SHRI RAMAVTAR SHARMA, Gangapur City V. ITO, Sawai Madhopur

ITA 537/JPR/2012

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 5196 (ITAT-JAIPUR)
• Duration Of Justice: 4 year(s) 2 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-08-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2004-2005
• Appeal Filed On: 01-06-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: G R PAREEK
• Keywords: Income from undisclosed sources; Opportunity of being heard; Source of fund; Onus to prove
• Section: 69C; 148; 144

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHE S, JAIPUR BEFORE: SHRI R. P TOLANI, JM & SHRI VIKRAM SINGH YA DAV, AM ITA NO.537 /JP/12 ASSESSMENT YEAR : 2004-05 SHRI RAM AVTAR SHARMA S/O SHRI RADHEY SHYAM SHARMA, CHAMUNDA MANDIR KE PASS, GANGAPUR CITY VS. THE INCOME TAX OFFICER, WARD-2, SAWAI MADHOPUR PAN NO. CNWPS 5924 C APPELLANT RESPONDENT ASSESSEE BY : SHRI SIDDARTH RANKA (C.A.) REVENUE BY : SHRI G.R. PAREEK (JCIT) DATE OF HEARING : 27.05.2016 DATE OF PRONOUNCEMENT : 23/08/2016. 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 TAKE N FOLLOWING GROUNDS OF APPEAL: (1) THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF T HE CASE, THE LD. LOWER AUTHORITIES GROSSLY ERRED IN COMING TO THE CONCLUS ION THAT THE ASSESSEE IS THE OWNER OF THE GOODS (GOLD ORNAMENTS AND JEWELLER Y) SEIZED BY THE SALES TAX AUTHORITIES AND IN MAKING/SUSTAINING AN ADDITION OF RS. 29,32,344/-. 1.1 THAT THE ASSESSEE BEING NOT THE OWNER OF THE SA ID GOODS, HE BEING ONLY A CARRIER OF GOODS, HE HAVING CARRIED GOODS ON BEHAL F 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 AUT HORITIES GROSSLY ERRED IN STILL HOLDING THAT THE ASSESSEE IS THE OWNER OF THE SAID GOLD ORNAMENTS ITA NO. 537/JP/12 SHRI RAM AVTAR SHARMA, GANGAPURCITY VS. ITO, WARD - 2, SAWAI MADHOPUR 2 AND JEWELLERY AND SILVER UTENSILS AND IN MAKING THE IMPUGNED ADDITION OF RS.29,32,344/- U/S 69A OF THE INCOME TAX ACT, 1961. 1.2 THAT THE ASSESSEE BEING A MAN OF LOW MEANS, H AVING NO TAXABLE INCOME IN THE PAST, NOR DURING THE YEAR UNDER APPEAL, EARN ING SMALL INCOME ON ACCOUNT OF BEING CARRIER OF GOODS, THE LD. LOWER AU THORITIES GROSSLY ERRED IN HOLDING THAT THE ASSESSEE IS REAL OWNER AND IN N OT DELETING THE SAID ADDITION. 1.3 THAT THE LD. LOWER AUTHORITIES GROSSLY ERRED IN ASSUMING AND PRESUMING THAT THE SAID GOODS WERE PURCHASED BY HIM AND THAT HE IS LIABLE TO BE ASSESSED AS THE OWNER WHEN HE IS A CARRIER OF GOODS EARNING COMMISSION AND THE LD. ASSESSING OFFICER HAS ACCEPTED THE INCO ME SHOWN BY WAY OF CARRIER. 