Naresh Kumar Konll v. Kespondent

IN THE HIGH COURT OF PUNJAB & HARYANA ATCHANDIGARH ITA No.71 of 2000Date of Decision: 17.11.2014 Commissioner of Inocme Tax (Central), Ludhiana Naresh Kumar Konll Versus .._Appellant .kespondent CORAMHON'BLE MR. JUSTICE RAJIVE BHALLAHON'BLE MR. JUSTICE B’.S. WALI Present:Mr. Rajesh Katoch, Advocate, for the appellant, Mr. Salil Kapoor, Advocate, with Mr. Vikas Jain, Advocate, for the respondent. BERR RAJIVE BHALLA, J (ORAL) The revenue is before us challenging order dated13.11.1999 passed by the Income lax Appellate Iridunal,Amritsar Bench, Amritsar (hereafter referred to as “Tribunal)pertaining to biock assessment year 196/-38 to 1997 to 1998on the following substantial questions of law:- a iWhether, on the Facts and in theCircumstances of the Case, the ITATwas correct in holding that Addition ofRs.4,92,325/- made by the AO onaccount of non-genuine Gifts wascovered by the — Addition oRs. 9, 75,333/- confirmed on account peak of Unexplained Credits in various Bank Accounts wnen potn the Aagaitionwere independent of each Other? 2Whether, on the Facts and in theCircumstances of the Case, theAppellate Tribunal was _ Justified allowing benetit of past Savings of Rs.4lacs invested in Jewellery found fromLocker No.39 with Canara’ BankPathankot, when Asstt. Record of theAssessee does not reflect any suchWithdrawals for the acquisition ofJewellery. (11)Whether, on the Facts and in theCircumstances of the Case, theAppellate Tribunal was_ justified ifurther allowing Benefit of 400 gms. ofJewellery as Istridhan of Assessee'sWife Smt. Surbhi Kohli out of theaforesaid Jewellwery, ignoring the factthat Benefit on this account has alreadybeen allowed by the IIAT whiledeciding the appeal of Sh.sSuresKumar Kohli, Father of the Assessee?3.Whether, on the Facts and in theCircumstances of the Case, the ITAT was justified in deleting the Addition of RsS.8,29,936/- made by the AO onaccount of Unexplained Jewellery foundfrom Locker No.7? with State Bank ofPatiala,disregardingvariouscontradictions wnicn existed in tneversion of the Assessee that thejewellery belonged to other Persons?”Counsel for the revenue submits that the Tribunalhas erred in deleting addition of Rs.4,92,325/- made by theAssessing Officer on account of gifts on the ground that theyare already covered in the peak of unexplained creditrecorded in various bank accounts. Ihe Tribunal havingaccepted that the gifts were not genuine, should have heldthat the Assessing Officer was well within his jurisdiction toadd Rs.4,92,325/- to the income of the assessee. As his nextargument, counsel for the revenue submits that the benefit ofpast savings of Rs.4 lacs allowed with respect to jewelleryfound in locker No.39 Is contrary to the record as theassessee was unable to refer to any withdrawals for purchaseof jewellery. It is further contended that benefit of 400 gms. ofjewellery, allowed to the assessee's wife Is incorrect as similarbenefit had already been allowed in the case of assessee'sfather, Sh.Suresh Kumar Kohli. The benefit of ishtridhancould only have been allowed either to the assessee in the ITA No.71 of 2000 present case or to his father, who Is the assessee in ITANo.136 of 2000. It is also argued that additions ofRs.8,29,936/- made by the Assessing Officer on account ofunexplained jewellery found in locker No./72, State Bank oPatiala have been deleted disregarding contradictions in theversion put forth by the assessee and failure of the assesseeto prove tnat the jewellery belonged to other persons. It Isprayed that as the impugned order Is not only contrary to lawbut IS perverse and arbitrary, the appeal may be allowed,order passed by the Iridbunal may be set aside and aaaitionmade by the Assessing Officer may be restored. ITA No.71 of 2000 present case or to his father, who Is the assessee in ITANo.136 of 2000. It is also argued that additions ofRs.8,29,936/- made by the Assessing Officer on account ofunexplained jewellery found in locker No./72, State Bank oPatiala have been deleted disregarding contradictions in theversion put forth by the assessee and failure of the assesseeto prove tnat the jewellery belonged to other persons. It Isprayed that as the impugned order Is not only contrary to lawbut IS perverse and arbitrary, the appeal may be allowed,order passed by the Iridbunal may be set aside and aaaitionmade by the Assessing Officer may be restored. Counsel for the respondent submits that thequestions of law framed by the revenue are mere questions offact as they do not indicate infraction of any provision of thestatute nor do they point out any legal flaw. Counsel for theassessee further submits that after holding that the gifts arenot genuine and including them in Rs.9,/75,333/-, added to thincome of the assessee, the Assessing Officer could not haveadded another sum of Rs.4,92,325/-. The Tribunal has,therefore, rightly deleted this addition. As regards questionNo.2, it is submitted that it is a pure question of fact. Thediscretion exercised by the I[ribunal is neither perverse noarbitrary. Ine conclusions recorded by the Iribunal snouid,therefore, be affirmed and even otherwise if the jewellery washeld to belong to the appellant, the Tribunal was justified in granting