Commissioner Of Income-Tax-Ii, Amritsar v. Sh. Tejinder Singh Huf

Income-tax Appeal No.174of 2009 **** IN THE HIGH COURT OF PUNJAB AND HARYANA ATCHANDIGARH Income-tax Appeal No.174of 2009(O&M) Date of decision: 8.2.2011 Commissioner of Income-Tax-II, Amritsar ...Appellant Versus Sh. Tejinder Singh HUF ...Respondent CORAM: HON'BLE MR.JUSTICE ADARSH KUMAR GOEL HON'BLE MR.JUSTICE AJAY KUMAR MITTAL Present: Mr. G.C.Srivastava, Senior Standing Counsel with Mr. Sukant Gupta, Advocate for the appellant. Mr. Sukant Gupta, Advocate for the appellant. Ms. Radhika Suri, Advocate for the respondent. **** ADARSH KUMAR GOEL, J (Oral). 1.This appeal has been preferred by the revenue underSection 260A of the Income Tax Act, 1961 (for short “the Act)against the order dated 25.7.2008 of the Income Tax AppellateTribunal, Special Bench, Delhi in I.T.A. No.163/ASR/2003 for theassessment year 1998-99 proposing to raise following substantialquestions of law:- i)Whether on the facts and in the circumstances ofthe case, the order of the Special Bench of ITAT,New Delhi is ex-facie perverse in that it ignores allthe evidences and facts brought on recorddemonstrating the Hawala nature of the impugnedthe case, the order of the Special Bench of ITAT,New Delhi is ex-facie perverse in that it ignores allthe evidences and facts brought on recorddemonstrating the Hawala nature of the impugned ii) iii) iv) **** transactions, while holding that these evidenceswere not sufficient to doubt the bona-fides of thesaid transactions? Whether on the facts and in the circumstances ofthe case, the order of the Special Bench of ITAT,New Delhi has erred in deciding the case of therespondent on the basis of the factual findings inthe case of M/s Bemco Jewellers P. Ltd./ManojAggarwal whereas they were entirely different? Whether the Special Bench of ITAT, New Delhihas erred in holding that M/s Bishan Chand MukeshKumar was a genuine trader of jewellery becausefacts of this firm were similar to the case of M/sBemco Jewellers/Manoj Aggarwal, even though Sh.Manoj Aggarwal was found to be a Hawala Operatorby the Special Bench, ITAT, Delhi? Whether the Special Bench of ITAT, New Delhi hascommitted an ex-facie perversity in holding that nouseful purpose will be fulfilled in allowing the AO toexamine the additional evidence in the form ofmaterial collected during the course of assessmentproceedings of M/s Bishan Chand Mukesh Kumar,even while the Special Bench of ITAT, New Delhihad held that “....and the issue about the genuineness of thetransactions of purchase and sale of jewellery by **** M/s Bishan Chand Mukesh Kumar including thepurchase of jewellery from the assessee has notbeen considered and decided by us on merits.” v) Whether the Special Bench of ITAT, New Delhi haserred in relying upon the sales tax assessmentorders filed at pages No.138 & 139 of theAppellant's Paper Book without giving anopportunity to the AO to verify the same withoutgiving any reasons for the same rendering the orderperverse and non-speaking? vi)Whether on the facts and in the circumstances ofthe case, the Special Bench of ITAT, New Delhiwas right in ignoring the glaring errors and gapingholes pointed out by appellant Revenue Dept. inthe evidence led by the assessee in cases such aswhen the jewellery was valued at Delhi as perbusiness practices of M/s Bishan Chand MukeshKumar, then how was it possible that cheque ofexact amount was issued at Amritsar at the time ofpurchase of jewellery. This argument is notdisposed of in the final order issue, thus rendering itnon-speaking and perverse? vii)Whether on the facts and in the circumstances ofthe case, the Special Bench of ITAT, New Delhi wasjustified in accepting the genuineness of thejewellery transactions of the respondent, when the **** vi)Whether on the facts and in the circumstances ofthe case, the Special Bench of ITAT, New Delhiwas right in ignoring the glaring errors and gapingholes pointed out by appellant Revenue Dept. inthe evidence led by the assessee in cases such aswhen the jewellery was valued at Delhi as perbusiness practices of M/s Bishan Chand MukeshKumar, then how was it possible that cheque ofexact amount was issued at Amritsar at the time ofpurchase of jewellery. This argument is notdisposed of in the final order issue, thus rendering itnon-speaking and