ITO, Wd., 2(4), Solapur, v. Smt. Shobha Balbhim Shinde, Solapur

ITA 1339/PUN/2005 | 1998-1999
Pronouncement Date: 31-01-2011 | Result: Dismissed

Appeal Details

RSA Number 133924514 RSA 2005
Bench Pune
Appeal Number ITA 1339/PUN/2005
Duration Of Justice 5 year(s) 8 month(s)
Appellant ITO, Wd., 2(4), Solapur,
Respondent Smt. Shobha Balbhim Shinde, Solapur
Appeal Type Income Tax Appeal
Pronouncement Date 31-01-2011
Appeal Filed By Department
Order Result Dismissed
Bench Allotted B
Tribunal Order Date 31-01-2011
Date Of Final Hearing 19-01-2011
Next Hearing Date 19-01-2011
Assessment Year 1998-1999
Appeal Filed On 31-05-2005
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH B PUNE BEFORE SHRI I.C. SUDHIR (JM) AND SHRI G.S. PANNU (AM) ITA NO. 1339 /PN/200 5 ( ASSTT. YEAR : 1998 - 99 ) INCOME TAX OFFICER WARD 2(4) SOLAPUR .. APPELLANT V. SMT. SHOBHA BALBHIM SHIND E 219 - A/220 GOLD FINCH PETH SOLAPUR . RESPONDENT A PPELLANT BY : SHRI HEMANT KUMAR C. LEUVA RESPONDENT BY : SHRI K. SRINIVASAN ORDER PER I.C. SUDHIR JM THE REVENUE HAS QUESTIONED FIRST APPELLATE ORDER ON SEVERAL GROUNDS INVOLVING THE ISSUE AS TO WHETHER LD CIT(A) WAS JUSTIFIED IN DELETING THE ADDITION OF RS. 11 09 020/ - MADE AS INCOME FROM UNDISCLOSED SOURCES IN RESPECT OF FICTITIOUS SALE PROCEEDS OF DIAMOND JEWELLERY AND DELETING THE ADDITION OF RS. 88 721/ - MADE U/S. 69C IN RESPE CT OF EXPENDITURE FOR OBTAINIG THE ACCOMMODATING/HAWALA ENTRY FROM M/S. GALAXY EXPORTS MUMBAI. 2. AT THE OUTSET OF HEARING THE LD. A.R. POINTED OUT THAT UNDER ALMOST SIMILAR RELEVANT FACTS IN THE CASE OF HUSBAND AND BROTHER OF THE ASSESSEE I.E. ACIT V/S . SHRI BAL B HIM DATTATRAYA SHINDE AND SHRI BHAGWAN DATTATRAYA SHINDE (A.Y. 1998 - 99) ITA NOS. 1362 AND 1364/PN/2005 THE TRIBUNAL HAS DECIDED AN IDENTICAL ISSUE IN FAVOUR OF THE ASSESSEES VIDE ITS ORDER DT. 31 ST AUGUST 2007 (COPIES SUPPLIED). HE SUBMITTED FURTHER THAT THE HONBLE BOMBAY HIGH COURT IN THE CASE OF CIT V/S. UTTAMCHAND JAIN (2010) 320 ITR 554 (BOM.) HAS BEEN PLEASED TO DISMISS THE APPEAL PREFERRED BY THE DEPARTMENT WHILE UPHOLDING THE DECISION OF THE TRIBUNAL WHEREIN ALSO SALE OF JEWELLERY D ECLARED UNDER VOLUNTARY DISCLOSURE SCHEME HAS BEEN HELD AS VALID IN ABSENCE OF CONTRARY EVIDENCE. ITA NO 1339 /PN/200 5 SMT. SHOBHA BALBHIM SHINDE . ASSTT. YEAR :1998 - 99 PAGE OF 4 2 3. THE LD. D.R. ON THE OTHER HAND TRIED TO JUSTIFY THE ORDERS OF THE AUTHORITIES BELOW. 