SHRI KAMAL MOHAN GUPTA, JAIPUR V. DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE-7, JAIPUR

ITA 835/JPR/2019

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 7819 (ITAT-JAIPUR)
• Duration Of Justice: 7 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-01-2020
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Assessment Year: 2014-2015
• Appeal Filed On: 07-06-2019
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: MUKESH VERMA
• Assessee Lawyers: S S GOGRA
• Keywords: Search and seizure; Principle of natural justice; Period of limitation; Source of fund; Additional evidence; Valuation report; Time period of passing order; Condonation of delay
• Section: 143(3); 143(2); 13; 132

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES,A JAIPUR JH LAANHI XKSLKBZ] U;KF;D LNL; ,OA JH FOE FLAG ;KNO] YS[KK LNL; DS LE{K BEFORE: SHRI SANDEEP GOSAIN, JM & SHRI VIKRAM SING H YADAV, AM VK;DJ VIHY LA- @ ITA NO. 835/JP/2019 FU/KZKJ.K O'K Z @ ASSESSMENT YEAR : 2014-15 SHRI KAMAL MOHAN GUPTA S/O SHRI RAM SWAROOP GUPTA H.N.35, SARDAR SINGH NAGAR, VILLAGE & POST: KANOTA, AGRA ROAD, TEHSIL: BASSI, JAIPUR CUKE VS. THE DCIT CIRCLE-7 JAIPUR LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO.: AHCPG 3166 G VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT FU/KZKFJRH DH VKSJ L S@ ASSESSEE BY : SHRI S.S. GOGRA, ADVOCATE JKTLO DH VKSJ LS @ REVENUE BY: SHRI MUKESH VERMA , CIT DR LQUOKBZ DH RKJH[ K@ DATE OF HEARING : 20/01/2020 MN?KKS'K.KK DH RKJH[ K@ DATE OF PRONOUNCEMENT: 23 /01/2020 VKNS'K@ ORDER PER SANDEEP GOSAIN, J.M. THE PRESENT APPEAL HAS BEEN FILED BY THE ASSESSEE AGAINST THE ORDER OF CIT(A) -3,JAIPUR DATED 11.03.2019 FOR THE ASSES SMENT YEAR 2014-15 WHEREIN THE ASSESSEE HAS RAISED THE FOLLOWING GRO UNDS OF APPEAL. 1. THAT THE AO AS WELL AS LD. CIT(A) HAS ERRED IN NOT ALLOWING REVALUATION OF JEWELLERY SEIZED BY ADIT, K OLKATTA ON DATED 30-10-2013 FOR WHICH SEVERAL APPLICATIONS WERE SUBMITTED TO PR.CCIT, RAJASTHAN ON DATED 29-01-2016 AND ITA NO. 835/JP/2019 SHRI KAMAL MOHAN GUPTA VS DCIT,CIRCLE-7, JAIPUR 2 ON DATED 23-02-2016 AND BEFORE LD. CIT(A)-111, JAIP UR ON DATED 19-01-2016 AND EXPLAINED THE CIRCUMSTANCES WI TH EVIDENCES WHICH EXPLICITLY SHOW THAT SEIZED GOLD JE WELLERY IS HIGHLY EXCESSIVE VALUED BY DEPARTMENTAL VALUER DURI NG THE YEAR COURSE OF SEIZURE AND THAT TOO IN ABSENCE OF O WNER OF GOODS. THUS INTERIM ORDER FOR REVALUATION OF SEIZED JEWELLERY MAY PLEASE BE ALLOWED. 2. THAT THE AO AS WELL AS LD. CIT(A) HAS ERRED IN T REATING SEIZED JEWELLERY OF RS. 77,81,035/- AS UNACCOUNTED FOR IN HANDS OF APPELLANT WHEREAS SAME IS PROPERLY SHOWN I N BOOKS OF ACCOUNT, INCOME TAX RETURNS OF MR.CHANDRA PRAKAS H SONI (OWNER OF GOODS) AND IN WHICH APP WAS WORKING/ ENGA GED AS BROKER IN THE CASE AND FOR WHICH SEVERAL DOCUMENTAR Y EVIDENCES HAVE BEEN SUBMITTED AND SAME IS ALSO ACCE PTED BY DEPARTMENT WHILE PASSING THE ASSESSMENT ORDER U/S 1 43(3) OF MR. CHANDRA PRAKASH SONI (OWNER). 3. THAT LD. CIT(A) HAS ERRED IN NOT ALLOWING THE ADDITIONAL GROUND FOR DOING DOUBLE ADDITION OF DECL ARED STOCK VALUE OF SEIZED JEWELLERY OF RS. 26,72,808/- WHICH IS SHOWN IN BOOKS OF ACCOUNTS OF SHRI CHANDRA PRAKASH SONI (OWNER) AND FURTHER ADDED IN HANDS OF SHRI CHANDRA PRAKASH SONI ON PROTECTIVE BASIS AND SAME IS AGAIN ADDED IN HANDS OF APPELLANT BY TREATING AS UNACCOUNTED FOR STOCK. THA T DATE OF PASSING OF ASSESSMENT ORDER OF SHRI CHANDRA PRAKASH SONI (OWNER) IS LATER IN DATE THEN DATE OF PASSING OF AS SESSMENT ORDER OF APPELLANT. THUS THIS GROUND TAKEN BEFORE T HE LD. CIT(A) WAS NOT AVAILABLE AT THE TIME OF FILING OF A PPEAL, THEREFORE, TAKING AT THE TIME OF HEARING OF APPEAL. 2.1 DURING THE COURSE OF HEARING, THE LD. AR OF THE ASS ESSEE SUBMITTED THAT THE ASSESSEE HAS FILED THE APPEAL LATE BY 21 D AYS FOR WHICH AN ITA NO. 835/JP/2019 SHRI KAMAL MOHAN GUPTA VS DCIT,CIRCLE-7, JAIPUR 3 APPLICATION FOR CONDONATION OF DELAY HAS BEEN FILED BY THE ASSESSEE WITH FOLLOWING PRAYER. 1. THAT THE APPEAL ORDER PASSED BY LD. CIT(A)-III JAIPUR WAS SERVED UPON AN OLD AGED FATHER OF APPELLANT (SH RI RAM SWAROOP GUPUTA) VIDE REGISTERED POST ON 18-03-2019 AT JHIS RESIDENTIAL STAGE AT AGRA ROAD, JAIPUR. THAT DUE TO OLD HE COULD NOT UNDERSTAND THE INTRICACIES OF CASE AND CO ULD NOT COMMUNICATE SAME TO APPELLANT (KAMAL MOHAN GUPTA) A ND WHO IS RESIDING AT FLAT NO. 701, SDC EURO EXOTICA, SHRI KUSHAL NAGAR, SANGANER, JAIPUR. THAT AFTER CHECK BY COUNSEL FROM THE OFFICE LD. CIT(A), JAIPUR ABOUT NON-DELIVE RY OF ORDER, IT CAME TO KNOW THAT APPEAL ORDER HAS ALREAD Y BEEN SENT AT GIVEN ADDRESS AND ONLY THEN FOR THE FIRST T IME IT HAS COME TO KNOW THAT ORDER HAS BEEN PASSED AND SENT TO ADDRESS OF APPELLANT. THE IMMEDIATE APPELLANT SEARCHED THE SEALED ENVELOP WITH HIS FATHER AND IMMEDIATELY CONTACT TO HIS COUNSEL. 2. THAT THE ORDER HAS BEEN DELIVERED ON 18-03-2019 AND THEREAFTER LIMITATION PERIOD OF 60 DAYS WHICH EXPIR ES ON 17- 05-2019 AND THEREAFTER APPEAL IS FILED BEFORE HON'B LE ITAT ON 7-06-2019, THUS THERE IS DELAY OF 21 DAYS IN FIL ING OF APPEAL BEFORE HON'BLE ITAT, JAIPUR BENCH. 3. THAT SUCH DELAY OF 21 DAYS IS UNINTENTIONAL AND DUE TO NON-COMMUNICATION BY OLD AGED FATHER OF APPELLANT ( SHRI RAM SWAROOP GUPTA) AND WHO COULD NOT UNDERSTAND THE INTRICACIES OF THE CASE. 4. THAT AN AFFIDAVIT IN SUPPORT OF LIMITATION APPLI CATION OF FATHER OF APPELLANT AND APPELLANT HIMSELF ARE ENCLO SED HEREWITH. ITA NO. 835/JP/2019 SHRI KAMAL MOHAN GUPTA VS DCIT,CIRCLE-7, JAIPUR 4 THUS IT IS HUMBLY REQUESTED TO KINDLY CONDONE THE D ELAY OF 21 DAYS IN SUBMISSION OF APPEAL AND THE SAME MAY PL EASE BE HEARD ON MERITS. 