Appeal details
Counselvise Citation
[2016] 132 COUNSELVISE.COM (IT) 8848 (ITAT-CHENNAI)
Assessee PAN
Bench
Appeal Number
Duration Of Justice
4 month(s) 29 day(s)
Appellant
Respondent
Appeal Type
Income Tax Appeal
Pronouncement Date
15-07-2016
Appeal Filed By
Department
Bench Allotted
B
Next Hearing Date
21-06-2016
Assessment Year
2010-2011
Appeal Filed On
16-02-2016
Judgement Text
, , IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH : CHENNAI . . . , . !' , # $ % [ BEFORE SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND SHRI A. MOHAN ALANKAMONY, ACCOUNTANT MEMBER ] ./ I.T.A.NOS.354 , 355 & 356/MDS/2016 / ASSESSMENT YEARS : 2008-09, 2010-11 AND 2011- 12 & C.O.NOS. 53 & 54/MDS/2016 [IN I.T.A.NOS.354 & 355/MDS/2016] ASSESSMENT YEARS: 2008-09 & 2010-11 THE DY. COMMISSIONER OF INCOME-TAX CENTRAL CIRCLE-1(2) CHENNAI VS. SHRI SARAVANA ARUL NO.14, RANGANATHAN STREET T. NAGAR, CHENNAI 600 017 [PAN AOFPS 1937 M ] (APPELLANT) (RESPONDENT /CROSS OBJECTOR ) DEPARTMENT BY : SHRI SUPRIYO PAL, JCIT ASSESSEE BY : SHRI K.M. MOHANDASS, CA / DATE OF HEARING : 21 - 06 - 2016 / DATE OF PRONOUNCEMENT : 15 - 0 7 - 2016 / O R D E R PER N.R.S.GANESAN, JUDICIAL MEMBER THE REVENUE FILED APPEALS AGAINST THE RESPECTIVE ORDERS OF THE COMMISSIONER OF INCOME-TAX (APPEALS)-18, CHENNA I, FOR ASSESSMENT YEARS 2008-09, 2010-11 AND 2011-12. THE ASSESSEE HAS ALSO FILED CROSS OBJECTIONS FOR ASSESSMENT YEARS 2008-09 AND 2010- 11. SINCE COMMON ISSUE ARISES FOR CONSIDERATION IN ALL THE APPEALS ITA NOS.354 TO 356/16 CO NOS.53 & 54/16 :- 2 -: AND THE CROSS OBJECTIONS, WE HEARD THEM TOGETHER AN D DISPOSING OF THE SAME BY THIS COMMON ORDER. 2. LET US FIRST TAKE UP REVENUES APPEAL I.T.A.NO.354/ MDS/2016 FOR ASSESSMENT YEAR 2008-09. 3. THE FIRST ISSUE ARISES FOR CONSIDERATION IS ADDITIO NS MADE TOWARDS UNEXPLAINED CREDIT, AGRICULTURAL INCOME, UN EXPLAINED CASH DEPOSITS, UNEXPLAINED INVESTMENTS AND INTEREST ON S ETTLEMENT MONEY. 4. SHRI SUPRIYO PAL, LD. DEPARTMENTAL REPRESENTATIVE S UBMITTED THAT THE ASSESSEE IS A PARTNER IN M/S SARAVANA SEL VARATHNAM (JEWELLERY), M/S SARAVANA SELVARATHNAM (TEXTILES), M/S SARAVANA SELVARATHNAM (SWEETS) AND PROPRIETOR OF M/S SARAVAN A SELVARATHNAM (WATER). DURING THE YEAR UNDER CONSIDERATION, THER E WAS A SEARCH IN THE PREMISES OF THE ASSESSEE ON 18.8.2011. HOWEVER , NO INCRIMINATING MATERIAL WAS FOUND DURING THE COURSE OF SEARCH OPER ATION AGAINST THE ASSESSEE. THE ASSESSEE FILED THE RETURN OF INCOME FOR ASSESSMENT YEAR 2008-09 IN THE REGULAR COURSE ON 31.10.2008 AD MITTING AN INCOME OF ` 2,96,18,623/-. THE TIME LIMIT FOR ISSUING NOTICE U/S 143(2) HAS EXPIRED ON THE DATE OF SEARCH. THE ASSESSING OFFIC ER FOUND THAT THE ASSESSEE HAS NOT SUBSTANTIATED THE RECEIPT OF GIFT, AGRICULTURAL INCOME ETC. BEFORE THE ASSESSING OFFICER, THEREFORE, THE A SSESSING OFFICER ITA NOS.354 TO 356/16 CO NOS.53 & 54/16 :- 3 -: TREATED THE SAME AS UNDISCLOSED INCOME U/S 153 OF THE ACT. THEREFORE, THE CIT(A) IS NOT JUSTIFIED IN DELETING THE ADDITION MADE BY THE ASSESSING OFFICER. 