ITAT Chennai Quashes Section 153C Assessments, Restricts Addition to 2% Profit Estimation

Nalli Trust Vs DCIT (ITAT Chennai)

The Chennai Bench of the Income Tax Appellate Tribunal (ITAT) disposed of five appeals filed by the assessee for Assessment Years (AYs.) 2017-18 to 2021-22 against separate orders of the Commissioner of Income Tax (Appeals). The appeals for AYs. 2017-18 to 2020-21 involved a common legal issue concerning the validity of assessments completed under Section 153C of the Income Tax Act, while the appeal for AY 2021-22 challenged an addition made on merits.

For AYs. 2017-18 to 2020-21, the assessee raised an additional legal ground contending that the Assessing Officer lacked jurisdiction to initiate proceedings under Section 153C because the seized material was received and satisfaction was recorded only on 07.03.2023, after the amendment effective from 01.04.2021. The Revenue opposed admission of the additional ground. The Tribunal admitted the additional ground, holding that it was purely legal and required no further factual verification. Referring to the first proviso to Section 153C(1), Section 153C(3), and the decisions of the Madras High Court in Harigovind v. ACIT and the Delhi High Court in PCIT v. Ojjus Medicare Pvt. Ltd., the Tribunal held that, for the assessee, the date of initiation of search is the date on which the Assessing Officer having jurisdiction receives the seized material and records satisfaction. Since that date fell after 01.04.2021, Section 153C(3) rendered the provisions of Section 153C inapplicable. Consequently, the notices issued under Section 153C and the assessment orders for AYs. 2017-18 to 2020-21 were held to be without jurisdiction and were quashed.

For AY 2021-22, the Tribunal considered an addition of ₹26,00,492 made under Section 143(3). The Assessing Officer had made the addition after the assessee, engaged in the retail sale of silk sarees and jewellery, voluntarily offered the amount during assessment proceedings arising from data recovered during a search conducted in the case of M/s Mohanlal Jewellers Pvt. Ltd. The assessee maintained that all transactions with M/s Mohanlal Jewellers Pvt. Ltd. were duly recorded, furnished reconciliation statements, and stated that the disclosure had been made only to buy peace and avoid litigation. The Commissioner (Appeals) upheld the addition on the basis of the voluntary disclosure.

The Tribunal observed that the addition had been made solely on the basis of the disclosure and that the Assessing Officer had not brought any independent evidence to establish unaccounted purchases despite the reconciliation and supporting records produced by the assessee. It held that an admission alone could not constitute the sole basis for addition without corroborative evidence. The Tribunal further observed that even if unaccounted purchases were assumed, only the profit element embedded in such purchases could be taxed. Relying on the co-ordinate Bench decision in M/s Gold AIK Vs The ITO, it held that a profit rate of 2% on the alleged unaccounted purchases would meet the ends of justice. The Tribunal therefore directed the Assessing Officer to restrict the addition to 2% of the value of the alleged unaccounted purchases of 2340.210 grams, partly allowing the appeal for AY 2021-22. Accordingly, the appeals for AYs. 2017-18 to 2020-21 were allowed and the appeal for AY 2021-22 was partly allowed.

Recent Cases Discussed

• Sitaram Jewellers v. DCIT (ITAT Chennai), ITA #915/CHNY/2025 dated 21.01.2026.
• Shanmugasundaram Manoharan V. DCIT (ITAT Chennai), ITA Nos. 1607, 1608, 1609/CHNY/2025 dated 09.12.2025.
• Harigovind v. ACIT (Madras High Court), [2025] 180 taxmann.com 197 (Madras) / [2026] 308 Taxman 188 (Madras).
• PCIT Vs. Ojjus Medicare Pvt. Ltd. (Delhi High Court), (2024) 465 ITR 101 (Delhi).
• M/s Gold AIK Vs The ITO (ITAT Chennai), ITA No.1046-1051/Chny/2024 dated 06.11.2024.

FULL TEXT OF THE ORDER OF ITAT CHENNAI

The captioned appeals being ITA Nos. 3072, 3073, 3074, 3075 & 3076 /Chny/2025are filed by assessee against the separate orders of the Commissioner of Income Tax (Appeals), Chennai-20 all dated 19.08.2025 arising out of assessment orders dated 30.03.2023, 30.03.2023, 28.03.2023, 29.03.2023 passed u/s 153(C) and 28.03.2023 u/s 143 of the Income Tax Act 1961 for A.Ys. 2017-18, 2018-19, 2019-20, 2020-21 & 2021-22 respectively.