1.4 THAT THE LD. CIT(A) HAVING BEEN SATISFIED THAT OUT OF THE MANY PARTIES, GOODS RELATING TO 3 PARTIES HAVING BEEN ADMITTED BY THEM, HE HAVING DELETED THE ADDITION TO THE EXTENT OF RS.4,82,756/- (ADMITTED BY 3 JEWELLERS) THE LD. CIT(A) GROSS ERRED IN NOT DELETI NG THE BALANCE OF ADDITION OF RS. 29,32,344/- WHEN FACTS AND CIRCUMST ANCES FOR ALL THE PARTIES REMAIN THE SAME. 2. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OR TH E CASE, THE LD. LOWER AUTHORITIES GROSSLY ERRED IN HOLDING THAT THE ASSES SEE IS EXPLAINABLE FOR THE AMOUNT DEPOSITED AS PENALTY BEFORE THE SALES TA X AUTHORITIES AMOUNTING TO RS.10,37,257/-AND IN HOLDING THE SAME AS INCOME FROM UNDISCLOSED SOURCES U/S 69C OF THE INCOME TAX ACT. 2.1 THAT THE TRADERS WHOSE GOODS THE ASSESSEE WAS C ARRYING FROM DELHI AND WHOSE NAMES WERE CONVEYED TO THE SALES TAX AUTHORIT IES ON THE SPOT, THEY HAVING PROVIDED THE SAID AMOUNT OF PENALTY FOR RELEASE OF THE GOODS FROM THE SALES TAX AUTHORITIES, THE ASSESSEE HAVING CONVEYED THE ASSESSING OFFICER THE SAID AMOUNT HAVING BEEN RECE IVED FROM THEM, THE IMPUGNED ADDITION IN THE HANDS OF THE ASSESEE IS UN JUSTIFIED , BAD IN LAW AND DESERVES TO BE DELETED. 2.2 THAT THE LD. ASSESSING OFFICER MADE AN ADDITION OF RS.11,03,077/- WHILE THE LD. CIT(A) SUSTAINED TO THE EXTENT OF RS. 10,37 ,257/- WHICH IS JUSTIFIED, BAD IN LAW AND DESERVES TO BE DELETED. ITA NO. 537/JP/12 SHRI RAM AVTAR SHARMA, GANGAPURCITY VS. ITO, WARD - 2, SAWAI MADHOPUR 3 2.3 THAT WHEN TWO PERSONS HAVING ADMITTED OF PAYM ENT OF PENALTY FOR THE RELEASE OF THE SAID GOODS, THE LD. CIT(A) HAVING D ELETED AMOUNTS HAVING BEEN RECEIVED FROM THEM AT RS. 65,820/-, THE SUSTEN ANCE OF BALANCE ADMISSION IS UNJUSTIFIED, BAD IN LAW AND DESERVED T O BE DELETED WHEN FACTS AND CIRCUMSTANCES FOR ALL THE PARTIES REMAIN THE SAME. 3. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF TH E CASE, THE LD. LOWER AUTHORITIES GROSSLY ERRED IN MAKING SEPARATE ADDITI ONS, IN NOT TELESCOPING THE SAME WHEN DIFFERENT ADDITIONS OUGHT TO HAVE BEE N SET OFF/ TELESCOPED. 2. BRIEFLY THE FACTS OF THE CASE ARE THAT THE ASSES SING OFFICER RECEIVED CERTAIN INFORMATION FROM THE COMMERCIAL TAX DEPARTM ENT IN THE CASE OF THE APPELLANT AND THEREAFTER, THE ASSESSMENT WAS COMPLE TED U/S 144 READ WITH SECTION 148 WHEREIN ADDITION OF RS.34,15,100/- WAS MADE U/S 69A OF THE ACT AND ANOTHER ADDITION OF RS. 11,03,077/- WAS MADE U/ S 69C OF THE ACT. THE APPELLANT CARRIED THE MATTER IN APPEAL BEFORE THE L D. CIT(A), KOTA WHO HAD GIVEN PARTIAL RELIEF TO THE ASSESSEE AND FOR THE R EMAINING ADDITIONS, THE APPELLANT IS