5. ON THE CONTRARY, SHRI K.M. MOHANDASS, LD. REPRESENT ATIVE FOR THE ASSESSEE SUBMITTED THAT ADMITTEDLY, THE ASSES SEE FILED THE RETURN OF INCOME FOR THE ASSESSMENT YEAR UNDER CONSIDERATI ON ON 31.10.2008 ADMITTING INCOME OF ` 2,96,18,623/-. THE SEARCH TOOK PLACE ON 18.8.2011. ON THE DATE OF SEARCH OPERATION, THE TI ME LIMIT FOR ISSUING NOTICE U/S 143(2)OF THE ACT EXPIRED. IN OTHER WO RDS, ACCORDING TO THE LD. REPRESENTATIVE, THE ASSESSMENT PROCEEDINGS ON T HE BASIS OF THE RETURN FILED BY THE ASSESSEE ON 31.10.2008 IS NOT PENDING ON THE DATE OF SEARCH. THEREFORE, IN VIEW OF SECOND PROVISO TO SEC. 153A OF THE ACT, ACCORDING TO THE LD. REPRESENTATIVE, THE ASSES SMENT PROCEEDINGS PENDING ON THE DATE OF THE SEARCH SHALL ABATE AND T HE ASSESSING OFFICER HAS TO FRAME A SINGLE ASSESSMENT INCLUDING ALL THE INCOME WHICH WAS DISCLOSED EARLIER IN THE RETURN OF INCOME AND THE INCOME WHICH WAS FOUND DURING THE COURSE OF SEARCH OPERATI ON. HOWEVER, WHEN THE PROCEEDINGS ARE NOT PENDING AND TERMINATED EITHER BY OPERATION OF LAW OR OTHERWISE BY AN ORDER U/S 143( 3)OF THE ACT ON THE DATE OF SEARCH OPERATION, THE ASSESSMENT PROCEEDING S SHALL NOT ABATE. IN OTHER WORDS, ACCORDING TO THE LD. REPRESENTATIVE , THE ASSESSMENT ITA NOS.354 TO 356/16 CO NOS.53 & 54/16 :- 4 -: PROCEEDINGS ON THE BASIS OF THE RETURN FILED ON 31. 10.2008 CANNOT BE REEXAMINED BY THE ASSESSING OFFICER IN THE PROCEEDI NGS U/S 153A OF THE ACT. AT THE BEST, THE ASSESSING OFFICER CAN AS SESS OR RE-ASSESS THE INCOME ON THE BASIS OF MATERIAL FOUND DURING THE CO URSE OF SEARCH OPERATION. IN THE CASE BEFORE US, ACCORDING TO THE LD. REPRESENTATIVE, NO MATERIAL WAS FOUND DURING THE COURSE OF SEARCH O PERATION, THEREFORE, THERE IS NO QUESTION OF MAKING ANY ADDIT ION FOR THE BLOCK PERIOD. 6. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EITHER SIDE AND ALSO PERUSED THE MATERIAL AVAILABLE ON RECORD. WE HAVE ALSO GONE THROUGH THE PROVISIONS OF SEC. 153A OF THE ACT. SE C. 153A CLEARLY PROVIDES THAT ASSESSMENT PROCEEDINGS PENDING ON THE DATE OF THE SEARCH OPERATION SHALL ABATE AND THE ASSESSING OFFI CER HAS TO PASS A COMPREHENSIVE ASSESSMENT ORDER INCLUDING ALL THE IN COME OF THE ASSESSEE. IN CASE THE ASSESSMENT PROCEEDINGS ARE N OT PENDING ON THE DATE OF SEARCH ON THE BASIS OF THE RETURN FILED EAR LIER, THEN THE PROCEEDINGS WILL NOT ABATE AND STAND CONCLUDED, THE REFORE, THE ASSESSING OFFICER CANNOT REOPEN THE ASSESSMENT WHIC H WAS CONCLUDED ON THE DATE OF SEARCH OPERATION. AT THE BEST, AS R IGHTLY SUBMITTED BY THE LD. REPRESENTATIVE FOR THE ASSESSEE, THE ASSES SING OFFICER CAN ITA NOS.354 TO 356/16 CO NOS.53 & 54/16 :- 5 -: ASSESS OR RE-ASSESS THE INCOME ON THE BASIS OF THE MATERIAL FOUND DURING THE COURSE OF SEARCH OPERATION. 