Itxa/3191/2009 Of The Commissioner Of Income Tax (Central),Pune v. Smt. Hema A. Kukreja

p[IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION INCOME TAX APPEAL (L) NO.2025 OF 2007 The Commissioner of Income Tax V/s.Kiran Deepak Kukreja ..Appellant...Respondent. AND INCOME TAX APPEAL (L) NO.2026 OF 2007 The Commissioner of Income Tax V/s.Hema A. Kukreja ..Appellant...Respondent. ANDINCOME TAX APPEAL (L) NO.2029 OF 2007 The Commissioner of Income Tax V/s.Ashok R. Kukreja (HUF) ..Appellant...Respondent. AND INCOME TAX APPEAL (L) NO.1215 OF 2009 The Commissioner of Income Tax V/s.Asha S. Kukreja ..Appellant. ..Respondent. ANDINCOME TAX APPEAL (L) NO.1216 OF 2009 The Commissioner of Income Tax V/s.Shrichand Kukreja ..Appellant. ..Respondent. ANDINCOME TAX APPEAL (L) NO.1217 OF 2009 The Commissioner of Income Tax V/s. ..Appellant. Naribhai R. Kukreja ..Respondent. ANDINCOME TAX APPEAL (L) NO.1679 OF 2009 The Commissioner of Income Tax V/s.Smt. Neetu M. Kukreja ..Appellant...Respondent. ANDINCOME TAX APPEAL (L) NO.1680 OF 2009 The Commissioner of Income Tax..Appellant. V/s.Mahesh Rajaram Kukreja..Respondent. ANDINCOME TAX APPEAL (L) NO.1681 OF 2009 The Commissioner of Income Tax V/s.Srichand R. Kukreja (HUF) ..Appellant...Respondent. Mr. Vimal Gupta for the appellant. Mr. K. Gopal with Mr.Jitendra Jain for the respondent. CORAM : V.C.DAGA AND J.P.DEVADHAR, JJ. DATED : 26TH AUGUST, 2009. P.C. :- 1.All these appeals are filed by the revenue to challenge the orders of ITAT wherein the Tribunal by following its decision in the case of Uttamchand Jain has deleted the addition of undisclosed income made by the assessing officer. It may be noted that the appeal filed by the revenue challenging the devision of the Tribunal in the case of Uttamchand Jain (Income Tax Appeal No.634 of 2009) has been dismissed by this Court on 02/07/2009. 2.The respondents (assessees for short) are all dealers in diamonds. Each of the assessees had declared certain diamond jewellery under the Voluntary Disclosure of Income Scheme, 1997 (VDIS 1997 for short). The said declaration was accepted by the Department and a certificate was issued to the respective assessees under VDIS 1997. 3.The assessees claimed to have sold the jewellery declared under VDIS 1997 in the year relevant to assessment year 1998-99 and offered to tax the capital gains arising from the respective sales. The AO disallowed the claim of the assessees on the ground that the persons to whom the jewellery was sold had stated in their statements that the transactions were not genuine and although, later on the statement was retracted and an affidavit was filed on oath to effect that the transactions were genuine, the transactions were not proved. Challenging the aforesaid orders, appeals were filed and ultimately the Tribunal following its decision in the case of Uttamchand Jain allowed the claim of the assessees and deleted the additions. Challenging the aforesaid orders, present appeals are filed. 4.Mr. Vimal Gupta, learned counsel appearing on behalf of the appellants submitted that the decision of this Court in the case of Uttamchand Jain is distinguishable on facts because firstly, in the present case, the persons to whom jewellery were sold had not participated in the assessment proceedings, whereas in the case of Uttamchand Jain, the purchasers of the jewellery had participated in the assessment proceedings. Secondly, if the transactions were genuine, then there was no need for the assessees to pay commission to the middleman and these facts were not there in the case of Uttamchand Jain. Accordingly, Mr. Gupta submitted that the Tribunal was not justified in allowing the appeals by relying upon its decision in the case of Uttamchand Jain. 4.Mr. Vimal Gupta, learned counsel appearing on behalf of the appellants submitted that the decision of this Court in the case of Uttamchand Jain is distinguishable on facts because firstly, in the present case, the persons to whom jewellery were sold had not participated in the assessment proceedings, whereas in the case of Uttamchand Jain, the purchasers of the jewellery had participated in the assessment proceedings. Secondly, if the transactions were genuine, then there was no need for the assessees to pay commission to the middleman and these facts were not there in the case of Uttamchand Jain. Accordingly, Mr. Gupta submitted that the Tribunal was not justified in allowing the appeals by relying upon its decision in the case of Uttamchand Jain. 5.There is no merit in the above contention because, in all these cases the sales are claimed to have been made either to Vishnudutt Trivedi (Prop. of M/s. Dhananjay Diamonds) or Ratnadeep Jewellery or Kankai Jewellers. Admittedly, Vishnudutt Trivedi had participated in the assessment proceedings relating to Uttamchan Jain. If Vishnudutt Trivedi had appeared in the assessment proceedings of Uttamchand Jain, there is no reason as to why he would not appear in the case of the assessees herein especially when affidavits have been filed by him to the effect that the transactions are genuine. Moreover, the A.O. could have summoned all the purchasers who were assessed to tax. 6.In any event, as in the case of Uttamchand Jain, in the present cases also, the assessees had jewellery in respect of which the certificate have been issued under VDIS 1997 and on sale of the said jewellery the assessees have established the persons to whom it is sold and accounted for the sale proceeds received from him. Once the identity of the purchaser is established and the amounts received from the said purchaser is accounted, in the absence of any material to the contrary it is difficult to hold that the transactions were not genuine. Even if the assessees had paid commission to the middlemen for effecting the sale without examining the middlemen and without adducing any evidence to the contrary it cannot be said that the transactions are not genuine. Moreover, the genuineness of the sales in the hands of the purchasers have not been doubted by the revenue. 7.In these circumstances, we are clearly of the opinion that the Tribunal was justified in holding that the decision in the case of Uttamchand Jain is applicable to all these cases. 8.As noted earlier, the decision of the Tribunal in the case of Uttamchand Jain has been affirmed by this Court on 02/07/2009. 9.For the reasons stated in the judgment of this Court in the case of CIT V/s. Uttamchand Jain decided on 2[nd] July 2009 (Income Tax Appeal No.634 of 2009), all these appeals are dismissed with no order as to costs. (J.P.DEVADHAR, J.) (V.C.DAGA, J.)