2. As the first four appeals being ITA Nos. 3072, 3073, 3074, 3075 for A.Ys. 2017-18, 2018-19, 2019-20 & 2020-21 have identical legal issues which have been raised by the assessee by filing additional grounds. Therefore, first four appeals filed by the assessee are decided by common order. Appeal in ITA NO.3076/Chny/2025 for assessment year 2021-22 is a separate appeal raising grounds on merit of the addition.

3. During the course of hearing, Ld. AR raised certain additional grounds of appeal along with prayer under Rule 11 of the Income Tax Appellate Tribunal Rules, 1963. The additional ground of appeal taken reads as under:-

‘The assessing officer erred in completing the assessment u/s. 153C.

1. In as much as the appellant’s records were notified to the appellant’s Assessing Officer only on 24/02/2023, the date of initiation of search on the appellant is 24/02/2023 only; this being a date beyond 01/04/2021 it is submitted that provisions of section 153C would not apply and thus impugned notice u/s 153C is to be quashed.

The appellant relies on the decisions of the jurisdictional court / tribunal in the following cases:

A. HARIGOVIND v. ACIT [2025] 180 Com 197 (Madras)/[2026] 308 Taxman 188 (Madras) [28-10-2025]

B. Shanmugasundaram Manoharan V. DCIT ITA in # 1607,1608,1609/CHNY/2025 dt. 09.12.2025 (reliance placed by Hon’ble ITAT on Madras High Court decision stated above)

C. Sitaram Jewellers v. DCIT – [ITA #915/CHNY/2025] dt. 21/01/2026 (reliance placed by Hon’ble ITAT on Madras High Court decision stated above)

On Merits

II. The CIT (Appeals) Order is silent on the factual submissions made by the appellant with regard to the transactions with M/s. Mohanlal Jewellers P Ltd (MJPL) and dismissed theappellant’s appeal “only” on the premise that the appellant had “voluntarily” offered the income, relying on the following jurisdictional pronouncements

i. Jayasree Chit Funds & Services (P.) Ltd. v. CIT [1981] 5 Тахтан 259 (Ker.HC), “wherein it asas held that chartered accountant is legally competent to make agreement with ITO for certain additions to assessable income so as to bind assessee”.

ii. Rameshchandra& Co. v. CIT [1987] 168 ITR 375 (Bombay HC) held that “Where an assessee has made a statement of facts, he can have no grievance if the taxing authority taxes him in accordance with that statement. If he can have no grievance, he can file no appeal”.

(it) CIT v. Vamadevan Bhanu [2011] 330 ITR 559 (Kerala HC) held that” In our view, after disabling the Assessing Officer to conduct enquiry and to sustain assessment on his own reasoning by agreeing for specific additions, it is not fair on the part of the assessee and the auditor to backtrack and disown the commitments”.

The appellant submits that the facts of our case are dissimilar to the above cases mentioned by CIT(A). The appellant relies on the following judicial pronouncements in support of its claim for making an appeal to the appellate authorities, even though the subject amounts were offered as income by the appellant during the assessment proceedings:

(a) Pullangode Rubber Produce Co Ltd Vs. State of Kerala 91 ITR 18, the apex court held that “an admission is extremely an important piece of evidence but it cannot be said that it is conclusive and it is open to the person who made the admission to show that it is incorrect”.

In appellant’s case, the CIT (Appeals) failed to appreciate that the appellant had clearly reiterated that although all transactions with MJPL have been duly accounted and that only “in order to buy peace, save time avoid protracted litigation and focus our concentration on business promotion”, the appellant had voluntarily offered the said amount of Rs. 40,69,280 as additions.

b. Commissioner of Income-tax, Salem v. S. Khader Khan Son [2012] 25 com 413 (SC) affirming the Order in the case of CTT v. S. Khadar Khan Son [2008] 300 ITR 157(Mad. HC) wherein it was held

“Whether Section 133A does not empower any ITO to examine any person on oath, so statement recorded under section 133A has no evidentiary value and any admission made during such statement cannot be made basis of addition”.

c. The appellant also relies on the circular of the Central Board of Direct Taxes dated March 10, 2003, with regard to the confession of additional income during the course of search and seizure and survey operations. The said circular dated March 10, 2003, reads as follows:

“Instances have come to the notice of the Beard where assessees have claimed that they have been forced to confess the undisclosed income during the course of the search and seizure and survey operations. Such confessions, if not based upon credible evidence, are later retracted by the concerned assessees while filing returns of income. In these circumstances, on confessions during the course of search and seizure and survey operations do not serve any useful purpose. It is, therefore, advised that there should be focus and concentration on collection of evidence of income which leads to information on what has not been disclosed or is not likely to be disclosed before the Income-tax Department Similarly, while recording statement during the course of search and seizure and survey operations no attempt should be made to obtain confession as to the undisclosed income. Any action on the contrary shall be viewed adversely.

Further, in respect of pending, assessment proceedings also, the Assessing Officers should rely upon the evidences/materials gathered during the course-of search/survey operations or thereafter while framing the relevant assessment orders.”

III. The appellant craves to file additional grounds at the time of hearing.

4. Ld. AR submits that additional grounds of appeal now taken are purely legal in nature and goes to the root of the matter and requires no investigation or verification thus, the same may please be admitted for adjudication. Reliance is placed on the judgement of the Hon’ble Supreme Court in thecase of NTPC Ltd. vs. CIT reported in (1998) 229 ITR 0383 (SC).

5. On the other hand, Ld DR for the Revenue submitted that additional grounds of appeal require verification on the part of Assessing Officer. Therefore, the same may not be admitted at this stage.

6. After considering the submissions and perused the additional ground of appeal taken, we find that the assessee has challenged the validity of the assessment order passed 153C of the Act without jurisdiction. All the facts related to the additional grounds of appeal are available before us thus requires no verification from the AO. Therefore, by respectfully following the judgement of Hon’ble Supreme Court in the case of NTPC Ltd. (supra), the additional grounds of appeal taken by the assessee are admitted for adjudication.

7. First, we take additional Grounds of appeal No.I raised by the assessee wherein the assessee has challenged the jurisdiction of the AO in completing the assessment u/s 153C of the Act ignoring the fact that the case was centralized and notified to AO on 24.02.2023 and the satisfaction was recorded by the AO of the assessee on 07.03.2023 (Notice u/s 153 issued on 07.03.2023), the law stood amended and provisions of section 153C become inapplicable.

8. Before us, Ld.AR for the assessee submits that proceedings u/s 153C of the Act were initiated in the case of the assessee on the basis of the documents found and seized during the course of search on third person. Ld. AR further submits that based on the search on 10.11.2020 in the case of M/s Mohanlal Jewellers Chennai (P) Ltd, Shri Suresh Kumar Khatri and others certain incriminating material were found, which have bearing on the determination of the total income of the assessee. Accordingly, proceedings u/s 153C were initiated in the case of the assessee and additions were made. Ld.AR submits that from 01.04.2021, law has been amended and as per the order of Hon’ble Jurisdictional High Court in the case of PCIT Vs. Ojjus Medicare Pvt. Ltd. reported in (2024) 465 ITR 101(Delhi), the date of search should be the date when the AO of the assessee hasrecorded his satisfaction which in the present case is 07.03.2023. However, since the law has been amended w.e.f. 01.04.2021, according to which no proceedings could be initiated u/s 153C of the Act for the searches conducted on or after 01.04.2021 and thus provisions of section 153C of the Act could not be applied and the AO should have initiated the proceedings u/s 148 of the Act. For this reliance is placed on the judgement of hon’ble Madras High court in the case of Harigovind v. ACIT reported in [2025] 180 taxmann.com 197 (Madras).

9. Per contra, the ld. CIT DR submits that in the present case, the assessment was carried out based on certain incriminating material found in the search of M/s Mohanlal Jewellers (P) Ltd, M/s Mohanlal Jewellers Chennai (P) Ltd, Shri Suresh Kumar Khatri and others. Accordingly the AO has recorded his satisfaction and initiated the proceedings u/s 153C of the Act which are valid proceedings.