7. IN THE CASE BEFORE US, ADMITTEDLY, NO INCRIMINATING MATERIAL WAS FOUND DURING THE COURSE OF SEARCH OPERATION. THE ASSESSING OFFICER HAS RE-EXAMINED THE INCOME DECLARED IN THE RETURN FILED BEFORE THE DATE OF SEARCH OPERATION AND MADE ADDITION ON T HE GROUND THAT THE INCOMES DISCLOSED ARE NOT SUBSTANTIATED. THIS TRI BUNAL IS OF THE CONSIDERED OPINION THAT IN THE ABSENCE OF ANY MATER IAL FOUND DURING THE COURSE OF SEARCH OPERATION TO INDICATE THAT INC OME DISCLOSED EARLIER WAS NOT CORRECT, THE ASSESSING OFFICER CANNOT REEXA MINE THE SAME. IN OTHER WORDS, THE ASSESSMENT PROCEEDING ON THE BASIS OF THE RETURN FILED ON 31.10.2008 WAS TERMINATED BY OPERATION OF LAW SINCE THE TIME LIMIT FOR ISSUE OF NOTICE U/S 143(2) EXPIRED. THE REFORE, THE ASSESSING OFFICER HAS TO NECESSARILY CONFINE HIMSELF ONLY TO THE MATERIAL FOUND DURING THE COURSE OF SEARCH OPERATION FOR THE PURPO SE OF MAKING ASSESSMENT OR RE-ASSESSMENT IN A PROCEEDING U/S 15 3A OF THE ACT. IN THE CASE BEFORE US, NO MATERIAL WAS FOUND DURING TH E COURSE OF SEARCH OPERATION, THEREFORE, THE CIT(A) HAS RIGHTLY DELETE D THE ADDITION MADE BY THE ASSESSING OFFICER. THEREFORE, THIS TRIBUNAL DO NOT FIND ANY REASON TO INTERFERE WITH THE ORDER OF THE CIT(A) AN D ACCORDINGLY, THE SAME IS CONFIRMED. ITA NOS.354 TO 356/16 CO NOS.53 & 54/16 :- 6 -: 8. NOW COMING TO ASSESSMENT YEAR 2010-11 IN I.T.A.NO. 355/MDS/2016, THE ONLY ISSUE ARISES FOR CONSIDERATI ON IS DISALLOWANCE OF INTEREST TO THE EXTENT OF ` 54,24,820/-. 9. SHRI SUPRIYO PAL, LD. DR SUBMITTED THAT THE ASSESSI NG OFFICER FOUND THAT IN THE PROFIT & LOSS ACCOUNT THE ASSESS EE HAS DEBITED ` 98,98,049/- BEING INTEREST PAID. THE ASSESSEE EXP LAINED BEFORE THE ASSESSING OFFICER THAT INTEREST WAS PAID TO M/S SAN KARA PANDIAN STORES TO THE EXTENT OF ` 54,24,870/- FOR THE PERIOD 30.6.2004 TO 31.12.2008 . THEREFORE, THE ASSESSING OFFICER FOUND THAT THE INT EREST PAID TO M/S SANKARA PANDIAN STORES RELATES TO EARLIER ASSESSMEN T YEAR. THEREFORE, THE ASSESSING OFFICER DISALLOWED THE CLAIM OF INTER EST TO THE EXTENT OF ` 54,24,870/-. THE CIT(A), ACCORDING TO THE LD. DR, FOUND THAT THE ENTIRE AMOUNT WAS PAID DURING THE YEAR UNDER CONSID ERATION AND THE RECIPIENT OF THE INTEREST ALSO PAID THE TAXES, THER EFORE, IT WAS DELETED. ACCORDING TO THE LD. DR, THE INTEREST EXPENDITURE R ELATABLE TO THE YEAR