2.2 ON THE OTHER HAND, THE LD. DR OPPOSED THE COND ONATION APPLICATION OF THE ASSESSEE. 2.3 WE HAVE HEARD THE RIVAL CONTENTIONS, PERUSED TH E MATERIALS AVAILABLE ON RECORD AND ALSO THE AFFIDAVITS OF THE ASSESSEE AND HIS AGED FATHER SHRI RAM SWAROOP GUPTA. TAKING INTO CONSIDER ATION THE FACTS AND CIRCUMSTANCES OF THE CASE AND ALSO THE DECISION OF HON'BLE APEX COURT IN THE CASE COLLECTOR, LAND ACQUISITION VS. MST. KA TIJI AND OTHERS, 167 ITR 471 (SC), WE ARE OF THE CONSIDERED VIEW THAT IN THE GIVEN FACTS AND CIRCUMSTANCES OF THE CASE, THE ASSESSEE WAS PREVENT ED BY SUFFICIENT CAUSE WHICH WAS BEYOND HIS CONTROL. THEREFORE, THE DELAY IS CONDONED. 3.1 BRIEF FACTS IN THIS CASE ARE THAT AN INFORMAT ION RECEIVED BY NSCBI AIRPORT, KOLKATA ON 30.10.2013 AS THE ASSESSEE- SHR I KAMAL MOHAN GUPTA WAS CARRYING WITH HIM LARGE QUANTITY OF GOLD ORNAME NTS. HE WAS ASKED TO PRODUCE THE SUPPORTING DOCUMENTS IN RESPECT OF THE SOURCE, OWNERSHIP, POSSESSION AND APPLICATION OF THE SAID GOLD ORNAMEN TS IN HIS POSSESSION. IN RESPONSE, HE COULD ONLY SUBMIT AN APPROVAL MEMO FROM M/S AMIT ITA NO. 835/JP/2019 SHRI KAMAL MOHAN GUPTA VS DCIT,CIRCLE-7, JAIPUR 5 GEMS (PROPRIETORSHIP CONCERN OF ASSESSEE HIMSELF.) AS, AT THE TIME OF VERIFICATION, SH. KAMAL MOHAN GUPTA ( ASSESSEE) CO ULD NOT EXPLAIN SATISFACTORY EXPLANATION. IN THE LIGHT OF THE ABOV E, A WARRANT OF AUTHORIZATION U/S 132(1) OF THE IT ACT, 1961 WAS DULY EXECUTED BY THE DIT INVESTIGATION WING, ON MR. KAMAL MOHAN GUPTA AT THE NSCBI AIRPOR T, KOLKATA ON 30.10.2013 AND A SEARCH AND SEIZURE OPERATION UNDER SECTION 132 OF THE INCOME TAX ACT, 1961 WAS CONDUCTED ON MR. KAMAL MOH AN GUPTA AT NSCBI AIRPORT, KOLKATA RESULTING IN THE SEIZURE OF STONE STUDDED GOLD JEWELLERY (JADAU) WEIGHING 2141.000 GMS. THE ORDER U/S. 127 ISSUED BY THE COMMISSIONER OF INCOME-TAX-III, JAIPUR ON 19.03 .2014 AND CASE WAS TRANSFERRED FROM ITO, WARD- 7(3), JAIPUR TO CIRCLE -7, JAIPUR. IN VIEW OF TERM OF SECTION 153 OF I.T. ACT, 1961, NOTICE U/S. 153 A WAS ISSUED TO ASSESSEE ON 20.05.2015 REQUIRING HIM TO FURNISH HIS RETURN OF INCOME FOR A.Y. 2014-15 WITHIN 30 DAYS OF RECEIPT OF THE SAID NOTICE. IN RESPONSE ASSESSEE VIDE ITS REPLY DATED 24/06/2015 SUBMITTED THAT THE ASSESSEE HAS FILED RETURN OF INCOME ON 20/10/2014 WITH ACKNOWLED GMENT NO. 182201014010459. NOTICE U/S. 143(2) WAS ISSUED ON 0 1.09.2015. SUBSEQUENTLY, THE AO PASSED THE ASSESSMENT ORDER. ITA NO. 835/JP/2019 SHRI KAMAL MOHAN GUPTA VS DCIT,CIRCLE-7, JAIPUR 6 3.2 AGGRIEVED BY THE ORDER OF THE AO, THE ASSESSEE PREFERRED THE APPEAL BEFORE THE LD. CIT(A) AND THE LD. CIT(A) AFTER CONS IDERING THE CASE OF BOTH THE PARTIES DISMISSED THE APPEAL OF THE ASSESS EE AND UPHELD THE ORDER OF THE AO. 3.3 AGGRIEVED BY THE ORDER OF THE LD. CIT(A), THE A SSESSEE HAS PREFERRED THE PRESENT APPEAL BEFORE US ON THE GROUN DS MENTIONED HEREINABOVE. 3.4 THE GROUND NO. 1 RAISED BY THE ASSESSEE RELATES TO CHALLENGING THE ORDER OF THE LD. CIT(A) IN NOT ALLOWING THE REVALUA TION OF GOLD JEWELLERY SIZED BY ADIT TEAM, KOLKATTA. 3.5 THE LD.AR , APPEARING ON BEHALF OF THE ASSESSEE SUBMITTED BEFORE US THAT AS PER FACTS OF THE CASE, THE ASSESSEE WA S CARRYING WITH HIM GOLD ORNAMENTS WHICH WERE SEIZED BY ADIT TEAM, KOLKATTA. THE SAID JEWLLERY BELONGED TO SHRI CHANDRA PRAKASH SONI AND THE ASSES SEE WAS ONLY THE BROKER WHO WAS CARRYING THE SAMPLE OF THE JEWELLERY FOR DISPLAY AND SEEKING THE ORDERS. IT WAS SUBMITTED BY THE LD.AR O F THE ASSESSEE THAT THE ORDER OF THE AO IS BASED ON VALUATION REPORT SOUGHT BY THE DEPARTMENT BUT THE SAID VALUATION REPORT IS VERY EXCESSIVE AND IS NOT AS PER FACTUAL POSITION OF THE JEWELLERY IN QUESTION. IT WAS FURT HER SUBMITTED THAT THE ITA NO. 835/JP/2019 SHRI KAMAL MOHAN GUPTA VS DCIT,CIRCLE-7, JAIPUR 7 ASSESSEE HAS FILED SEVERAL APPLICATIONS TO THE PR.C CIT, RAJASTHAN ON 29- 01-2016 AND 23-02-2016 AND BEFORE THE LD. CIT(A)-II I, JAIPUR ON 19-01- 2016 AND EXPLAINED THE CIRCUMSTANCES WITH EVIDENCES WHICH EXPLICITLY SHOWS THAT SEIZED GOLD JEWELLERY IS HIGHLY EXCESSIV ELY VALUED BY THE DEPARTMENT VALUER DURING THE COURSE OF SEIZURE AND THAT TOO IN THE ABSENCE OF OWNER OF GOODS. THE LD.AR OF THE ASSESSE E REITERATED THE SAME ARGUMENTS AS WERE RAISED BY HIM BEFORE THE LD. CIT( A) WHICH IS CONTAINED IN PARA 4.1 OF THE ORDER PASSED BY THE LD. CIT(A) A ND THE SAME IS REPRODUCED BELOW. 4.1 DURING THE APPELLATE PROCEEDING THE APPELLANT H AS FILED WRITTEN SUBMISSION ALONG WITH ADDITIONAL EVIDENCE. THE SUBM ISSION IS AS UNDER AND ALSO ARGUED THE CASE ON THE SAME BASIS . 