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Mrs. Padma G. Vazirani Flat no.602, Prabhu Kutir Altamount Road Mumbai 400 026 v/s Dy. Commissioner of Income Tax Central Circle46, Mumbai
September, 14th 2012
                    , 
                    ,                       `' 

                  IN THE INCOME TAX APPELLATE TRIBUNAL
                            "D" BENCH, MUMBAI

       .  ,   ,      ,                                

        BEFORE SHRI B. RAMAKOTAIAH, ACCOUNTANT MEMBER AND
                   SHRI AMIT SHUKLA, JUDICIAL MEMBER


                       . / ITA no. 5867/Mum./2009
                     (   / Assessment Year : 2008­09)

Mr. Dinesh G. Vazirani
2nd Floor, Rusi House                                 .......................  /
Darabshaw Lane                                                            Appellant
Off Nepean Sea Road
Mumbai 400 006

                                  v/s

Dy. Commissioner of Income Tax                             ...................    /
Central Circle­46, Mumbai                                            Respondent

   ./ Permanent Account Number ­ AADPV9691H


                       . / ITA no. 5868/Mum./2009
                     (   / Assessment Year : 2008­09)

Mrs. Padma G. Vazirani
Flat no.602, Prabhu Kutir                             .......................  /
Altamount Road                                                              Appellant
Mumbai 400 026

                                  v/s

Dy. Commissioner of Income Tax                             ...................    /
Central Circle­46, Mumbai                                            Respondent

   ./ Permanent Account Number ­ AADPV7575L



                        / Assessee by : Mr. Rakesh Joshi
                        / Revenue by       : Mr. Satbir Singh
                                                           Mr. Dinesh G. Vazirani
                                                          Mrs. Padma G. Vazirani

                                                                             2
         /                                             /
Date of Hearing ­ 19.07.2012                     Date of Order ­ 07/09/2012





                                  / ORDER


   ,                            /
PER AMIT SHUKLA, J.M.


      The present appeals preferred by the above named assessees, are
directed against separate impugned orders of even date 21st August 2009,
passed by the learned Commissioner (Appeals), Central­II, Mumbai, for the
quantum of assessment passed under section 143(3) r/w section 153B(1)(b)
of the Income Tax Act, 1961 (for short "the Act"), for the assessment year
2008­09.    These appeals pertain to different assessees involving common
issues, except variation in figures, arising out of materially similar set of
facts & circumstances and were heard together. As a matter of convenience,
therefore, all these appeals are being disposed off by way of this
consolidated order.


 2.   In the case of Mrs. Padma G. Vazirani (for short "Padma") the assessee
 has challenged the addition of ` 12,34,370, on account of unexplained
 investment in diamond jewellery and addition of ` 6,05,000, on account of
 unexplained investment in art work and painting. Similarly, in the case of
 Mr. Dinesh G. Vazirani, (for short "Dinesh"), the addition of ` 4,63,750, has
 been made on account of diamond jewellery and ` 14,17,700, on account of
 art work / paintings.


 3.   Brief facts of the case are that a search and seizure action under
 section 132(1) of the Act, was carried out in the case of Saffron Group on
 17th April 2007, and both the assesses were also covered under the search.
 During the course of search and seizure action, gold and diamond jewellery,
 articles and art works / paintings were found at the residence of Padma,
 situated at 602, Prabhu Kutir, 15, Altamount Road, Mumbai, and at the
 residence of Dinesh, situated at 6, Rushi House, Durab Shaw Lane, Nepean
                                                           Mr. Dinesh G. Vazirani
                                                          Mrs. Padma G. Vazirani

                                                                             3
Sea Road, Mumbai. A locker bearing no.780, in Union Bank of India, was
also subjected to search, which belongs to Mrs. Minal D. Vazirani (for short
"Minal") wife of Dinesh and daughter-in-law of Padma. From these cases,
following diamond and gold jewellery were found:-


                       In the case of Padma ­ ` 92,32,470
                       In the case of Dinesh ­ ` 29,42,210
                       In the case of Minal ­ ` 18,64,660





