ITO, Jabalpur V. Shri Raja Saraf, Jabalpur

ITA 39/JAB/2010

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 0852 (ITAT-JABALPUR)
• Duration Of Justice: 8 year(s) 10 month(s) 20 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 28-05-2019
• Appeal Filed By: Department
• Bench Allotted: DB
• Next Hearing Date: 07-06-2012
• Assessment Year: 2006-2007
• Appeal Filed On: 08-07-2010
• Court: TRIBUNAL
• Department Lawyers: ABHISHEK SHUKLA
• Assessee Lawyers: DR H S MODH
• Keywords: Search and seizure; Wrong claim
• Section: 143(3); 133A; 131

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL INDORE BENCH AT JABALPUR BEFORE SHRI JOGINDER SINGH, JUDICIAL MEMBER AND SHRI R. C. SHARMA, ACCOUNTANT MEMBER I.T.A. NO.39/JBP/2010 ASSESSMENT YEAR: 2006-07 ITO, WARD-1(1), JABALPUR APPELLANT VS. RAJA SARAF, JABALPUR PAN AJFPS 0732 H RESPONDENT APPELLANT BY SHRI ABHISHEK SHUKLA, D. R. RESPONDENT BY DR. H.S. MODH, ADVOCATE DATE OF HEARING 12/09/2013 DATE OF PRONOUNCEMENT 25/10/2013 O R D E R PER JOGINDER SINGH, JUDICIAL MEMBER : THE REVENUE IS AGGRIEVED BY THE IMPUGNED ORDER DATE D 26/2/2010 PASSED BY THE LEARNED FIRST APPELLATE AUTHORITY, JABALPUR. THE ONLY GROUND RAISED IN THIS APPEAL PERTAINS TO DELETING THE ADDITION OF RS.1,14 ,25,261/- MADE BY THE ASSESSING OFFICER BEING COST OF UNACCOUNTED STOCK O F GOLD JEWELLERY AT 13394.210 GMS. 2 2. DURING HEARING OF THIS APPEAL, WE HAVE HEARD SHRI ABHISHEK SHUKLA, LEARNED SR. D.R AND DR. H.S. MODH, LD. COUNSEL FOR THE ASSESSEE. THE CRUX OF ARGUMENTS ADVANCE BY THE LD. SR. DR IS IN SUPPORT T O THE ASSESSMENT ORDER BY SUBMITTING THAT THERE WAS NO EVIDENCE OF APPOINTING DEALER AS HAS BEEN CLAIMED BY THE ASSESSEE. IT WAS PLEADED THAT ON VOUCHER NO.4 3, THERE WAS NO MENTION THAT THE GOLD/JEWELLERY WAS ON APPROVAL BASIS. IT WAS STRONGLY CONTENDED THAT ANMOL JEWELLERS ARE NOT SENDING JEWELLERY TO OTHER JE WELLERS IN INDIA AND NO SALE WAS MADE BY THE ASSESSEE FOR ANMOL JEWELLERS. IT WAS POINTED OUT THAT IN NORMAL COURSE OF BUSINESS, THERE WAS NO OTHER TRANSACTION. IT WAS ARGUED THAT WHY ANMOL JEWELLERS KEPT THE GOLD FOR SUCH A LONG TIME WI TH THE ASSESSEE AND THIS IS A SOLITARY TRANSACTION OF CLAIMING OF SENDING GOLD ON APPROVAL BASIS. 2.1 ON THE OTHER HAND, THE LD. COUNSEL FOR THE ASSE SSEE DEFENDED THE IMPUGNED ORDER BY CLAIMING THAT THE ASSESSEE STARTE D NEW BUSINESS OF JEWELLERY, ANMOL JEWELLERS IS MAKING GOLD CHAINS AND VARIETY OF CHAINS WERE GIVEN TO THE ASSESSEE BY ANMOL JEWELLERS. PLEA WAS ALSO RAISED THA T JEWELLERY WAS GIVEN FOR OBTAINING ORDERS FROM THE JABALPUR AREA. IT WAS CONT ENDED THAT THE STATEMENT OF ANMOL JEWELLERS WAS RECORDED WHO DULY CONFIRMED OF HAV ING GIVEN THE GOLD TO THE ASSESSEE ON APPROVAL BASIS FOR WHICH OUR ATTENTI ON WAS INVITED TO PAGE 24 OF THE PAPER BOOK. IT WAS EXPLAINED BY THE LD. COUNSEL FOR