Ita/183/2010 Of K.p.beeran v. The Asst Commissioner Of Income Tax

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT: THE HONOURABLE MR.JUSTICE C.N.RAMACHANDRAN NAIR & THE HONOURABLE MR.JUSTICE K.VINOD CHANDRAN THURSDAY, THE 17TH DAY OF NOVEMBER 2011/26TH KARTHIKA 1933 ITA.No. 183 of 2010 ======= APPELLANT/APPELLANT/RESPONDENT IN ITA ======================================== 1 K.P.BEERAN, PROPRIETOR RIYAZ JEWELLERY WORKS KAMATH LANE PALAYAM CALICUT. BY ADV.DR.K.B.MUHAMED KUTTY (SR.) SRI.K.M.FIROZ SMT.M.SHAJNA RESPONDENT /APPELLANT IN ITA ============================== 1 THE ASSISTANT COMMISSIONER OF INCOME TAX CENTRAL CIRCLE CALICUT. BY ADV. SRI.P.K.R.MENON,SR.COUNSEL, GOI(TAXES) SRI.JOSE JOSEPH, SC, FOR INCOME TAX THIS INCOME TAX APPEAL HAVING COME UP FOR ADMISSION ON 17-11-2011 , ALONG WITH ITA. 223/2010, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: APPENDIX APPELLANT'S ANNEXURES: ANNEXURE A: TRUE COPY OF ASSESSMENT ORDER DATED 30.9.2002 ANNEXURE B: TRUE COPY OF THE GROUNDS OF APPEAL BEFORE THE FIRSTAPPELLATE AUTHORITYAPPELLATE AUTHORITY ANNEXURE C: TRUE COPY OF THE APPEAL ORDER DATED 8.10.2004ANNEXURE D: TRUE COPY OF THE MODIFIED ORDER GIVING EFFECT TO : TRUE COPY OF THE MODIFIED ORDER GIVING EFFECT TOTHE FIRST APPEAL ORDERTHE FIRST APPEAL ORDER ANNEXURE E : TRUE COPY OF THE GROUNDS OF APPEAL FILED BY THEAPPELLANT BEFORE THE APPELLATE TRIBUNALAPPELLANT BEFORE THE APPELLATE TRIBUNAL ANNEXURE F : TRUE COY OF THE PETITION FOR ADDITIONAL GROUNDFILED BY THE APPELLANTFILED BY THE APPELLANT ANNEXURE G : TRUE COPY OF THE PETITION FOR ADDITIONAL GROUNDFILED BY THE APPELLANTFILED BY THE APPELLANT ANNEXURE H : TRUE COPY OF THE APPELLATE TRIBUNAL ORDER(COMMONORDER) DATED 18.9.2009ORDER) DATED 18.9.2009 RESPONDENTS' ANNEXURES: NIL //TRUE COPY// P.A. TO JUDGE C.N. RAMACHANDRAN NAIR, &K. VINOD CHANDRAN, JJ ---------------------------------------------------- I T A Nos.183 & 223 of 2010----------------------------------------------------Dated this the 17[th] day of November, 2011 J U D G M E N T , J C.N. Ramachandran Nair Heard the learned senior counsel Dr. K.B. MohamedKutty appearing for the appellant and learned StandingCounsel for the respondent. 2. Both the appeals arise from block assessmentcompleted after search on the appellant/assessee who was adealer in Gold ornaments. During search conducted by thedepartment, unaccounted gold was recovered and theassessee was required to explain the source. Even though,assessee tried to explain stating that 27 goldsmiths workingfor him gave gold as security, in the course of enquiry andevidence, assessee could not establish it with evidence. Hisexplanation was that the seized gold belongs to goldsmiths.Even though, goldsmiths were examined they did not give anyconvincing evidence to establish assessee's case. Further,confirmation letters issued by the goldsmiths were stereotyped bearing same date. Receipts issued accepting thegold deposits were found to be too stereotyped forms withoutitemized details, but only the weight of gold. The lettersissued by the goldsmiths were also found to be not genuine,because all the letters demanding return of gold were retainedin the same stereotyped form with same date on the letters.The appellant was granted substantial relief in CIT(Appeal)against which assessee as well as the department filed appealsbefore the Tribunal. The Tribunal dismissed the said appeals,but, remanded the Revenues Appeal for the reason that CIT(Appeal) has not considered the assessment order on the basisof the materials on which the assessment is made. stereotyped bearing same date. Receipts issued accepting thegold deposits were found to be too stereotyped forms withoutitemized details, but only the weight of gold. The lettersissued by the goldsmiths were also found to be not genuine,because all the letters demanding return of gold were retainedin the same stereotyped form with same date on the letters.The appellant was granted substantial relief in CIT(Appeal)against which assessee as well as the department filed appealsbefore the Tribunal. The Tribunal dismissed the said appeals,but, remanded the Revenues Appeal for the reason that CIT(Appeal) has not considered the assessment order on the basisof the materials on which the assessment is made. 3. So far as the appeal filed against the order of remandis concerned, we feel that what the Tribunal stated is that theCIT (Appeal) has not considered the findings in theassessment order on the basis of the materials relied on withreference to Section 69B of the Act. So much so, we do notfind any grievance for the assessees because assessee getsopportunity before the CIT (Appeal) in fresh proceedings tosubstantiate his case. We therefore, dismiss this appeal. 4. So far as the appeal filed against the order of theTribunal dismissing the assessee's appeal is concerned, what ITA 183 & 223 of 2010 we notice is that the Tribunal reconfirmed the findings onadditions based on evidence recovered in the course of search.This is a case where assessment is only based on recovery ofGold. Admittedly, the assessee had to explain the sourcefailing which the value of gold is to be assessed asunaccounted income. Assessee's attempt to prove the sourceof the gold seized through the 27 goldsmiths miserably failedbefore the 3 authorities, namely the Assessment Officer, thefirst appellate authority as well as the Tribunal. We do notfind any reason to interfere with the findings of the Tribunalon the additions made based on recovery of gold, the sourceof which could not be explained by the assessee. In view of the findings above, we dismiss both theappeals leaving it open to the assessee to pursue theremanded case before the first appellate authority. Sd/-C.N. RAMACHANDRAN NAIR(Judge) Sd/- K. VINOD CHANDRAN (Judge) jma //true copy// P.A to Judge