10. Heard the parties at length and perused the material available on record. Claim of the assessee is that the AO has recorded his satisfaction on 07.03.2023 thus the date of search should be reckoned from that date only. Assessee further claimed that the law was amended w.e.f. 1.4.2021 by Finance Act, 2021, and as per the amended law, no action u/s 153C of the Act could be taken on the search carried out on or after 01.04.2021 and the assessment should have been completed u/s 148 of the Act as per the amended provisions. Before going further, we examine the provisions of section 153C of the Act, which reads as under:

153C.Assessment of income of any other person.—

(1) “Notwithstanding anything contained in section 139, section 147, section 148,section 149, section 151 and section 153, where the Assessing Officer is satisfiedthat,–

a. any money, bullion, jewellery or other valuable article or thing, seized orrequisitioned, belongs to; or

b. any books of account or documents, seized or requisitioned, pertains or pertainto, or any information contained therein, relates to, a person other than the personreferred to in section 153A, then, the books of account or documents or assets, seizedor requisitioned shall be handed over to the Assessing Officer having jurisdiction oversuch other person and that Assessing Officer shall proceed against each such otherperson and issue notice and assess or reassess the income of the other person inaccordance with the provisions of section 153A, if, that Assessing Officer is satisfiedthat the books of account or documents or assets seized or requisitioned have abearing on the determination of the total income of such other person for sixassessment years immediately preceding the assessment year relevant to the previousyear in which search is conducted or requisition is made and] for the relevant assessment year or years referred to insubsection (1) of section 153A Provided that in case of such other person, thereference to the date of initiation of the search under section 132 or making ofrequisition under section 132A in the second proviso to sub-section (1) of section153A shall be construed as reference to the date of receiving the books of account ordocuments or assets seized or requisitioned by the Assessing Officer havingjurisdiction over such other person:

Provided further that the Central Government may by rules made by it and published in the Official Gazette, specify the class or classes of cases in respect of such other person, in which the Assessing Officer shall not be required to issue notice for assessing or reassessing the total income for six assessment years immediately preceding the assessment year relevant to the previous year in which search is conducted or requisition is made and for the relevant assessment year or years as referred to in sub-section (1) of section 153A except in cases where any assessment or reassessment has abated.

(2) Where books of account or documents or assets seized or requisitioned as referred to in subsection (1) has or have been received by the Assessing Officer having jurisdiction over such other person after the due date for furnishing the return of income for the assessment year relevant to the previous year in which search is conducted under section 132 or requisition is made under section 132A and in respect of such assessment year—

(a) no return of income has been furnished by such other person and no notice under sub-section (1) of section 142 has been issued to him, or

(b) a return of income has been furnished by such other person but no notice under sub-section (2) of section 143 has been served and limitation of serving the notice under sub-section

(2) of section 143 has expired, or

(c) assessment or reassessment, if any, has been made, before the date of receiving the books of account or documents or assets seized or requisitioned by the Assessing Officer having jurisdiction over such other person, such Assessing Officer shall issue the notice and assess or reassess total income of such other person of such assessment year in the manner provided in section 153A.

(3) Nothing contained in this Section shall apply in relation to a search initiated under Section 132 or books of account, other documents or any assets requisitioned under Section 132A on or after the 1st day of April, 2021.”

11. As per first proviso to Section 153C(1), the date of initiation of search u/s 132 or making requisition u/s 132A in terms of second proviso to Sub Section (1) of Section 153A shall be construed as reference to the date of receiving the books of account or documents or assets seized or requisitioned by the Assessing Officer having jurisdiction over such other person. As observed above, in the present case, the AO of the assessee has recorded the satisfaction on 07.03.2023 after taking the seized material thus the date of search in the case of assessee should be 07.03.2023. This view is supported by the judgement of Hon’ble Jurisdictional High Court in the case of Ojjus Medicare (supra), the headnote reads as under:

“Section 153C of the Income-tax Act, 1961 – Search and seizure – Assessment of any orperson (Block assessment) – Assessment years 2010-11 to 2013-14 – Whether firstproviso to section 153C, and which has been consistently recognized to also embodycommencement point for reckoning six or ten assessment years’, shifts relevant datefrom date of initiation of search or a requisition made to date of receipt of books ofaccount or documents and assets seized by jurisdictional Assessing Officer ofnon-searched person – Held, yes Whether furthermore where date of handing over ofdocuments was not available, date of issuance of satisfaction Note by AssessingOfficer under section 153C would be pertinent for purpose of First Proviso to section153C – Held, yes – Whether significant difference between computation of relevantassessment year for identification of six assessment years and to construct a block often assessment years is that while six assessment years’ hinge upon phrase”immediately preceding”

assessment year pertaining to search year, ten assessment years’ are liable to be computed orreckoned from end of assessment year relevant to year of search – Held, yes – Whether thus, ininstant case where satisfaction note were issued between 1-4-2021 and 31-3­2022, relevant assessment year would be 2022-23 and assessment years’ 2010-11, 2011-12 and 2012-13 would clearly fall outside block period of ten assessment years as provided under section 153C read with section 153A – Held, yes [Paras 85, 86, 96 and 97] [In favour of assessee].”