perverse? vii)Whether on the facts and in the circumstances ofthe case, the Special Bench of ITAT, New Delhi wasjustified in accepting the genuineness of thejewellery transactions of the respondent, when the **** respondent's conduct conflicted with the test of'Normal human conduct' principle laid down by theHon'ble Supreme Court in the case of Durga PrasadMore 82 ITR 540 and Sumati Dayal 214 ITR 801? viii)Whether the Special Bench of ITAT, New Delhi hascommitted a gross perversity in sweepingly ignoringall the facts and evidences of the appellantRevenue Dept. whilst accepting every far-fetchedargument of the respondent? ix) Whether the ld. ITAT grossly erred in law byapplying two different yardsticks and standards byrequiring the appellant Revenue Dept. to pass testof cross examination of all witnesses and at thesame time being satisfied by all the respondent'saverments at face value, thus forcing the revenue toprove its case beyond all reasonable doubt? x)Whether the ld. Special Bench of ITAT, New Delhiwas justified in giving no finding regarding thegenuineness of sale of the jewellery by therespondent to M/s Bishan Chand Mukesh Kumar? 2. The assessee is HUF engaged in the business of fabrics. In its return for the assessment year in question, the assesseeclaimed long term capital loss on account of sale of jewellery. Thesaid jewellery was disclosed under Voluntary Disclosure of IncomeScheme, 1997 (for short “VDIS”) valued at ` 7,88,131/- as on 1.4.1987. Indexed cost was higher than the price at which the samewas claimed to be sold on 2.2.1998 and 18.2.1998. The assessingofficer doubted the genuineness of the transactions and held the saleproceeds to be unaccounted funds of the assessee. The CIT(A)upheld the additions. On further appeal, the Tribunal reversed theview taken by the assessing officer and the CIT(A) mainly on theground that in the decision rendered in the case of M/sBemco/Manoj Aggarwal Jewellers (“Bemco”) which was heldapplicable to M/s Bishan Chand Mukesh Kumar (“BCMK”) to whomthe jewellery was sold by the assessee, additions were set aside.Finding recorded on the issue by the assessing officer, the CIT(A)and the Tribunal are as under:- Finding recorded by the asessing officer “This office frames its inference on the basis of materialon record and comes to the conclusion that the allegedsale of jewellery is bogus and is infact the introduction ofthe unaccounted money of the assessee through the garbof sale of jewellery disclosed by the assessee underVDIS. The conclusion is based on the following factors:- a)The assessee has submitted that the jewellerywas very old and had sentimental value.However, the same has been immediatelysold after the date of receipt of VDIScertificate from the office of worthy CIT,Amritsar.was very old and had sentimental value.However, the same has been immediatelysold after the date of receipt of VDIScertificate from the office of worthy CIT,Amritsar. b)The assessee submits that M/s Bishan Chand **** Mukesh Kumar jeweller was introduced tohim through his relatives at Delhi. However,he was unable to identify the relatives. a)The assessee has submitted that the jewellerywas very old and had sentimental value.However, the same has been immediatelysold after the date of receipt of VDIScertificate from the office of worthy CIT,Amritsar.was very old and had sentimental value.However, the same has been immediatelysold after the date of receipt of VDIScertificate from the office of worthy CIT,Amritsar. b)The assessee submits that M/s Bishan Chand **** Mukesh Kumar jeweller was introduced tohim through his relatives at Delhi. However,he was unable to identify the relatives. c)The assessee has further submitted that therepresentative of the jeweller came to Amritsarto take delivery of the jewellery worth approx.14 lakh without any receipt or withoutreceiving the payment for the same is also notbelievable. d)Confirmation has been received by this officewhile the party is not traceable at the addressas given by the assessee. It is then strangeas to why the letters sent by this office werenot received back. In case they were dulyreceived and replied, then why were they nottraceable on enquiry of Inspector of DDIoffice. Also non-cooperation of the jewellerwith the office to whom commission wasissued by this office also