'THAT THE LD. AO HAS ERRED IN PASSING OF IMPUGNED A SSESSMENT ORDER DT. 22.3.2016 WHICH IS WITHOUT PROVIDING PROPER OPPORTUNITY OF BE ING HEARD. THAT APPELLANT HAS MADE SEVERAL REQUEST FOR GETTING REVALUATION OF SEI ZED JEWELLERY BY STATING THAT GOODS WHICH WERE CARRYING BY APPELLANT WERE OF STUDDED JE WELLERY WHICH IS CONTAINING WAX OF ABOUT60% TO 70% WAX OF TOTAL WEIGHT WHEREAS VALU ER HAS VALUED ENTIRE JEWELLERY AT THE RATE OF PURE GOLD-WHICH IS ABSOLUTELY IMPROP ER AND LD. AO HAS FURTHER ERRED IN NOT ALLOWING TO PROVIDE OPPORTUNITY FOR REVALUATION OF SEIZED JEWELLERY WHICH IS AGAINST THE PRINCIPLE OF NATURAL JUSTICE AND IS UNC ALLED FOR. THAT LD. AO HAS ERRED IN CONTENDING THAT THE APPELL ANT HAS HIMSELF HAS ACCEPTED THE VALUATION WHEREAS FACT OF THE CASE IS THAT THE APPE LLANT WAS UNDER ACUTE MENTAL PRESSURE AND WAS COMPELLED TO ACCEPT THE VALUATION. HE WAS S UDDENLY CAUGHT BY TEAM OF DEPARTMENTAL OFFICERS AT KOLKATTA. APPELLANT BELONG S FROM AVERAGE FAMILY AND IS ALSO NOT SO LITERATE. HE FELT HIMSELF IN TROUBLE AND WAS ALS O BEING THREATENED THAT LOT OF BAD THINGS WILL HAPPEN WITH HIM, IF HE DID NOT ACCEPT THE SEAR CH PROCEEDINGS AND VALUATION REPORT. AS APPELLANT HAS SWORN ON AFFIDAVIT DT.18.1.2016 SU BMITTED DURING ASSESSMENT PROCEEDINGS ALONGWITH REQUEST LETTER DI. 18.1.2016 WHEREBY HE HAS SAID THAT 'VALUATION REPORT DT. 30.10.2013 WAS GOT SIGNED BY HIM BEFORE DEPARTMENTAL OFFICERS UNDER ACUTE MENTAL PRESSURE AND WITHOUT UNDERSTANDING THE CORRE CT VALUATION AMOUNT.' MEANING ITA NO. 835/JP/2019 SHRI KAMAL MOHAN GUPTA VS DCIT,CIRCLE-7, JAIPUR 8 THEREBY THE VALUATION REPORT WAS SIGNED WITHOUT UND ERSTANDING THE CONTENTS OF THE SAME. THUS ACTION OF LD. AO THAT APPELLANT HAS ACCEPTED T HE VALUATION IS IMPROPER AND WITHOUT ASCERTAINING THE FACTUAL CIRCUMSTANCES UNDER WHICH HE WAS COMPELLED TO ACCEPT THE VALUATION AND ASSESSMENT BASED ON THAT VALUATION RE PORT IS IMPROPER AND UNJUSTIFIED IN THE FACTS & CIRCUMSTANCES OF THE CASE. THAT APPELLANT HAS SUBMITTED APPLICATION FOR REVALU ATION OF SEIZED JEWELLERY TO HON'BLE PR. COMMISSIONER-ILL, JAIPUR ON DT.19.1.201 6 AND TO HON'BLE PR. CCIT, JAIPUR ON DT.23.2.2016, DT. 29.1.2016 AND WITHOUT GETTING OUT COME OF THOSE APPLICATION THE LD. AO HAS PASSED THE ASSTT. ORDER WHICH IS ABSOLUTELY ILLEGAL AND UNJUSTIFIED IN THE FACTS & CIRCUMSTANCES OF THE CASE AND MAY PLEASE BE HELD AS ILLEGAL. THAT AFTER COMPLETION OF SEIZURE PROCEEDINGS OF ENT IRE RECORD WAS TRANSFERRED BY THE ADI WING, KOLKATTA TO THE OFFICE OF .1 CI T, CIRLCE -7, JAIPUR AND LD. AO WAS THE OFFICER WHO WAS INCHARGE AND HAVING PROPER JURISDIC TION OVER THE APPELLANT AND THEREFORE ALL SUCH APPLICATION FOR REVALUATION WERE MADE BEFORE THE JURISDICTIONAL OFFICE AT JAIPUR. THAT SEVERAL GROUNDS HAVE BEEN RAISED BEFORE LD. AO FOR GETTING REVALUATION OF SEIZED JEWELLERY AND ALL THESE GROUNDS HAVE BEEN UNATTENDE D WHILE PASSING THE ASSESSMENT ORDER BY LD. AO AS BELOW:- GROUNDS FOR WANT OF REVALUATION OF SEIZED JEWELLERY (A) THAT THE VALUATION OF GOODS WERE TAKEN IN PRESENCE OF APPELLANT WHO WAS WORKING AS BROKER ON BEHALF OF MR. CHANDRA PRAKASH SONI FOR CARRYING THE JEWELLERY FOR DISPLAY PURPOSES IN THE OPEN MARKET AT KOLKATTA . OWNER - MR. CHANDRA PRAKASH SONI HAS NEVER BEEN CONFRONTED WITH SUCH VALUATION AT ANY POINT OF TIME DURING SEIZURE PROCEEDINGS, THUS ENTIRE VALUATION PROCEEDI NGS ARE NON-EST. (B) THAT COPY OF STATEMENT OF MR. CHANDRA PRAKASH SONI- OWNER WAS PROVIDED BY LD. AO DT. 18. 1.2016 FOR WHICH APPLICATION DT.25.5 .2015 WAS SUBMITTED THUS AFTER PWSING OF MORE THAN SEVEN(7) MONTHS STATEMENTS WERE PROVIDED. THUS APPELLANT WAS UNABLE TO SAY ANYTHING WITHOUT GETTING COPY OF THE STATEMENTS. THE VALUATION OF STUDDED JEWELLERY WAS GOT DONE WIT HIN SUCH A SHORT SPAN OF TWO ONLY, WHICH IS NOT AT ALL POSSIBLE TO GET THE SAME DONE A S IT TAKES TO VALUE SUCH TYPE OF JADAU, STUDDED JEWELLERY OF AT LEAST 1-2 WHOLE DAY. THE VA LUATION REPORT WAS GOT DONE BY THE THEN VALUER SHRI HARERAM ROY, 21/B, GOLAP, SASTRI L ANE, P.L. ALUCHIPARA, KOLKATTA IN THE OFFICE OF DEPARTMENT AND LATER ON IT HAS ALSO COME TO KNOW THAT HE HAS ALSO BEEN SUSPENDED BY I.T. DEPARTMENT DUE TO INCONSISTENCIES IN DOING VALUATION. THAT THE VALUATION OF STUDDED JEWELLERY SEIZED IS V ALUED AT RS.77,81,035/- WHICH ARE MANUFACTURED FROM GOLD (999 PURITY) AND SEMI PREVIO US STONES STUDDED THEREIN OF ITA NO. 835/JP/2019 SHRI KAMAL MOHAN GUPTA VS DCIT,CIRCLE-7, JAIPUR 9 WHICH GROSS WEIGHT WAS COUNTED FOR 3121.86 GMS AND NET WEIGHT WAS CONTED FOR 2141.00 GMS. BY SAID VALUER. THAT VALUE OF GOLD HAS BEEN TAKEN AT RS.2935/- PER GMS. AND RATES OF PRECIOUS & PRECIOUS STONES ARE VARYING FROM ONE TO ANOTHER VER Y MUCH. THE RATE OF POLKA (SEMI PREVIOUS STONE) ;S TAKEN FROM RS.2914/- TO RS. 10,0 00/- PER CTS. I.E. IN ITEM NO. 1 OF VALUATION REPORT, QUANTITY OF POLKA IS WRITTEN AS 3 0.00 GMS. AND VALUE IS TAKEN FOR RS. 1,80,000/-, THUS RATE OF POLKA IS TAKEN FOR RS.6,00 0/- PER CTS. AND CORRESPONDINGLY AT SR. NO. 3 = QUANTITY OF POLKA IS TAKEN AT 18,000 CT S AND VALUE IS TAKEN FOR RS.1,80,000/- , THUS VALUE IS TAKEN FOR RS. 10,000/- PER CTS. WHE REAS THE PREVAILING MARKET RATE OF POLKI IS IN BETWEEN OF RS.1500/- TO RS.1700/- PER C ARAT (MAXIMUM) IN OPEN MARKET OF JAIPUR WHICH CAN VERY WELL BE ASCERTAINED AND TAKEN FROM JEWELLERS OF JAIPUR. THE FOLLOWING ARE THE PREVAILING RATES OF SEMI PRECIOUS STONES IN OPEN MARKET AT JAIPUR:- (A) POLKI = RS.1500 - 1700 PER CARAT (B) PEARL & BEADS = RS. 20-70 PER CARAT WHEREAS THE VALUER HAS TAKEN THE MINIMUM RATE OF RS .3,000/- PER CARAT AND ON HIGHER SIDE THE RATE HAS BEEN TAKEN AT RS.10,000/- PER CAR AT WHICH IS ON TOO HIGHER SIDE AND SHOWS THAT ENTIRE VALUATION IS DONE WRONGLY. THE COPY OF FOLLOWING PURCHASE BILLS OF POLKI (CUT & POLISHED DIAMONDS) WERE ALSO SUBMITTED TO LD. AO AS BELOW:- NAME OF PARTY & ADDRESS BILL NO. DATE AMOUNT RATE/CARAT 0 M/S BAHUBALI DIAMONDS PVT. LTD. 3 06.07.2013 500000/- 1600/- (II) DO - 8 22.10.2013 300000/ - 1500/ - (I) M/S SANKALP DIM EXPORTS 112 28.08. 