12. Now coming to the sub-section (3) of section 153C of the Act which provides that provisions of section 153C are not applicable to the search initiated on or after 1st day of April,2021. Since in the present case, date of search is to be taken as 03.12.2021 i.e. the date when the satisfaction note was recorded by the AO of the assessee and, such date (03.12.2021) is fallen after 01.04.2021, therefore, as per sub-section (3) of section 153C, provisions of section 153C would not be applicable and the initiation of proceedings u/s 153C and subsequent assessment order passed us/ 153C of the Act is invalid and without jurisdiction. The hon’ble Madras High court after considering these facts under identical circumstances, in the case of Harigovind v ACIT (supra) has held as under:

35. “A reading of the second proviso to Section 153A(1) would show that the assessment or reassessment, if any, relating to any assessment year falling within the period of six assessment years and for the relevant assessment year or years referred to in this sub-section, 153C(1) pending on the date of initiation of the search under Section 132 or making of requisition under Section 132A, as the case may be, shall abate. Therefore, any pending proceedings shall be abated as per the above proviso. 36. On the strength of the above second proviso to Section 153A(1), the respondents had strongly contended that the first proviso to Section 153C is only with regard to the abatement of proceedings and not for anything else.

37. On the other hand, the petitioners had contended that it is not only for abatement but for all the other purposes. According to the petitioner, if a particular date is determined for the purpose of abatement of proceedings, then the same would be applicable for all the purposes, including the date of initiation of proceedings under: Section 153C against the other person.

38. Even a reading of Section 153C makes it clear that determination of total incomeof such other person for 6 assessment years immediately preceding the assessmentyear relevant to the previous year, in which the search was conducted or requisitionwas made and for the relevant assessment year or years, referred in sub Section (1) ofSection 153C of the Act.

39. As far as the other person is concerned, the six years period would be calculated, the date on which the requisition was made and that would be the date, for the purpose of determination ofassessment of income. On the other hand, as far as the searched person is concerned, this 6 yearsperiod would vary and the same would be calculated from the date of search made in the premises of searched person. Therefore, for the purpose of initiation and determination of income for 6 assessment years, two different dates have been fixed by the Statute, i.e., for the searched person, it was taken the date of search, whereas, for the other person, it was taken the date, on which the requisition is made to the JAO of the other person.

40. Thus, as far as the searched person is concerned, the date of initiation of search is the date, on which the search was conducted in his premises. The said date would be the date of initiation of search for searched person for all purposes. As far as the other person is concerned, the date of initiation of search would be the date, on which the materials, books of accounts, etc., are handed over to the JAO of the other person and this date would be considered as the date of initiation of search for other person for all purposes. Thus, there cannot be two different date of initiation of search, either for the searched person or for the other person.

41. The provisions of Sub-Section (3) of Section 153C states that “153C(3).nothing contained in this Section shall apply in relation to a search initiated under Section 132 or books of account, otherdocuments or any assets requisition under Section 132A on or after the 1st day of April, 2021”

which means, if the search is initiated subsequent to 01.04.2021, the provision of Section 153C will not apply and accordingly, no proceedings can be initiated againstthe other person.

42. According to the petitioner, the date of handing over of the seized materials, i.e., 25.11.2022, is the date of initiation of search. If the said contention of the petitioner is accepted, obviously, the issuance of impugned notices dated 07.02.2023 by the 2nd respondent is without any authority and contrary to Sub-Section (3) of Section 153C of the Act and thus, the same is liable to be quashed.

12. We find the above referred judgment of the Hon’ble jurisdictional High Court is squarely applies in these cases. Hence, respectfully following the judgment of the Hon’ble jurisdictional High Court in the case of Harigovind vs. Assistant Commissioner of Income-tax Non-corporate [2025] 180 taxmann.com 197 (Madras), we set aside /quash all the notices issued u/s.153C on the assessee as the date of handing over of the seized materials, i.e., 07.03.2023, is the date of initiation of search. The issuance of impugned notices u/s153C dated 07.03.2023 by the AO is without any authority and contrary to Sub-Section (3) of Section 153C of the Act and thus, the same is liable to be quashed. Since, the same legal issues arises in all four captioned appeals, therefore, our order will apply mutatis Mutandis in other three appeals.