4. HAVING GONE THROUGH THE ABOVE CITED DECISIONS WE FIND SU BSTANCE IN THE ABOVE SUBMISSION OF THE LD. A.R. THAT UNDER ALMOST SIMILAR FACTS IN THE CASES OF SHRI BALBHIM DATTATRAY SHINDE (SUPRA) THE TRIBUNAL HAS DECIDED AN IDENTICAL ISSUE IN FAVOUR OF THE ASSESSEES THEREIN. THE RELEVANT FACTS OF THE PRESENT CASE ARE THAT IN ITS RETURN OF INCOME THE ASSESSEE HAD SHOWN LONG TERM CAPITAL GAIN CONSISTING OF LONG TERM CAPITAL GAIN ON SALE OF DIAMOND JEWELLERY DECLARED U/S. VDIS 1997 ON 31 ST DECEMBER 1997. THE DIAMOND JEWELLERY DECLARED UNDER VDIS WAS SHOWN AS SOLD O N 10.2.1998 FOR RS. 11 09 020/ - . SUBSEQUENTLY THE CASE WAS RE - OPENED U/S. 147 OF THE ACT BY ISSUING NOTICE U/S. 148 BY THE A.O ON THE BASIS OF INFORMATION RECEIVED BY HIM THAT THE TRANSACTION IN RESPECT OF SALE OF DIAMOND DECLARED UNDER VDIS WERE NOT GEN UINE AND MANY PERSONS HAVE OBTAINED BOGUS SALE BILLS AND THE ASSESSEE IS ONE OF THEM. BEFORE THE LD CIT(A) IT WAS SUBMITTED BY THE ASSESSEE THAT SHE HAS FULLY DISCHARGED THE ONUS PLACED ON HER REGARDING THE GENUINENESS OF SALE OF DIAMONDS. IT WAS SUBMI TTED THAT THE EXISTENCE OF DIAMONDS AND THEIR AVAILABILITY FOR SALE TO M/S. GALAXY EXPORTS IS EVIDENCED BY VDIS - 1997 DECLARATION MADE BY THE ASSESSEE AND A CERTIFICATE U/S. 68(2) OF VDIS 1997 ISSUED BY THE CIT MUMBAI. THE SALE OF DIAMONDS BY THE ASSESSE E TO M/S. GALAXY EXPORTS IS EVIDENCED BY PURCHAE BILL FILED BY THE ASSESSEE BEFORE THE A.O. THE GENUINENESS OF SALE CONSIDERATION RECEIVED BY THE ASSESSEE IS EVIDENCED BY THE ACCOUNT PAYEE CHEQUE ISSUED BY M/S. GALAXY EXPORTS FROM THEIR BANK ACCOUNT. IT WAS SUBMITTED THAT THE A.O HAS NOT BROUGHT ON RECORD ANY EVIDENCE TO PROVE THAT THE ASSESSEE HAD GIVEN AN EQUIVALENT AMOUNT OF CASH TO M/S. GALAXY EXPORTS BEFORE RECEIVING THE CHEQUE FROM THEIR BANK ACCOUNT. THE A.O DID NOT CONDUCT ANY INVESTIGATION HIMS ELF AND HAS MERELY RELIED ON THE INVESTIGATION IN THE CASES OF SHRI KAMAL KUMAR JOHRI AND SHRI HARI OM SHARMA WITHOUT ANY OPPORTUNITY OF CONFRONTATION GIVEN TO THE ASSESSEE. ITA NO 1339 /PN/200 5 SMT. SHOBHA BALBHIM SHINDE . ASSTT. YEAR :1998 - 99 PAGE OF 4 3 ACCEPTING ALL THESE CONTENTIONS BESIDES OTHER THE LD CIT(A) HAS DELETED THE ADD ITION ON THE BASIS OF DECISIONS RELIED UPON BEFORE HIM. 5. THE PUNE BENCH OF THE TRIBUNAL UNDER SIMILAR FACTS AND CIRCUMSTANCES IN THE CASE OF ACIT V/S. SHRI BALBHIM DATTATRAY SHINDE AND ANOTHER (SUPRA) HAS DECIDED AN IDENTICAL ISSUE IN FAVOUR OF THE AS SESSEES THEREIN. CONCLUDING PARA NO.6 THEREOF IS BEING REPRODUCED HEREUNDER FOR A READY REFERENCE : 6. ON PERUSAL OF THE ORDER OF THE CIT(A) IT IS EVIDENT THAT CIT(A) HAS