gives credence tothe conclusion being drawn by this office. e) The jewellery sold inter-alia includes diamondjewellery sold worth Rs.367868/- whose valueas on 1.4.87 had been shown at Rs.77170/-.Thus, the increase has been shown at 4.77times. However, as per the date of the Gemand jewellery export promotion council this **** increase in rates of diamond jewellery has notbeen so sharp. Thus considering all the above factors, itis clear that the sale of jewellery as disclosedby the assessee is bogus and has been usedonly to introduce his own unaccounted incomeinto the regular books. Thus, the assesseehas not explained to the satisfaction of theoffice the introduction of credit ofRs.1680475/- in his regular books and is thusadded to the income of the assessee u/s 68 ofthe Income-tax Act. Accordingly, the loss ofRs.182891/- as claimed by the assessee isalso disallowed and the capital gain on sale ofMEP units at Rs.1227/- is separately broughtto tax.” Finding recorded by the CIT(A) “7.1I have considered the appellant's contentions in thebackground of facts on appellate record and the reasonsgiven by the assessing officer in the assessment orderand his remand report, as mentioned above. The issue tobe decided here is as to on whom the onus lies to provethe genuineness of sales and whether the party on whomthe onus lies has been able to discharge such onus in acomplete manner so that it can be said that the onus hasshifted on the other side to disprove the same. In the **** present case, the appellant's counsel has filedconfirmation of sales purportedly from M/s Bishan ChandMukesh Kumar, Saraf, Delhi which bears date much priorto the calling of information by the A.O. in this case. Thisraises serious doubts about the genuineness ofconfirmation because in the normal circumstancesconfirmation is sought from the party only when it isrequired by the other party during the course ofassessment or other proceedings. In the present case, itappears that this confirmation was obtained by theappellant much before the date of query raised by theAssessing officer which indicates a prior planning andpre-mediated approach. This raises serious doubts aboutthe genuineness of the confirmation filed and in myopinion, this confirmation could not be said to be sufficientto discharge the onus of proving the sale of jewellery inthe context of the following facts:- i)Though the appellant claimed jewellery to bevery old and having sentimental value, theappellant had promptly sold this very jewelleryimmediately after the date of receipt of VDIScertificate.very old and having sentimental value, theappellant had promptly sold this very jewelleryimmediately after the date of receipt of VDIScertificate. ii)Jewellery was sold to unknown party of Delhii.e. M/s Bishan Chand Mukesh Kumar claimedto have been introduced through a relative ofthe appellant to whom the appellant was noti.e. M/s Bishan Chand Mukesh Kumar claimedto have been introduced through a relative ofthe appellant to whom the appellant was not iii) iv) v) vi) **** able to identify. The appellant handed over jewellery worthRs.14 lacs to this unknown jeweller of Delhiwithout any receipt of without receiving anypayment on the delivery of the jewellery. Although confirmation has been received bythe AO, but the party is not traceable at theaddress given on the confirmation. All the letters sent by the AO throughregistered post/speed post have not beenreceived back undelivered. The said party i.e. M/s Bishan Chand MukeshKumar, Delhi is stated to be not traceable asper the report of the inspector, referred toabove. Hence, it is clear that the onus which lies onthe appellant to prove genuineness of sale ofjewellery cannot be said to have beendischarged. Report of the Inspector of theInvestigation Wing, Delhi dated 16.1.2002alongwith letter of the ADIT (Investigation)Unit-I (2), Delhi are reproduced hereunder forready reference:- “--Per letter No. Addl.DIT(Inv)UI/200102/1081dt. 22.1.2002 sent by Sh. K.L.Anand, ADIT-(Inv.) UnitI(2), New Delhi to Sh. B>B>Vig, **** ITO, Ward IV(4), Amritsar. “2. After receipt of your letter, anothersummons u/s 131 was issued to the party,namely M/s Bishan Chand Mukesh Kumar andthe same could not be served at the givenaddress. Copy of Inspector's report in thisregard is enclosed. It is also brought to yournotice that action u/s 132(1) was carried outby the Investigation Unit-I this Directorate on3.8.2000 in the case of Shri Manoj Kumar andothers. One of the associates covered u/s132(1) was the same M/s Bishan ChandMukesh Kumar. This group has since beencentralized with Shri Ram Mohan Singh,CDIT, Central Circle-3, Mayur Bhawan (RoomNO.724, Connaught Circus, New Delhi. 