TMI Blog1982 (3) TMI 60X X X X Extracts X X X X X X X X Extracts X X X X ..... Intelligence Unit, West Bengal, Calcutta, that at a search conducted in the business premises of the assessee on 2nd and 3rd August, 1966, diamonds, pearls and precious stones valued at Rs. 2,21,487 had been seized. When called upon to explain the source of these precious stones the assessee claimed that the seized goods were covered by the opening stock and purchases to the extent of Rs. 54,362 and that the remaining goods to the extent of Rs. 1,67,125 belonged to sixteen persons from whom they had been received on approval basis for sale or for repair on estimation. The assessee produced eleven persons whose, statements were recorded by the ITO and written statements were filed from other persons. After examining the evidence the ITO came ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee bad proved the receipt of precious stones worth Rs. 1,850 from Sri P. C. Mehta for cleaning. Thus, the Appellate Tribunal deleted an addition of Rs. 3,034 only. With regard to the rest of the items the Appellate Tribunal agreed with the authorities below that the assessee had not proved the source of the jewellery seized from the assesses and upheld the addition made under s. 69A of the Act. The assessee applied to the Tribunal for referring the questions of law said to arise out of the order of the, Tribunal under s. 256(1) of the I.T. Act, 1961. The Tribunal declined to, refer the said questions on the ground that the questions were not questions of law arising out of the order of the Tribunal. On a further application made ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... olen property that the thief is the owner thereof. Therefore, it is evident that section 69A was enacted to make certain properties as income by the deeming provision but then facts must be found to bring a case within that deeming provision. In other words, in the face of the Tribunal's clear finding that it cannot be assumed that the assessee in the present case was the owner of the money, the deeming provision cannot be made to apply in his case." In our opinion, the deeming part of s. 69A comes into play only if the following two conditions are fulfilled : (1) The assessee is found to be the owner of any money, bullion, jewellery or other valuable article, and (2) Such money, bullion, jewellery or valuable article is not recorded ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in law. In the case of Maqbool Hussain v. State of Bombay, AIR 1953 SC 325, the Supreme Court had to deal with a case where gold was found in the possession of the appellant when he landed at the Santa Cruz airport. The appellant was detained by the Customs authorities and the gold was seized from his person. Proceedings were started under the Customs Act against the appellant. The Supreme Court observed (pp. 327, 328): " This question of the ownership of the gold was not, in our opinion, material. The gold was found in the possession of the appellant when he landed at the Santa Cruz airport... Once the appellant was found in possession of the confiscated gold the burden of proving that he was not the owner would fall upon whosoever af ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... from the question raised in this reference. In the case of CIT v. Smt. P. K. Noorjehan [1980] 123 ITR 3 (Ker), the Tribunal held that although the explanation about the nature and source of the money invested in question was unsatisfactory , the assessee being muslim lady aged 20 or 21 years, who had no other source of income, it was impossible for her to have earned the amounts invested in the properties. It was held by the Division Bench of the Punjab High Court that the Tribunal did not act arbitrarily or capriciously. It took into account the complete absence of the sources of income of the assessee and the fact that having regard to her age and the circumstances in which she was Placed, she could not be credited with having earned a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lso, relied on certain passages from Salmond on jurisprudence, 12th Edn., for the purpose of establishing the difference between the legal concept of " ownership " and " possessions. But, in our opinion, those questions really do not arise in this case because of the findings of fact made by the Tribunal. The question in this case is whether there was any material before the Tribunal for coming to those findings. In this case, the assessee was found in possession of the jewelleries in question. The Tribunal found that the assessee carries on business as dealer in precious stones and also as a middle man between sellers and buyers of precious stones. The assessee's explanation as to the nature Of possession of the stones was rejected by th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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