Ashok Kumar Agarwal Vs ACIT (ITAT Hyderabad)
The Income Tax Appellate Tribunal (ITAT), Hyderabad, partly allowed the assessee’s appeal arising from additions made on account of unexplained cash and gold bullion found during a search. The Tribunal held that the Assessing Officer’s failure to cite a specific provision under Sections 69 to 69D of the Income-tax Act did not invalidate the additions, as the assessment order clearly recorded the facts and reasons for treating the cash and gold bullion as unexplained.
A search under Section 132 was conducted on 04.06.2019, during which cash of ₹1 crore and 12 gold bars weighing 1,200 grams were found at the assessee’s residence. During the search, the assessee stated that the cash belonged to himself and three proprietary concerns but could produce cash book extracts showing a balance of only ₹6,73,805. He was unable to explain the source of the remaining cash or the gold bullion and admitted additional income of ₹39.84 lakh in respect of the gold. During assessment proceedings, however, the assessee changed his explanation, claiming that the cash belonged to nine family members, including the three proprietary concerns, and produced affidavits from those persons. He also claimed that the gold bars had been purchased in earlier financial years and were recorded in the books of account. The Assessing Officer rejected these explanations due to lack of supporting documentary evidence and added ₹1,39,84,000 as unexplained cash and bullion, taxable under Section 115BBE. The Commissioner (Appeals) confirmed the additions.