3.I am directed to request you to please contactShri Ram Mohan Singh, DCIT holding jurisdictionM/s Bishan Chand Mukesh Kumar for conductingnecessary enquiries in the case” -Per Inspector Sh.Praduman Singh, ITI, UnitI, NewDelhi's report in trhe case of M/s Bishan ChandMukesh Kumar dated 16.1.2002. “As directed, I visited the premisesNo.1166/202, Kucha Mahajani, Chandni Chowk,Delhi on 14.1.2002 to serve the summon on the **** above said party. The premises is on the 2[nd] floorand there is no sign board of M/s Bishan ChandMukesh Kumar at this premises. Local enquirymade revealed that this party is not functioning fromthis place. Efforts are being made to locate thepresent address of the party.” The report received from the DDIT(Investigation)dated 25.10.2002 throws further light on theauthenticity of the confirmation letters filed in thiscase. Contents of the letter dated 25.10.2002 isreproduced hereunder for ready reference:- -Per letter No.DSDIT(Inv.) UII(2)/2002/2003/21dated 25.10.2002 sent to this office by Shri--S.S.Jain, Dy.Director of Incometax (Inv.), UnitII(4),New Delhi. “Kindly refer to your letter No.205/02-03-671dated 23 August, 2002 on the subject noted above.After going through the appraisal report the requiredinformation is submitted as under:- As per the information it was found that Sh.Manoj Aggarwal and others had been in thebusiness of selling bogus accommodation bookentries of various types for consideration ofcommission and that he had no real business. Hehad been operating from different premises in Delhi. -Per letter No.DSDIT(Inv.) UII(2)/2002/2003/21dated 25.10.2002 sent to this office by Shri--S.S.Jain, Dy.Director of Incometax (Inv.), UnitII(4),New Delhi. “Kindly refer to your letter No.205/02-03-671dated 23 August, 2002 on the subject noted above.After going through the appraisal report the requiredinformation is submitted as under:- As per the information it was found that Sh.Manoj Aggarwal and others had been in thebusiness of selling bogus accommodation bookentries of various types for consideration ofcommission and that he had no real business. Hehad been operating from different premises in Delhi. AS a consequence of information, search was **** conducted u/s 132 of Income tax Act, 1961 on3.8.2000 at the office premises and at theresidential premises of Sh. Manoj Aggarwal, as wellas at the premises of one of the mediators Sh.Kamlesh Kumar Gupta, and one of the beneficiariesSh. Girish Mittal. Survey operations u/s. 133A ofthe Income-tax Act, 1961 were also carried out on3.8.2000 at B-19, Swasathya Vihar, Delhi i.e. thepremises of Sh. Manoj Aggarwal. It revealed that he had various bank accountsin different banks which had been opened andoperated by him and his associates to facilitate hisbusiness of selling bogus accommodation bookentries. As per page No.4-7 of the Appraisal Reportthere are 51 bank account in different namesincluding the names of Bishan Chand MukeshKumar as given below. Majority of these accountshave been used in his widespread operations of providing bogs accommodation book entries:- S. Name & Address A/c Name & Address A/c Nos. Holder/operated by of bank No. Holder/operated by of bank No. 4. Bishan Chand Mukesh Kumar Mukesh Kumar Vijaya 1001 1166/202, Kucha Bank Mahajani, Chandani chowk Vigyan Vihar The case was centralized with Central Circle-III in the charge of CIT, Central-II, New Delhi and theseized record along with the appraisal report wassent to the Assessing Officer, Central Circle III on17.9.2001. In view of the above, any furtherinformation in this regard may kindly be asked for **** the Assessing Officer who was suggested toascertain the volume and nature of transactions inthe above said bank accounts before arriving at thecorrect income of the assessee”. Perusal of the said letter shows that the partners ofthe concern M/s Bishan Chand Mukesh Kumar areknown to he involved in the business of sellingbogus accommodation book