No addition can be made on the basis of purported, Notional, Fictitious Sale of Jewellery

Last updated: 25 May 2023

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The Income Tax Appellate Tribunal (ITAT) has ruled that no capital gains tax can be levied on the supposed sale of jewellery if the sale itself is notional, fictitious, or cannot be proven. The tribunal found no basis in the Income Tax Act to presume a sale and calculate capital gains simply because the amount of jewellery found during a search was less than declared in wealth tax returns. The addition made on account of alleged long-term capital gains from such purported sales was directed to be deleted.

Court :
ITAT New Delhi

Brief :
The jewellery seized of Rs.16,77,363/- is intra polated in the jewellery found of Rs.43,17 ,442/-. Hence, keeping in view the entire disclosed jewellery as per the WTR and as found in the premises, we hold that no addition can be made on this account.

Citation :
ITA NO. 2351/DEL/2019: ASSTT. YEAR: 2015-16

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1999

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3499

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4999

(Excl. of GST ₹899)

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Judgement posted by

FCS Deepak Pratap Singh

Associate Vice President - Secretarial & Compliance (SBI General Insurance Co. Ltd.)

Dear Friends, MyselfFCSDeepak P. Singh ( B.Sc.. LLB, FCS. FIII, CIAFP, CRMP, ID) , A Fellow Member of ICSI, Law Graduate ,Fellow Member of Insurance Institute of India, Certified Independent Director ,Certified Insurance Anti Fraud Professional , Certified Risk Governance Professional ( ICSI-III) and cleared Limited I ... Read more

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