benefit of past savings of Rs.4 lacs. As regards thequestion No.2 (il), It is contended that as per a CBDT circular,a woman is entitled to retain 500 gms. as Isntridnan. IheTribunal has allowed 400 gms. on account of Ishtridhan in thecase of assessee's wife |.e. Smt.Surbhi Kohli and it tsincorrect that this benefit has been ordered in the case of theassessee's father (Suresh Kumar Konli). The benefit toouresh Kumar Kohli has been granted with respect to thelatters wife and pertains to ancestral jewellery. As regardsquestion No.3, it is argued that as the owner of jewelleryappeared before the Assessing Officer and claimed thejewellery as his own. The Assessing Officer was, therefore,not justified in adding the cost of the jewellery to the incomeof the appellant. The Tribunal has after recording clear andcogent reasons, deleted the aaadition by holding that thejewellery belongs to one Harbans Lal who had filed anaffidavit and appeared before the Assessing Officer. We have heard learned counsel for the parties,perused the impugned order as well as the order passed bythe Assessing Officer. A search of the assessee's business premises, hishouse and various banks ts.’ the foundation of bloassessments for the years 1987-88 to 1997-98. TheAssessing Officer, after considering various transactions,jewellery and other documents added substantial amounts to the income of the assessee. The assessee filed an appeal.The Tribunal by way of the impugned order confirmed a majorpart of the assessment order but with respect to addition ofRS.4,92,325/- on account of non-genuine gifts, deleted thisaddition. The Tribunal also granted benefit of Rs.4 lacs aspast savings and allowed the value of 400 gms. of jewelleryas ishtridhan of the assessee's wife, Smt.Surbhi Kohli. TheTribunal also deleted Rs.8,29.936/- added by the AO onaccount of unexplained jewellery by holding that the jewellerybelongs to one Harbans Lal. | the income of the assessee. The assessee filed an appeal.The Tribunal by way of the impugned order confirmed a majorpart of the assessment order but with respect to addition ofRS.4,92,325/- on account of non-genuine gifts, deleted thisaddition. The Tribunal also granted benefit of Rs.4 lacs aspast savings and allowed the value of 400 gms. of jewelleryas ishtridhan of the assessee's wife, Smt.Surbhi Kohli. TheTribunal also deleted Rs.8,29.936/- added by the AO onaccount of unexplained jewellery by holding that the jewellerybelongs to one Harbans Lal. | A due consideration of arguments advanced bycounsel for the revenue, does not enable us to hold that theTribunal has violated any provision of the Income Tax Act,1961 much less does It indicate a perversity of reasoning oran arbitrary exercise of discretion. An appeal, under theIncome Tax Act, 1961, Is maintainable only if it raises asubstantial question of law and, therefore, inhers aninfraction of law, a misreading of evidence, disregard ofstatutory provisions, a consideration that IS perverse andarbitrary or if it raises a question of law that has not beenanswered. A perusal of the impugned order reveals that Itdoes not suffer from any of these infractions and the Tribunalnas while recording Its opinion considered the matter in Itsentirety and only’ thereafter recorded findings against therevenue. Admittedly, Rs.4,92,325/- on account of non-genuine sales was already included in the addition ofRs.9,/5,333/- made by the Assessing Officer. The Tribunal,therefore, rightly deleted this addition. As regards the benefitof past savings of Rs.4 lacs granted to the appellant, theAssessing Officer himself held that jewellery belongs to theappellant and was, therefore, required to apportion someamount towards investment or savings. Tne Tribunal,therefore, rightly granted the benefit of Rs.4 lacs as pastsavings. [he plea with respect to Isntridnan is similarlyunfounded as benefit has been granted on account ofishtridhan of the assessee's wife Smt.Surbhi Kohli. Thebenefit granted to Suresh Kumar Kohli, father of the assesseepertains to the latter's wife |.e. mother of the appellant andthen also in the assessment pertaining to Suresh KumarKonll. The question relating to unexplained jewelleryfound in locker No./72 has been considered in detail by thTribunal. After appraisal of the evidence adduced before theAssessing Officer namely an affidavit by Harbans Lal and hisstatement recorded before the Assessing Officer, It was heldas a matter of fact that the jewellery does not belong to theassessee. VVe are not Inclined and nor can we wnileexercising jurisdiction as a second appellate Court re-appraise evidence mucn less the statement made by Harbans ITA No.71 of 2000 Lal etc. till such time as consideration of this evidence Isperverse or arbitrary. The Tribunal has after appraising theaffidavit and the statements recorded a plausible finding.Counsel for the revenue Is unable to point out any misreadingof evidence or perversity in the process of reasoning as wouldenable us to interfere with the findings of fact recorded by the Tribunal. In view of what is recorded hereinabove, finding nomerit, the substantial questions of law are answered againstthe revenue and the appeal Is dismissed. | RAJIVE BHALLA |JUDGE 1/.11.2014Vinay [ B.S. WALIA ]JUDGE