4.   In the statement recorded on oath under section 132(4), in the case of
Padma and Dinesh, details regarding jewelleries found were asked on which
it was stated that most of the jewellery has been purchased through cheque
payments drawn from respective bank account and some of them were
received through gifts. None of them accepted that these jewelleries are
undisclosed investment. During the course of scrutiny proceedings under
section 153A, the assessee was required to reconcile gold / diamond
jewellery and various other articles found at the time of search. In response,
the assessee furnished reconciliation of various jewelleries acquired from
time to time and articles purchased. A gift confirmation letter was also filed
from the mother of Minal (w/o of Dinesh and daughter in law of Padma).
Insofar as reconciliation of gold jewellery was concerned, the Assessing
Officer was satisfied that the assessee was able to produce the details of
purchase and, therefore, he accepted the investment made in the gold
jewelleries. However, with regard to the diamond jewelleries aggregating to
` 80,62,432, in the case of Padma and diamond jewellery of ` 34,58,255 in
the case of Dinesh, (which also included jewellery belonging to Minal), the
assessees were required to prove the source of these diamond jewelleries.
The assessee submitted that most of these items have been purchased by
way of cheque and has been recorded in the books of account. Certain
jewelleries have been received by way of gift at the time of marriage or by
the mother of Minal. Reconciliation of such jewelleries and details of cheque
payments with the name of jewelers from whom jewelleries were purchased,
date of purchase and cheque details were furnished. The details regarding
gift which is in the form of certificate from mother of Minal, was also given.
                                                          Mr. Dinesh G. Vazirani
                                                         Mrs. Padma G. Vazirani

                                                                            4
However, the Assessing Officer found that the details with regard to certain
purchases / donors of the gift were not made available and no proof was
filed. He further observed that insofar as diamond jewelleries are concerned,
the items found and tallied in terms of carat with the items disclosed, the
assessee could not furnish the proof of acquisition or gift received. After
quantifying such jewellery which has been tabulated at Pages-3 and 4 of the
assessment order, he noted that the diamond jewellery worth 12,34,370, in
the case of Padma and diamond jewellery worth ` 4,63,750, in case of
Dinesh, proper explanation could not be furnished. Accordingly, he added the
same.


5.   At the time of search and seizure, ten pieces of art work in the case of
Padma and 133 pieces of art work in the case of Dinesh were also found at
the residence. Out of the same, seven pieces to the tune of ` 8,05,000, in
the case of Padma and 33 pieces to the tune of ` 57,60,000, was seized in
the case of Dinesh. For evaluating such art work / painting, an expert
committee was appointed to work out the value of these art work / painting.
The assessee was required to reconcile these art works and in response to
which reconciliation and details of each and every art work purchased from
time to time and also, which were gifted from various persons were
provided. Insofar as certain items given in the form of gift and purchases
made from outside country, the Assessing Officer held that the assessee's
explanation were not proper. He tabulated such description of art pieces in
the assessment order and accordingly, the addition of ` 6,05,000, was made
in the hands of Padma. ` 14,17,700, was made in the hands of Dinesh.


6.   Aggrieved by the additions made by the Assessing Officer, the
assessee preferred first appeal before the Commissioner (Appeals) wherein
detail submissions were made along with reconciliation, source of acquisition
of the jewellery and also the valuer's report which were furnished before the
Assessing Officer. The Commissioner (Appeals) rejected the said submissions
of the assessee and drew following conclusions which are common in both
the appeals:-
                                                                Mr. Dinesh G. Vazirani
                                                               Mrs. Padma G. Vazirani

                                                                                  5

      "2.3.2.   As far as the possession of aforesaid 11 items of diamond
      jewellery worth ` 4,63,750 is concerned, it is not disputed that ­

      (i)     No wealth tax returns have been furnished by the appellant or
              by appellant's family members.

      (ii)    No valuation report indicating any of the aforesaid 11 items of
              diamond jewellery neither in the name of the appellant nor in
              the name of any family member.