2013 300000/ - 1200/ - (II) M/S NAMAN GEMS, SURAT 117 01. 11 . 2013 300000/ - 1500/ - ( 1 M/S KEDIA E.,,PORTS PVT. LTD., JAIPUR 50 04.11.2013 472800/- 1500/- ( V M/S BAHUBALI DIAMONDS PVT LTD SUR 01 20.11.2013 231008/ - 1600/ - THAT PURCHASE RATES OF THESE BILLS ARE VARYING FROM 1200 TO 1600 PER CARAT WHICH WERE STUDDED IN THOSE JEWELLERY WHICH WERE CAUGHT A ND WRONGLY SEIZED BY I.T. DEPARTMENT. WHEREAS THE VALUER HAS TAKEN UP THE RAT E OF SUCH POLKA (CUT & POLISHED DIAMONDS) VARYING FROM RS.6000/- TO RS. 10000/- PER CARAT. THUS IT IS VERY MUCH UNCLEA, THAT FROM WHERE THE ABOVE RATES HAVE BEEN TAKEN. THUS IT IS VERY MUCH PROVED THAT VALUATION OF JEWEL LERY WAS MADE UNDER PRESSURE AND LOOKING TO THE ACTUALITY OF MATERIAL USED THERE IN. AS THE APPELLANT IS DEALER IN SUCH STUDDED JEWELLER Y AND UNDERSTANDS THE VERY BASIC OF THESE GOLD JEWELLERY. AS THESE STUDDED JEWELLERY ARE CONTAINING AT MAXIMUM WAX ITA NO. 835/JP/2019 SHRI KAMAL MOHAN GUPTA VS DCIT,CIRCLE-7, JAIPUR 10 THEREIN AND WHICH IS CONTAINING IN THESE JEWELLERY ABOUT 60% TO 70% OF WEIGHT. THE STUDDED JEWELLERY IS MANUFACTURED WITH FILLING OF W AX THEREIN ONLY THEN SUCH SEMI P, ECIOUS STONES ARC AFFIXED THEREIN. AS A MANUFACTURI NG PROCESS OF THE SAME, THE GOLD LEAF IS PREPARED AND THEN THICK WAX IS PUT THEREIN AND ON UPSIDE THE STONES ARE STUDDED THEREIN. THUS IT CONTAINS NOT MORE THAN 19- 20% OF PURE GOLD (999PURITY). WHILE VALUING THE SAME THE VALUER HAS TAKEN THE ENT IRE WEIGHT AS PURE GOLD (999PURITY) WITHOUT CONSIDERING THE QUANTITY FOR WZ X & CH4PDI THEREIN. THUS IN OTHER WORDS THE VALUE OF WAX FILLEA IN JEWE LLERY IS VALUED AT RATE OF PURE . THE RATE OF WAX IS ABOUT RS. 1.50 PER GMS WHICH IS EASI LY AVAILABLE IN LOCAL MARKET AIPUR AND CAN ALSO BE GOT ASCERTAINED BY YOU AT YOUR END, WHE REAS THE RATE OF PURE GOLD TAKEN FOR VALUATION IS OF RS.2,935/- PER GMS. THUS THERE IS D IFFERENCE OF RS. 2933.50 PER GRAM OR 29,33,500/- PER KILO GRAM. THAT JEWELLERY IS CONTAINING DORI SO THAT IT BECOME S WEARABLE. DORI IS MADE OF COTTON THREAD FOILED WITH GOTA. THE WEIGHT OF DO RI IS ABOUT 10% TO 15% OF TOTAL WEIGHT. THE VALUER HAS COUNTED WEIGHT OF T HESE DORI IN TOTAL PURE WEIGHT OF GOLD (999 PURITY). THAT WHILE VALUING STUDDED JEWELLERY, THE QUANTITY OF GOLD IS MEASURED ABOUT 68% IN TOTAL WEIGHT BY VALUER WHICH IS ABSOLUTELY WRONG AND WITHOUT ANY BASIS AND BASED ON HIS WHIMS & FANCIES AND WITHOUT ANY BASIS. WHILE MANUFACTURING OF SUCH TYPE OF STUDDED JEWELLERY WAX CHAPDI IS USED THERE SO THAT IT MAY HOLD SEMI PRECIOUS STONES I.E. PEARLS, POLKA ETC. WHILE VALUI NG ABOVE STUDDED JEWELLERY THE PERCENTAGE OF GOLD IS TAKEN ABOUT 68% OF TOTAL WEIG HT, WHEREAS IT CONTAINS NOT MORE THAN 20% OF TOTAL WEIGHT, THUS 4850% OF GOLD WEIGHT IS EXCESSIVELY TAKEN BY VALUING THE STUDDED JEWELLERY. AS AN EXEMPLARY CALCULATION IN SUCH STUDDED JEWELLE RY THE COMPOSITION OF JEWELLERY IS GIVEN AS UNDER:- TYPICAL COMPOSITION COMPOSITION OF STUDDED JEWELLERY TAKEN BY VALUER (WITHOUT BASIS) GOLD WEIGHT 17-18% 68% OTHER ALLOYES 5.6% 0% SEMI PRECIOUS STONES 18-20% 32% WAX, CHAPDI, DORI ETC. 60-65% 0% THUS VALUATION AS TAKEN BY VALUER IS WITHOUT ANY BA SIS AND IS TOTALLY MISCONCEIVED. IT IS FURTHER TO NOTE THAT ENTIRE VALUATION PROCESS WA S COMPLETED BY HIM WITHIN A PERIOD ITA NO. 835/JP/2019 SHRI KAMAL MOHAN GUPTA VS DCIT,CIRCLE-7, JAIPUR 11 2 HOURS (AT MAXIMUM), WHEREAS TO ASCERTAIN CORRECT VALUE OF SUCH TYPE OF STUDDED JEWELLERY MORE THAN ONE DAY IS REQUIRED SO AS TO AR RIVE THE CORRECT PURITY AND VALUE THEREOF THUS IT IS CRYSTAL CLEAR JUST TO CO-OPERATE THE SEARCH TEAM THE ENTIRE VALUATION WAS DONE AND APPELLANT WAS ALSO PUT UNDER HUGE PRES SURE TO ADOPT SUCH VALUATION. THAT APPELLANT HAS SUBMITTED HIS AFFIDAVIT STATING THEREIN ABOUT NOT PROPERLY UNDERTAKING VALUATION OF JEWELLERY BEFORE LD. AO AN D THAT HAS REMAIN CONTROVERTER. ON THE OTHER SIDE, THE VALUER WHILE DOING VALUATION HAS COMPUTED PURE GOLD OUT OF TOTAL WEIGHT AND HE HAS NOT MENTIONED ANY DETAILS O F SUCH DIFFERENCE OF PURE AND NET WEIGHT. THE PERCENTAGE OF OTHER ALLOYS IS NOT PROPE RLY TAKEN. IT IS VERY COMMON SCIENCE OF METALLURGY THAT PURE GOLD CANNOT BE STAN D ALONE AND IT WILL BE BEND AWAY IMMEDIATELY AND STONES, FITTINGS CANNOT BE STUDDED THEREIN. TO HOLD GOLD IN A WEARABLE CONDITION IT IS VERY ESSENTIAL TO MIX OTHE R ALLOYS, ONLY THEN STONES ETC, ALLOYS BE STUDDED/AFFIXED. IN PURE GOLD WITHOUT MIX ING OF OTHER ALLOYS, STONES, PEARLS ETC, CANNOT AFFIXED. THE VALUATION AS UNDERTAKEN BY VALUER IS BASED ON PURE GOLD WITHOUT DISCRIMINATING THE VALUE OF OTHER ALLOYS TH EREIN. THAT THE OWNER OF GOODS (MR. C- 1 ;ANDRA PRAKASH SONI) HAS DISCLOSED THE VALUE OF SUC H GOODS IN HIS AUDITED BOOKS OF ACCOUNT AS ON 31.3.20 14 (AS SEIZED JEWELLERY) FOR RS.26, 72,808/-, WHEREAS THE VALUATION OF THESE GOODS HAVE BEEN TAKEN BY VALUER FOR RS.77,81,035/-, THUS THERE IS A DIFFERENCE OF RS.51 ,08,227/-. THAT APPELLANT HAS SUBMITTED CERTIFICATE FROM M/S. S.J. GEMS & JEWELS, 2456, TATEHRA KA TIBA, DHOBI GHAT KA RASTA, PURANI BASTI, JAIPUR WHO HAS CERTIFIED THAT GOLD RED JEWELLERY GENERALLY BEING CONTAINS OF FOLL OWING INGRIENDENTS:- (A) GOLD-PURE = 15%-20% (B) WAX/CHAPDI = 65% - 70% (C) DORI, SARAFA ETC. = 5%40% ABOVE CERTIFICATE WAS SUBMITTED TO LD. AO BEFORE PA SSING OF ASSESSMENT AND LD. AO HAS ERRED IN NOT PUTTING ANY RELIANCE TO SAME AND N O CONTRARY