IN APPEAL BEFORE US. 2.1 THE LD AR SUBMITTED THAT THE APPELLANT WAS CARR YING 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 RS. 70,000/- FROM CARRIER WORK. THE APPEL LANT 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 DO CUMENTS RELATED TO GOODS ARE NOT FOUND AVAILABLE WITH THE GOODS DURING THEI R MOVEMENT. SIMILARLY SALES TAX IS ALSO LEVIABLE ON THE VALUE OF GOODS A PER PR OVISION OF SECTION 78(11) ON THE TRANSPORTER OR A CARRIER OF GOODS BY PRESUMING THAT GOODS SO TRANSPORTED HAVE BEEN SOLD IN THE STATE OF RAJASTHAN BY HIM AND HE IS DEEMED TO BE A DEALER FOR THOSE GOODS UNDER THE SAID ACT. THEREFO RE, IMPOSING OF PENALTY AS WELL AS CHARGING OF SALES TAX IN THE VALUE OF GOOD S FOUNDS IN THE POSSESSION OF THE APPELLANT AS A CARRIER OF GOODS DOES ESTAB LISH HIS OWNERSHIP BUT AS DONE AS PROVIDED UNDER THE SALES TAX LAW. ITA NO. 537/JP/12 SHRI RAM AVTAR SHARMA, GANGAPURCITY VS. ITO, WARD - 2, SAWAI MADHOPUR 4 THE LD AR FURTHER SUBMITTED THAT THE LD. AO WAS NO T PROPER AND JUSTIFIED IN MAKING ADDITION OF RS. 34,15,100/- IN APPELLANT S INCOME U/S 69A OF THE IT ACT, 1961 BY TREATING THE VALUE OF GOODS BELONGING TO OTHER PERSONS AS APPELLANTS GOODS WHICH HE WAS CARRYING AS A CARRIE R. HE HAS DONE THIS MERELY ON THE BASIS OF ORDER PASSED BY THE LD. CTO, FLYING SQUAD, COMMERCIAL TAXES DEPARTMENT, BHIWADI(ALWAR) VIDE ORDER U/S 78(5) & 78(11) DATED 09.05.2003 OF THE RST ACT, 1994. HE HAS NOT PROPERLY CONSIDER ED THE FOLLOWING WHILE MAKING SAID ADDITION: (A) THE APPELLANT IN HIS FIRST STATEMENT RECORDED O N 9/5/2003 BY THE AUTHORITIES OF COMMERCIAL TAXES DEPARTMENT HAS EXPL AINED THAT HE WAS CARRYING THE GOODS FOUND IN HIS POSSESSION DURING T HE COURSE OF THEIR INSPECTION AS A CARRIER WHICH BELONG TO 10 PERSONS WHOSE NAMES ADDRESSES AS WELL AS DESCRIPTION & QUANTITY WAS ALS O EXPLAINED BEFORE HIM. (B) THE LD. AO AFTER GETTING INFORMATION ABOUT THE ACTION BY THE COMMERCIAL TAXES DEPARTMENT HAS DURING THE ENQUIRY PROCEEDINGS /ASSESSMENT PROCEEDINGS RECORDED STATEMENT OF THE APPELLANT ON 15.11.2003, 13.1.2004 AND 28.7.2009. THE APPELLANT HAS EXPLAINE D FULL PARTICULARS ABOUT THE OWNERSHIP OF THE GOODS FOUND IN HIS POSSE SSION WHICH BELONG TO 10 PERSONS. (C) THE LD.AO HAS ALSO PERSONALLY EXAMINED & RECORD ED STATEMENT OF 3 PERSONS SHRI SURESH CHAND SONI, SHRI RAM VILAS SONI AND SHRI MITHILESH SONI WHO HAVE CONFIRMED ABOUT THE NATURE OF THEIR REGULAR DEALING WITH THE APPELLANT. EVEN TWO PERSONS SHRI SATISH CHAND SONI AND SHRI RAM VILAS SONI HAVE ALSO RECORDED TRANSACTIONS IN THEIR REGULAR BOOKS OF