M/s. Dharamraj Jewellers, Ahmedabad V. The ACIT., Circle-5(2), Ahmedabad

ITA 2483/AHD/2016

• Counselvise Citation: [2019] 115 COUNSELVISE.COM (IT) 7743 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 year(s) 14 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-10-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: Not Allotted
• Assessment Year: 2012-2013
• Appeal Filed On: 30-09-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: L P JAIN
• Assessee Lawyers: SHRI P M MEHTA

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD C BENCH (BEFORE SHRI PRADIP KUMAR KEDIA, ACCOUNTANT MEMBER & SHRI MAHAVIR PRASAD, JUDICIAL MEMBER) ITA. NO: 2483/AHD/2016 (ASSESSMENT YEAR: 2012-13) DHARAMRAJ JEWELLERS 5-6, NAVNIT PLAZA, NR. MUNICIPAL MARKET, C.G. ROAD, AHMEDABAD-380009 V/S ACIT, CIRCLE-5(2), AHMEDABAD (APPELLANT) (RESPONDENT) PAN: AACFD 4300L APPELLANT BY : SHRI SHRI P. M. MEHTA, AR RESPONDENT BY : SHRI L. P. JAIN, SR. D.R. ( )/ ORDER DATE OF HEARING : 01 -10-201 9 DATE OF PRONOUNCEMENT : 14 -10-2019 PER MAHAVIR PRASAD, JUDICIAL MEMBER 1. THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAIN ST THE ORDER OF THE LD. CIT(A)-5, AHMEDABAD DATED 01.08.2016 PERTAINING TO A.Y. 2012-13 AND FOLLOWING GROUNDS HAVE BEEN TAKEN: ITA NO. 2483 /AHD/2016 . A.Y. 2012-1 3 2 1. ON THE FACTS AND CIRCUMSTANCES OF THE APPE LLANT'S CASE, LEARNED. CIT(A) HAS ERRED IN CONFIRMING THE ADDITION OF RS.11,86,570/- WITHOUT APPRECIATING THE FACT THAT THE EXCESS STOCK OF 532.094 GMS OF 22CT GOLD F OUND DURING THE COURSE OF SURVEY ACTION IS BELONG TO FAMILY MEMBERS OF THE AP PELLANT AND ACCORDINGLY THE SAME ARE NOT RECORDED IN THE BOOKS OF ACCOUNTS. 2. ON THE FACTS AND CIRCUMSTANCES OF THE APPE LLANT'S CASE, LEARNED. CIT(A) HAS ERRED IN CONFIRMING ADDITION OF RS.28,007/- ON ACCO UNT OF EXCESS STOCK OF SILVER AND RS.1,14,600/- ON ACCOUNT OF EXCESS STOCK OF 24C T GOLD FOUND DURING THE COURSE OF SURVEY ACTION WITHOUT APPRECIATING THE FACT THAT WHILE ARRIVING AT THE NET WEIGHT THE VALUER HAS ESTIMATED VALUES FOR PRECIOUS STONE AND METALS STUDDED IN THE JEWELLERY WHEREAS THE WEIGHT AS REFLECTED IN FI NANCIAL BOOKS OF ACCOUNT IS PRECISE AND ACTUAL WEIGHT AND IN VIEW OF THIS FACTS THE DIFFERENCE ARISE IN STOCK OF SILVER, DIAMOND AND GOLD AS PER BOOKS OF ACCOUNTS A ND AS PHYSICALLY FOUND BY THE SURVEY PARTY. 3. WITHOUT PREJUDICE TO THE SAME, LD. CIT(A) OUGHT TO HAVE APPRECIATED THE FACT THAT THERE IS SHORTAGE OF 408.883 GMS IN THE QUANTI TY OF 18CT GOLD AND 21.560 CARAT IN THE QUANTITY OF DIAMOND AND ACCORDINGLY IT CAN BE PRESUMED THAT DIFFERENTIAL AMOUNT OF 18 CT GOLD AND DIAMOND SOLD BEFORE THE SURVEY PROCEEDINGS AND MONEY SOLD HAS BEEN UTILIZED TO BUY EXCESS OF 4 7.950 GM OF 24CT GOLD, 532.094 GM OF 22CT GOLD AND 1120.291 GMS OF SILVER FOUND IN THE PREMISES OF THE APPELLANT AND ACCORDINGLY THE APPELLANT SHOULD BE A LLOWED THE BENEFIT OF TELESCOPING TO THE EXTENT OF RS. 12,40,234/- 4. THE APPELLANT CRAVES LEAVE TO ADD TO, ALTER, AME ND AND/OR WITHDRAW ANY GROUND OR GROUNDS OF APPEAL EITHER BEFORE OR DURING THE COURSE OF HEARING OF THE APPEAL. 