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TMI Blog2007 (2) TMI 242X X X X Extracts X X X X X X X X Extracts X X X X ..... n the basis of the information furnished by the Investigation Wing, Delhi to the AO of the assessee the impugned assessment has since been carried out. The Investigation Wing, Delhi had concluded that RKE gave accommodation entries to third persons and were not carrying out actual sale purchase of jewellery. On the basis of this information the ADIT, Investigation, Chandigarh recorded the statements of the assessee as well as his wife Mrs. Krishna Kumari and his son Shri Ajay Sarna. From the examination of the assessee, his wife and son the ADIT, Chandigarh inferred that there was no actual sale of jewellery by the assessee to RKE. On the basis of the aforesaid, the AO, in the course of assessment proceedings, show caused the assessee to explain why the amount shown as received from RKE should not be treated as income from undisclosed sources. The assessee however submitted that he had sold jewellery to RKE which was earlier declared under VDIS. The assessee also submitted for consideration of the AO an affidavit of Shri Pradeep Kumar Gupta, director of RKE confirming the transaction of purchase of gold jewellery from the assessee. In addition the assessee submitted copies of the a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he pleas of the assessee. The CIT(A) accepted the position that the possession of jewellery was not in doubt. The CIT(A) records a finding that the onus was on the assessee to justify the sale of jewellery declared. He further held that the onus was on the assessee to produce the parties and therefore the omission on the part of the AO not to summon Shri Pardeep Kumar Gupta or non-issuing of commissions to the assessing authority at Delhi for enquiries, was not relevant. In any case, the CIT(A) concluded that the aforesaid inaction of the AO cannot be understood to mean that the transaction of sale stood explained. For the above and other reasons detailed in the order, the CIT(A) held that the assessee had failed to establish that the jewellery was sold to RKE, as claimed. The addition of Rs. 8,77,196 was accordingly sustained. 3. In the above background, the assessee is in appeal before us. We have heard both the parties in respect of the orders of the lower authorities with reference to the material placed on record before us. The appellant has submitted a paper book containing copies of submissions made before the lower authorities as well as the material in support of the tra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... port of the Investigation Wing, Delhi in this regard. With regard to the acceptance of similar sale transaction in the hands of Smt. Krishna Kumari, wife of the assessee, the learned Departmental Representative submitted that the said assessment has been made by the AO under s. 143(1)(a) in a summary manner and no scrutiny assessment has been carried out. That therefore, it does not reflect any conscious view of the AO that the transaction was above board. 6. We have considered the rival submissions carefully. The issue in this question relates to the authenticity of the sale of jewellery claimed to have been made by the assessee to RKE of a sum of Rs. 8,77,196. In principle, there cannot be a dispute to the proposition that the onus is on the assessee to adequately explain the amount credited on account of the said sale of jewellery. In this case the assessee has supported the sale on the basis of purchase voucher of the purchaser, copy of account of the assessee as appearing in the books of account of the purchaser, evidence of having received payment from the purchaser through banking channel etc. In addition to above evidences, the assessee also relied upon the affidavit of M ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... have declared jewellery under VDIS. In conclusion, however what has been recommended is further "investigations to find out if there was a genuine sale of assets" by various parties. Therefore, at best, the said report only required the AO in the instant case to carry out necessary investigations and thereafter come to a finding with respect to the genuineness of the impugned sale transactions. The said report by itself is not enough to be deduced against the assessee. Moreover, the assessing authority at Delhi has accepted the return of income filed by RKE for the asst. yrs. 1997-98 and 1998-99 in the course of assessment framed under s. 143(3) of the Act. The copies of said orders are placed at pp. 16 and 17 of the paper book. This aspect was very much before the AO and also before the CIT(A). We do not find that any effort has been made by the Revenue to controvert the aforesaid aspect. A fact position which emerges uncontroverted is that in the hands of RKE, no adverse inference has been drawn with respect to the purchase of impugned jewellery from the assessee seller. Therefore, it has to logically follow that the sale transaction in the hands of the assessee stood explained. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bunal in ITA No. 621/Chd/2002 vide order dt. 16th Sept., 2005 has accepted the sale transaction as genuine. The learned counsel appearing before us has vehemently contended that the factual matrix in the instant case stands on similar footing ,to that in the case of Anil Talwar. On this aspect, we find that even before the AO, the assessee has submitted that similar transaction in the case of Anil Talwar was approved by the CIT(A). Subsequently, the decision of CIT(A) has since been endorsed by the Tribunal in its order dt. 16th Sept., 2005. We have perused the said decision of the Tribunal and notice that the reasons weighing with the Revenue to reject the sale transaction are similar to those taken by the AO in the instant case. The Tribunal, after considering the entire material on record and the circumstances held that the sale of jewellery stood explained. The Tribunal was satisfied with the same set of evidence and material with respect to RKE that is presently before us. Thus, we are inclined to uphold the stand of the assessee. 9. For the above reasons, we conclude by holding that in the face of the material and facts found on record, the assessee can be said to have disc ..... X X X X Extracts X X X X X X X X Extracts X X X X
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