THE ASSESSEE THAT THE STATEMENT FROM ANMOL JEWELLERS WAS RECORDED TWICE. IT WAS PLEADED THAT THE 3 RECORD OF ANMOL JEWELLERS WAS EXAMINED BY THE DDIT MU MBAI AND AFTER 1.4.2005, NO JEWELLERY WAS ACQUIRED. IT WAS FURTHER AR GUED THAT DEPARTMENT ACCEPTED CLOSING STOCK OF THE ASSESSEE FOR AY 2005- 06 AND VOUCHER NO.43, ISSUED BY ANMOL JEWELLERS, IS STILL WITH THE DEPARTMENT WHICH WAS SEIZED FROM THE ASSESSEE. ON QUESTIONING FROM THE BENCH, AS TO HOW MUCH JEWELLERY WAS SOLD OUT OF THE JEWELLERY TAKEN ON APPROVAL BASIS, THE LD . COUNSEL FOR THE ASSESSEE CLAIMED THAT NO SALE WAS RECORDED FROM THE APPROVED JEWELLERY AND RETURNED THE SAME TO ANMOL JEWELLERS. IT WAS ALSO EXPLAINED THAT SURVEY WAS CONDUCTED AT ANMOL JEWELLERS ALSO WHEREIN NOTHING WRONG WAS FOUND. O UR ATTENTION WAS INVITED TO PAGE 24 OF THE PAPER BOOK EVIDENCING THA T STATEMENT FROM ANMOL JEWELLERS WAS RECORDED ON 8.4.2005 AND THEREAFTER ASS ESSMENT WAS COMPLETED ON 23.12.2008 WHEREAS THE IMPUGNED JEWELLERY WAS RECEI VED IN NOVEMBER 2004 AND IMPOUNDED DURING SURVEY. 2.2 WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PE RUSED THE MATERIAL AVAILABLE ON RECORD. THE FACTS, IN BRIEF, ARE THAT O N 5.4.2005, TWO PERSONS WERE APPREHENDED BY THE POLICE WHO WERE FOUND TO BE SUSPIC IOUS AND THE GRP PERSONNEL ON EXAMINATION OF THE BANKS FOUND CONTAIN ING 7.74 KG OF GOLD ORNAMENTS/JEWELLERY ALONG WITH CASH OF RS.3.90 LACS. SURVEY U/S 133A OF THE ACT WAS CONDUCTED ON 6.4.2005 BY THE I.T. DEPARTMENT AT T HE BUSINESS PREMISES OF THE ASSESSEE. DURING SURVEY, IT WAS FOUND THAT BAC WE RE MAINTAINED BY THE 4 ASSESSEE IN COMPUTER AND THE SOFTWARE TALLY 5.4 WAS B EING USED. ACCORDINGLY, THE ENTIRE TALLY SOFTWARE WAS COPIED ON CD. STATEMENT OF SHRI SHEKHAR SARAF WAS RECORDED. PRINTOUT OF CASH BOOK AND P & L ACCOUN T FOR THE YEAR ENDING ON 31.3.2005 WERE ALSO TAKEN BY THE SURVEY PARTY. INVEN TORY OF GOLD, AVAILABLE AT THE BUSINESS PREMISES, WAS ALSO PREPARED, ACCORDING TO WHICH, THE TOTAL STOCK OF GOLD WAS AT 18.722 KG (GROSS WEIGHT) WAS FOUND WHEREAS AS PER BOOKS, THE STOCK WAS 13291.150 GMS (GOLD ORNAMENTS) AND ONE KG (GOLD BULLION) (TOTAL 14291.150 GMS). AS PER THE REVENUE, THERE WAS EXCESS STOCK OF GOLD WEIGHING 4430.85 GMS. AS PER THE ASSESSING OFFICER, THERE WAS EXCESS STOCK OF GOLD WEIGHING 11874.85 GMS (INCLUDING 7444.00 GMS FOUND BY THE PO LICE). IT WAS CLAIMED BY THE ASSESSEE THAT 13284.210 GMS OF GOLD WAS ON ACCOU NT OF APPROVAL BASIS FOR SALE TO OTHERS. 2.3 IN ORDER TO FIND THE GENUINENESS OF CLAIM OF TH E ASSESSEE, A LETTER WAS ISSUED TO OTHER JEWELLERS. THE ASSESSING OFFICER OBSE RVED THAT THE ASSESSEE HAD NEVER KEPT ANY SUCH GOLD IN THE PAST ON APPROVAL BA SIS EITHER FROM ANMOL JEWELLERS P. LTD. OR ANY OTHER PARTY. THE EXPLANATION OF THE ASSESSEE WAS DISBELIEVED AND THUS, THE EXCESS GOLD AMOUNTING TO RS.1,14,25,261/- AND EXCESS CASH OF RS.2,93,317/- WAS ASSESSED TO THE INCOME OF THE ASSESSEE (TOTAL ADDITION WAS MADE AT RS.1,20,36,569/-). 