      (iii)   No purchase bills, whatsoever produced in support of the
              aforesaid diamond jewellery.

      (iv)    No gift deed produced to explain the possession of the aforesaid
              diamond jewellery.

      (v)     The appellant failed to explain the nature, mode and source of
              acquisition of the aforesaid 11 items of diamond jewellery found
              from his Nepean Sea Road, Mumbai, residential premises and
              bank locker no.780, United Bank of India, Peddar Road Branch,
              Mumbai.

      Having regard to the facts and circumstances of the case, the
      unexplained investment in the acquisition of the aforesaid 11 items of
      diamond jewellery worth ` 4,63,750 is chargeable to tax under section
      69A of the Act for the following reasons:­


7.    Thereafter, he proceeded to analyse various decisions with regard to
evidence found from the possession of the assessee and other decisions on
section 69A of the Act. These discussions are appearing at Page-16 / Para-
2.3.3, onwards. Similarly, with regard to the additions made on account of
art work / paining, he, not only upheld the valuation done by the expert
committee but also the findings given by the Assessing Officer. Accordingly,
both the additions were confirmed and the appeal of the assessees were
dismissed. Aggrieved, the assessee is in further appeal before the Tribunal.


8.    Learned Counsel for the assessee, before us, submitted that all the
diamond jewellery which were found from the possession of the assessee,
were duly recorded in the books of account and each & every item of
jewellery were reconciled. He drew our attention to the summary of total
jewellery found and summary of total jewellery reconciled. Further, he
referred to the details of various cheques and bank account from which
                                                          Mr. Dinesh G. Vazirani
                                                         Mrs. Padma G. Vazirani

                                                                            6
jewelleries were purchased along with yearwise description, name of jeweler
from whom purchases were made, cheque details, date of purchase and the
amount paid. He submitted that upto the date of search, the jewellery
purchased through cheques aggregated to ` 83,46,695. These details are
appearing at Pages-6 and 7 of the paper book. He further submitted that the
valuer's report dated 22nd May 1990, in the case of Padma, wherein
caratwise details of diamond were provided to show that most of them were
prior to 31st March 1990. Relying on these documents, he submitted that
most of the jewelleries have been purchased and recorded in the books of
account. Regarding jewellery received by way of gift, he submitted that the
major part of the gift have come from Mrs. Vina Morjani, from U.S.A., who is
mother of Minal and w/o Dinesh. In support of this, he submitted that a copy
of certificate given by her is appearing at Page-10 of the paper book wherein
she has given the details of gold jewellery and itemwise details of diamond
jewellery which was given to her daughter at the time of her wedding in
December 1994. He submitted that if such jewelleries are taken into
consideration, then there remains no unexplained item with regard to the
jewellery received by way of gift. Alternatively, he submitted that both the
assessee have very heavy withdrawals in all the years which is evident from
the chart given at Page-11 of the paper book from where he pointed out that
the withdrawals for the financial year 2006-07 itself was at ` 80,19,717, and
the amount invested in jewelleries and apparels where a at ` 51,08,207.
Similar withdrawal and investment in jewellery have been there in the earlier
years as well as in the subsequent years. From this, he submitted that none
of the additions which have been made by the Assessing Officer on this
score, can be sustained. Regarding art works and paintings, he submitted
that both the assesses were themselves very talented painters and most of
the paintings have been purchased through cheques. Some of the painting
have been received through gift or have been purchased much before the
period covered under the search under section 153A, for paltry sums. By
way of example, he submitted that one of the sketches by Mr. M.F. Hussain,
was received by Padma, at the time of lunch with him in London wherein he
made a sketch with ink on a napkin paper and gifted to the assessee. This
                                                            Mr. Dinesh G. Vazirani
                                                           Mrs. Padma G. Vazirani

                                                                              7
has been valued at ` 2,50,000, whereas the assessee had no cost of
acquisition. Similarly, in the case of Dinesh, he submitted that there were
certain paintings which have been bought from China for a very paltry sum
and the same has been valued at a very heavy price. Similar instances were
pointed out by him to various other paintings which was either purchased
several years ago or received as gift in some public forum. He, thus,
concluded that not only the valuation is too excessive keeping in view the
mode of acquisition, but also very arbitrary.