entries of various typesfor consideration of commission and they had noreal business. On the basis of such information,search has been conducted u/s. 132 at the officepremises and residential premises of the partners ofthe concern, M/s Bishan Chand Mukesh Kumar.Investigation Wing has been able to identify variousbank accounts in different banks which have beenopened and operated by the partners and itsassociates to validate the selling of bogusaccommodation book entries. These bank accountshave been identified and further investigations arein progress. In spite of various enquiry lettersissued by the investigation Wing, the party M/sBishan Chand Mukesh Kumar has failed to appearand confirm the purchases made from the appellant.Considering the totality of facts and circumstancesof this case including the various reports, referred toabove, I am of the opinion that firstly confirmation **** **** letter filed by the appellant or received subsequentlyby the AO cannot be said to be sufficient todischarge the onus which lies on the appellantparticularly in the context of the fact that the partywhose confirmation is sought to be relied upon bythe appellant is known to be indulging in providingbogus accommodation book entries for aconsideration. Further the said party M/s BishanChand Mukesh Kumar, Delhi has failed to appear orproduce evidence in respect of jewellery claimed tohave been purchased by them from the appellanteven after a lapse of 2 years including the period oftime during the asstt. Proceedings as well asappellate and remand proceedings. Further, even ifthe said party, M/s Bishan Chand Mukesh Kumar isproved to be existing on the address given, but thatis not sufficient to completely discharge the onus ofproving the alleged sale of jewellery andgenuineness of the transaction because nexusbetween sale of jewellery claimed to have been soldby the appellant and the transaction with M/s BishanChand Mukesh Kumar does not seemto have beenproved. In view of the above, the appellant'scontentions in this regard are rejected and it isheld that the AO was justified in making addition ofRs.16,80,475/- on account of bogus sale of **** jewellery and also in rejecting the loss claimed bythe appellant at Rs.1,82,891/-.” Finding recorded by the Tribunal “166. After hearing the arguments of learnedrepresentatives of all the sides in these cases, we felt thatit would be appropriate to consider and decide theappeals filed in the case of M/s Bishan Chand MukeshKumar and Shri Manoj Aggarwal/Bemco Jewellers first asthe issue relating to genuineness of the transactions ofpurchase and sale of jewellery in the said cases havebeen investigated in detail and the decision thereon willhave a direct bearing on the ultimate fate of the case ofthe assessee i.e.Tejinder Singh, HUF. Accordingly, theappeals filed in the case of M/s Bishan ChandMukeshKumar have already been disposed of by us in theforegoing portion of this order wherein the assessmentmade under section 158BC read with section 158BD hasbeen held to be bad in law on the grounds and for thereasons set out thereon. Consequently, the saidassessment made in the case of M/s Bishan ChandMukesh Kumar has been quashed by us holding thesame to be invalid and keeping in view this decision onthe preliminary legal issues, we have refrained ourselvesfrom considering and deciding the other issues involved inthe said case on merits including the issue relating togenuineness of the transactions of purchase and sale of **** **** jewellery. Assuming the possibility of such an eventualityand keeping in view that the material collected during thecourse of assessment proceedings in the case of M/sBishan Chand Mukesh Kumar , which has already beenfiled and admitted as additional evidence in the case ofTejinder Singh, HUF, can still be utilized, Shri S.D.Kapilahas urged that the case of Shri Tejinder Singh should berestored to the file of the Assessing Officer to considerand decide the same afresh in the light of the saidadditional evidence. He has submitted that this will alsofacilitate in giving an opportunity to the assessee tocross-examine the deponents whose statements havebeen sought to be relied upon by the department and alsoto rely upon the letters/affidavits of the said deponentswhich have been filed by him and admitted by