TMI Blog2015 (1) TMI 735X X X X Extracts X X X X X X X X Extracts X X X X ..... cts of the matter, we are of the view that the issue is to be examined afresh by the AO, for the limited purpose, to verify as to whether, the jewellary seized is recorded in the books of account of D-Mines Trading Co. Pvt. Ltd. If the seized jewellary is recorded in the books of account of the company, necessarily assessee’s explanation that he is not the owner of the jewellary cannot be said to be false and therefore, addition u/s 69A of the Act is not warranted in his hands. - Decided in favour of assessee for statistical purposes. - ITA No.784/Del /2013 - - - Dated:- 9-1-2015 - SHRI GEORGE GEORGE K. AND SHRI T.S. KAPOOR, JJ. For The Appellant : Shri Rakesh Joshi, And Shri Sanjay Jain, C.As. For The Respondent : Shri Piyush Jain, CIT, DR. ORDER PER SHRI GEORGE GEORGE K., JM: 1. This appeal of the assessee is directed against the order of the CIT (A)- XXVI, Delhi dated 26.11.2012. The relevant assessment year is 2010-11. 2. The assessee has, in his grounds of appeal, raised the following two issues, namely: (1) that the CIT (A) had erred in confirming the addition of ₹ 1,38,02,690/- made u/s 69A of the Act; (2) that the CIT (A) erred in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... appellant was in Jammu on 30.7.2009 and was traveling by auto-rickshaw, the Sales Tax Officers intercepted the autorickshaw and on search found gold/diamond ornaments. The seized jewellery was estimated by the Sales Tax Department u/s 67(5), 67(10)(6) of the Jammu Kashmir Vat Act, 2005 and also by the approved valuer. At the time of seizure of jewellery, the consignment was not accompanied by any document as envisaged u/s 67(2) of J K Vat Act, 2005. S. 67(2) of J K Vat Act, 2005, inter alia states as under: .. 6.1. Warrant u/s 132(1) of the I.T. Act 1961 dated 6.8.2009 was served uponthe Addl. CIT (Admn), Jammu on 7.8.2009. The appellant filed a petition before the Hon ble High Court of J K at Jammu for release of jewellery. The Hon ble H.C passed an interim order on 10.6.2011. It was stated in the said order that the appellant deposited an amount of ₹ 34 lacs as penalty in terms of s. 67(10) of J K Vat Act, 2005 and an amount of ₹ 2.76,053/- as penalty imposed u/s 69(10) of the aforesaid Act. The order also stated that the appellant was required to pay a security to the tune of ₹ 37,50,672/- which is a bank guarantee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e, there is no such evidence pertaining to the seizure of the documents. A perusal of the affidavit reveals that it was made after almost one and a half month after the seizure occurred. The contents are also contradicting wherein it was stated that the seized invoices along with the goods were seen by the appellant s counsel on 31.7.2009 when the appellant was intercepted and again it was stated that the Counsel gave copies of the invoices to SIU which were found removed from the file. From this, it is evident that if the invoices were seized by the officers of SIU where was the necessity for the counsel to give those invoices to the SIU after the seizure? From this, I find that no documents like bills/invoices were found in the possession of the appellant along with the consignment on the day of seizure and the appellant and his counsel made up a story to throw the ball in the Court of the SIU Officers to get away with the unprecedented deed. I find it also strange that a prudent businessman who goes beyond his jurisdiction to expand his business activities would be so na ve that he would not keep a copy of the inventory of documents so seized but would keep copy of the inventory ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ornaments that were seized by the Sales Tax Officer at Jammu. It is also a point to note that the appellant derived income from the partnership business which was declared by him in his return. The appellant did not furnish any cogent evidence to show that he is not the owner of the ornaments that which seized either before the Sales Tax Officer or income-tax Department. In view of the above discussion, I find no justification in interfering in the order passed u/s 143(3) dated 29.12.2011 by the AO treating the value of jewellery seized amounting to ₹ 1,38,02,690/- as deemed income of the appellant u/s 69A. Therefore, the addition made by the assessing officer amounting to ₹ 1,38,02,690/- is hereby confirmed. 4. Aggrieved, the assessee has come up before us with the present appeal. During the course of hearing, the learned AR reiterated what has been represented before the CIT (A). On the other hand, the ld. DR supported the stand of the incometax authorities. 5. We have carefully considered the rival submissions and perused the relevant materials on record and also the documentary evidences produced by the ld. AR in the form of a Paper Book. The facts of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Commercial Taxes (Recy), Jammu had ordered the release of seized goods equal to the amount of security furnished [Page A 13 of PB AR]. 5.2. During the course of hearing, it was contended that the bills have been issued by D-Mines Trading Company Private Limited and duly accounted for in its books of account, stock register etc., It was also the assertion of the assessee that as per the directions of the Hon ble High Court (supra), the jewellery was released by the STA based on the bank guarantee furnished by the company. Moreover, it was contended that the evidences produced by the assessee during the course of assessment proceedings have not been duly considered or verified by the AO before concluding the assessment. It was, further, urged that the seized jewellery was not belonged to him but to the company in which he was a director. It was, therefore, argued that since the company had come forward to accept the ownership of the seized jewellery, then the AO was not justified in making an addition in the hands of the assessee. For this proposition, the assessee has placed reliance on the following case laws: (i) Mangilal Agarwal (dead) through LRs v. ACIT 300 ITR 372 (Ra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e imposition of penalty amounting to ₹ 37.50 Lakhs under the J K VAT Act 2005, which is placed on record clearly depicts the company as the petitioner. During the course of assessment proceeding before the income tax authorities, the company through its Director had claimed ownership of jewellary (Pages 231 and 232 of the P.B. of A.R). When company had claimed ownership of the jewellary, mere possession of the same by the assessee at the time of its seizure by STA is immaterial as to determine the ownership of jewellary. To determine the ownership of jewellary necessarily the books of account of the company also needs to be examined. 5.5. It is a fact that the AO had not verified as to whether the company DMines Trading Co. Pvt. Ltd had recorded in its books of account the transaction effected. Taking into account the facts of the matter, we are of the view that the issue is to be examined afresh by the AO, for the limited purpose, to verify as to whether, the jewellary seized is recorded in the books of account of D-Mines Trading Co. Pvt. Ltd. If the seized jewellary is recorded in the books of account of the company, necessarily assessee s explanation that he is not the ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