UNDER CONSIDERATION ALONE COULD BE ALLOWED. SINCE THE INTEREST WAS PAID FOR THE PERIOD 30.6.2004 TO 31.12.2008, ACCORD ING TO THE LD. DR, THE PAYMENT OF INTEREST DOES NOT RELATE TO THE YEAR UNDER CONSIDERATION. THEREFORE, THE CIT(A) IS NOT JUSTIF IED IN ALLOWING THE CLAIM OF THE ASSESSEE. ITA NOS.354 TO 356/16 CO NOS.53 & 54/16 :- 7 -: 10. ON THE CONTRARY, SHRI K.M.MOHANDASS, LD. REPRESENTA TIVE FOR THE ASSESSEE SUBMITTED THAT ADMITTEDLY THE ASSESS EE PAID INTEREST TO THE EXTENT OF ` 54,24,870/- TO M/S SANKARA PANDIAN STORES DURING T HE YEAR UNDER CONSIDERATION. THE INTEREST WAS PAID FO R THE PURPOSE OF UTILIZING THE FUNDS IN THE BUSINESS OF THE ASSESSE E. ACCORDING TO THE LD. REPRESENTATIVE, THERE WAS A DISPUTE BETWEEN THE ASSESSEE AND M/S SANKARA PANDIAN STORES WITH REGARD TO PAYMENT OF IN TEREST. THE DISPUTE WAS RESOLVED DURING THE YEAR UNDER CONSIDER ATION AND AS A RESULT, THE ASSESSEE WAS REQUIRED TO PAY INTEREST DURING THE YEAR UNDER CONSIDERATION. THE LD. REPRESENTATIVE SUBMIT TED THAT EVEN THOUGH THE INTEREST WAS PAID FOR THE PERIOD 30.6.20 04 TO 31.12.2008, THE LIABILITY TO PAY INTEREST WAS CRYSTALLIZED DURI NG THE YEAR UNDER CONSIDERATION WHEN THE DISPUTE WAS RESOLVED BETWEEN THE PARTIES, THEREFORE, THE PAYMENT OF INTEREST HAS TO BE ALLOWE D DURING THE YEAR UNDER CONSIDERATION. 11. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EITHER SIDE AND ALSO PERUSED THE MATERIAL AVAILABLE ON RECORD. THE ASSESSEE DEBITED A SUM OF ` 98,98,049/- IN THE PROFIT & LOSS ACCOUNT BEING THE INTEREST PAID. THE ASSESSING OFFICER ALLOWED THE CLAIM OF T HE ASSESSEE TOWARDS PAYMENT OF INTEREST OTHER THAN THE INTEREST PAID TO M/S SANKARA PANDIAN STORES TO THE EXTENT OF ` 54,24,870/-. FROM THE ASSESSMENT ITA NOS.354 TO 356/16 CO NOS.53 & 54/16 :- 8 -: ORDER IT APPEARS THAT THE ASSESSEE PAID INTEREST F OR THE PERIOD 30.6.2004 TO 31.12.2008, THEREFORE, THE PAYMENT OF INTEREST RELATES TO EARLIER ASSESSMENT YEARS. THE ASSESSING OFFICER HA S ALSO FOUND THAT THE ASSESSEE HAS NOT DEDUCTED TAX AT THE TIME OF M AKING PAYMENT. IT IS NOT IN DISPUTE THAT THERE WAS A DISPUTE BETWEEN THE PARTIES AND THE SAME WAS RESOLVED DURING THE YEAR UNDER CONSIDERATI ON. THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT THERE WAS A DISP UTE BETWEEN THE PARTIES WITH REGARD TO PAYMENT OF INTEREST AND THE INTEREST TO BE PAID WAS CRYSTALLIZED ONLY ON SETTLEMENT OF THE DISPUTE. IT IS ALSO NOT IN DISPUTE THAT THE DISPUTE WAS RESOLVED DURING THE YE AR UNDER CONSIDERATION AND THE ASSESSEE PAID THE INTEREST, EVEN THOUGH THE PAYMENT OF INTEREST RELATES TO EARLIER ASSESSMENT Y EARS. SINCE THE DISPUTE WAS RESOLVED AND THE PAYMENT OF INTEREST WA S CRYSTALLIZED DURING THE YEAR