ACCOUNTS. COPIES OF RELEVANT PAGES OF CASH BOOK & LEDGER WERE ALSO OBTAINED BY THE LD. AO WHICH WERE ALSO MADE AS PA RT OF HIS ASSESSMENT ORDER AS ANNEX. G & H. SHRI RAM VILAS SONI HAS ALS O RECORDED THE AMOUNT OF PENALTY & SALES TAX & CARRIER CHARGES ON THE GOLD JEWELLERY & SILVER REIMBURSED TO THE APPELLANT IN HIS CASH BO OK 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 RS. 1,71,322 SILVER COST OF GOODS 46,800 SALES TAX 936 ITA NO. 537/JP/12 SHRI RAM AVTAR SHARMA, GANGAPURCITY VS. ITO, WARD - 2, SAWAI MADHOPUR 5 COURIER CHARGES 200 SALES TAX PENALTY 14,9 40 TOTAL RS. 62,876 THE ABOVE FACTS PROVED BEYOND ANY DOUBT THAT THE GO ODS CARRIED BY THE APPELLANT WAS NOT OWNED BY HIM. THE LD AR FURTHER SUBMITTED THAT THE LD.AO HAS NOT ESTABLISHED THE APPELLANTS OWNERSHIP ON THE GOODS FOUND IN HIS PO SSESSION AT THE TIME OF THEIR INSPECTION BY THE AUTHORITIES OF COMMERCIAL T AXES DEPARTMENT BEFORE TREATING THE VALUE OF GOODS RS. 3415100/- AS UNEXP LAINED U/S 69A OF THE IT ACT, 1961 FOR THE PURPOSE OF MAKING ADDITION. THE LD AR FURTHER SUBMITTED THAT THE AUTHORITIES OF COMMERCIAL TAXES DEPT. HAS SEIZED THE MATERIAL FOUND IN THE POSSESSION OF THE APPELLANT & CREATED DEMAND OF RS.11,03,077/-. THE APPELLANT HAS COLLECTED THE AMOUNT FROM THE CONCERNED OWNERS OF GOODS IN PROPORTION TO THE VALUE OF THEIR GOODS & DEPOSITED THE SAME WITH THE COMMERCIAL TAXES DEPT. AFTER PAYMENT OF DEMAND SAID GOODS WERE RELEASED BY THE COMMERCIAL TAXES DEPTT. WHICH THE APPELLANT HAS HANDED OVER TO THEM. THUS TREATING PAYMENT OF RS. 11,03,077/- BY THE APPELLANT TO THE COMMERCIAL TAXES DEPT. AS UNEXPLAI NED EXPENSES IN THE HANDS OF THE APPELLANT U/S 69C OF THE IT ACT, 1961 IS ALS O NOT PROPER & JUSTIFIED. THE LD AR HAS FURTHER RELIED ON THE FOLLOWING DECIS IONS: MANGILAL AGARWAL VS ACIT 163 TAXMAN 399 (RAJ) CIT VS. S. PITCHAIMANICKAM CHETTIAR 15 TAXMAN 68 (M AD) 2.2 THE FINDINGS OF THE LD. CIT(A) ARE AS UNDER: IN CASE OF MOVABLE ASSETS (GOLD, SILVER, CURRENCY ETC.), POSSESSION IS CONSIDERED PROOF OF OWNERSHIP (UNLESS OTHERWISE IS PROVED). TH E ASSESSEE IN ALL THE PROCEEDINGS BEFORE SALES TAX AUTHORITIES ADMITTED THAT THE JEWELLERY BELONGED TO THEM. THE ASSESSEE IN ALL THE PROCEEDINGS BEFOR E I.T. AUTHORITIES STATES THAT JEWELLERY BELONGED TO OTHERS. THE ASSESSEE PAID PE NALTY OF RS.11,03,077/- LEVIED BY SALES TAX, TO GET THE JEWELLERY OF RS. 34 LACS RELEASED BY SALES TAX AUTHORITIES, HOWEVER, BEFORE INCOME TAX AUTHORITIES HE STATED THAT THE SAME WAS PAID BY OTHERS. THERE WAS NO PROOF TO PROVE THA T THE AMOUNT OF PENALTY WAS PAID BY THESE