Ita/97/2012 Of A.shihabudeen v. The Commercial Of Income Tax, Kottayam

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT: THE HONOURABLE MR.JUSTICE K.M.JOSEPH &THE HONOURABLE MR. JUSTICE K.RAMAKRISHNAN FRIDAY, THE 8TH DAY OF MARCH 2013/17TH PHALGUNA 1934 ITA.No. 97 of 2012 () ---------------------- AGAINST THE ORDER/JUDGMENT IN ITA.NO.116/COCH/2008 of INCOME TAX APPELLATE TRIBUNAL,COCHIN BENCH DATED 25-11-2011 ..... APPELLANT(S): ------------------------ A.SHIHABUDEEN, VILAYIL JEWELLERS, KARUNAGAPPALLY, KOLLAM BY ADVS.SRI.P.BALAKRISHNAN SRI.MOHAN PULICKKAL RESPONDENT(S):---------------------------- THE COMMERCIAL OF INCOME TAX, KOTTAYAM. BY ADV. SRI.JOSE JOSEPH, SC, INCOME TAX THIS INCOME TAX APPEAL HAVING COME UP FOR ADMISSION ON 08-03-2013 ALONG WITH ITA. NO.146 OF 2012, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: ON 08-03-2013 ALONG WITH ITA. NO.146 OF 2012, THE COURT Kss ITA NO.97/2012 APPENDIX APPELLANT'S ANNEXURES: ANNEX.A:COPY OF THE ASSESSMENT ORDER DTD. 28/02/2006 OF THE ASSESSING OFFICER.THE ASSESSING OFFICER. ANNEX.B:COPY OF THE ORDER DTD. 15/10/2007 OF THE COMMISSIONER OF INCOMETAX (APPEALS) IV, KOCHI.OF INCOMETAX (APPEALS) IV, KOCHI. ANNEX.C:COPY OF THE ORDER DTD. 20/04/2009 OF THE INCOME TAX APPELLATE TRIBUNAL IN ITA NO.116/COCH/2008.APPELLATE TRIBUNAL IN ITA NO.116/COCH/2008. ANNEX.D:COPY OF THE JUDGMENT DTD. 24/03/2010 IN ITA NO.1766 OF 2009 OF THIS HON'BLE COURT.OF THIS HON'BLE COURT. ANNEX.E:COPY OF THE ORDER DTD. 25/11/2011 OF THE INCOMETAX APPELLATE TRIBUNAL IN ITA NO.116/COCH/2008.APPELLATE TRIBUNAL IN ITA NO.116/COCH/2008. ANNEX.F:COPY OF THE LETTER DTD. 7/10/2011 FROM THE REPRESENTATIVE OF THE APPELLANT ADDRESSED TO THE TRIBUNAL.OF THE APPELLANT ADDRESSED TO THE TRIBUNAL. RESPONDENT'S ANNEXURES: N I L /TRUE COPY/ P.S.TO JUDGE K. M. JOSEPH & K. RAMAKRISHNAN, JJ. ---------------------------------------------- I. T. A. NOS. 97 & 146 OF 2012 ----------------------------------------------- Dated this the 8th March, 2013 JUDGMENT K.M. Joseph, J. Appellant has approached this Court being aggrieved by theorder of the Appellate Tribunal. 2. This is a case where large credits by way of deposit of gold were found and it was added to the income of the appellantunder Section 68 of the Income Tax Act. Originally, the tribunalhad held in favour of the appellant. Revenue came before thisCourt in appeal and this Court allowed the appeal and remandedthe matter with certain observations. The tribunal after consideringthe matter, has found in favour of the Revenue and dismissed theappeals filed by the appellant. 3. The tribunal found that the case of the appellant that the gold was available on the basis of deposits made by various ITA.97 & 146/12 parties, cannot be believed. Various circumstances were relied on in arriving at the said conclusion. Statements were obtained fromthe so-called depositors of gold and contradictions were broughtout rendering the version of the appellant unacceptable. 4. We heard the learned counsel for the appellant and thelearned counsel appearing for the Revenue. 5. Learned counsel for the appellant would only raise one complaint before us. He would point out the following portion ofthe Judgment of this Court in the earlier appeal: “When the Assessing Officer and the first 3. The tribunal found that the case of the appellant that the gold was available on the basis of deposits made by various ITA.97 & 146/12 parties, cannot be believed. Various circumstances were relied on in arriving at the said conclusion. Statements were obtained fromthe so-called depositors of gold and contradictions were broughtout rendering the version of the appellant unacceptable. 4. We heard the learned counsel for the appellant and thelearned counsel appearing for the Revenue. 5. Learned counsel for the appellant would only raise one complaint before us. He would point out the following portion ofthe Judgment of this Court in the earlier appeal: “When the Assessing Officer and the first appellate authority considered the genuineness of eachand every case of deposit alleged to have beenreceived by the appellant, it was the duty of theTribunal to have considered the evidence in a realisticmanner and to make reasonable inference and decidethe case reasonably. Even though assessee is a dealerin gold ornaments who has registration under theKGST Act and is filing returns, strangely none of theauthorities have chosen to consider whether assesseehas accounted purchase of all these gold ornamentsand paid purchase tax under Section 5A becausedeposits are admittedly taken as stock in trade and used in business. Therefore, if the transaction isgenuine, the assessee would have accounted purchaseof old gold paying tax under Section 5A and paid salestax on corresponding sales turnover of new jewellery.This is of course only a corroboration of facts andeven if assessee has paid sales tax accounting boguspurchases, nothing stands in the way of the IncomeTax Department in making addition under Section 68,if justified.” He would contend that there was non-compliance of the said direction. In other words, he would contend that this Court hadfound that if deposits had been received, it would have beenincluded as old stock of gold and tax would have been paid underSection 5A and thereafter the court also proceeded to hold that thiscould been corroboration of the appellant's case. Thereafter, thecourt also observed that even if tax is paid, it is open to the tribunalto take a view in favour of the Revenue. The complaint is thateven though sales tax records revealing purchase of gold from ninepersons and payment of tax under Section 5A of the KGST Actwas made available, there is no reference at all to the same.Learned counsel for the Revenue would submit that there is no ITA.97 & 146/12 reference to the same in the order. We feel that if that is the case of the appellant, the appellant can move under Section 254(2) ofthe Income Tax Act for rectification. In such circumstances, we are of the view that we need not consider the matter in these Appeals, as the orders stand now,nothing is brought on record for us to come to the conclusion thateven though the records were produced, they were not considered.Without prejudice to the right of the appellant, if so advised, tomove under Section 254(2) of the Income Tax Act, the Appeals aredismissed. Sd/= K. M. JOSEPH JUDGE Sd/= K. RAMAKRISHNAN JUDGE kbk. //True Copy//