Ita/35/2016 Of Inis Varghese Maliekkal v. Commissioner Of Income Tax, Kochi

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT: THE HONOURABLE MR.JUSTICE THOTTATHIL B.RADHAKRISHNAN & THE HONOURABLE MR. JUSTICE DEVAN RAMACHANDRAN THURSDAY, THE 3RD DAY OF NOVEMBER 2016/12TH KARTHIKA, 1938 ITA.No. 35 of 2016 ---------------------- AGAINST THE ORDER IN ITA 783/Coch/2013 of I.T.A.TRIBUNAL,COCHIN BENCH DATED 06-02-2015 APPELLANT/RESPONDENT-ASSESSEE: -------------------------------- INIS VARGHESE MALIEKKAL IX/467, MALIEKKAL HOUSE, MISSION QUARTERS, THRISSUR-680 001. BY ADV. SRI.S.ARUN RAJ RESPONDENT/APPELLANT-REVENUE: -------------------------------- COMMISSIONER OF INCOME TAX, I.S.PRESS ROAD, KOCHI-682018. BY ADV. SRI.P.K.R.MENON,SR.STANDING COUNSEL, GOI(TAXES) BY ADV. SRI.JOSE JOSEPH, SC, FOR INCOME TAX BY SRI.K.M.V.PANDALAI, INCOME TAX DEPARTMENT THIS INCOME TAX APPEAL HAVING BEEN FINALLY HEARD ON 03-11-2016,THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: ITA.No. 35 of 2016 APPENDIX APPELLANT'S ANNEXURES: ANNEXURE A : TRUE COPY OF THE ASSESSMENT ORDER DATED 8.12.2011 PASSEDBY THE ASST. COMMISSIONER OF INCOME TAX, CIRCLE 2(1) THRISSUR FOR THEAY 2009-10 U/S 143(3) OF THE ACT. ANNEXURE B : TRUE COPY OF ASSESSMENT ORDER DATED 31.12.2009 PASSED BYITO, WARD 2(2), THRISSUR FOR THE AY 2007-08. ANNEXURE C : TRUE COPY OF THE LETTER DATED 25.2.2009 SUBMITTED BYTHE APPELLANT TO THE ADDL. COMMISSIONER OF INCOME TAX, THRISSUR. ANNEXURE D : TRUE COPY OF THE FIRST APPELLATE ORDER DATED 24.9.13PASSED BY THE COMMISSIONER OF INCOME TAX (APPEALS)-V, KOCHI. ANNEXURE E : TRUE COPY OF THE ORDER DATED 6.2.2015 PASSED BY THEINCOME TAX APPELLLATE TRIBUNAL COCHIN BENCH, COCHIN, FOR THE AY 2009-10. RESPONDENT'S ANNEXURES: NIL ami/ //TRUE COPY// P.A.TO JUDGE THOTTATHIL B.RADHAKRISHNAN & DEVAN RAMACHANDRAN, JJ. ----------------------------------------------- I.T.A.No.35 of 2016 ----------------------------------------------- Dated this the 3[rd] day of November, 2016 J U D G M E N T Thottathil B.Radhakrishnan, J. 1.We have heard the learned counsel for the appellant and thelearned Senior counsel for the Department.learned Senior counsel for the Department. 2.The Income Tax Appeal under consideration commenced with asurvey proceedings under Section 133A of the Income Tax Actwhich led to determination of amounts relatable to unexplainedmoney etc. falling under Section 69A of that Act. In the appealbefore the Tribunal, there was no dispute that Section 69Abecame applicable by reason of the unexplained gold whichwas found from the premises of the assessee. There was alsono dispute on facts that the quantity of gold for which theappellant became answerable was 30 kg. The only disputebefore the Tribunal was as to whether the unexplained goldought to have been deemed to be an income of the assessee forthe financial year during which the survey was conducted.Therefore, the question that arises for decision in this appeal :-2-: appears to be as to whether the Tribunal was justified in law inholding that those valuable articles are to be deemed to be theincome of the assessee for the financial year during which thesurvey was conducted. This is how the questions forconsideration have been formulated in the memorandum ofappeal and on which notice has been issued. :-2-: appears to be as to whether the Tribunal was justified in law inholding that those valuable articles are to be deemed to be theincome of the assessee for the financial year during which thesurvey was conducted. This is how the questions forconsideration have been formulated in the memorandum ofappeal and on which notice has been issued. 3.Section 69A of the Act provides that where in any financialyear the assessee is found to be the owner of any money,bullion, jewellery or other valuable article and such money,bullion, jewellery or valuable article is not recorded in thebooks of account, if any, maintained by him for any source ofincome, and the assessee offers no explanation about thenature and source of acquisition of the money, bullion,jewellery or other valuable article, or the explanation offeredby him is not, in the opinion of the Assessing Officer,satisfactory, the money and the value of the bullion, jewelleryor other valuable article may be deemed to be the income ofthe assessee for such financial year. Therefore, there is the I.T.A.No.35/16 :-3-: statutory jurisdiction for the authority concerned to invoke thedeeming provision provided thereby. Obviously, the assesseehas the eligibility to demonstrate that the deeming provisionshould not be applied on any particular valuable article whichhas been so found. This obviously calls for determination of aquestion of fact as to whether the article should be deemed tobe the income of the financial year during which the surveywas conducted or whether it should be permitted to be spreadover and backdated to a period which would reduce the valueof the article on its valuation process. The assessee hadpleaded before the Tribunal and other authorities that the 30kg. of gold which he has been called upon to account, hasactually to be spread back to a period of 15 years, since thatwould be the spill over of wastage of gold in the process of theassessee who is a jeweler. This issue is purely a question offact. Apart from a self serving testimony in the form of acommunication, which is Annexure C, there is no materialworthwhile for the authorities, including the Tribunal, toconclude on facts in favour of the assessee. We, therefore, do I.T.A.No.35/16 :-4-: not find that the decision of the Tribunal is erroneous or thatthis appeal stands on any substantial question of law in termsof Section 260A of the IT Act. This appeal, therefore, fails. In the result, this appeal is dismissed. Sd/- THOTTATHIL B.RADHAKRISHNAN JUDGE Sd/- DEVAN RAMACHANDRAN JUDGE ami/4.11.16 //True copy//P.A.to Judge