5 2.4 ON APPEAL, THE LD. CIT(A) DELETED THE ADDITION. THE RELEVANT PORTION OF THE ORDER IS REPRODUCED HEREUNDER FOR READY REFERENCE : - THE MAIN OBJECTION OF THE ASSESSING OFFICER WAS TH AT THE TRANSACTION WAS VERIFIED DURING THE ASSESSMENT PROC EEDINGS BUT THE ASSESSEE FAILED TO SUBMIT THE DETAILS OF PERSON S FROM ANMOL JEWELLERS PVT. LTD. WHO CAME TO DELIVER THE JEWELLE RY TO M/S RAJA JEWELLERS ON APPROVAL. ACCORDING TO THE ASSESSING O FFICER IT WAS UNBELIEVABLE THAT THE ASSESSEE WAS NOT AWARE OF THE NAME AND IDENTITY OF THE PERSON WHO DELIVERED THE JEWELLERY TO THE ASSESSEE ON APPROVAL NOR ABOUT HIS TRAVEL PLANS. FU RTHER, THE SUMMONS ISSUED U/S 131 TO M/S ANMOL JEWELLERS REMAI NED UN- COMPLIED WITH. THIS SHOWS THAT THE DOCUMENTARY EVID ENCES WERE CREATED LATER. FURTHER, THE VOUCHER NO.65 DATE D 30-11- 2004 PRODUCED BY THE APPELLANT WAS A SELF MADE VOUC HER AND NO OTHER DETAILS INCLUDING EXTERNAL VOUCHERS HAD BE EN FURNISHED. THIS DOCUMENT WAS NOT A CONCLUSIVE PROOF THAT THE J OURNEY WAS PERFORMED BY THE DELIVERY BOYS ON OR BEFORE 05-11-2 004. NO BILLS OF TRAVELING OR TICKETS OF TRAVELING FROM MUM BAI TO JABALPUR WERE PRODUCED NOR WERE GIVEN DURING THE APPELLATE PROCEEDINGS. FURTHER, THE AMOUNT OF RS.8,455/- DEBITED BY THE AJPL, MUMBAI IN THEIR BOOKS OF ACCOUNTS TOWARDS TRA VELING EXPENDITURE WERE MEANT FOR THE MONTH OF NOV.,2004. THIS INDICATES THAT THE EXPENDITURE INCLUDED OTHER TRAVE LING EXPENSES ALSO. IN ANY CASE THE AMOUNT OF RS.8,455/- WAS A VERY SMALL AMOUNT AND WOULD HARDLY COVER THE EXPENDITURE OF ON E PERSON BY TRAIN FROM MUMBAI TO JABALPUR. AGAIN NO INSURANCE OF SUCH HUGE AMOUNT OF JEWELLERY BEING CARRIED TO A LONG DE STINATION HAD BEEN SHOWN. LIKEWISE THE CASH VOUCHER REVEALED THAT SHRI ABDUL SHEIKH WAS THE PERSON WHO ACTUALLY TRAVELED F ROM MUMBAI TO JABALPUR AND HAD DELIVERED THE SAID QUANT UM OF GOLD JEWELLERY TO SHRI RAJA SARAF. HOWEVER, THE IDENTITY OF THE PERSON WAS NOT ESTABLISHED AS TO THIS POSITION IN ANMOL JE WELLERS PVT. LTD. THUS THE EVIDENCES NOW SUBMITTED ARE NOTHING B UT THEIR SELF SERVING DOCUMENTS AND LIABLE TO BE REJECTED. NOW EV EN IF THE PAYMENT VOUCHER NP.65 DATED 30-11-2004 AND THE CLAI M OF EXPENDITURE OF RS.8,445/- BY SHRI ABDUL SHEIKH ARE CONSIDERED TO BE SELF SERVING EVIDENCES, THE BOO~S OF ACCOUNTS OF ANMOL JEWELLERS PVT. LTD. FOR THE YEAR 2009-10 WHICH WERE WRITTEN IN THE NORMAL COURSE OF BUSINESS CANNOT BE HELD TO BE THE DOCUMENT WHICH WOULD HAVE BEEN PREPARED SUBSEQUENTL Y THAT IS AFTER THE COMPLETION OF ASSESSMENT AND HENCE, HAS N O EVIDENTIARY VALUE. IN ANY CASE THIS PIECE OF EVIDEN CE IS NOT SUBSTANTIVE EVIDENCE BUT ONLY A CORROBORATIVE ONE. THEREFORE, 6 EVEN IF IT IS NOT ADMITTED, IT