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2019 (4) TMI 1478 - ITAT VISAKHAPATNAMAddition to excess stock of gold jewellery weighing 2717.400 gms - proof of purchased pure gold - bill produced for conversion of pure gold into jewellery - HELD THAT:- There is no dispute that the assessee had purchased pure gold from M/s SVBC, Vizag on 09.11.2015 and 13.11.2015 and the said gold was not available with the assessee at the time of survey and it was also not in dispute that the gold jewellery weighing 2717.400 gms was physically available in the shop at the time of survey. Once, it is established that the assessee had purchased 3,100 gms and the same was not available in the shop, there is no reason to disbelieve the issue of pure gold for making the gold jewellery ornaments. In this case, the assessee has produced the bill for receipt of gold jewellery from M/s Jai Mata Di Jewellers on 03.12.2015 which is within the reasonable time of conducting the survey. Therefore, there is no reason to disbelieve the genuineness of the bill. AO did not make any enquiry with M/s Jai Mata Di Jewellers to find out the correctness of the bill. The assessee is free to furnish the necessary evidence to address the difference found during the course of survey in the reasonable time. In the instant case, the assessee had furnished all the bills from M/s Jai Mata Di Jewellers and voucher No.92, which was raised for issue of gold to M/s Jai Mata di Jewelelrs before the Ld.CIT(A) as well as the AO. Therefore, the assessee has established that the pure gold was issued to M/s Jai Mata Di Jewellers was received back subsequently. The department did not make out a case that the bill issued by M/s Jai Mata Di Jewellers as either bogus or fake. We agree with the observation of the CIT(A) that the AO has made the addition only on suspicion and surmises, hence, the addition made by the AO is unsustainable. Addition for deficit cash found in the business premises during the survey - Addition u/s 68 - HELD THAT:- In this case, there was deficit cash of ₹ 11,59,906/- which was found during the course of survey and the assessee had explained that ₹ 8,00,000/- was kept in his house. The said statement given at the time of survey was also confirmed u/s 132 on 24.11.2015 during the course of search conducted in the residence of Mr.Mahendra Jain. Therefore, there is no reason to disbelieve explanation of the assessee that the sum of ₹ 8,00,000/- found in the residential premises was related to the business and deficit cash of ₹ 8,00,000/- in the business premises stands explained. There was further difference of ₹ 3,59,906/- which was stated to be partly counter cash which was not inventorised by the survey team and offered to income. As rightly observed by the CIT(A), there is no reason to disbelieve the explanation of the assessee with regard to the source of ₹ 8,00,000/- and balance of ₹ 3,50,000/- was admitted as income in response to show cause notice issued by the AO vide his letter dated 04.12.2017. Since the assessee failed to explain the reason for deficit cash and admitted the same as income in its hands, we do not see any reason to interfere with the order of the CIT(A). Accordingly, we uphold the order of the Ld.CIT(A) and confirm the addition
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