9911796707
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2016 (8) TMI 73 - AT - Income TaxAddition u/s 68 - deceleration under VDIS scheme - whether items sold in the present year is the same which was declared by the assessee under VDIS - Held that - As per page No. 2 of the original assessment order available on page 8 of the paper book, out of ₹ 560,730/- being total sales consideration, sale of gold is for ₹ 185,730/- and sale of diamonds is for ₹ 375,000/-. Regarding sale proceeds of gold, it is of the opinion that since gold jewellery was converted in to gold, its sale for ₹ 185,730/- should be accepted and resultant long term capital loss on sale of gold should be allowed. Thus direct the A.O. accordingly because gold sold and declared under VDIS cannot be different and this is not the case of the revenue that gold sold is more that gold declared under VDIS 1997. Regarding Diamonds, mere Carat quantity alone cannot determine that the Diamond sold and declared under VDIS 1997 are same because the price of the price of Diamond mainly depends upon quality of the Diamonds being its cut and colour apart from its size. Regarding this sale of Diamonds for ₹ 375,000/-, do not know the size and the cut and colour of diamonds are also not known because the same is not mentioned in the VDIS declaration. Hence it is seen that the assessee has failed to establish that the diamonds sold in the present year and declared under VDIS are same. Hence, feel that no interference is called for regarding addition in respect of sale of diamonds of ₹ 375,000/-. None of the Tribunal orders cited above by the ld.AR of the assessee is rendering any help to the assessee in respect of diamond sale issue and since, the assessee has failed to establish this fact that the Diamonds sold in the present year are the same Diamonds which declared by the assessee in VDIS declaration 1997 as directed by the Hon ble Karnataka High Court and therefore, find no reason to interfere with the order of the ld.CIT(A) in respect of diamond issue. - Decided against assessee.
Issues:
- Appeal against order of CIT(A) for assessment year 1998-99. - Addition under section 68 of the Act. - Discrepancy between sale invoice and declaration. - Consideration of gold on hand. - Interest charged under section 234B. - Proof required for taxing transactions under section 68 of the IT Act. - Applicability of Tribunal orders on similar cases. Analysis: 1. The appeal was filed against the order of the CIT(A) for the assessment year 1998-99. The grounds raised by the assessee challenged the addition made under section 68 of the Act and discrepancies between the sale invoice and declaration. The appellant also disputed the consideration of gold on hand, interest charged under section 234B, and the requirement of proof for taxing transactions under section 68 of the IT Act. 2. The matter had previously reached the Hon'ble High Court of Karnataka, which directed that if the goods sold in the present year matched those declared under the VDIS Scheme 1997, no addition could be made under section 68 of the IT Act. The appellant argued that the lower authorities had repeated the same addition without justification, citing relevant Tribunal orders to support their case. 3. The Revenue supported the orders of the authorities below, emphasizing the difference between what was sold under the transactions and declared in the VDIS 1997 application. The Bench queried about the sale bill and valuation report, with the appellant providing details of the jewellery declared under VDIS 1997. 4. The Tribunal considered the direction of the Hon'ble High Court and examined the facts of the case. While the sale of gold was accepted based on conversion details, the sale of diamonds was scrutinized. The Tribunal noted that carat quantity alone could not establish the diamonds sold were the same as those declared under VDIS 1997, as diamond value depends on quality factors beyond carat quantity. 5. The Tribunal reviewed the applicability of Tribunal orders cited by the appellant, finding that the judgments did not support the appellant's case regarding the sale of diamonds. It was emphasized that without proof of size, color, and cut of the diamonds, it could not be accepted that the diamonds sold matched those declared under VDIS 1997. 6. In conclusion, the Tribunal partially allowed the appeal, directing the A.O. to accept the sale of gold but upholding the addition in respect of the sale of diamonds. The Tribunal found no reason to interfere with the order of the CIT(A) regarding the diamond issue, based on the failure to establish the identity of the diamonds sold in the present year with those declared under VDIS 1997.
|