WOULD NOT EFFECT OTH ER SUBSTANTIVE DOCUMENTARY EVIDENCE WHICH ESTABLISHED THE FACTS OF THE CASE IN THEIR CORRECT PERSPECTIVE. NOW THE STATEMENT OF SHRI MEHOL V. VERMA, THE DIRECTOR OF AJPL RECORDED ON OATH ULS 13 3A ON 08- 04-2005 BY DY DIRECTOR OF INCOME-TAX (INVESTIGATION UNIT-4(1), MUMBAI CANNOT BE A SELF SERVING DOCUMENT BECAUSE BY NO MEANS IT COULD HAVE BEEN PREPARED AFTER ASSESSMENT WAS COMPLETED. SIMILARLY THE ASSESSMENT ORDER PASSED U/ S 143(3) FOR THE A.Y.2006-07 BY ACIT CIRCLE 6(1), MUMBAI DAT ED 23-12- 2008 IN THE CASE OF M/S ANMOL J EWELLERS PVT. LTD. ALSO COULD NOT HAVE BEEN A SELF SERVING DOCUMENT NOR COULD HAVE BE EN MANUFACTURED BY THE APPELLANT HIMSELF AS AN EVIDENC E TO BE PRODUCED AFTER HIS ASSESSMENT WAS COMPLETED. AS A M ATTER OF FACT, THE ASSESSMENT ORDER OF M/S AJPL LTD., WAS PA SSED ON 23- 12-2008 ONLY AND IMMEDIATELY AFTER THAT THE ASSESSM ENT ORDER U/S 143(3) WAS PASSED IN THE CASE OF THE APPELLANT ON 31-12- 2008. THEREFORE, THERE WAS NO OCCASION FOR THE APPE LLANT TO BRING OUT THIS DOCUMENTARY EVIDENCE AT THE TIME OF HIS ASSESSMENT PROCEEDINGS. SIMILARLY THE CONFIRMATORY LETTER AND THE APPRVAL VOUCHER ISSUED BY MIS ANMOL JEWELLERS, COULD NOT BE SAID TO HAVE BEEN PREPARED AS AN AFTER THOUGHT B ECAUSE THEY STAND SUBSTANTIATED WITH OTHER DOCUMENTARY EVIDENCE S, I.E. PURCHASE VOUCHERS, WHICH WERE SHOWN TO THE D.D.I., MUMBAI WHILE EXPLAINING THE SOURCE DURING THE COURSE OF RE CORDING OF HIS STATEMENT. BECAUSE OF THESE REASONS THESE DOCUMENTA RY EVIDENCES ARE HEREBY ADMITTED FOR ADJUDICATION. \ I NOW IT IS SEEN IMMEDIATELY ON THE NEXT DAY AFTER TH E GOVERNMENT RAILWAY POLICE, SATNA HAD RAIDED THE TWO SUSPICIOUS LOOKING PERSONS AT SATNA RAILWAY STATION THE BUSINESS PREMISES OF SHRI RAJA SARAF WAS SURVEYED ULS 133A ON 06-04-2005. AS A RESULT THE GOLD STOCK OF 26.575 KG . WAS FOUND. BOOKS OF ACCOUNTS WERE GOT VERIFIED AND THE FOLLOWING ENTRIES WERE FOUND RECORDED IN THE STOCK REGISTER. (1 ) GOLD ORNAMENTS AS PER THE STOCK OF THE ASSESSE E: 13.291 KG. (2) GOLD ORNAMENTS ON APPROVAL BASIS AS PER STOCK REGISTER: 13.284 KG 3) GOLD IN THE FORM OF BULLION: 1.000 KG TOTAL GOLD: 27.575 KG ON PHYSICAL VERIFICATION THE OFFICERS OF THE DEPART MENT HAD FOUND 18.22 KG. OF GOLD ORNAMENTS IN THE BUSINESS PREMISE S AND THERE WAS SHORTAGE OF 7.853 KG. OF GOLD. SHORTAGE W AS WELL EXPLAINED BY THE ASSESSEE AS DISCUSSED IN THE FOREG OING PARA 7 AND THUS THE GOLD ORNAMENTS FOUND IN THE BUSINESS P REMISES AND THE GOLD REMAINS SEIZED BY THE GRP, SATNA TOGET HER TALLIES WITH THE STOCK FOUND AT THE TIME OF SURVEY AND ALSO STOCK REGISTER MAINTAINED IN THIS REGARD. FURTHER M/S ANMOL JEWELLERS PVT. LTD., MUMBAI VIDE THEIR CONFIRMATION LETTER DATED NOVEMBE R, 2008 ISSUED TO M/S RAJA JEWELLERS, SARATE BAZAR, JABALPU R HAD CONFIRMED THAT THEY HAD ISSUED ON APPROVAL VOUCHER