Harshit Kochar Vs ACIT (ITAT Delhi)
ITAT Delhi Deletes Addition on Expensive Watches Found During Search – Holds They Belonged to Entire Kochar Family & Within Family Status
A search u/s 132 was conducted on 22.10.2016 at the residence of Assessee at New Delhi along with other Kochar family members. Jewellery & watches were inventorised. Assessee filed return declaring income of Rs.6,41,300/-. AO made additions u/s 69A r.w.s. 115BBE towards undisclosed jewellery of Rs.40.68 lakh & expensive watches of Rs.92.37 lakh.
Before CIT(A), Assessee explained that jewellery & watches belonged to entire Kochar family consisting of 20 members. Bills for some jewellery were produced. CIT(A) deleted jewellery addition but restricted watch addition to Rs.21.26 lakh, based on internet valuation of certain high-value watches.
Assessee’s contended before Tribunal that watches belonged to entire Kochar family & were received as gifts on marriages, anniversaries, birthdays & other ceremonial occasions. Since 20 members resided together & only 15 watches were found, presumption that all watches belonged to Assessee alone was arbitrary. Valuation adopted by AO was by unapproved valuer; CIT(A) used internet valuation but still wrongly taxed entire amount in Assessee’s hands. Presumption u/s 292C could not be applied against Assessee alone when assets were found in common premises.