UNDER CONSIDERATION, THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT THE INTEREST PAID BY THE ASSESSEE TO THE EXTENT OF ` 54,24,870/- HAS TO BE ALLOWED DURING THE YEAR UNDER CONSIDERATION. IT IS NOT IN DISPUTE THAT THE RECIPIENT OF THE INTERES T M/S SANKARA PANDIAN STORES HAS PAID THE TAXES. WHEN THE RECIPIENT HAS PAID THE TAXES, THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT THERE IS NO REASON FOR DISALLOWING THE CLAIM OF THE ASSESSEE. IN VIEW OF THE ABOVE, THIS ITA NOS.354 TO 356/16 CO NOS.53 & 54/16 :- 9 -: TRIBUNAL DO NOT FIND ANY REASON TO INTERFERE WITH T HE ORDER OF THE CIT(A). ACCORDINGLY, THE SAME IS CONFIRMED. 12. NOW COMING TO ASSESSMENT YEAR 2012-13 IN I.T.A.NO. 356/MDS/2016, THE ONLY ISSUE ARISES FOR CONSIDERATI ON IS WITH REGARD TO UNEXPLAINED INVESTMENT TO THE EXTENT OF ` 1,15,72,530/-. 13. SHRI SUPRIYO PAL, LD. DR SUBMITTED THAT DURING THE COURSE OF SEARCH OPERATION, GOLD JEWELLERY TO THE EXTENT OF 6 112.900 GMS WAS FOUND. THE APPROVED VALUER VALUED THE JEWELLERY AT ` 1,58,51,878/-. SILVER ARTICLES TO THE EXTENT OF 18,377 GMS WAS ALS O FOUND WHICH WAS VALUED AT ` 10,84,243/-. THE ASSESSEE EXPLAINED BEFORE THE A SSESSING OFFICER THAT 1566.20 GMS OF JEWELLERY BELONGS TO HI S MOTHER LATE SMT. PREMA. HIS MOTHER LATE SMT. PREMA DECLARED 3650 GM S OF JEWELLERY UNDER VDIS. THE JEWELLERY DECLARED UNDER VDIS WAS INHERITED BY THE ASSESSEE ON THE DEATH OF HIS MOTHER. THE ASSESSEE ALSO EXPLAINED BEFORE THE ASSESSING OFFICER THAT IN THE MONTH OF M ARCH 2011, 2083.8 GMS OF GOLD JEWELLERY WAS MELTED AND TRANSFERRED TO JEWELLERY BUSINESS ACCOUNT. HOWEVER, THE SAME CONTINUED IN THE RESIDEN TIAL PREMISES OF THE ASSESSEE. ACCORDING TO THE LD. DR, EVEN THOU GH THE SAME WAS TAKEN AS STOCK IN THE BOOKS OF ACCOUNT OF THE BUSIN ESS, IT CONTINUES TO BE PHYSICALLY AVAILABLE IN THE RESIDENTIAL PREMISES . THE ASSESSING OFFICER, AFTER CONSIDERING THE EXPLANATION OF THE ASSESSEE, FOUND THAT ITA NOS.354 TO 356/16 CO NOS.53 & 54/16 :- 10 -: THE ITEM OF JEWELLERY FOUND DURING THE COURSE OF S EARCH OPERATION AND THE ITEM OF JEWELLERY DECLARED UNDER VDIS BY THE ASSESSEES MOTHER ARE DIFFERENT ONE, THEREFORE, THE CLAIM OF THE ASS ESSEE THAT THE ASSESSEES MOTHER DECLARED 3650 GMS OF GOLD JEWELLE RY WHICH WAS SUBSEQUENTLY INHERITED BY THE ASSESSEE CANNOT BE A CCEPTED. THE ASSESSING OFFICER ALSO FOUND THAT PART OF THE JEWEL LERY WAS ASSESSED AS UNEXPLAINED INVESTMENT IN THE HANDS OF ASSESSEES WIFE SMT. SHANMUGAPRIYA. THE BALANCE JEWELLERY WAS ASSESSED IN THE HANDS OF THE ASSESSEE. ACCORDING TO THE LD. DR, IN THE ABS ENCE OF ANY MATERIAL TO INDICATE THE TRANSFER OF JEWELLERY TO THE JEWELL ERY BUSINESS, THE CLAIM OF THE ASSESSEE THAT 2083.8 GMS OF GOLD JEWELLERY WAS TRANSFERRED TO JEWELLERY BUSINESS CANNOT BE ACCEPTED. THE ASSESS EE HAS ALSO NOT FILED THE WEALTH TAX RETURN, THEREFORE, THE CIT(A) IS NOT JUSTIFIED IN ALLOWING THE CLAIM OF THE ASSESSEE. 