NO.43, THE GOLD ORNAMENTS WEIGHING 13,294.210 GRAMS TO MI S RAJA JEWELLERS ON 05-11-2004 AND THAT THE SAID GOLD ORNA MENTS WERE RETURNED BY M/S RAJA JEWELLERS ON 15-03-2006 TO ANMOL JEWELLERS PVT. LTD. THIS PIECE OF EVIDENCE WAS NOT REBUTTED BY THE ASSESSING OFFICER NOR IT WAS DISPROVED, AS A MA TTER OF FACT THE ISSUE VOUCHER NO.43 DATED 05-11-2004 OF ANMOI J EWELLERS PVT. LTD. WHICH PROVED THAT 22 CARAT GOLD ORNAMENTS WEIGHING 13294.210 GRAMS WAS ISSUED IN THE NAME 'OF RAJA JEW ELLERS WAS ALSO AVAILABLE AT THE TIME OF RAID. THE STATEME NT OF RAJA SARAF DATED 19.04.05 & 05.12.2008 CONFIRM THIS FACT AND REMAIN UNCONTROVERTED. THEREFORE, IT COULD NOT BE SAID THA T THE GOLD ORNAMENTS, IN FACT, BELONGED TO THE APPELLANT AND W ERE ACQUIRED BY HIM FROM HIS UNDISCLOSED INCOME. IT IS FOUND REC ORDED IN HIS STOCK REGISTER AS OPENING STOCK AS ON 01-04-2005. F URTHER, THE STATEMENT OF SHRI RAJA SARAF WAS RECORDED ON 19-04- 2005 IN CONTINUATION OF THE SURVEY CONDUCTED U/S 133A IN HI S BUSINESS PREMISES ON 06-04-2005. HE HAD VERY CLEARLY STATED THAT ON 05- 04-2005 HE AND HIS TWO EMPLOYEES NAMELY SHRI RAMESH SONI MID SHRI NEERAJ SONI HAD GONE TO SATNA WITH 7963.40 5 GRAMS OF GOLD ORNAMENTS ALONGWITH CASH OF RS.1.10 LAKHS. THE CASH OF RS.1 LAKH WAS WITHDRAWN FROM THE CASH BOOK AND R S.10,000/- WAS PROCURED FROM HIS MOTHER. IT WAS VERY SPECIFICA LLY STATED BY HIM THAT THE GOLD JEWELLERY WAS GOT MANUFACTURED BY HIM FROM ANMOL JEWELLERS, MUMBAI. FOR MANUFACTURING OF GOLD JEWELLERY THE GOLD WAS FINANCED BY THE STATE BANK OF INDIA, C OMMERCIAL BRANCH, DADAR, MUMBAI FOR WHICH HE HAD GIVEN THE BN K GUARANTEE OF STATE BANK OF INDIA, MILONIGANJ BRANCH , JABALPUR. HE FURTHER STATED THAT HE HAD SOLD TO M/S MAHAVEER JEW ELLERS, SARAFA BAZAR, SATNA GOLD JEWELLERY WEIGHING 342.250 GRAMS FOR RS.1,86,526/- AND SIMILARLY TO M/S MAMA BHANJA JEWELLERS AND BANKERS, CITY KOTHWALI, SATNA 177.400 GRAMS OF GOLD FOR RS.96,683/-. HE HAD PRODUCED PHOTOCOPY OF THE BILL AT THAT TIME ONLY. FURTHER IN ANSWER TO QUESTION NO.4 HE ALSO CO NFIRMED THAT HE HAD MADE TRANSIT INSURANCE FOR RS.83,50,000/-. HE HAD PRODUCED A PHOTOCOPY OF THE RELEVANT DOCUMENT ION 1 9.4.05 ITSELF IN SUPPORT OF HIS CLAIM WHEN THE STATEMENT W AS BEING RECORDED. HE ALSO STATED THAT HE HAD INTIMATED TO O RIENTAL INSURANCE I COMPANY, JABALPUR ON 15-04-2005 REGARDING THE SEIZURE OF THE GOLD JEWELLERY BY GRP THE COPY OF WH ICH WAS 8 AGAIN PRODUCED AT THE TIME OF RECORDING OF SUCH A S TATEMENT. FURTHER, IN REPLY TO QUESTION NO.6 REGARDING THE EX ISTENCE OF ORIGINAL APPROVAL VOUCHER IT WAS SPECIFICALLY ANSWE RED BY HIM THAT APPROVAL VOUCHER WAS SEIZED BY THE GRP, SATNA BUT WAS NOT DISCLOSED IN THE SEIZURE DOCUMENT. HE FURTHER S TATED THAT IN SUPPORT OF HIS CLAIM REGARDING THE EXISTENCE OF APP ROVAL VOUCHER HE WAS PRODUCING THE PHOTOCOPY OF PAGE 