theTribunal as additional evidence. He has contended thatthis will enable the assessing officer to reach a properconclusion after taking into consideration this entireevidence which has been gathered after the completion ofassessment in the case of Tejinder Singh, HUF and whichis relevant to decide the issues involved in the said case.Although this plea of Shri S.D. Kapila sounds to be logicaland legally tenable, we find it difficult to accept the samein view of our decision rendered in the cases of ShriManoj Aggarwal and Bemco in the foregoing portion ofthis order. It is no doubt true that jewellery by Tejinder **** Singh, HUF was sold to M/s Bishan Chand MukeshKumar and the issue about the genuineness of thetransactions of purchase and sale of jewellery by M/sBishan Chand Mukesh Kumar including the purchase ofjewellery from the assessee has not been considered anddecided by us on merits. However, a similar issueinvolved in the case of Bemco/Manoj Aggarwal has beenconsidered and decided by us on merits. In the saidcases, the facts involved were almost similar to the factsinvolved in the case of M/s Bishan Chand Mukesh Kumarinasmuch as the transactions relating to purchase andsale of jewellery were held to be bogus by thedepartment alleging that such transactions were enteredinto in order to give accommodation entries oncommission basis. This allegation was based on thesimilar type and nature of evidence collected by thedepartment and the modus operandi allegedly followed byBemco/Manoj Aggarwal was the same as alleged to befollowed by M/s Bishan Chand Mukesh Kumar whilegiving accommodation entries in the form of bogus salesentries of jewellery. The case sought to be made out bythe department about the alleged bogus purchase andsale of jewellery transactions on the basis of similarnature of evidence has been examined by us in detail andon such examination, we have held that the evidencecollected by the revenue authorities was not sufficient to **** **** establish their stand that the jewellery transactionscarried on by Bemco Jewellers Pvt. Ltd. were only papertransactions or bogus and the same were put through byaccommodation entries in order to earn commissionincome therefrom. We have found it difficult to reject theassessee's plea about the genuineness of the jewellerytransactions as opposed to the normal course of humanconduct even applying the principles laid down by theHon'ble Supreme Court in the cases of Durga PrasadMore (supra) and Sumati Dayal (supra). We have alsofound that the circumstances surrounding the case werenot strong enough to hold the claim of the assesseeabout genuineness of the jewellery transactions as totallyunbelievable or outrageous. We have also found that noevidence of any consequence was unearthed during thecourse of search to directly show that the jewellerybusiness was bogus and that it was only accommodationentry business. On the other hand, the evidence broughton record by the assessee especially the evidence in theform of sales tax assessment order wherein thetransactions of purchase and sale of jewellery wereaccepted by the sales-tax authorities was found to bereliable bus us to support the case of the assessee thatthe relevant transactions of purchase and sale ofjewellery were genuine. As the issue involved in the caseof Bemco/Manoj Aggarwal as well as all the material facts **** relevant thereto including the evidence brought on recordare similar to the case of M/s Bishan Chand MukeshKumar, we are of the view that the decision rendered inthe case of Bemco/Manoj Kumar on the said issue isapplicable even in the case of M/s Bishan Chand MukeshKumar with equal force and this being so, no meaningfulpurpose will be served by sending the matter back to theAssessing Officer for reconsideration and re-decisionmerely because the issue has not been decided on meritsin the case of M/s Bishan Chand Mukesh Kumar. In ouropinion, this exercise would prove to be merely academicand it would result only in multiplicity of litigation. In thatview of the matter and keeping in view the reasons givenabove, we do not find any justifiable reason to send thismatter to the Assessing Officer for reconsideration assought by Shri Kapila and following our conclusion drawnin the case of Bemco/Manoj Aggarwal, we hold thetransaction relating to sale of jewellery in the case of thepresent assessee, i.e. Tejinder Singh HUF is genuine.Accordingly, we delete the addition made by theAssessing Officer and confirmed by the CIT(Appeals)under section 68 and allow this appeal of the assessee.”3.We have heard learned counsel for the parties. 