9911796707
TMI Blog1983 (8) TMI 116X X X X Extracts X X X X X X X X Extracts X X X X ..... central excise authorities. The value of gold and silver ornaments plus the cash came to Rs. 3,32,076. The customs authorities (Collector of customs) initiated proceedings against the assessee for contravention of sections 11 and 11D of the Customs Act, 1962 and sections 7 and 16 of the Gold Control Act, 1968. The Collector of customs in a fairly well discussed and elaborate order dated17-4-1978held that the assessee is not in any way connected with the gold and cash recovered. He, therefore, found him not guilty. No penalty was imposed on the assessee. Since, however, the gold was found to be smuggled gold, the same was confiscated under section 11. 2. When the income-tax proceedings of the assessee were taken up, the matter of seizure ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d Appellate Commissioner in the shape of aforesaid observations, learned ITO would also find whether subsequent to order dated 17-4-1978 of the Collector of central excise, Indore, any further section and if so what has been taken by the customs and excise authorities with reference to provisions of section 112 of the Customs Act. Revenue succeeds to the said extent." In the meanwhile, the WTO while making the assessment of the assessee included the sum of Rs. 3,32,076 as the wealth of the assessee on the valuation date, i.e., 31-3-1976. The assessee pleaded that since he is not held to be the owner, the same should not be included in his wealth. The WTO, however, rejected the assessee's objections. The AAC, who heard the wealth-tax appea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ame was liable to be confiscated under any circumstances and there can be no value remaining to be included as part of the assessee's wealth. Mr. Dave in further reply contended that it is only when the confiscation took place it could be said that the assessee ceased to be the owner and not at the time when the search was made and gold and silver ornaments and cash were found and that date is definitely before the valuation date. 4. We are impressed by the submissions made by Mr. Sharma. We felt that it is not proper merely to take the course of action that has been adopted in the income-tax proceedings. The essential requirement in the income-tax proceedings is about the source of acquisition. Whether the gold is smuggled or not, once i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... control of the seized articles. In fact, possession and control alone are not enough for the purpose of wealth-tax. It must be found that the assessee is the owner or in other words it must be found that the assets belonged to the assessee and then only the value of such assets can be included in his wealth. There is no such finding that the assets belonged to the assessee nor there can be on the basis of material brought on record by the WTO. The ITO's finding at best was that the assessee was found in possession but it cannot be said that there is any evidence of the ownership of the assets lying with the assessee especially in the face of his categorical declaration that he is not the owner of such seized goods. In our opinion this find ..... X X X X Extracts X X X X X X X X Extracts X X X X
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