9.    On   the   other   hand,   the   learned   Departmental   Representative
submitted that whatever description of gold jewellery was found to be tallied
with the purchase bills, the Assessing Officer has already accepted the same.
Even in the case of diamond jewellery, he has accepted most of the items. It
was, in respect of certain items, which were received by way of gift, the
Assessing Officer has not accepted the same. Further, he submitted that
even though there were heavy drawings by the assessee but the same has
to be co-related with the jewellery. Regarding conversion of diamond
jewellery, which was argued by the learned Counsel to counter the allegation
of the Assessing Officer that caratwise matching of jewellery has not been
done by the assessee, he submitted that no evidence whatsoever has been
produced before the Assessing Officer. Regarding art work and painting, no
proper explanation was given as to how it was acquired and the valuation
has been done by the experts, therefore, dispute regarding valuation cannot
be raked up at this stage. He, thus, heavily relied upon the findings of the
Commissioner (Appeals) as well as the Assessing Officer and submitted that
no further benefit should be given as the Assessing Officer has himself given
substantial benefit with regard to the jewellery and paintings found from the
possession of the assessees.


10.   In the rejoinder, the learned Counsel submitted that, regarding gift,
the gift letter was itself seized and based on such letter, the investigation
wing, after verification, released the jewellery. It was further submitted that
regarding old jewellery, photographs were shown to the investigation wing
                                                                Mr. Dinesh G. Vazirani
                                                               Mrs. Padma G. Vazirani

                                                                                  8
which is evident from Pages-7 and 8 of the paper book-II, wherein in
response to question no.4, this was specifically clarified. Regarding re-
making of jewellery, he referred to the documents placed at page-20 of the
paper book.


11.   We have heard the rival contentions of the parties and carefully
perused the orders of the authorities below as well as the material available
on record. The first issue relates to addition on account of unexplained
investment in diamond jewelleries. In case of Padma, aggregate diamond
jewellery of ` 82,60,432, was found at the residence and from the bank
locker. At the time of search, the assessee had stated on oath that in most
of the cases, copies of purchase bills were available, along with details of
payments and some of them were received by way of gift on the occasion of
her marriage and marriage of her son. She also showed the photographs of
the marriage of her son and daughter to show that most of the jewelleries
were acquired in the earlier years. This specific averments was given in the
statement of oath on administered on 10th May 2007, which, for the sake of
ready reference, is reproduced herein below:-

      Q.no.4 Do you have any further evidence to place on record with
      regard to the jewellery kept under P.O. at your residence as per P.O.
      dtd. 7.5.07?

      Ans. I am producing copies of bills along with bank payment details
      with regard to the purchase of jewellery by me over the last few years.
      As regards item nos.10(a), 10(b) and 10(c). The same was given as
      gift to me by my sister Dr. Shila Verghese on the occasion of the
      marriage of my son in 1994. As regards item nos.8, 16(a), 11(b) &
      25(a), I am showing you the photograph as well as photo album of my
      son as well as daughter's wedding, which took place in 1994 & 1992,
      respectively. These photograph clearly show that I have been wearing
      these pieces of jewellery at that time. Other than that, there are quite
      a few pieces that are quite old received by me from my mother,
      relatives and in­laws at the time of my wedding and various other
      festivals and occasions such as birth of children etc. As regards the
      balance details, I am in the process of compiling all my bills and other
      documentary evidences, which will be submitted to you shortly."