PERSONS. IN ALL THE DOCUMENTS BEF ORE SALES TAX AUTHORITIES ASSESSEE WAS TREATED AS OWNER. HE HIMSELF NEVER DE NIED OWNERSHIP BEFORE SALES TAX AUTHORITIES. ASSESSEE FILED APPEAL, AGAIN ST ORDER OF PENALTY PASSED BY ITA NO. 537/JP/12 SHRI RAM AVTAR SHARMA, GANGAPURCITY VS. ITO, WARD - 2, SAWAI MADHOPUR 6 SALES TAX AUTHORITIES, AS OWNER OF JEWELLERY AND CL AIMED THAT HE WAS THE OWNER OF JEWELLERY. OUT OF 10 PERSONS , 2 PERSONS NAMELY SHRI SATISH CHAND SONI AND SHRI RAMVILAS SONI ADMITTED TO HAVE PURCHASED GOOD S FROM ASSESSEE AND HAVE SHOWN ADVANCE OF MONEY IN THEIR BOOKS OF A/S. SHRI SATISH CHAND HAS SHOWN ADVANCE OF RS.2,67,356/-, SHRI RAMVILAS SONI HAS S HOWN ADVANCE OF RS.1,76,400/-. SIMILARLY SHRI MITHILESH KUMAR SONI ALSO ADMITTED TRANSACTION OF 5 KG. OF SILVER AND HAS SHOWN ADVANC E OF TOTAL RS. 39,000/-. THE ASSESSEE WAS FOUND TO BLOW HOT AND COLD ACCORDING T O HIS OWN CONVENIENCE.THE ASSESSEE AT ONE TIME STATED THAT HE ADMITTED OWNERS HIP AS HE WAS OFFERED 50% OF THE REFUND OUT OF PENALTY LEVIED BY SALES TAX AU THORITIES (IF ANY). IT IS THEREFORE, HELD THAT ASESSEE, EXCEPT IN THE CASES O F THREE PERSONS , FAILED TO PROVE THAT THE JEWELLERY DID NOT BELONG TO HIM. ACC ORDINGLY, EXCEPT JEWELLERY OF RS.4,82,756/- (ADMITTED BY 3 JEWELLERS) THE REST OF THE JEWELLERY WAS HELD TO BE BELONGING TO ASSESSEE & WAS UNDISCLOSED. ACCORDINGL Y, ADDITION OF RS. 29,32,344/- IS CONFIRMED. THE ASSESSING OFFICER IS DIRECTED TO DELETE ADDITION OF RS. 4,82,756/-. 2.3 THE LD. DR RELIED ON THE ORDER OF THE LOWER AUT HORITIES. 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 T HE GANGAPUR CITY WHO USED TO BRING THEIR GOLD, SILVER AND JEWELLERY. FURTHER, T HE 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 PRO PORTIONATE TO THEIR RESPECTIVE GOODS SO SEIZED. FURTHER THE ASSESSEE I N HIS STATEMENT BEFORE THE COMMERCIAL TAXES DEPT. AS WELL AS STATEMENTS MADE B EFORE THE AO PRIOR TO THE ISSUANCE OF NOTICE U/S 148 AND SUBSEQUENTLY DURING THE COURSE OF ASSESSMENT PROCEEDINGS AS WELL AS THROUGH FURNISHING OF AN AFF IDAVIT HAS CONSISTENTLY STATED THAT HE IS NOT THE OWNER OF THE GOLD, JEWELLERY AND OTHER ARTICLES FOUND IN HIS POSSESSION. IT IS ALSO NOTED THAT THE AO WHILE FRA MING THE ASSESSMENT HAS ACKNOWLEDGED THIS FACT THAT THE ASSESSEE IS MAINT AINING CONSISTENT POSITION STATING THAT THE GOLD, JEWELLERY AND OTHER ARTICLES DOESNT BELONG TO HIM AND BELONG TO OTHER 10 SPECIFIED PERSONS WHOSE PARTICUL ARS HAVE BEEN DISCLOSED IN HIS EARLIER STATEMENT. AT THE SAME TIME, THE AO DID NOT AGREE WITH THE SAID POSITION OF THE