT IS CLEAR THAT THE VALUE OF GOLD JEWELLERY AND SILVER ARTICLE AS REFLECTED IN THE WEALTH TAX RETUR N INCLUDES THE VALUE OF THE GOLD JEWELLERY RECEIVED AS GIFT BY THE ASSESSEE. WE ALSO FOUND THAT WEALTH TAX VALUE OF GOLD JEWELLERY AND SILVER ARTICLES IN ASSESSMENT YEAR 2007-08 WAS RS. 23 77 0 46/- AND RS. 3 18 499/- RESPECTIVELY WHICH GETS REDUCED TO RS. 13 37 287/- AND RS. NIL RESPECTIVELY IN THE ASSESSM ENT YEAR 2008-09 AND THE SAID REDUCTION WAS SHOWN IN THE WEA LTH TAX RETURN IN THE ASSESSMENT YEAR 2008-09 ON ACCOUNT OF SALE OF JEWELLERY AND SILVER ARTICLES RECEIVED IN GIFT. WE ALSO FOUND THAT IN ASSESSMENT YEAR 2007-08 THOUGH THE BOOK VALUE OF THE SILVER ARTICLE IS TAKEN AT NIL THE WEALTH TAX VALU E THEREOF IS TAKEN AT RS. 2 18 449/- WHICH ALSO SUBSTANTIATE TH E CLAIM OF ASSESSEE THAT THE SILVER ARTICLES AND JEWELLERY RE CEIVED IN GIFT ARE DULY REFLECTED IN THE WEALTH TAX RETURN. THE SA LE OF THESE JEWELLERY WAS EFFECTED THROUGH M/S. MULTANI JEWELLE RS AND M/S. GAPPULAL BABULAL SARAF WHO CONFIRMED THE TRAN SACTION OF SALE. THE SALE CONSIDERATION WAS RECEIVED THROUG H ACCOUNT PAYEE CHEQUE IN RESPECT OF SALE OF 1754.950 GMS. O F GOLD ORNAMENTS AND 27.190 KGS. OF SILVER BULLIONS. THE S ALE REALIZATION WAS RECEIVED BY ACCOUNT PAYEE CHEQUE AN D LONG TERM CAPITAL GAIN WAS WORKED OUT BY THE ASSESSEE ON THE BASIS OF DATE OF ITS ACQUISITION PRIOR TO 1.4.1981. NOW T HE QUESTION ARISES AS TO WHETHER THE JEWELLERY SHOWN BY THE ASS ESSEE CAN BE CONSIDERED REASONABLE KEEPING INTO ACCOUNT HER F AMILY -: 17: - 17 BACKGROUND AND THE COMMUNITY TO WHICH SHE BELONGS. ASSESSEE HAD SHOWN TOTAL GOLD JEWELLERY AT 1754.950 GMS. AND SILVER BULLIONS AT 27.190 KGS. KEEPING INTO ACCOUNT AGE OF THE ASSESSEE THE COMMUNITY TO WHICH SHE BELONGS AND HE R FAMILY BACKGROUND IT WILL BE REASONABLE TO ACCEPT THE ASS ESSEES CLAIM AT 50 %. ACCORDINGLY THE ASSESSING OFFICER I S DIRECTED TO RECOMPUTE CAPITAL GAINS AFTER ALLOWING BENEFIT OF I NDEXATION IN RESPECT OF 50% OF THE JEWELLERY CLAIMED TO BE ACQUI RED AS GIFT AT THE TIME OF HER MARRIAGE AND OTHER SOCIAL OCCASION FROM HER PARTNER AND IN LAWS. WE DIRECT ACCORDINGLY. 23. IN THE RESULT THE APPEAL OF THE REVENUE IS DISMISS ED WHEREAS THE APPEAL FILED BY THE ASSESSEE IS ALLOWED IN PART. THIS ORDER HAS BEEN PRONOUNCED IN THE OPEN COURT ON 21 ST FEBRUARY 2012. SD SD (JOGINDER SINGH) ( R.C.SHARMA) JUDICIAL M EMBER ACCOUNTANT MEMBER DATED :_21 ST ______FEBRUARY 2012. CPU* 1417