12.   In another statement recorded on 12th May 2007, in respect of
question no.1, the assessee submitted various evidences and documents
                                                                Mr. Dinesh G. Vazirani
                                                               Mrs. Padma G. Vazirani

                                                                                  9
regarding jewelleries. For the sake of reference and record, question no.1
and answer thereto is also reproduced herein below:-

      During the P.O. operation you were able to give the documentary
      evidence for item no. 2, 3, 8, 10(a), 10(b), 10(c), 11(a), 11(b), 11(c),
      16(a), 16(b), 18, 1.9, 22(a), 22(b), 22(c), 25(a), 26, 27(a), 27(b),
      30(c), 32(a), 32(b), 33(a), 33(b), 34, 38(a), 38(b), 41(a), 41(b), 42,
      43(a), 43(b), 49, 52, 53, 54, 55, 56, 57 and 59 amounting to
      Rs.14,84,274/- in respect of the diamond jewelery found at residence
      during the course of search action on 17.04.2007 and the same was
      valued by Pradeep Kumar J. Jhaverl, Government approved valuer. In
      absence of documentary evidence, why the balance Jeweflery should
      not be seized as per the Income Tax Act, 1961, and that the same
      should be treated as an unaccounted investment?

      All this Diamond jeweller)' has been acquired over the past 40 years
      either by purchasing or through gifts from my parents, in-laws,
      relatives and other Mends and well wishers. We have also submitted
      the Gift letters, valuation reports, etc. to substantiate the same.
      Additionally we have also produced the photo albums from the time of
      my son's marriage and my daughter's wedding in the years 1992 and
      1994. These photographs clearly show that some of this Jewellery has
      been in my possession from the time of these weddings. Moreover, we
      have also produced various bills which were substantiated by bonafide
      cheque payments from my regular bank accounts but they do not
      match the description with the wording of the valuer appointed as
      above. It is the general practice of the jwellers to write this kind of
      description at the time of purchase. No item is in excess of the value
      as given by the valuer and the cheque and the value are matching as
      per the price paid. After taking into consideration all these facts put
      before you the entire diamond jewelleiy would stand explained.
      Several of these evidences are not acceptable to you. Hence I have, no
      objection at this point in time in the seizure of the said diamond
      jewellery, However, it maybe imperative to note that none of these
      items are forming my undisclosed investments nor is my acceptance
      for the seizure an assertion of the same being an undisclosed
      investment."


13.   From the above answers given by he assessee at the time of search, it
is seen that the assessee had given the explanation with regard to all the
another jewelleries found at the time of search along with the evidences and
details as were available. Further, in support of this explanation, valuation
report dated 31st March 1990, given by Approved Valuer wherein detail
description with regard to quantity in carats and gross weight in grams were
furnished before the Assessing Officer, the copy of which have been provided
before us at Pages-8 and 9 of the paper book-II. During the course of
                                                            Mr. Dinesh G. Vazirani
                                                           Mrs. Padma G. Vazirani

                                                                              10
assessment proceedings, the assessee has filed details of cheque payments
for the purchase of jewellery and the bank statement along with the
summary of purchases made through jewelers, date, cheque number and
amount, right from the assessment year 2002-03 up to the date of search.
This statement is appearing at Pages-6 to 9 and 13 to 14. The aggregate
value of details of these cheques comes to ` 83,46,695 in the case of Padma.
In the case of Dinesh and his wife Minal, the aggregate value of cheque
payment for the purchase of jewellery were ` 10,59,828 and ` 19,91,302,
respectively. Besides this, as stated above, valuation report dated 22nd May
1990, showing various jewellery were also available to the assessee prior to
31st March 1990. Regarding jewellery received by way of gift, the assessee
has mainly relied upon the letter of Vina , mother of Minal and daughter-in-
law of Padma. In the said certificate, the details of entire jewellery given at
the time of marriage have been mentioned. From these documentary
evidences, the assessee has tried to explain that all the jewelleries which
have been found are fully accounted for and nothing is unexplained. In fact,
the assessee's claim has been that what has been recorded by the assessee
in the books is more than what has been found at the time of search. On the
other hand, the Assessing Officer's case is that some of the items of
jewellery, the assessee was unable to file any evidences or could tally in
terms of carats with the item disclosed. He has short listed certain items
aggregating to ` 12,34,370, in case of Padma and ` 4,63,750, in case of
Dinesh. This finding of the Assessing Officer has been confirmed by the
Commissioner (Appeals) also.


