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2018 (5) TMI 1966 - AT - Income TaxSales in cash of bullion being unexplained in the absence of detail and corroboration - whether cash sales of gold by the assessee is part of the trading transaction and the trader buying the gold would fall u/s 14A(3)? - HELD THAT:- CIT (A) has categorically mentioned that prima facie there is no dispute as regards recording of transaction in the books of account and quantitative details for the period 01.04.2011 to 31.03.2012 includes inward or outward transactions of gold of 10 Kgs. during the year under assessment. CIT (A) has proceeded on the basis of surmises that, “the business transactions of jewellery and bullion dealers are highly cash intensive in nature and it is always apprehended that they could be used for flow of black money into the system and has referred to section 115BBE”. CIT (A) also mentioned that “during the year under assessment, mention of PAN was made mandatory w.e.f. 01.07.2011 for bullion purchase of ₹ 5,00,000/- or more at a time.” So far as question of making mention of PAN as mandatory w.e.f. 01.07.2011 for all jewellery/bullion purchases of ₹ 5,00,000/- or more is concerned, when it is undisputed case of the assessee that the sale of gold in question was made on 03.05.2011 and sold on 05.05.2011, the provisions for mentioning PAN which came into effect w.e.f. 01.07.2011 are not attracted. Ld. CIT (A) in para 4.3(b) at page 18 has himself recorded that, “Interestingly and coincidentally, in our case, the appellant has undertaken these transactions just before that”. CIT(A) despite being satisfied that the provisions are not applicable in case of the assessee but proceeded to enhance the income of the assessee to the tune of ₹ 2,24,99,000/- on account of sales in cash of bullion being unexplained in the absence of detail and corroboration. In the face of the fact that books of account duly audited by the auditors have been accepted by the dl. CIT (A) and no adverse inference has been drawn and provisions contained u/s 115BBE are not attracted, the income has been enhanced by ld. CIT (A) apparently on the basis of surmises which is not sustainable in the eyes of law, hence following the decision rendered by Hon’ble High Courts and Tribunal in CIT-II vs. Jindal Dyechem Industries Pvt. Ltd. [2012 (4) TMI 423 - DELHI HIGH COURT] , R.B. Jessaram Fetehcahnd (Sugar Dept.) vs. CIT, Bombay City-II [1969 (7) TMI 10 - BOMBAY HIGH COURT] and Kishore Jeram Bhai Khaniya, Prop. M/s. Poonam Enterprises, Mp-83 [2014 (5) TMI 699 - ITAT DELHI] addition made by ld. CIT (A) is ordered to be deleted. - Decided in favour of the assessee.
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