2. DURING THE COURSE OF SURVEY PROCEEDING, AS ON 08/06 /2011 AS PER BOOKS OF A/C OPENING STOCK OF 22CT GOLD ORNAMENTS WAS SHOWN OF 25364.716 GRAMS WHEREAS PHYSICAL STOCK DURING SURVEY PROCEEDINGS WA S FOUND OF 27379.140 GRAMS. 3. IN REPLY TO THE NOTICE, ASSESSEE STATED THAT 1015.8 00 GRAMS OF GOLD ORNAMENTS BELONG TO THE FAMILY MEMBERS OF THE ASSESSEE GROUP WHICH SHOULD NOT BE CONSTRUED AS STOCK IN TRADE OF THE BUSINESS . AS AS SESSEE AND HAS FAMILY MEMBER ITA NO. 2483 /AHD/2016 . A.Y. 2012-1 3 3 DO NOT HAVE ANY LOCKER FACILITY, THEREFORE, IN ORDE R TO SAFEGUARD THE JEWELLERY OF THE ASSESSEE HAS KEPT HIS AND FAMILY MEMBER JEWELLE RY IN A STRONG ROOM BAULT OF THE BUSINESS PREMISES. 4. BUT LD. A.O. WAS NOT AGREE WITH THE CONTENTION OF T HE ASSESSEE AND MADE ADDITION OF RS. 11,86,570/- ON ACCOUNT OF EXCESS ST OCK OF 22CT GOLD. 5. AGAINST THE SAID ORDER, ASSESSEE PREFERRED FIRST ST ATUTORY APPEAL BEFORE THE LD. CIT(A) WHO CONFIRMED THE ACTION OF THE ASSESSING OF FICER. 6. WE HAVE THROUGH THE RELEVANT RECORD AND IMPUGNED OR DER AND HEARD BOTH THE PARTIES. DURING THE SURVEY PROCEEDING, AS QUESTION NO. 30 OF THE STATEMENT OF THE ASSESSEE WAS RECORDED AND SAME IS PART OF PAPER BOOK PAGES 40 TO 58 WHEREIN HE HAS GIVEN DETAILS 32 JEWELLERY ITEM AND STATED THAT SAME BELONG TO HIS AND, FAMILY MEMBERS OF THE ASSESSEE. AS ASSESSE E IS NOT HAVING BANK LOCKER FACILITY, THEREFORE, SAME WAS KEPT IN A STRONG ROOM OF THE BUSINESS PREMISES AND STATED BEFORE THE LOWER AUTHORITIES, NO ENTRIES PAS SED IN THE FINANCIAL BOOKS OF ACCOUNTS FOR THE MOVEMENT OF STOCK BETWEEN THREE PA RTIES AND ASSESSEE, A PROPER TRACK RECORD IS MAINTAINED FOR ALL THE TRANS ACTIONS THROUGH ORNET WHICH IS THE ACCOUNTING SOFTWARE USED BY THE ASSESS EE. 7. WHEN THE SPECIFICALLY ASKED THE LD. D.R. THAT WHET HER ANY STATEMENT OF FAMILY MEMBER TO WHOM PURPORTEDLY JEWELLERY IS BELONGING W AS RECORDED DURING THE SURVEY PROCEEDING OR DURING THE ASSESSMENT PROCEEDI NG. LD. D.R. SAID NO SUCH STATEMENT WAS RECORDED BY THE REVENUE. HOWEVER, HE VEHEMENTLY SUPPORTED THE ORDERS OF THE REVENUE. ITA NO. 2483 /AHD/2016 . A.Y. 2012-1 3 4 8. FROM THE DATE OF SURVEY PROCEEDING, ASSESSEE TOOK T HE STAND THAT THE DIFFERENCE OF JEWELLERY IS BELONGING TO HIS FAMILY MEMBERS. NO REBUTTAL TO THE STAND OF THE ASSESSEE WAS BROUGHT ON RECORD. IN THE ABSENCE OF A NY CONTRARY POSITION SHOWN TO BE TAKEN BY THE FAMILY MEMBERS/RELATIVES OF ASSE SSEE, THE STAND OF THE ASSESSEE TAKEN IN THE COURSE OF SURVEY REQUIRES TO BE BELIEVED. WE, THUS, FIND MERIT IN THE CASE MADE OUT BY ASSESSEE FOR BONA FID ES OF ITS EXPLANATION. 9. IN THE RESULT, APPEAL FILED BY THE ASSESSEE IS ALLO WED. ORDER PRONOUNCED IN OPEN COURT ON 14- 10- 2019 SD/- SD/- (PRADIP KUMAR KEDIA) (MAHAVIR PRASAD) ACCOUNTANT MEMBER TRUE COPY JUDICIAL MEMBER AHMEDABAD: DATED 14/10/2019 RAJESH COPY OF THE ORDER FORWARDED TO: - 1. THE APPELLANT. 2. THE RESPONDENT. 3. THE CIT (APPEALS) 4. THE CIT CONCERNED. 5. THE DR., ITAT, AHMEDABAD. 6. GUARD FILE. BY ORDER DEPUTY/ASSTT.REGISTRAR ITAT,AHME DABAD