14.   The Assessing Officer has given the remark purchase / gift. He has not
tried to co-relate with the overall summary of jewellery purchased and gift
which was mostly acquired at the time of marriage and gift by Mrs. Bina. The
overall tally given in the reconciliation explains the entire jewellery. The
Commissioner (Appeals) held that once the assessee has been found to be in
possession of jewellery, the concept of "Ownership" get attracted and,
therefore, it is the assessee's onus to discharge that it was acquired through
proper sources without which it would be assumed that it would be an
                                                           Mr. Dinesh G. Vazirani
                                                          Mrs. Padma G. Vazirani

                                                                             11
unexplained investment. For this proposition, he has relied on the various
case laws and provisions of The Indian Evidence Act, 1872. In our opinion,
there was no occasion for the Commissioner (Appeals) to go into such a
theoretical concepts laid down by various High Courts / Supreme Court, he
should have confined himself to the findings given by the Assessing Officer
and the contentions of the assessee about the evidence and explanation
furnished in support of jewellery found. His conclusion drawn in Para-2.3.2,
as reproduced above, is factually incorrect, which is evident from the fact
that the assessee had furnished not only the valuation report, purchase bill,
gift certificate but has also tried to explain the nature, mode and source of
acquisition of various items of diamond jewellery found. All his observations
are negatived by the material placed before us in the form of paper book
which was also available before the Assessing Officer and the Commissioner
(Appeals).


15.   Now coming to the conclusion drawn by the Assessing Officer, we find
that in the chart given in the assessment order, he has referred that most of
the items were gifted / purchased from drawings. He has not looked into the
reconciliation filed by the assessee and also the details furnished before him
from which it would be evidently clear that some of the jewellery pertained
to gift received during the course of marriage and some of them were in
possession of the assessee prior to 31st March 1990, which is evident from
valuation report filed by the assessee. From the aggregate value of entire
summary and the amount mentioned in the gift certificate, it would be seen
that almost the entire jewellery stands explained. While drawing any kind of
adverse inference for treating the jewellery found as unexplained, one has to
look into various preponderance of probabilities because in our Indian
custom, gifting of jewellery at the time of marriage is normal practice and
custom and it becomes very difficult to give a direct evidence of the
acquisition of the jewellery received at the time of marriage. One goes by
certain corroborative evidences like marriage photos, gift letters issued by
the relatives, etc. In case of the assessee, most of the items have been
shown to be purchased by the assessee for which details of cheque
                                                           Mr. Dinesh G. Vazirani
                                                          Mrs. Padma G. Vazirani

                                                                             12
payments and the names of the jeweler have been given. It is only on few of
the items, the assessee has claimed to have received at the time of her
marriage and at the time of her son's marriage. These gifted jewelleries
cannot be treated as unexplained as the same is duly supported by such
corroborative evidence like gift certificate issued by the mother of daughter-
in-law and photographs of marriages shown before the investigation unit.
Under these facts, the reasons given by the Assessing Officer that some of
the jewellery remained unexplained cannot be upheld. There is another
ground taken by the Assessing Officer that caratwise items disclosed do not
tally with the items of jewellery found. This ground cannot, per se, be
adversely viewed, if overall tally of carats and grams are reconciled. There
may be a case whether jewelleries get recycled and exchanged. This is
evident from a certificate appearing at Page-20 of paper book-II. Thus
overall source of quantity of carats and grams weight is required to be
looked into. Consequently, we set aside the impugned order passed by the
Commissioner (Appeals) and the addition made by the Assessing Officer, on
this score of unexplained diamond jewelleries, is hereby deleted. Likewise, in
case of Deepak also, the same reasoning will apply and, accordingly, in case
of Deepak also, no addition on account of unexplained investment on
account of diamond jewellery can be made. Thus, ground no.1, relating to
unexplained investment in the diamond jewellery in both the appeals stands
allowed.