ASSESSEE AND HAS STATED THAT CONTR ARY TO THE STATEMENTS MADE BY THE ASSESSEE, THE DOCUMENTARY EVIDENCE RECEIVED FROM THE COMMERCIAL TAX DEPARTMENT PROVES THAT THE ASSESSEE WAS THE OWNER O F THE GOLD AND OTHER ITEMS FOUND IN HIS POSSESSION BY THE COMMERCIAL TAX ES DEPT. ITA NO. 537/JP/12 SHRI RAM AVTAR SHARMA, GANGAPURCITY VS. ITO, WARD - 2, SAWAI MADHOPUR 7 2.5 IN THIS REGARD, WE HAVE GONE THROUGH THE STATEM ENT OF THE ASSESSEE DATED 09.05.2003 MADE BEFORE THE COMMERCIAL TAXES D EPT WHEREIN THE ASSESSEE HAS STATED THAT HE IS A COURIER OF THE GOO DS AND ALSO DISCLOSED THE NAME OF THE PERSONS HAVING JEWELLERY SHOPS IN GANGA PUR FOR WHOM HE WAS CARRYING THE GOODS FROM DELHI TO GANGAPUR CITY. TH E ORDER HAS BEEN PASSED BY THE COMMERCIAL TAXES DEPARTMENT U/S 78(5) READ WITH SECTION 78(11) OF THE RAJASTHAN SALES TAX ACT, 1944. HERE, IT WOULD BE RE LEVANT TO REFER TO SECTION 78(2), 78(5) AND SECTION 78(11) OF RAJASTHAN SALES TAX ACT, 1944 WHICH READS AS UNDER:. SECTION 78(2):THE DRIVER OR THE PERSON IN CHARGE OF A VEHICLE OR CARRIER OF GOODS IN MOVEMENT SHALL (A) CARRY WITH HIM A GOODS VEHICLE INCLUDING CHALL AN AND BILITIES BILLS OF SALE OR DISPATCH MEMOS AND PRESCRIBED DECLARATION F ORMS; (B) STOP THE VEHICLE OR CARRIER AT EVERY CHECK-POST AND WHILE ENTERING AND LEAVING THE LIMITS OF THE STATE, BRING AND STOP THE VEHICLE AT THE NEAREST CHECK- POST, SET UP UNDER SUB-SECTION (1); (C) PRODUCE ALL THE DOCUMENTS INCLUDING PRESCRIBED DECLARATION FORMS RELATING TO THE GOODS BEFORE THE INCHARGE OF THE CH ECK POST; (D) GIVE ALL THE INFORMATION IN HIS POSSESSION RELA TING TO THE GOODS; AND (E) ALLOW THE INSPECTION OF THE GOODS BY THE INCHAR GES OF THE CHECK-POST OR ANY OTHER PERSON AUTHORIZED BY SUCH INCHARGE. SECTION 78(5): THE INCHARGE OF THE CHECK POST OR T HE OFFICER EMPOWERED UNDER SUB-SECTION (3), AFTER HAVING GIVEN THE OWNER OF TH E GOODS OR A PERSON AUTHORISED IN WRITING BY SUCH OWNER OR THE PERSON I NCHARGE OF THE GOODS A REASONABLE OPPORTUNITY OF BEING HEARD AND AFTER HAV ING HELD SUCH ENQUIRY AS HE MAY DEEM FIT, SHALL IMPOSE ON HIM FOR POSSESSION O R MOVEMENT OF GOODS, WHETHER SEIZED OR NOT, IN VIOLATIONS OF THE PROVI SIONS OF CLAUSE (A) OF SUB SECTION (2) OR FOR SUBMISSION OF FALSE OR FORGED DO CUMENTS OR DECLARATION, A PENALTY EQUAL TO THIRTY PERCENT OF THE VALUE OF SU CH GOODS. SECTION 78(11): IF A TRANSPORTER FAILS TO GIVE INFO RMATION AS REQUIRED FROM HIM UNDER CLAUSE (D) OF SUB-SECTION (2) ABOUT THE CONSI GNER, CONSIGNEE OR THE GOODS WITHIN SUCH TIME AS MAY BE SPECIFIED OR TRANSPORTS THE GOODS WITH FORGED