MADE CATEGORICAL FINDINGS BEFORE THE DELETION OF THE ADDITIONS MADE BY THE AO ON ACCOUNT OF ALLEGED FICTITIOUS SALE PROCEEDS OF DIAMOND JEWELLERY AND ON ACCOUNT OF COMMISSION ON BILLS VIZ. I) THE ADDITION ON ACCOUNT OF PROCEEDS FROM SALE OF JEWELLERY TO M/S. GALAXY EXPORTS CANNOT BE SUSTAINED MERELY ON THE BASIS OF INVESTIGATION DONE IN THE CASE OF THE BUYER PARTY DURING THE COURSE OF SEARCH PROCEEDINGS IN ITS CASE AS THE SAME HAS NO DIRECT RELEVANCE TO THE APPELLATE PROCEEDINGS IN THE APPELLANTS CASE II) ON THE CONTRARY THE CONFIRMATIONS OF THE BUYER PARTY FILED BY THE APPELLANT D URING THE APPELLATE PROCEEDINGS AS DIRECTLY RELEVANT IN THIS CASE AND THE AO HAS DONE NOTHING TO DISPROVE THE SAME AND III) THERE HAS BEEN A COMPLETE DENIAL OF THE PRINCIPLES OF NATURAL JUSTICE IN THIS CASE IN AS MUCH AS THE EVIDENCE FILED BY THE APPELLA NT HAS NOT BEEN CONTROVERTED BY THE AO AND COMPLETE RELIANCE IS PLACED BY THE AO ON THE OUTCOME OF INVESTIGATION IN THE CASE OF A THIRD PARTY. IN ANY EVENT THE HON BLE ITAT MUMBAI BENCH B(THIRD MEMBER) IN THE CASE OF UTTAMCHAND P. JAIN VS. ITO [2006] 103 ITD 1 HAS FOLLOWED THE RATIO LAID IN THE CASE OF MOHANLAL R. DAGA VS. ITO (SUPRA) ON WHICH THE RELIANCE PLACED BY THE ASSESSEE WHILE DECIDING THE CASE IN FAVOUR OF THE ASSESSEE ON SIMILAR IDENTICAL FACTS AND CIRCUMSTANCES OF THE CASE. THE ISSUE IS THUS SQUARELY COVERED BY THE AFORESAID THIRD MEMBER DECISION. WE RESPECTFULLY FOLLOW THE SAME. IN VIEW OF THE DISCUSSIONS ABOVE WE UPHOLD THE ORDER OF THE CIT(A) IN DELETING THE ADDITIONS MADE ON ACCOUNT OF PROCEEDS FROM SALE OF JEWELLERY AND COMMISSIO N ON BILLS IN THESE TWO APPEALS. THUS THE GROUND NOS. 1 & 2 IN BOTH THE APPEALS RAISED BY THE REVENUE ARE HEREBY DISMISSED. 6. FOLLOWNG THE ABOVE DECISION OF THE PUNE BENCH WE DECIDE THE ISSUE RAISED IN THE GROUNDS OF THE APPEAL PREFERRED BY THE RE VENUE AGAINST THE REVENUE. THE RELATED GROUNDS ARE THUS REJECTED. 7. IN THE RESULT FIRST APELLATE ORDER IN THIS REGARD IS UPHELD. 8. CONSEQUENTLY APPEAL IS DISMISSED. ITA NO 1339 /PN/200 5 SMT. SHOBHA BALBHIM SHINDE . ASSTT. YEAR :1998 - 99 PAGE OF 4 4 THE ORDER IS PRONOUNCED IN THE OPEN COURT ON 31ST JANUARY 2011 SD/ - SD/ - ( G.S.PANNU ) ACCOUNTANT MEMBER ( I.C. SUDHIR ) JUDICIAL MEMBER PUNE DATED THE 31ST JANUARY 20 1 1 US COPY OF THE ORDER IS FORWARDED TO : 1. THE A PPELLANT 2. THE RESPONDENT 3. THE CIT - IV CIT - V PUNE 4. THE CIT(A) - III PUNE 5. THE D.R. B BENCH PUNE 6. GUARD FILE BY ORDER ASSISTANT REGISTRAR INCOME TAX APPELLATE TRIBUNAL PUNE