14 OF THE DA ILY NEWSPAPER ( NAVABHARAT, SATNA ) DATED 06-04-2005. T HESE FACTS WERE AGAIN CONFIRMED !BY HIM IN HIS STATEMENT RECORDED ON 5-12-2008. SIMILARLY IN CONTINUATION OF SURVEY PROC EEDINGS ULS 133A A SUMMON WAS ISSUED TO SHRI RARNESH TEJRAJ SON I WHOSE STATEMENT WAS RECORDED ON 20-06-2005 BY THE ASSESSI NG OFFICER WHO IN ANSWER TO QUESTION NO.3 HAD STATED T HAT HE HAD PLACED HIS SIGNATURE ON THE APPROVAL VOUCHER COPY O F WHICH WAS AVAILABL1E WITH HIM WHICH WAS SEIZED. APART FROM TH IS THE STATEMENT OF SHRI MEHUL V. VERMA, DIRECTOR OF M/S. AJPL, MUMBAI WAS RECORDED BY THE DY. DIRECTOR OF INCOME-T AX (INVESTIGATION) UNIT-4(1), MUMBAI ON 08-04-2008. IN HIS STATEMENT HE HAD EXPLAINED IN DETAIL ABOUT THE TRAN SACTIONS TAKEN PLACE BETWEEN M/S. AJPL, MUMBAI AND M/S. RAJA JEWELLERS DURING THE F.Y.2004-05 AND HAD VERY CATEG ORICALLY STATED AS UNDER:- ON 05-11-2~04 M/S. AJPL HAD SUPPLIED 13294.210 GRA MS OF 22CARAT GOLD ORNAMENTS TO M/S RAJA JEWELLERS ON APPROVAL BASIS. THIS JEWELLERY HAD NOT BEEN SOLD BY M/S RAJA JEWELLERS TILL DATE. AS THE SAID JEWELLERY IS GIVEN OR APPROVAL BA SIS THE SAME IS NOT REFLECTED AS SALES OF M/S AJPL & SAID JEWELL ERY IS APPEARING AS CLOSING STOCK OF M/S AJPL.' AS A MATTER OF FACT, HE EXPLAINED IN DETAIL ALONGWI TH THE DOCUMENTARY EVIDENCES ABOUT THE: SOURCE OF THE GOLD GIVEN ON APPROVAL BASIS TO M/S RAJA JEWELLERS. THE SOURCE OF GOLD WAS EXPLAINED AS UNDER:- DATE BILL NO. PARTY NAME WEIGHT 28.10.2004 3505 M/S. RAKSHA BULLION 2.000 KG 26.10.2004 3552 M/S. RAKSHA BULLION 1.600 KG 23.10.2004 3968 M/S. HIRAJI NAVSUG JI 1.000 KG 21.10.2004 3534 M/S. RAKSHA BULLION 5.000 KG 15.10.2004 310272 STATE BANK 5.000 KG IN ORDER TO PROVE THE GENUINENESS OF THE SOURCE PUR CHASE VOUCHERS WERE ALSO PRODUCED BY HIM BEFORE THE D.D.I . (INV.), MUMBAI. SINCE THIS STATEMENT WAS RECORDED BY THE OFFICER OF THE DEPARTMENT AND AS THE SOURCE OF THE GOLD JEWELLERY WAS ALSO 9 PROVED WITH THE HELP OF DOCUMENTARY EVIDENCES THERE WAS NO REASON TO DISBELIEVE THE ASSESSEE'S SUBMISSION THAT HE HAD PROCURED THE GOLD JEWELLERY WEIGHING 13294.210 GRAM S FROM MIS AJPL, MUMBAI ON APPROVAL BASIS WHICH WERE CARRIED T O SATNA FOR ITS SALE. SINCE IT COULD NOT BE SOLD, THE SAME WAS FOUND IN THE POSSESSION OF HIS EMPLOYEES NAMELY SHRI RAMESH SONI & SHRI NEERAJ SONI WHEN THEY WERE RAIDED BY THE GRP, SATNA . AS AGAINST THIS NO EVIDENCE HAS BEEN BROUGHT FORWARD O N RECORD TO PROVE THAT THE GOLD JEWELLERY WEIGHING 13394.210 GR AMS DID NOT BELONG TO AJPL, MUMBAI BUT WAS UNACCOUNTED STOCK OF M/S RAJA JEWELLERS, JABALPUR. FURTHER, THE ASSESSMENT FOR A. Y. 2006-07 OF M/S ANMOL JEWELLERS PVT. LTD., MUMBAI WAS COMPLETED U/S 143(3) WHEREIN THE BOOKS OF ACCOUNTS WERE SCRUTINIZED. NOW THE BOOKS OF ACCOUNTS OF AJPL REVEALED THAT VIDE ISSUE VOUCHE R NO.43/DATED 05-11-2004 13294 GRAMS OF GOLD WAS