4.Learned counsel for the revenue submits that theTribunal erred in reversing the finding recorded by the assessingofficer and the CIT(A) solely on the basis that since in the case of **** 4.Learned counsel for the revenue submits that theTribunal erred in reversing the finding recorded by the assessingofficer and the CIT(A) solely on the basis that since in the case of **** BCMK transactions of jewellery were held to be genuine, the case ofthe assessee was not required to be gone into on merits. It wassubmitted that case of the assessee was required to be individuallygone into to ascertain genuineness of the claim of the assessee forcapital loss. Even if Bemco or even BCMK to whom the jewellery issaid to have been sold by the assessee was not liable to be taxed inrespect of said transactions, the case of the assessee had to beexamined to determine whether sale by the assessee was genuine.Finding in the case of Bemco could not be mechanically applied toBCMK and on that basis to the assessee. The issue of genuinenessof the transaction of sale by the assessee and correctness of thefinding recorded by the assessing officer and the CIT(A) wererequired to be gone into by the Tribunal before setting aside theaddition. Reasons given by the assessing officer and CIT(A) arerequired to be dealt with. The documents produced for the first timesuch as sales tax assessment order in the case of BCMK, requiredthe matter being remanded to consider the circumstances such aswhether the jewellery allegedly sold was not the same as had beendeclared under the VDIS, as held by the CIT(A). 5.Learned counsel for the assessee fairly stated that thefinding that order in the case of Bemco could be automaticallyapplied to the BCMK and to the assessee without considering themerits of the case of the assessee could not be justified. She,however, submitted that the assessee has furnished sufficientexplanation in support of genuineness of its claim, as noticed in theimpugned order. She also relied upon the judgment of Hon'ble **** Supreme Court in Commissioner of Income-Tax, Orissa Vs.Orissa Corporation P. Ltd.[1986] 159 ITR 78 to contend that itwas for the revenue to examine source of income of the creditor/purchaser of the jewellery, in absence of which addition in the handsof the assessee could not be made. Once the assessee dischargedthe onus, addition under Section 68 was not justified. 6.We are satisfied that the finding recorded by the Tribunalthat addition under Section 68 in respect of alleged bogus sale ofjewellery was not justified is perverse. The Tribunal has notconsidered the merits of the genuineness of the transaction of saleby the assessee. In the light of finding recorded by the assessingofficer and the CIT(A), it was expected that the Tribunal should havegone into the question of identity of the jewellery declared under theVDIS and jewellery sold in the transaction in question. It wasnecessary to go into the question whether the assessee had notreceived any bogus accommodation book entries as inferred in theorder of assessing officer and CIT(A). In absence thereof, theimpugned finding cannot be sustained. In this view of the matter, itis not necessary to go into the submission made on behalf of theassessee that there was sufficient explanation as this is an issuewhich is yet to be gone into by the Tribunal which is a final factfinding authority. 7.Accordingly, we hold that the order of the Tribunal isperverse to the extent indicated above. The questions raised standanswered accordingly. The impugned order of the Tribunal is set **** aside and the matter is remanded to it for fresh decision on merits inaccordance with law. It is made clear that the parties will be at libertyto raise such contentions as may be relevant and necessaryincluding the contention of applicability of Section 68. The partiesmay appear before the Tribunal for further proceedings on 4.4.2011. 8.The appeal is disposed of accordingly. (Adarsh Kumar Goel) Judge February 08, 2011Pka (Ajay Kumar Mittal) Judge