13. ITA No.3076/Chny/2025 for AY 2021-22:

This appeal is filed by the assessee against the order of the Commissioner of Income Tax (Appeals) [CIT(A)] for the Assessment Year 2021-22.

13.1 Brief facts of the case are that the assessee is engaged in the business of retail sale of silk sarees and jewellery. A search under section 132 was conducted in the case of M/s Mohanlal Jewellers Pvt. Ltd. (MJPL), wherein certain data in “J-Pack” software was found indicating transactions with the assessee.During assessment proceedings, the Assessing Officer (AO) observed that jewellery purchases to the extent of 2340.210 grams were not fully supported by invoices. The assessee, while denying any unaccounted purchases, offered an additional income of Rs.26,00,492/- to buy peace and avoid litigation.The AO accepted the said offer and completed the assessment u/s 143(3) by making addition of Rs.26,00,492/-. The CIT(A) confirmed the addition on the ground that the assessee had voluntarily agreed to the same.

13.2 The issue before us is whether the addition of Rs.26,00,492/- made solely on the basis of voluntary disclosure, is sustainable in law and on facts.

13.3 The learned Authorised Representative (AR) submitted that all transactions with MJPL were duly recorded in the books of accounts. Detailed reconciliation was furnished before the AO, which was not properly appreciated. The addition was made solely based on a conditional offer to avoid litigation and not on any incriminating evidence. Even assuming without admitting that there were discrepancies, only profit element embedded in such transactions can be taxed. In similar line of jewellery business, courts and tribunals have consistently held that only a small percentage (around 2%) of alleged unaccounted purchases can be brought to tax. He relied upon the order of the co­ordinate bench of the Tribunal in the case of M/s Gold AIK Vs The ITO ITA No.1046-1051/Chny/2024 dated 06.11.2024. He further submitted that the application of 23% GP by the assessee itself was excessive and without prejudice.

13.4 Per contra, the learned Departmental Representative (DR) supported the orders of the lower authorities and submitted that the assessee had voluntarily offered the additional income. Such admission is binding and cannot be retracted.The CIT(A) has rightly relied on judicial precedents to uphold the addition.

14. We have heard the rival submissions and perused the material available on record. It is observed that the addition has been made solely on the basis of disclosure made by the assessee. The assessee has consistently maintained that all transactions are recorded. No unaccounted purchases exist. The disclosure was made to buy peace and to avoid protracted litigation. It is a settled position of law that admission cannot be the sole basis of addition unless supported by corroborative evidence.The assessee has furnished reconciliation of transactions with MJPL, details ofpayments, Gold metal exchanges, Making charges invoices. The AO has not brought any independent evidence to conclusively prove that the purchases were unaccounted.Even assuming that there were unaccounted purchases, the settled principle is that only the profit element embedded in such purchases can be taxed and not the entire amount.This principle has been consistently upheld in various judicial pronouncements.

15. In the present case, the assessee applied 23% GP, which appears highly excessive. In the jewellery trade, especially in similar factual circumstances, net profit estimation of around 2% on disputed transactions has been accepted as reasonable. Accordingly, in the interest of justice, a 2% profit rate on the alleged unaccounted purchases would meet the ends of justice and based on the order of the co-ordinate bench of the Tribunal in the case of M/s Gold AIK Vs The ITO ITA No.1046-1051/Chny/2024 dated 06.11.2024 [Page 3-29 of Paper Book].The reliance placed by the CIT(A) on the voluntary disclosure is misplaced because the disclosure was conditional and without admission of concealment. It was made to avoid litigation, there is no estoppel against statute. Therefore, the assessee is entitled to contest the addition.

16. In view of the above, the addition of Rs.26,00,492/- is not sustainable in full. The AO is directed to restrict the addition to 2% of the value of alleged unaccounted purchases (2340.210 grams). Accordingly, the appeal of the assessee is partly allowed.

17. In the result, all the captioned five appeals are disposed of as under:

Order pronounced in the open court on 17^th day of March, 2026 at Chennai.