EVIDENCE HAVE BEEN BROUGHT ON RECORD FOR NOT ACCEPTING THE SAME. THAT LD. AO HAS ERRED IN NOT APPRECIATING THE STATE MENTS OF MR. CHANDRA PRAKASH SONI RECORDED ON SAME DATE OF SEARCH PROCEEDINGS OF APPELLANT I.E. ON 30.10.2013 WHEREIN RELEVANT QUESTION NO. 8 WHICH IS REPRODUCED AS BELOW:- Q.NO.8:- PLEASE EXPLAIN THE ITEM WISE DETAILS OF SA MPLE GIVEN ON DT.3.10.2013 AND ON DT.14.10.2013 TO MR. KAMAL MOHAN GUPTA AND GET IT M ATCHED WITH YOUR BOOKS OF ACCOUNTS. FINS- THAT I HAVE GIVEN TOTAL 2050 GMS. G ROSS WEIGHT STUDDED JEWELLERY TO SHRI KAMAL MOHAN GUPTA AND IT IS CONTAINING ABOUT 20% GOLD CON TENT THEREIN ........... ITA NO. 835/JP/2019 SHRI KAMAL MOHAN GUPTA VS DCIT,CIRCLE-7, JAIPUR 12 THAT AT SAME TIME OF SEARCH PROCEEDINGS WHEN THE ST ATEMENTS WERE BEING RECO-DED FOR AND OWNER OF GOODS IS CONTENDING THAT IT IS CONTAIN ING GOLD CONTENT ABOUT 20% OF TOTAL WEIGHT AND EVEN THOUGH THE SAME IS NOT ACCEPTED BY LD. AO WHILE PASSING THE ASSESSMENT ORDER IS TOTALLY UNJUSTIFIED IN THE FACT S & CIRCUMSTANCES OF THE CASE. THAT IN BROAD SENSE GROSS WEIGHT OF SEIZED JEWELLERY IS OF 3120.55 GMS. AND OF ITS 20% GOLD IS COMPUTED THEN IT BECOMES TO 624.11 GINS. OF GOLD CO NTENT AND OF WHICH VALUE IS NOT MORE THAN 18 LACS (APPROX.) AND NOT 71 LACS. THUS B Y NOT PROVIDING OPPORTUNITY FOR GETTING SAME REVALUED IS ABSOLUTELY IMPROPER ACTION ON PART OF THE LD. AO AND ASSESSMENT BASED ON THAT VALUE IS ALSO ILLEGAL AND AGAINST THE PRINCIPLE OF NATURAL JUSTICE. THAT WHILE PASSING THE: ASSESSMENT ORDER NO WHERE T HE FINDING OR CONTRARY EVIDENCE HAVE BEEN BROUGHT ON RECORD NEITHER BY THE INVESTIGATION AGENCY NOR BY THE LD. AO ABOUT STATUS OF KAMAL MOHAN GUPTA. THAT NOWH ERE IN THE ASSESSMENT ORDER THE STATUS OF KAMAL MOHAN GUPTA IS DENIED AS BROKER OF M/S. GOLD THEME JEWELS PROP. CHANDRA PRAKASH SONI AND MORE SO WHEN STATEME NTS OF BOTH THE PERSONS ARE SIMULTANEOUSLY WERE RECORDED AND IN WHICH ONE PERSO N WAS AT KOLKATTA AND AT SAME TIME ONE PERSON WAS AT JAIPUR AND ANSWERS OF B OTH PERSONS ARE IN SAME LINE AND WHICH IS CORROBORATIVELY MATCHED AS IS APPEARIN G FROM THE STATEMENTS OF BOTH THE PERSONS. THAT LD. AO HAS ERRED IN CONTENDING THAT APPELLANT HAS NOT CHALLENGED THE VALUATION OF JEWELLERY EARLIER WHEREAS FACTS OF THE CASE IS T HAT APPELLANT HAS FILED WRIT PETITION NO. 8900/2014 BEFORE HON 'BLE RAJASTHAN HIGH COURT ON THE GROUND OF ILLEGAL SEIZURE OF STOCK IN TRADE (JEWELLERY) AS STOCK IN TRADE CAN NOT BE SEIZED BY INCOME TAX DEPARTMENT. THE HON 'BLE RHC VIDE THEIR JUDGMENT DT . 23.02.2017 HAS DIRECTED TO RELEASE THE SEIZED JEWELLERY FORTHWITH, BUT EVEN AF TER DIRECTION OF HON'BLE RAJ. HC THE SAME HAVE NOT BEEN RELEASED BY DEPARTMENT TILL DATE . THUS CONTENTION OF LD. AO TO THE EXTENT THE VALUATION SHOULD HAVE BEEN CHALLENGED BE FORE RHC IS WITHOUT ANY LEGS AND IMPROPER I N THE FACTS & CIRCUMSTANCES OF THE CASE. WHEN THE BAS IC SUBSTRATUM OF SEIZURE IS CHALLENGED IN WRIT PETITION THEN THERE D OES NOT REMAIN ANY REASON TO CHALLENGE VALUATION IN THAT WRIT PETITION. THAT THE PROCEEDINGS U/S. 143(3) ARE INDEPENDENT PR OCEEDINGS AND IN WHICH ASSESSING OFFICER SHOULD APPLY HIS MIND AFRESH SO AS TO MAKE A PROPER AND JUSTIFIED ASSESSMENT OF THE INCOME AND WHICH IS LACKING IN THE PRESENT C ASE AND THUS IMPUGNED ASSESSMENT ORDER IS ABSOLUTELY ILLEGAL AND MAY PLEASE BE DELET ED. ITA NO. 835/JP/2019 SHRI KAMAL MOHAN GUPTA VS DCIT,CIRCLE-7, JAIPUR 13 3.6 ON THE OTHER HAND, LD. DR RELIED ON THE ORDER P ASSED BY THE LD. CIT(A). 3.7 WE HAVE LD. COUNSEL FOR BOTH THE PARTIES, PERUS ED THE MATERIALS PLACED ON RECORD AND ALSO PERUSED THE ORDERS PASSED BY THE LOWER AUTHORITIES. BEFORE WE DECIDE THE MERITS OF THIS GR OUND, IT IS NECESSARY TO EVALUATE THE ORDER PASSED BY THE LD. CIT(A) WHILE D ISPOSING OFF THIS GROUND. THE LD. CIT(A) HAD ADJUDCATED THIS GROUND I N PARA 4.2 OF HIS ORDER WHICH IS REPRODUCED AS UNDER:- 4.2 I HAVE CAREFULLY CONSIDER THE MATERIAL BEFORE M E I FIND THAT THE JEWELLERY WAS SEIZED FROM THE ASSESSEE BY THE INVESTIGATION WING, INCOME TAX DEPARTMENT AT AIRPORT, KOIKATA ON 30.10.2013 WHICH WAS VALUED BY THE REGISTERED VALUER AT RS.77, 81,035/-. DURING THE COURSE OF STATEMENT OF THE ASSESSEE RECORDED BY THE INVESTIGATION WING, THE ASSESSEE ACCEPTED THE VALUE OF THE ABOVE MOVABLE PROPERTY AT RS.77,81,035/-. DURING THE COURSE OF SEARCH AND SEIZURE OPERATION, THE ASSESSEE FAILED TO EXPLAIN THE SOURCE OF INVEST MENT SUBMITTING THE PROPER EVIDENCES. HENCE, THE CLAIM OF THE ASSESSEE IS BASELESS THAT THE VALUE OF THE JEWELLERY DID NOT MADE PROPERLY I.E. O N ACTUAL WEIGHT. FURTHER I FIND THAT THE JEWELLERY WAS SEIZED ON 30. 