DOCUMENTS, BESIDES IMPOSING THE PENALTY UNDER SUB-S ECTION (5), IT SHALL BE ITA NO. 537/JP/12 SHRI RAM AVTAR SHARMA, GANGAPURCITY VS. ITO, WARD - 2, SAWAI MADHOPUR 8 PRESUMED THAT THE GOODS SO TRANSPORTED HAVE BEEN SO LD IN THE STATE OF RAJASTHAN BY HIM AND HE SHALL BE DEEMED TO BE A DEA LER 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 AUTHORISED BY THE OWNER OR THE IN-CHARGE OF THE GOO DS. IN THE INSTANT CASE, TAKING INTO CONSIDERATION THE STATEMENT OF THE APPE LLANT DATED 09.05.2003 MADE BEFORE THE COMMERCIAL TAXES DEPT, PENALTY LEV IED U/S 78(5) IN TERMS OF THE ORDER ISSUED BY THE COMMERCIAL TAXES DEPT. DATE D 09.05.2003 CAN ONLY BE SAID TO BE LEVIED ON THE APPELLANT AS THE IN-CHARGE / CARRIER OF THE GOODS AND NOT AS THE OWNER OF THE GOODS. THE SAID ORDER ISSUED B Y THE COMMERCIAL TAXES DEPT. DATED 09.05.2003 NOWHERE STATES THAT THE OWNE RSHIP OF THE GOLD LIES WITH THE ASSESSEE. FURTHER, SUBSEQUENT FILING OF AN APPEAL AGAINST THE SAID ORDER WHEREIN THE APPELLANT IS THE SIGNATORY AGAIN DOESNT PROVE THE OWNERSHIP OF THE APPELLANT. THEREFORE, THE CONTENTION OF THE ASSESSING OFFICER THAT THE DOCUMENTARY EVIDENCE RECEIVED FROM THE COMMERCIAL T AX DEPARTMENT PROVES THAT THE ASSESSEE WAS THE OWNER OF THE GOLD AND OTH ER ITEMS FOUND IN HIS POSSESSION BY THE COMMERCIAL TAXES DEPT. IS CONTRAR Y TO THE LEGAL AND FACTUAL POSITION WHICH CANNOT BE ACCEPTED. FURTHER, THE AO HAS RECORDED THE STATEMENT OF THE THREE PERSONS WHO HAVE ADMITTED TH AT GOLD BELONGS TO THEM AND INSPITE OF THAT, HE HAS GONE AHEAD AND MADE AN ADDITION IN THE HANDS OF THE ASESSEE. THE LD. CIT(A) HAS TAKEN A NOTE OF TH E SAID ADMISSION AND HAS GIVEN PARTIAL RELIEF TO THE ASSESSEE. THIS ALSO SU PPORT THE CASE OF THE ASSESSEE THAT GOLD FOUND IN HIS POSSESSION DOES NOT BELONG T O HIM AND IT BELONG TO OTHER 10 PERSONS. ALTHOUGH ONLY 3 PERSONS HAVE ADM ITTED ABOUT THEIR OWNERSHIP OF THEIR SHARE OF GOLD, THE FACT THAT THE OTHER 7 PERSONS HAVE NOT COME FORWARD, THAT DOES NOT ESTABLISH THE OWNERSHI P OVER GOLD BELONGS TO THE ASSESSEE. 2.7 HERE, IT WOULD BE RELEVANT TO REFER TO THE DECI SION OF THE HONBLE RAJASTHAN HIGH COURT IN THE CASE OF MANGILAL AGARWAL VS. ACIT 163 TAXMAN 399 THAT NO PRESUMPTION OF OWNERSHIP CAN BE RAISED STATUTOR ILY IN FAVOUR OF THE REVENUE AND AGAINST THE ASSESSEE, NOR IS THERE ANY WARRANT TO INVOKE SECTION 69A MERELY ON THE BASIS OF ASSESSEES POSSESSION. ON HIS DISCLAIMER THAT SUCH ARTICLES FOUND IN HIS POSSESSION DO NOT BELONG TO H IM, THE BURDEN LIES ON THE REVENUE TO ESTABLISH THE OWNERSHIP OF THE ASSESSEE BEFORE