TMI Blog2016 (10) TMI 201X X X X Extracts X X X X X X X X Extracts X X X X ..... evenue : Shri G.R. Pareek (JCIT) ORDER PER SHRI VIKRAM SINGH YADAV, A.M. This appeal has been filed by the assessee against the order of CIT(A) Kota dated 26.03.2012 wherein the assessee has taken following grounds of appeal: (1) That on the facts and in the circumstances of the case, the ld. Lower authorities grossly erred in coming to the conclusion that the assessee is the owner of the goods (gold ornaments and jewellery) seized by the Sales Tax Authorities and in making/sustaining an addition of ₹ 29,32,344/-. 1.1 That the assessee being not the owner of the said goods, he being only a carrier of goods, he having carried goods on behalf of many traders of Gangapur City, whose name he had stated on the spot in his statements before the Sales Tax Authorities, the ld. lower authorities grossly erred in still holding that the assessee is the owner of the said gold ornaments and jewellery and silver utensils and in making the impugned addition of ₹ 29,32,344/- u/s 69A of the Income Tax Act, 1961. 1.2 That the assessee being a man of low means, having no taxable income in the past, nor during the year under appeal, earning small income on account ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed. 2. Briefly the facts of the case are that the Assessing officer received certain information from the Commercial tax department in the case of the appellant and thereafter, the assessment was completed u/s 144 read with section 148 wherein addition of ₹ 34,15,100/- was made u/s 69A of the Act and another addition of ₹ 11,03,077/- was made u/s 69C of the Act. The appellant carried the matter in appeal before the ld. CIT(A), Kota who had given partial relief to the assessee and for the remaining additions, the appellant is in appeal before us. 2.1 The ld AR submitted that the appellant was carrying on business as a Carrier of goods. This fact has not been disputed by the ld. AO while completing assessment for the year under appeal as he has assessed his income at ₹ 70,000/- from carrier work. The appellant did not have any other source of income during the year under appeal. The ld AR further submitted that as per provisions of section 78(5) of the RST Act. 1994 , the Incharge of check post is empowered to impose the penalty on the owner of goods or a person authorise in writing by such owner or the person incharge of the goods where the requisite docum ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... so recorded the amount of penalty Sales Tax Carrier charges on the Gold Jewellery Silver reimbursed to the appellant in his cash book dated 9.5.2003 as under: Gold Jewellery Cost of goods 1,29,400 Penalty CTO 38,800 Sales Tax 2,592 Courier charges 250 Total ₹ 1,71,322 Silver Cost of goods 46,800 Sales tax 936 Courier charges 200 Sales Tax penalty 14,940 Total ₹ 62,876 The above facts proved beyond any doubt that the goods carried by the appellant was not owned by him. The ld AR further submitted that the ld.AO has not established the appellant s ownership on the goods found in his possession at the time of their inspection by the authorities of Commercial Taxes Department before treating the value of goods ₹ 3415100/- as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... low hot and cold according to his own convenience.The assessee at one time stated that he admitted ownership as he was offered 50% of the refund out of penalty levied by Sales tax authorities (if any). It is therefore, held that asessee, except in the cases of three persons , failed to prove that the jewellery did not belong to him. Accordingly, except jewellery of ₹ 4,82,756/- (admitted by 3 jewellers) the rest of the jewellery was held to be belonging to assessee was undisclosed. Accordingly, addition of ₹ 29,32,344/- is confirmed. The Assessing Officer is directed to delete addition of ₹ 4,82,756/-. 2.3 The ld. DR relied on the order of the lower authorities. 2.4 We have heard the rival contentions and perused the material available on record. The reasons recorded u/s 148 of the Act by the AO states that the assessee is a carrier of goods for the traders in the gangapur city who used to bring their gold, silver and jewellery. Further, the Assessing officer states that the penalty on the goods which have been seized by the Commercial tax department has been paid by the said traders in proportionate to their respective goods so seized. Further the asses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 78(5): The incharge of the check post or the officer empowered under sub-section (3), after having given the owner of the goods or a person authorised in writing by such owner or the person incharge of the goods a reasonable opportunity of being heard and after having held such enquiry as he may deem fit, shall impose on him for possession or movement of goods, whether seized or not, in violations of the provisions of clause (a) of sub section (2) or for submission of false or forged documents or declaration, a penalty equal to thirty percent of the value of such goods. Section 78(11): If a transporter fails to give information as required from him under clause (d) of sub-section (2) about the consigner, consignee or the goods within such time as may be specified or transports the goods with forged documents, besides imposing the penalty under sub-section (5), it shall be presumed that the goods so transported have been sold in the State of Rajasthan by him and he shall be deemed to be a dealer for those goods under this Act. 2.6 On review of the above provisions of Rajasthan Sales Tax Act, it is clear that the penalty can be levied either on the owner of the goods or the person ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the assessee and he is not in a position to explain the source of acquisition of that gold. If the ownership is not established then the assessee is not bound to give an explanation as to the source of acquisition of the goods. Further, from mere possession of the gold, the ownership cannot be presumed in the person who possessed the gold at the particular point of view. Section 110 of the Evidence Act, which provides that a person is found in possession of anything, the burden of proof that he is not the owner is on the person who affirms that he is not the owner could not be invoked in the instant case as besides relying on the said section the revenue had not produced any other material to indicate that the gold belonged to the assessee. The assessment in this case, could not, therefore, be sustained on the basis of section 110 of the Evidence Act. 2.9 Further it is noted that the assessee s explanation regarding his commission income from carrier business has been accepted by the Revenue for the year under consideration. Further, nothing has been brought on record to suggest that the assessee is the owner of the gold and silver jewellery other than the documents received ..... 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