10.2013. THE APPELLANT WAS SILENT UPTO ALMOST 2 1 / 2 YEARS. FIRSTLY HE RAISED THIS ISSUE ON 18.01.2016 WHICH SHOWS THAT THE VALUATION TAKEN BY THE VALUER IS CORRECT AND THE OBJECTION RAISED BY THE APPELLANT I S WITHOUT ANY BASIS AND BASELESS. THIS ARGUMENT TAKEN BY THE APPELLANT IS AFTER THOUGHT THEREFORE THERE IS NO ISSUE FOR AGAIN REVALUATION O F SEIZED JEWELLERY. HENCE I REJECT THE CLAIM OF THE APPELLANT FOR REVAL UATION OF SEIZED JEWELLERY SO I AM THE VIEW THAT THE AUTHORISED VALU ER RIGHTLY VALUED THE SEIZED JEWELLERY. THEREFORE THESE GROUNDS ARE N OT ALLOWED. ITA NO. 835/JP/2019 SHRI KAMAL MOHAN GUPTA VS DCIT,CIRCLE-7, JAIPUR 14 AFTER HAVING GONE THROUGH THE ORDER PASSED BY THE L D. CIT(A) AND AFTER HEARING BOTH THE LD. COUNSELS AT LENGTH, WE FOUND T HAT DURING THE COURSE OF APPELLATE PROCEEDINGS, THE LD. CIT(A) HAD SOUGHT TH E REMAND REPORT FROM THE AO IN RESPECT OF THE GROUNDS RAISED BY THE ASSE SSEE ON THE GROUND OF REVALUATION OF JEWELLERY IN QUESTION. THE SAID REMA ND REPORT WAS GIVEN TO THE ASSESSEE AND ASSESSEE ALSO HAD FILED HIS REJOI NDER WHICH IS REPRODUCED BELOW. THE COPY OF THE REMAND REPORT GIVEN TO THE A/R OF THE APPELLANT FOR REJOINDER WHICH IS AS UNDER 'THAT THE APPELLANT HAS FILED THE APPLICATION U/RUL E 46A OF I.T. RULES WITH THE REQUEST TO ASCERTAIN ACTUAL/CORRECT VALUE OF SEIZED JEWELLERY BY GETTING THE SAME REVALUED AS THE SAME IS FALLING IN THE JURISDICTION OF ASSESSING OFFICER TO UNDERTAKE THOSE ASPECTS WHICH MIGHT HAVE LEFT WHICH ARE ESSENTIAL FOR DECIDING OF THE CASE. THAT THE AP PELLANT HAS FILED DETAILED SUBMISSION WITH EVIDENCES IN THE SUPPORT O F THE GETTING THE SEIZED JEWELLERY REVALUED WITH THE ASSESSING OFFICE R VIDE SUBMISSIONS DT.30.1.2018 WITH ALIT, CIRCLE-7, JAIPUR AND IN WHI CH COMPLETE DETAILS WITH ELABORATED REASONS ARE MENTIONED FOR WANT OF R EVALUATION OF SEIZED JEWELLERY BUT DESPITE OF SUBMISSION OF ALL THOSE RE LIED UPON EVIDENCES NO OPPORTUNITY IS ALLOWED BY LD. AO IN REMAND PROCEEDI NGS ALSO AND HAS NOT ALLOWED TO GET REVALUE THE SEIZE JEWELLERY WHIC H IS ABSOLUTELY ILLEGAL AND WITHOUT PROVIDING ANY OPPORTUNITY OF BEING HEAR D AND THUS REMAND REPORT AS SENT BY LD. AO MAY PLEASE BE DECLARED AS NON-EST AND NO COGNIZANCE ON SUCH REMAND REPORT MAY PLEASE BE DRAW N. THAT THE LD. AG HAS NOT TAKEN INTO CONSIDERATION FOLLOWING FACTS WHILE PREPARING REMAND REPORT WHICH ARE ESSENTIAL AND INEVITABLE FO R DECIDING THE CASE: - THAT APPLICATIONS WHICH HAVE BEEN SUBMITTED TO PR. CCIT, CIT ON DT. 19.1.2016, 23.2.2016, 29.1.2016 BEFORE PASSING OF A SSESSMENT HAS REMAIN UNANSWERED AND NOW IN SECOND INNINGS OF FACTUAL FIN DINGS OFFACTS THESE FACTS HAVE AGAIN BEING IGNORED BY THE LD. AO. THAT BASIC OBJECT OF RULE 46A IS TO BRING THOSE FAC TS ON RECORD WHICH ARE ESSENTIAL FOR DECIDING OF THE CASE AND WHICH CO ULD NOT BROUGHT ON ITA NO. 835/JP/2019 SHRI KAMAL MOHAN GUPTA VS DCIT,CIRCLE-7, JAIPUR 15 RECORD DURING THE ASSESSMENT PROCEEDINGS. AND WHILE ISSUING THE REMAND REPORT HE HAS IGNORED ALL THOSE ASPECTS WHIC H WERE IGNORED BY HIS PREDECESSOR WHICH IS ABSOLUTELY ILLEGAL AND UNJ USTIFIED IN THE FACTS & CIRCUMSTANCES OF THE CASE. THAT THE LD. AO HAS NOT BASED HIS REMAND REPORT ON THOSE POINTS ON WHICH THE APPLICATION U/RULE 46A IS SUBMITTED THAT LD. AO IS FOCUSING IN THE REMAND REPORT ON THE SOURCE OF FUNDS USED FO R THESE SEIZED JEWELLERY RATHER THE GROUND OF REVALUATION OF SEIZE D JEWELLERY. THAT NO REASON FOR NOT ALLOWING THE REVALUATION OF SEIZED J EWELLERY IS GIVEN BY LD. AO IN REMAND PROCEEDINGS. THAT LD. AO HAS NOT PROVIDE ANY OPPORTUNITY OF BEIN G HEARD BEFORE ISSUING THE REMAND REPORT. THAT IN THE SUBMISSIONS DT. 30.1.2019 THE APPELLANT HAS CATEGORICALLY REQUESTED FOR DEPOSITIO N OF GOVERNMENT FEES FOR GETTING THE REVALUATION OF SEIZED JEWELLER Y BUT LD. AO HAS IGNORED THOSE ASPECTS WHILE ISSUING THE REMAND REPO RT, WHICH IS ABSOLUTELY ILLEGAL AND IS BREACH OF PRINCIPLE OF NA TURAL JUSTICE. THAT LD. AO DURING REMAND PROCEEDINGS HAS NOT MAKE ANY INDEPENDENT INQUIRY IN THE JEWELLERY MARKET ABOUT G OLD CONTENT IN STUDDED JEWELLERY WHEREAS THE APPELLANT HAS SUBMIT REPORT OF THE INDEPENDENT JEWELLER OF THE MARKET DURING THE ASSES SMENT PROCEEDINGS (M/S S.J. GEMS & JEWELS) AND THERE IS NO FINDING IN REMAND IS GIVEN. THUS LD. AO HAS NOT DISCHARGED HIS DUTY BY IGNORING ALL THESE FACTUAL MATERIAL ASPECTS INTO CONSIDERATION BEFORE ISSUANCE OF REMAND REPORT AND THUS IT IS HUMBLY REQUESTED THAT THIS REMAND RE PORT WHICH IS IMPROPER IN THE FACTS & CIRCUMSTANCES OF THE CASE M AY NOT PLEASE BE TAKEN INTO CONSIDERATION WHILE DECIDING THE APPEAL AND CASE MAY PLEASE BE HEARD AND DECIDED ON MERITS OF CASE. YOU ARE HUMBLY REQUESTED TO KINDLY ACKNOWLEDGE WRIT TEN SUBMISSIONS AND APPEAL MAY EVALUATION OF SEIZED JEWELLERY MAY P LEASE BE ALLOWED SO AS TO RECORD AND DUE JUSTICE MAY PLEASE BE MADE AVAILABLE TO THE PASSED BY LD. AO MAY PLEASE BE DELETED & OBLIGE.' FROM THE TOTALITY OF THE FACTS AND CIRCUMSTANCES OF THE CASE, WE FOUND THAT THE ASSESSEE HAS TAKEN A SPECIFIC STAND FROM THE VE RY BEGINNING THAT THE GOODS WHICH WERE BEING CARRIED BY THE ASSESSEE WERE OF STUDDED JEWELLERY ITA NO. 835/JP/2019 SHRI KAMAL MOHAN GUPTA VS DCIT,CIRCLE-7, JAIPUR 16 WHICH IS CONTAINING WAX OF ABOUT 60% TO 70% OF TOTA L WEIGHT WHEREAS THE VALUER HAS VALUED THE ENTIRE JEWELLERY AT THE R ATE OF PURE GOLD AND THUS IN THIS WAY ACCORDING TO THE ASSESSEE, THE AO HAS E RRED IN NOT ALLOWING TO PROVIDE OPPORTUNITY FOR REVALUATION OF SEIZED JEWEL LERY WHICH IS AGAINST THE PRINCIPLES OF NATURAL JUSTICE. FROM THE ORDER O F THE LD. CIT(A),WE NOTICED THAT THIS REQUEST OF THE ASSESSEE WAS REJE CTED ON THE GROUND THAT THE JEWELLERY WAS GOT VALUED BY THE REGISTERED VALU ER AND THE ASSESSEE HIMSELF HAD ACCEPTED BY RECORDING HIS STATEMENT ABO UT THE VALUATION OF THE JEWELLERY BEFORE THE INVESTIGATION WING. IT WAS FURTHER HELD THAT THE ASSESSEE WAS SILENT FOR ALMOST 2 YEARS AND AT A V ERY LATER STAGE RAISED THE OBJECTION OF REVALUATION OF JEWELLERY WHICH IS WITHOUT ANY BASIS AND IT IS AN AFTERTHOUGHT. HOWEVER, IT WAS SUBMITTED BY TH E LD.AR OF THE ASSESSEE THAT THE ASSESSEE WAS UNDER ACUTE MENTAL P RESSURE AND