TRAN SFERRED TO RAJA JEWELLERS. THE ORNAMENT ACCOUNT OF AJPL WAS W RITTEN IN THE NORMAL COURSE OF BUSINESS AND THAT ENTRY WAS ALREAD Y FOUND RECORDED IN THEIR BOOKS WHEN THE SEIZURE WAS MADE B Y THE GRP, SATNA. THE ASSESSMENT WAS, COMPLETED ON 23-12-2008 THAT IS MUCH AFTER THE DATE OF THE RAID AND THE 1300KS OF A CCOUNTS INCLUDING POSITION OF STOCK WERE EXAMINED DURING TH E COURSE OF ASSESSMENT PROCEEDINGS AND WERE ACCEPTED BY THE A.O . THIS MEANS THAT THE AJPL'S CLAIM THAT GOLD JEWELLERY WEI GHING 13294.10 GRAMS WAS SENT BY THEM TO M/S RAJA JEWELLERS ON APPROVAL BASIS HAD ALSO BEEN ACCEPTED BY THE ASSESS ING OFFICER. AS TRANSACTION HAD TAKEN PLACE IN THE NORMAL COURSE OF ITS BUSINESS AND THE ASSESSEE HAS BEEN ABLE TO ESTABLIS H WITH THE HELP OF THESE DOCUMENTARY EVIDENCES BEYOND DOUBT TH AT THE GOLD JEWELLERY RECEIVED ON APPROVAL FROM M/S AJPL WAS NOT THE PART OF HIS STOCK BUT BELONGED TO M/S AJPL, MUMBAI. BECAUSE OF THESE REASONS, THE ASSESSEE'S CLAIM REGARDING THE POSSESS ION OF 13394.210 GRAMS OF GOLD JEWELLERY CANNOT BE HELD TO BE A BOGUS CLAIM AS CONFIRMED BY THE AJPL, MUMBAI. THIS GOLD J EWELLERY WAS RETURNED ALSO BY THE APPELLANT TO THEM ON 15-03 -2006 AND DULY CONFIRMED BY M/S ANMOL JEWELLERS PVT. LTD., MUMBAI, IT CANNOT BE SAID THAT IT WAS ASSESSEE'S UNACCOUNTED STOCK. A DDITION OF R S.1,14,25,261/- IS HEREBY DELETED. AS A RESULT, APPEAL IS ALLOWED 2.5 IF THE OBSERVATION MADE IN THE ASSESSMENT ORDER , CONCLUSION DRAWN IN THE IMPUGNED ORDER, THE ASSERTION MADE BY THE LEARNED R ESPECTIVE COUNSEL AND THE MATERIAL AVAILABLE ON RECORD ARE KEPT IN JUXTAPOSIT ION AND ANALYSED, WE NOTE THAT 10 WHILE COMING TO A PARTICULAR CONCLUSION THE LEARNED CIT(A) SOUGHT COMMENTS FROM THE LEARNED ASSESSING OFFICER AND AFTER CONSID ERING THE REJOINDER FILED BY THE ASSESSEE AS DISCUSSED FROM PAGES 9 TO 16 OF THE IMPUGNED ORDER, THE LEARNED CIT(A) DELETED THE ADDITION. THE MAIN REASO N OF ADDITION BY THE LEARNED ASSESSING OFFICER WAS THAT DURING THE ASSESSMENT PR OCEEDINGS THE ASSESSEE COULD NOT SUBMIT THE DETAILS OF PERSONS FROM ANMOL JEWELLERS PVT. LTD. WHO CAME TO DELIVER THE JEWELLERY TO THE ASSESSEE ON APPROVAL BASIS. THE STAND OF THE REVENUE IS ALSO THAT THE DOCUMENTARY EVIDENCE WAS CR EATED BY THE ASSESSEE AT THE LATER STAGE AND FURTHER THE VOUCHER NO. 65 DATE D 30.11.2004, PRODUCED BY THE ASSESSEE, WAS A SELF MADE VOUCHER. ANOTHER PLEA RAISED BY THE REVENUE IS THAT NO BILLS OF TRAVELLING OR TICKETS OF TRAVELLIN G FROM MUMBAI TO JABALPUR WERE PRODUCED. DURING HEARING IT WAS ALSO POINTED OUT TH AT NO INSURANCE OF JEWELLERY, BEING CARRIED TO A LONG DESTINATION, WAS NOT GOT DO NE. HOWEVER, THE FACT REMAINS THAT THE IMPUGNED JEWELLERY WAS TAKEN INTO P OSSESSION BY GRPF STAFF AT SATNA RAILWAY STATION AND AT THE SAME TIME, THE BUSI NESS PREMISES OF THE ASSESSEE WAS SURVEYED