14. ON THE CONTRARY, SHRI K.M.MOHANDASS, LD. REPRESENTA TIVE FOR THE ASSESSEE SUBMITTED THAT THE ASSESSEES MOTHER LATE SMT. PREMA DECLARED 3650 GMS OF GOLD JEWELLERY UNDER VDIS. ON THE DEATH OF ASSESSEES MOTHER, THE SAME WAS INHERITED BY THE A SSESSEE. MERELY BECAUSE THE ITEMS OF JEWELLERY DECLARED UNDER THE V DIS DOES NOT TALLY WITH THE ITEM FOUND DURING THE SEARCH OPERATION, TH AT CANNOT BE A REASON TO MAKE ANY ADDITION IN THE HANDS OF THE AS SESSEE. ACCORDING ITA NOS.354 TO 356/16 CO NOS.53 & 54/16 :- 11 -: TO THE LD. REPRESENTATIVE, 2083.8 GMS OF GOLD JEWEL LERY WAS MELTED AND UTILIZED FOR THE BUSINESS OF THE ASSESSEE. IT IS NOT IN DISPUTE THAT THE ASSESSEE IS ALSO ENGAGED IN THE RETAIL JEWELLE RY BUSINESS AND THE JEWELLERY WAS KEPT READY FOR SHIFTING TO THE BUSINE SS PREMISES OF THE ASSESSEE. THEREFORE, ACCORDING TO THE LD. REPRESEN TATIVE, MERELY BECAUSE SUCH TRANSFER WAS NOT REFLECTED IN THE BOOK S OF ACCOUNT, IT CANNOT BE SAID THAT THE ASSESSEE HAS INVESTED UNEX PLAINED MONEY IN THE JEWELLERY. THEREFORE, THE CIT(A) HAS RIGHTLY F OUND THAT THERE CANNOT BE ANY ADDITION TOWARDS VALE OF THE JEWELLER Y. 15. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EITHER SIDE AND ALSO PERUSED THE MATERIAL AVAILABLE ON RECORD. TH E FACT THAT THE ASSESSEES MOTHER DECLARED 3650 GMS OF GOLD JEWELLE RY UNDER THE VDIS IS NOT IN DISPUTE. OUT OF THE BALANCE OF 4522.700 GMS OF JEWELLERY, THE ASSESSEE CLAIMS THAT 2083.8 GMS OF GOLD JEWELLERY W AS MELTED AND IT WAS TRANSFERRED TO THE JEWELLERY BUSINESS. IT IS N OT IN DISPUTE THAT THE ASSESSEE IS ALSO ENGAGED IN THE RETAIL JEWELLERY BUSINESS. THE ASSESSEE CLAIMS THAT 4522.700 GMS JEWELLERY PERTAIN ED TO THE BUSINESS WAS KEPT IN THE RESIDENTIAL PREMISES OF THE ASSES SEE FOR GIVING TO THE GOLDSMITH ON THE NEXT DAY TO MANUFACTURE GOLD O RNAMENTS. THE CIT(A) FURTHER FOUND THAT MISMATCH BETWEEN THE JEWE LLERY DECLARED UNDER VDIS AND DURING THE COURSE OF SEARCH OPERATIO N CANNOT BE ITA NOS.354 TO 356/16 CO NOS.53 & 54/16 :- 12 -: REASON FOR MAKING ANY ADDITION IN THE HANDS OF THE ASSESSEE. ACCORDING TO THE LD. REPRESENTATIVE, FASHION AND DE SIGN IN JEWELLERY IS CHANGING VERY FAST, THEREFORE, THE ASSESSEE HAS TO NECESSARILY CHANGE THE JEWELLERY IN ACCORDANCE WITH DESIGN AND FASHION EXISTED ON DAY-TO- DAY BASIS. THE ASSESSEE HAS ALSO CONVERTED PART O F THE JEWELLERY INTO 24 CT. GOLD BAR WITH A VIEW TO INTRODUCE THE SAME I N THE JEWELLERY BUSINESS. THEREFORE, THE CIT(A) HAS RIGHTLY FOUND THAT MISMATCH OF ITEM OF JEWELLERY DECLARED IN THE VDIS AND THE ITEM OF JEWELLERY FOUND DURING THE COURSE OF SEARCH OPERATION CANNOT BE REA SON FOR DISALLOWING THE CLAIM OF THE ASSESSEE. ACCORDING TO THE LD. REPRESENTATIVE, THE CIT(A) HAS RIGHTLY ALLOWED THE CLAIM OF THE ASSESSEE. 16. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EITHER SIDE AND ALSO PERUSED THE MATERIAL AVAILABLE ON RECORD. AD MITTEDLY 6112.900 GMS OF GOLD JEWELLERY WAS FOUND DURING THE COURSE O F SEARCH OPERATION. IT IS NOT IN DISPUTE THAT THE ASSESSEES MOTHER LA TE SMT. PREMA DECLARED 3650 GMS OF GOLD JEWELLERY UNDER VDIS. TH E ASSESSING OFFICER REFUSED TO GIVE CREDIT TO THE GOLD JEWELLER Y DECLARED UNDER THE VDIS ON THE GROUND THAT THE JEWELLERY UNDER VDIS AR E NOT THE SAME JEWELLERY WHICH WAS FOUND DURING THE COURSE OF SEAR CH OPERATION. AS RIGHTLY SUBMITTED BY THE LD. REPRESENTATIVE FOR THE ASSESSEE, DESIGN ITA NOS.354 TO 356/16 CO NOS.53 & 54/16 :- 13 -: AND FASHION OF JEWELLERY CHANGE VERY FAST DAY BY DA Y, THEREFORE, CONVERTING THE JEWELLERY INTO A NEW FASHION JEWELLE RY OR CONVERTING THE SAME INTO 24 CARAT GOLD BAR CANNOT BE A REASON TO D OUBT THE DECLARATION UNDER THE VDIS. THE FACT REMAINS THAT THE ASSESSEES MOTHER DECLARED 3650 GMS OF GOLD JEWELLERY UNDER TH E VDIS WHICH WAS ACCEPTED BY THE COMPETENT AUTHORITY. THEREFORE, T HE AVAILABILITY OF 3650 GMS OF GOLD JEWELLERY CANNOT BE DOUBTED BY TH E ASSESSING OFFICER. THE CIT(A) HAS DIRECTED TO GIVE CREDIT FO R THE QUANTITY OF JEWELLERY DECLARED UNDER VDIS. THE CIT(A) HAS ALSO FOUND THAT THE PROBABLE WASTAGE DURING THE PROCESS OF MELTING IS T O BE TAKEN INTO CONSIDERATION WHILE GIVING CREDIT TO THE JEWELLERY DECLARED IN THE VDIS. IN VIEW OF THE ABOVE DISCUSSION, THIS TRIBUNAL DO N OT FIND ANY REASON TO INTERFERE WITH THE ORDER OF THE CIT(A). ACCORDINGL Y, THE SAME IS CONFIRMED. 17. NOW COMING TO THE CROSS OBJECTIONS OF THE ASSESSEE FOR ASSESSMENT YEARS 2008-09 AND 2010-11, THE ASSESSEE FILED THE CROSS OBJECTIONS ONLY TO SUPPORT THE ORDERS OF THE CIT(A) . NO INDEPENDENT GROUNDS ARE RAISED. THIS TRIBUNAL IS OF THE CONSI DERED OPINION THAT THE CROSS OBJECTIONS OF THE ASSESSEE FOR SUPPORTING TH E ORDERS OF THE CIT(A) ARE NOT MAINTAINABLE. ITA NOS.354 TO 356/16 CO NOS.53 & 54/16 :- 14 -: 18. IN THE RESULT, ALL THE APPEALS OF THE REVENUE AND CROSS OBJECTIONS OF THE ASSESSEE ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 15 TH JULY, 2016, AT CHENNAI. SD/- SD/- ( . !' ) (A. MOHAN ALANKAMONY) # / ACCOUNTANT MEMBER ( . . . ) ) (N.R.S. GANESAN) / JUDICIAL MEMBER / CHENNAI ! / DATED: 15 TH JULY, 2016 RD !' # $% &% / COPY TO: 1 . '( / APPELLANT 4. ) / CIT 2. #*'( / RESPONDENT 5. %+, # - / DR 3. ) () / CIT(A) 6. ,/ 0 / GF