IS NOT SO LITERATE AND THE ASSESSEE WAS COMPELLED TO ACCEPT T HE VALUATION OF THE JEWELLERY. THE ASSESSEE WAS SUDDENLY CAUGHT BY THE TEAM OF DEPARTMENTAL OFFICERS AT KOLKATTA AND THUS THERE IS NO ACCEPTANC E BY FREE WILL OF THE ASSESSEE. IN THIS RESPECT, THE ASSESSEE HAD ALSO FI LED AN AFFIDAVIT DATED 18- 01-2016 WHEREIN IT WAS CATEGORICALLY SUBMITTED DURI NG THE ASSESSMENT PROCEEDING THAT VALUATION REPORT DATED 30-10-2013 W AS GOT SIGNED BY ITA NO. 835/JP/2019 SHRI KAMAL MOHAN GUPTA VS DCIT,CIRCLE-7, JAIPUR 17 HIM UNDER ACUTE MENTAL PRESSURE AND THE SAME IS NOT CORRECT VALUATION OF JEWELLERY. IT WAS SUBMITTED BY THE LD.AR THAT THE ASSESSEE WAS NOT EVEN TOLD ABOUT THE CONTENTS OF THE SAID VALUATION REPOR T AND THEREFORE, THE ASSESSEE HAD SUBMITTED THE APPLICATIONS FOR REVALUA TION OF SEIZED JEWELLERY TO PR.CIT ON 19-01-2016 AND TO PR. CCIT, JAIPUR 23-02-2016 AND 29-01-2016. HOWEVER, WITHOUT DECIDING THE SAID APPLICATIONS, THE AO IN HURRIEDLY MANNER HAD PASSED THE ORDER OF ASSESS MENT. IT WAS SUBMITTED THAT THE VALUATION OF STUDDED JEWELLERY SEIZED IS VALUED AT RS.77,81,035/- WHICH ARE MANUFACTURED FROM GOLD (999 PURITY) AND S EMI PREVIOUS STONES STUDDED THEREIN OF WHICH GROSS WEIGHT WAS COUNTED F OR 3121.86 GMS AND NET WEIGHT WAS COUNTED FOR 2141.00 GMS. BY SAID VAL UER. THE VALUE OF GOLD HAS BEEN TAKEN AT RS.2935/- PER GMS. AND RATES OF PRECIOUS & SEMI PRECIOUS STONES ARE VARYING FROM ONE TO ANOTHER VER Y MUCH. THE RATE OF POLKA (SEMI PREVIOUS STONE) IS TAKEN FROM RS.2914/- TO RS. 10,000/- PER CTS. I.E. IN ITEM NO. 1 OF VALUATION REPORT, QUANTI TY OF POLKA IS WRITTEN AS 30.00 GMS. AND VALUE IS TAKEN FOR RS. 1,80,000/-, T HUS RATE OF POLKA IS TAKEN FOR RS.6,000/- PER CTS. AND CORRESPONDINGLY A T SR. NO. 3 = QUANTITY OF POLKA IS TAKEN AT 18,000 CTS AND VALUE IS TAKEN FOR RS.1,80,000/-. THUS VALUE IS TAKEN FOR RS. 10,000/- PER CTS. WHEREAS TH E PREVAILING MARKET RATE ITA NO. 835/JP/2019 SHRI KAMAL MOHAN GUPTA VS DCIT,CIRCLE-7, JAIPUR 18 OF POLKI IS IN BETWEEN OF RS.1500/- TO RS.1700/- PE R CARAT (MAXIMUM) IN OPEN MARKET OF JAIPUR WHICH CAN VERY WELL BE ASCERT AINED AND TAKEN FROM JEWELLERS OF JAIPUR. ACCORDING TO THE LD.AR, THE FO LLOWING ARE THE PREVAILING RATES OF SEMI PRECIOUS STONES IN OPEN MA RKET AT JAIPUR:- (C) POLKI = RS.1500 - 1700 PER CARAT (D) PEARL & BEADS = RS. 20-70 PER CARAT HOWEVER, THE VALUER HAS TAKEN THE MINIMUM RATE OF R S.3,000/- PER CARAT AND ON HIGHER SIDE THE RATE HAS BEEN TAKEN AT RS.10 ,000/- PER CARAT WHICH IS ON TOO HIGHER SIDE AND SHOWS THAT ENTIRE VALUATI ON IS DONE WRONGLY. THE COPY OF FOLLOWING PURCHASE BILLS OF POLKI (CUT & PO LISHED DIAMONDS) WERE ALSO SUBMITTED TO AO AS BELOW:- NAME OF PARTY & ADDRESS BILL NO. DATE AMOUNT RATE/CARAT 0 M/S BAHUBALI DIAMONDS PVT. LTD. 3 06.07.2013 500000/- 1600/- (III) DO - 8 22.10.2013 300000/ - 1500/ - (III) M/S SANKALP DIM EXPORTS 112 28.08. 2013 300000/ - 1200/ - (IV) M/S NAMAN GEMS, SURAT 117 01. 11 . 2013 300000/ - 1500/ - ( 1 M/S KEDIA E.,,PORTS PVT. LTD., JAIPUR 50 04.11.2013 472800/- 1500/- ( V M/S BAHUBALI DIAMONDS PVT LTD SUR 01 20.11.2013 231008/ - 1600/ - THE PURCHASE RATES OF THESE BILLS ARE VARYING FROM 1200 TO 1600 PER CARAT WHICH WERE STUDDED IN THOSE JEWELLERY WHICH W ERE CAUGHT AND WRONGLY SEIZED BY I.T. DEPARTMENT, WHEREAS THE VALU ER HAS TAKEN UP THE ITA NO. 835/JP/2019 SHRI KAMAL MOHAN GUPTA VS DCIT,CIRCLE-7, JAIPUR 19 RATE OF SUCH POLKA (CUT & POLISHED DIAMONDS) VARYIN G FROM RS.6000/- TO RS. 10000/- PER CARAT. THUS IT IS VERY MUCH UNCLEAR THAT FROM WHERE THE ABOVE RATES HAVE BEEN TAKEN. THE LD.AR SUBMITTED TH AT IT IS VERY MUCH PROVED THAT VALUATION OF JEWELLERY WAS MADE UNDER P RESSURE AND LOOKING TO THE ACTUALITY OF MATERIAL USED THEREIN. AS THE A SSESSEE IS DEALER IN SUCH STUDDED JEWELLERY AND UNDERSTANDS THE VERY BAS IC OF THESE GOLD JEWELLERY. THESE STUDDED JEWELLERY ARE CONTAINING A T MAXIMUM WAX THEREIN AND WHICH IS CONTAINING IN THESE JEWELLERY ABOUT 60% TO 70% OF WEIGHT. THE STUDDED JEWELLERY IS MANUFACTURED WITH FILLING OF WAX THEREIN ONLY THEN SUCH SEMI PRECIOUS STONES ARC AFF IXED THEREIN. AS A MANUFACTURING PROCESS OF THE SAME, THE GOLD LEAF IS PREPARED AND THEN THICK WAX IS PUT THEREIN AND ON UPSIDE THE STONES A RE STUDDED THEREIN. THUS IT CONTAINS NOT MORE THAN 19-20% OF PURE GOLD (999PURITY). WHILE VALUING THE SAME THE VALUER HAS TAKEN THE ENTIRE WE IGHT AS PURE GOLD (999PURITY) WITHOUT CONSIDERING THE QUANTITY FOR WZ X & CHAPDI THEREIN. THUS IN OTHER WORDS THE VALUE OF WAX FILLE D IN JEWELLERY IS VALUED AT RATE OF PURE . THE RATE OF WAX IS ABOUT RS. 1.50 PER GMS WHICH IS EASILY AVAILABLE IN LOCAL MARKET JAIPUR AND CAN ALSO BE GO T ASCERTAINED THE DEPARTMENT WHEREAS THE RATE OF PURE GOLD TAKEN FOR VALUATION IS OF ITA NO. 835/JP/2019 SHRI KAMAL MOHAN GUPTA VS DCIT,CIRCLE-7, JAIPUR 20 RS.2,935/- PER GMS. THUS ACCORDING TO THE LD.AR, TH ERE IS DIFFERENCE OF RS. 2933.50 PER GRAM OR 29,33,500/- PER KILO GRAM. THE JEWELLERY IS CONTAINING DORI SO THAT IT BECOMES WEARABLE. DORI I S MADE OF COTTON THREAD FOILED WITH GOTA. THE WEIGHT OF DORI IS ABOUT 10% TO 15% OF TOTAL WEIGHT. THE LD.AR CONTENDED THA T THE VALUER HAS COUNTED WEIGHT OF THESE DORI IN TOTAL PURE WEIG HT OF GOLD (999 PURITY).WHILE VALUING STUDDED JEWELLERY, THE Q UANTITY OF GOLD IS MEASURED ABOUT 68% IN TOTAL WEIGHT BY VALUER WHICH IS ABSOLUTELY WRONG AND WITHOUT ANY BASIS AND BASED ON