Itat/49/2022 Of Principal Commissioner Of Income Tax13 Kolkata v. Shri Goutam Chakraborty

OD- 9 IN THE HIGH COURT AT CALCUTTASPECIAL JURISDICTION (INCOME TAX)ORIGINAL SIDE ITAT/49/2022IA NO. GA/2/2022PRINCIPAL COMMISSIONER OF INCOME TAX, 13 KOLKATA-VERSUS- SHRI GOUTAM CHAKRABORTY BEFORE : THE HON’BLE ACTING CHIEF JUSTICE T.S. SIVAGNANAMAndTHE HON’BLE JUSTICE HIRANMAY BHATTACHARYYADate : 8[th] May, 2023 Appearance :Mr. Soumen Bhattacharjee, Adv....for appellantMr. Avratosh Majumder, Adv.Mr. Avra Mazumder, Adv.Mr. Kousheyo Roy, Adv.Mr. Suman Bhowmick, Adv.Mr. Samrat Das, Adv.…for respondent The Court : - This appeal filed by the revenue under Section 260Aof the Income Tax Act, 1961 (the Act) is directed against the order dated23/6/2021 passed by the Income Tax Appellate Tribunal “A” Bench,Kolkata (Tribunal) in ITA/13/Kol/2019 for the assessment year 2017-18.The revenue has raised the following questions of law for consideration :- i)Whether the Learned Tribunal has committed substantialerror in law by dismissing the appeal of the Revenue therebydeleting the additions made by the Assessing Officer underSection 69A of the Income Tax Act, 1961 on account ofseized gold bullion and ornaments. ii)Whether the order passed by the Learned Tribunal isperverse in not considering the factual trial of the transaction where identity of the original purchaser as wellas the identity of the seized gold remain undisclosed. iii) Whether the Learned Tribunal has committed substantialerror in law by not considering that the copy of invoice ofpurchase produced by the assessee is having a receipt dated04.07.2016 which is not earlier than the date of seizure ofgold bullion on 01.07.2016. iv) Whether the Learned Tribunal was committed substantialerror in law by not considering the applicability of section292C(1) of the Income Tax Act in the present case becausethe assets/gold were found at the custody of the assesseewhen he was caught by the search party and the assesseefailed to establish the actual ownership of the assets inspiteof opportunity given to him. v) v)Whether the Learned Tribunal has committed substantialerror in law by relying the observations of CIT(A) with regardto Section 132(I)(iii) read with section 132(1)(C) of the IncomeTax Act, wherein the ownership of the asset has not beenestablished by the assessee.Heard learned Counsel on either side. The revenue preferred the appeal before the learned Tribunalchallenging the order passed by the Commissioner of Income Tax,Appeals (13), CIT(A) dated 30[th] October, 2019. The said appeal was filedby the assessee challenging the assessment order made under Section143(3) of the Act declaring the total income of the assessee at v) v)Whether the Learned Tribunal has committed substantialerror in law by relying the observations of CIT(A) with regardto Section 132(I)(iii) read with section 132(1)(C) of the IncomeTax Act, wherein the ownership of the asset has not beenestablished by the assessee.Heard learned Counsel on either side. The revenue preferred the appeal before the learned Tribunalchallenging the order passed by the Commissioner of Income Tax,Appeals (13), CIT(A) dated 30[th] October, 2019. The said appeal was filedby the assessee challenging the assessment order made under Section143(3) of the Act declaring the total income of the assessee at Rs.6,64,71,382/- and making an addition of Rs.6,41,92,737/- underSection 69A of the Act as undisclosed and unexplained income of theassessee being gold and jewellry which were seized. The contention of thedepartment before the Tribunal was that the assessee did not produceany identification number for gold, bullion and ornaments andexplanation given by the various parties along with evidences which wereproduced by them should not have been accepted by the CIT(A). It wasfurther contended that in absence of cogent material to rebut thepresumption the addition made by the assessing officer ought to havebeen sustained by the CIT(A). The assessee resisted the submission bycontending that on the date of search and seizure of the gold and theornaments convincingly explained the source of the same and hadsubmitted the gold and jewellry were being brought from Chennai toCalcutta for manufacturing of ornaments and for polishing of some of theornaments. Further this statement was duly corroborated by each of theparties, who had given this gold and jewellery to the assessee formanufacturing of jewellery or for re-polishing of jewelleries etc. Furtherthe assessee contended that in response to the notices issued underSection 131 of the Act the parties who were noticees before the assessingofficer had confirmed the statement given by the assessee and there wasno adverse material in the hands of the assessing officer to makeaddition in the hands of the assessee. The various factual findings recorded by the CIT(A) were referred toby the assessee and the assessee sought to sustain the said order. Thelearned Tribunal first noted the facts of the case and the chain of events and found that the assessee was a partner in a firm which carried on thebusiness of manufacturing gold ornaments and they have been regularlyreceiving orders from one B B Jewellers, Chennai and others and thegold in question was handed over to the assessee by B B Jewellers. TheTribunal found that the original challans seized with the gold, bullionand gold jewellery supported the claim of the assessee. Further, it isfound that the claim of the assessee has been supported and proved byindependent verification done by the investigation wing with third partyjewellers in Chennai. The only reason based on which the assessingofficer made the addition was on the ground that the gold, bullion lackeddistinctive identification numbers on the challans. The correctness ofthis finding was considered by the learned Tribunal and the learnedTribunal agreed with the finding recorded by the CIT(A) at page 4 of theorder dated 30[th] October, 2019. The Tribunal has extracted the relevantparagraphs at the said order. From paragraph 8 of the impugned orderwe find that the factual findings recorded by the CIT(A) was notcontroverted by the department and the Tribunal having been satisfiedwith the factual conclusion arrived at by the CIT(A) agreed with the sameand dismissed the revenue’s appeal. The matter being entirely factual and the CIT(A) and the Tribunalhaving concurrently held in favour of the assessee on facts, we find noquestion of law, much less substantial questions of law, arising forconsideration in this appeal. Mr. Soumen Bhattacharjee, learned standing Counsel for theappellant revenue, places reliance on the decision of the Hon’ble The matter being entirely factual and the CIT(A) and the Tribunalhaving concurrently held in favour of the assessee on facts, we find noquestion of law, much less substantial questions of law, arising forconsideration in this appeal. Mr. Soumen Bhattacharjee, learned standing Counsel for theappellant revenue, places reliance on the decision of the Hon’ble Supreme Court in the case of Chuharmal s/o Takarmal Mohnani –vs-Commissioner of Income Tax, M.P. Bhopal , (1988) 3 SCC 588. On goingthrough the facts of the said case which are noted by the Hon’bleSupreme Court in paragraph 6 of the judgement, it was a case where thepetitioner did not adduce any evidence, far less discharged the onus ofproving that the wrist watch in question did not belong to the petitioner.As noted in the preceding paragraph, the CIT(A) on an examination of thefacts found that the stand taken by the assessee that the gold andornaments were given to him for the purpose of making jewellery and forpolishing was established and proved. Therefore, the decision inChuharmal s/o Takarmal Mohnani (supra) relied on by the revenue wouldnot lend any support to their case. In the result, the appeal is dismissed. The stay application being GA/2/2022 is also dismissed. (T.S. SIVAGNANAM) ACTING CHIEF JUSTICE (HIRANMAY BHATTACHARYYA, J.) pkd/GH/SN