16.   Now coming to the issue of unexplained investment in art work and
paintings. During the course of search and seizure action, the assessee and
her son Deepak were found in possession of several art works and paintings.
In fact, both of them are themselves an artist. During the course of
assessment proceedings, the Assessing Officer noted that some of the art
works could not be explained properly by the assessee with regard to the
source of acquisition. Accordingly, he has made the addition, after giving
detailed summary on various pieces of art work / paintings, to which the
assessee could not explain the same properly by adducing any evidence.
Assessee's contentions has been that these art works / paintings were either
                                                            Mr. Dinesh G. Vazirani
                                                           Mrs. Padma G. Vazirani

                                                                              13
gifted to them or were purchased for a paltry sum from various places.
Looking to the over all huge withdrawals made by both the assesses,
acquisition of such painting should not be adversely viewed. Alternatively,
the assessee's plea has been that the valuation done by the expert
committee is too high and excessive and by way of illustration, various
examples were given. From the narration given for the various art works /
paintings and explanation of the assessee, as have been reproduced in the
assessment order, we find that in some of the cases, the valuation seems to
be very high looking to the fact that some of the items has been received by
way of gift or has been purchased form China and other places of India for a
small price, for e.g., sketch drawn in paper napkin by ink has been gifted by
Mr. M.F. Hussain, himself, at the time of lunch with her in London, which is
made on a very small piece of paper of 13" x 8". This has been valued at a
price of ` 2,50,000. Similarly, in case of Deepak, there is an item of painting
which has been gifted to the assessee by his wife's friend and the same has
been valued at ` 5,00,000. Some of the items which have been acquired by
the assessee from China at ` 5,000, has been valued at ` 2,00,000 and `
6,00,000. Such a valuation, looking to the source of acquisition seems to be
very arbitrary and excessive.


17.   Keeping in view these facts and circumstances, we are of the
considered opinion that the entire issue of valuation of art work and painting
should be restored back to the file of the Assessing Officer and to get it
valued through an independent valuer after looking to the explanation of
source of acquisition by the assessee. The value of a painting per se could be
more, however, looking to the source of acquisition, such a value cannot be
ascribed to the art work / painting. There could be possibility that the
assessee may have acquired certain painting at a very low cost either from a
flea market or from abroad or by way of gift from friend or relative for which
such a high valuation cannot be taken. Thus, while deciding the issue, the
Assessing Officer will bear in mind or take into consideration these factors.
With these observations, the issue of unexplained investment in art works /
painting is restored to the file of the Assessing Officer for denovo
                                                              Mr. Dinesh G. Vazirani
                                                             Mrs. Padma G. Vazirani

                                                                                14
adjudication in the light of our aforestated observations and in accordance
with law. Needless to mention here that the Assessing Officer shall provide
due and effective opportunity of hearing to the assessee to explain their
cases. Thus, ground no.2, is treated as allowed for statistical purposes.


18.                       

15.   In the result, appeals are partly allowed for statistical purposes.


                               7th September 2012    
      Order pronounced in the open Court on 7th September 2012


             Sd/-                                                   Sd/-
        . 
        .                                                          
                                                                   
    B. RAMAKOTAIAH                                            AMIT SHUKLA
  ACCOUNTANT MEMBER                                         JUDICIAL MEMBER




 MUMBAI,          DATED:           7th September 2012



                / Copy of the order forwarded to:

(1)     / The Assessee;
(2)     / The Revenue;
(3)     () / The CIT(A);
(4)                 / The CIT, Mumbai City concerned;
(5)               ,     ,  / The DR, ITAT, Mumbai;
(6)     / Guard file.
                                                         / True Copy
                                               / By Order
   .  / Pradeep J. Chowdhury
         / Sr. Private Secretary

                                   /   / (Dy./Asstt. Registrar)
                                    ,  / ITAT, Mumbai
 
 
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