ON 6.4.2005 U/S 133A OF THE AC T. IF THE TOTALITY OF FACTS IS ANALYSED, WE NOTE THAT ALLEGED SHORTAGE OF JEWELLERY WAS DULY EXPLAINED BY THE ASSESSEE, AS HAS BEEN DISCUSSED IN THE IMPUGNED ORD ER AND THE DEPARTMENT HAS NOT PRODUCED ANY EVIDENCE CONTRARY TO THE FACTS REC ORDED IN THE IMPUGNED ORDER. THE STATEMENT OF SHRI RAJA SARAF WAS RECORDED ON 19.4 .2005 IN CONTINUATION OF SURVEY CONDUCTED AT THE BUSINESS PREMISES ON 6.4.20 05 WHEREIN IT WAS CLEARLY 11 TENDERED THAT HIS TWO EMPLOYEES, SHRI RAMESH SONI A ND NEERAJ SONI, HAD GONE TO SATNA. IN REPLY TO QUESTION NO. 4 IT HAS BEEN C ONFIRMED THAT TRANSIT INSURANCE FOR RS. 83,50,000/- WAS MADE. THE PHOTOCOPY OF THE RE LEVANT DOCUMENT WAS ITSELF PRODUCED WHEN THE STATEMENT WAS BEING RECORDED . AT PAGE 21 OF THE IMPUGNED ORDER THERE IS MENTION THAT ORIENTAL INSUR ANCE CO., JABALPUR, WAS DULY INTIMATED ON 15.4.2005 REGARDING SEIZURE OF GOLD JE WELLERY BY GRPF AND THE COPY OF THE SAME WAS ALSO PRODUCED DURING RECORDING OF ST ATEMENT. THE STATEMENT OF SHRI M.V. VERMA OF AJPL WAS RECORDED BY DDIT ((INV.) ON 8.4.2008 IN WHICH THE TRANSACTIONS TOOK PLACE BETWEEN M/S AJPL AND THE ASS ESSEE WERE DULY EXPLAINED AS HAS BEEN MENTIONED AT PAGES 21 AND 22 OF THE IMP UGNED ORDER. IN VIEW OF THESE FACTS, SINCE THE STATEMENT WAS RECORDED BY THE OFFICERS OF THE DEPARTMENT AND THE SOURCE OF THE GOLD WAS DULY EXPLAINED, THERE FORE, THERE IS NO REASON TO DISBELIEVE THE VERSION OF THE ASSESSEE THAT THE GOL D JEWELLERY BEING 13,294.210 GMS WAS PROCURED FROM M/S AJPL ON APPROVAL BASIS WHIC H WAS CARRIED TO SATNA FOR SALE. MORE SPECIFICALLY IT IS MENTIONED THAT WHE N THIS JEWELLERY COULD NOT BE SOLD, FINALLY IT WAS RETURNED TO M/S AJPL. IT IS AL SO NOTED THAT FOR A.Y. 2006-07 THE ASSESSMENT FRAMED IN CASE OF M/S ANMOL JEWELLERS PVT. LTD. U/S 143(3), WHEREIN THE BOOKS OF ACCOUNTS WERE SCRUTINISED, REVEA LED THAT VIDE VOUCHER NO. 43 DATED 5.11.2004 THE CLAIMED JEWELLERY WAS TRANSFER RED TO M/S RAJA JEWELLERS AND THE ORNAMENT ACCOUNT WAS RETURNED IN THE NORMAL COURSE OF BUSINESS THE ENTRY FOR WHICH WAS FOUND RECORDED IN THE BOOKS OF M/ S AJPL WHEN THE SEIZURE 12 WAS MADE BY GRPF, SATNA. THE ASSESSMENT OF M/S AJPL WAS ACCEPTED BY THE ASSESSING OFFICER MEANING THEREBY THE CLAIM OF SEND ING THE GOLD JEWELLERY TO THE ASSESSEE WAS ACCEPTED BY THE ASSESSING OFFICER. IN VIEW OF THESE FACTS AND THE DETAILED FINDING RECORDED IN THE IMPUGNED ORDER, WHI CH IS NOT BEING REPRODUCED BEING A MATTER OF RECORD, WE FIND NO INFIRMITY IN TH E ORDER OF THE LEARNED CIT(A) AND AFFIRM THE SAME. FINALLY, THE APPEAL OF THE REVENUE STANDS DISMISSE D. THIS ORDER WAS PRONOUNCED IN THE OPEN COURT ON25.10. 2013. SD/- SD/- (R. C. SHARMA ) (JOGINDER SINGH ) ACCOUNTANT MEMBER JUDICIAL MEMBER DATE: 25 /10/2013 !VYAS!2324 COPY TO APPELLANT, RESPONDENT, CIT (A),CIT, DR, GUARD FILE