HIS WHIMS & FANCIES AND WITHOUT ANY BASIS. WHILE MANUFACTURING OF SUCH TYPE OF STUDDED JEWELLERY, WAX CHAPDI IS USED THERE SO THAT IT MAY HOLD SEMI PRECIOUS STONES I.E. PEARLS, POLKA ETC. WHILE VALUI NG ABOVE STUDDED JEWELLERY THE PERCENTAGE OF GOLD IS TAKEN ABOUT 68% OF TOTAL WEIGHT, WHEREAS IT CONTAINS NOT MORE THAN 20% OF TOTAL WEIG HT, THUS 4850% OF GOLD WEIGHT IS EXCESSIVELY TAKEN BY VALUING THE STU DDED JEWELLERY. AN EXEMPLARY CALCULATION IN SUCH STUDDED JEWELLERY THE COMPOSITION OF JEWELLERY IS GIVEN AS UNDER:- TYPICAL COMPOSITION COMPOSITION ITA NO. 835/JP/2019 SHRI KAMAL MOHAN GUPTA VS DCIT,CIRCLE-7, JAIPUR 21 OF STUDDED JEWELLERY TAKEN BY VALUER (WITH OUT BASIS) GOLD WEIGHT 17-18% 68% OTHER ALLOYES 5.6% 0% SEMI PRECIOUS STONES 18-20% 32% WAX, CHAPDI, DORI ETC. 60-65% 0% THE LD.AR OF THE ASSESSEE FURTHER SUBMITTED THAT TH US VALUATION AS TAKEN BY VALUER IS WITHOUT ANY BASIS AND IS TOTALLY MISCO NCEIVED. IT WAS FURTHER SUBMITTED THAT EVEN DURING THE COURSE OF REMAND PRO CEEDINGS THE AO HAD FOCUSED ON THE SOURCE OF FUNDS USED FOR THIS SEIZED JEWELLERY AND IGNORED THE GROUND OF REVALUATION OF SEIZED JEWELLERY. WHI LE PASSING THE ASSESSMENT OF CHANDRA PRAKASH SONI THE DECLARED VAL UE OF STOCK AS ON 31.3.2014 IS OF RS.31,58,699/- WHICH INCLUDES SE IZED STOCK OF RS.2672808/- AND SAME IS ACCEPTED BY AO AND NO ADVE RSE FINDING IS GIVEN IN THE ASSESSMENT ORDER. MEANING THEREBY, THE AO HAS ACCEPTED THE VALUE OF SEIZED STOCK AT RS.2672808/- AND FURTHER THE DIFFERENCE OF RS. 5108227/- IS ADDED ON 'PROTECTIVE BASIS' IN THE HANDS OF CHANDRA PRAKASH SONI TO MAKE IT A TOTAL OF RS.7781035/- (ALREADY SHOWN RS. 2672808/- + ADDITION ON PROTECTI VE BASIS OF RS.5108227/-). IF IT WOULD HAVE BEEN INTENTION TO T REAT ENTIRE SEIZED ITA NO. 835/JP/2019 SHRI KAMAL MOHAN GUPTA VS DCIT,CIRCLE-7, JAIPUR 22 JEWELLERY AT RS. 7781035/- AS UNDISCLOSED THEN RS. 7781035/- WOULD HAVE BEEN ADDED ON PROTECTIVE BASIS IN HANDS OF CHANDRA PRAKASH SONI AND NOT DIFFERENCE VALUE OF RS. 267280 8/-.KEEPING IN VIEW THE FACTS AND CIRCUMSTANCES OF THE CASE NARRAT ED ABOVE, WE ARE OF THE VIEW THAT ADMITTEDLY NO VALUATION OF THE SEIZED JEW ELLERY WAS CARRIED OUT IN THE PRESENCE OF SHRI CHANDRA PRAKASH SONI WHO AC CORDING TO THE ASSESSEE IS, OWNER OF THE SEIZED JEWELLERY AND THE LD. CIT(A) HAS NOT DEALT WITH THE SPECIFIC GROUNDS RAISED BY THE ASSES SEE FOR SEEKING THE REVALUATION OF THE SEIZED JEWELLERY WHICH IS CONTAI NED IN PARA 4.1 OF THE ORDER OF THE LD. CIT(A). THE AO HAD ALSO NOT MADE A NY INDEPENDENT INQUIRY IN THE JEWELLERY MARKET ABOUT THE GOLD CONT ENTS OF STUDDED JEWELLERY DURING THE REMAND PROCEEDINGS WHEREAS THE ASSESSEE HAS SUBMITTED THE REPORT OF INDEPENDENT JEWELERS OF THE MARKET DURING THE ASSESSMENT PROCEEDING. THE ASSESSEE HAD ALSO SUBMIT TED THREE APPLICATIONS, THE COPY OF WHICH IS PLACED AT PAGES 145 TO 157 OF THE PAPER BOOK, FOR SEEKING THE REVALUATION OF SEIZED JEWELLE RY. IT IS IMPORTANT TO MENTION HERE THAT APPLICATION FOR SEEKING THE REVAL UATION OF SEIZED JEWELLERY WAS NOT ONLY MOVED BY THE ASSESSEE BUT AL SO BY THE ALLEGED OWNER I.E. SHRI CHANDRA PRAKASH SONI. EVEN OTHERWIS E, IT IS THE LEGITIMATE ITA NO. 835/JP/2019 SHRI KAMAL MOHAN GUPTA VS DCIT,CIRCLE-7, JAIPUR 23 AND LEGAL RIGHT OF THE ASSESSEE OR SHRI CHANDRA PRA KASH SONI TO GET THE REVALUATION OF THE JEWELLERY IN THEIR PRESENCE AND NO PREJUDICE SHALL BE CAUSED TO THE DEPARTMENT BECAUSE SAID SEIZED JEWELL ERY IS STILL IN THE POSSESSION OF THE DEPARTMENT FROM THE DATE OF SEIZU RE WHEREAS IN THIS CASE THE SPECIFIC POINTS/GROUNDS RAISED BY THE ASSE SSEE IN PARA 4.1 AS REPRODUCED ABOVE ARE NOT ADJUDICATED UPON. HENCE, T HE RIGHTS OF THE ASSESSEE HAD BEEN PREJUDICED. THEREFORE, KEEPING I N VIEW THE INTEREST OF NATURAL JUSTICE, EQUITY AND FAIR PLAY AND WHILE TAK ING INTO CONSIDERATION THE GROUNDS AS RAISED BY THE ASSESSEE IN PARA 4.1 ( SUPRA) FOR SEEKING REVALUATION OF THE SEIZED JEWELLERY, WE ALLOW THIS GROUND OF THE ASSESSEE AND DIRECT THE DEPARTMENT TO GET THE SEIZED JEWELLE RY REVALUED BY THE REGISTERED VALUER OF THE DEPARTMENT AND ALSO TO GET THE VALUATION REPORT WHILE KEEPING IN VIEW ALL THE POINTS RAISED BY THE ASSESSEE AS MENTIONED ABOVE. HENCE, THIS ISSUE IS RESTORED BACK TO THE FI LE OF THE AO FOR AFRESH ADJUDICATION AS DIRECTED ABOVE. THUS GROUND NO. 1 O F THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. 4.1 SINCE WE HAVE RESTORED BACK THE GROUND NO. 1 TO THE FILE OF THE AO FOR AFRESH ADJUDICATION, THEREFORE, IT IS NOT IMPER ATIVE TO ADJUDICATE UPON THE GROUND NO. 2 AND 3 OF THE ASSESSEE WHICH ARE IN TERCONNECTED. ITA NO. 835/JP/2019 SHRI KAMAL MOHAN GUPTA VS DCIT,CIRCLE-7, JAIPUR 24 5.0 IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES WITH NO ORDER AS TO COST. ORDER PRONOUNCED IN THE OPEN COURT ON 23/01/2020 . SD/- SD/- FOE FLAG ;KNO LANHI XKSLKBZ (VIKRAM SINGH YADAV) (SANDEEP GOSAIN) YS[KK LNL;@ ACCOUNTANT MEMBER U;KF;D LNL;@ JUDICIAL MEMBER TK;IQJ@ JAIPUR FNUKAD@ DATED:- 23 /01/2020. *MISHRA VKNS'K DH IZFRFYFI VXZSFKR@ COPY OF THE ORDER FORWARDED TO: 1. VIHYKFKHZ@ THE APPELLANT- SHRI KAMAL MOHAN GUPTA, JAIPUR 2. IZR;FKHZ@ THE RESPONDENT-THE DCIT, CIRCLE 7, JAIPUR 3. VK;DJ VK;QDR@ CIT 4. VK;DJ VK;QDR@ CIT(A) 4. FOHKKXH; IZFRFUF/K] VK;DJ VIHYH; VF/KDJ.K] T;IQJ@ DR, ITAT, JAIPUR . 5. XKMZ QKBZY@ GUARD FILE {ITA NO. 835/JP/2019} VKNS'KKUQLKJ@ BY ORDER, LGK;D IATHDKJ@ ASSTT. REGISTRAR