RAISING ANY PRESUMPTION AGAINST HIM. ITA NO. 537/JP/12 SHRI RAM AVTAR SHARMA, GANGAPURCITY VS. ITO, WARD - 2, SAWAI MADHOPUR 9 2.8 SIMILARLY, IN THE CASE OF CIT VS. S. PITCHAIMANICKAM CHETTIAR 15 TAXMAN 68 , HONBLE MADRAS HIGH COURT HAS HELD THAT SECTION 69A CAN APPLY ONLY WHEN THE GOLD IS OWNED BY THE ASSESSEE AND HE IS NOT IN A POSITION TO EXPLAIN THE SOURCE OF ACQUISITION OF THAT GOLD. IF THE OWNERSH IP 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 GO LD, THE OWNERSHIP CANNOT BE PRESUMED IN THE PERSON WHO POSSESSED THE GOLD AT TH E PARTICULAR POINT OF VIEW. SECTION 110 OF THE EVIDENCE ACT, WHICH PROVIDES THA T 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 N OT BE INVOKED IN THE INSTANT CASE AS BESIDES RELYING ON THE SAID SECTION THE REV ENUE HAD NOT PRODUCED ANY OTHER MATERIAL TO INDICATE THAT THE GOLD BELONGED T O THE ASSESSEE. THE ASSESSMENT IN THIS CASE, COULD NOT, THEREFORE, BE S USTAINED ON THE BASIS OF SECTION 110 OF THE EVIDENCE ACT. 2.9 FURTHER IT IS NOTED THAT THE ASSESSEES EXPLANA TION REGARDING HIS COMMISSION INCOME FROM CARRIER BUSINESS HAS BEEN AC CEPTED 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 GO LD AND SILVER JEWELLERY OTHER THAN THE DOCUMENTS RECEIVED FROM THE COMMERCIAL SAL ES TAX DEPARTMENT WHICH WE HAVE ALREADY EXAMINED OR THE ASSESSEE HAS ANY OTHER SOURCES OF INCOME OTHER THAN THE INCOME FROM CARRIER BUSINESS. IN LIGHT OF ABOVE AND RESPECTFULLY FOLLOWING THE HIGH COURT DECISIONS REF ERRED SUPRA, WE DELETE THE ADDITION OF RS. 29,32,344 MADE U/S 69A OF THE IT AC T. FURTHER, THE ASSESSEES EXPLANATION REGARDING DEPOSIT OF PENALTY AMOUNT ON BEHALF OF THE JEWELLERS IS ALSO FOUND REASONABLE AND WE SEE NO JUSTIFICATION I N THE ADDITION MADE BY THE AO U/S 69C OF THE ACT WHICH IS HEREBY DELETED. GRO UND NO. 1 AND 2 ARE THEREFORE ALLOWED. 3. IN THE LIGHT OF GROUND NO.1 & 2 DECIDED IN FAVOU R OF THE APPELLANT, GROUND NO.3 BECAME ACADEMIC AND WE SEE NO NECESSITY TO EXAMINE IT. IN THE RESULT THE APPEAL FILED BY THE ASSESSEE IS A LLOWED WITH ABOVE DIRECTIONS. ITA NO. 537/JP/12 SHRI RAM AVTAR SHARMA, GANGAPURCITY VS. ITO, WARD - 2, SAWAI MADHOPUR 10 OR DER PRONOUNCED IN THE OPEN COURT ON 23/08/ 2016. SD/- SD/- ( R.P TOLANI ) (VIKRAM SINGH YADAV) JUDICIAL MEMBER ACCOUNTANT MEMBER JAIPUR DATED:- 23/ 08/2016 PILLAI COPY OF THE ORDER FORWARDED TO: 1. THE APPELLANT- SHRI RAM AVTAR SHARMA, GANGAPUR CITY 2. RESPONDENT- THE ITO, WARD-2, SAWAI MADHOPUR 3. THE THE CIT(A) KOTA 4. THE CIT-KOTA 5. THE DR, ITAT, JAIPUR 6. GUARD FILE (ITA NO. 537/JP/12) BY ORDER, ASSISTANT. REGISTRAR.