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TMI Blog2015 (7) TMI 919X X X X Extracts X X X X X X X X Extracts X X X X ..... he appellant as claimed by the appellant and as also declared by Mrs. Malani in her assessment proceedings as recorded in the order of her Assessing Officer at Kolkata on 25 November 1986. Thus it is only in the previous year relevant to the Assessment Year 1987-88 i.e. financial year 1 April 1986 to 31 March 1987 that the appellant was found to be the owner of the jewellery in the locker belonging to Mrs. Malani. Decisions relied upon by the appellant do not have any application to the present facts. The basic difference in all the cited cases to the present facts is that the locker key which was seized on 20 March 1986 did not belong to the appellant but to one Mrs. Malani and therefore it was only on the opening of her locker that the question of finding jewellery in the locker and if found, the ownership of such jewellery would arise for determination. In all the cited cases the offending goods/money etc was found in the possession of the party in whose hand Section 69A of the Act was applied. - Decided against assessee. Double taxation - whether Tribunal erred in confirming the addition of ₹ 2,01,100/- in the Assessment Year 1987-88 specially in view of the additio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r: On 19 March 1986, a search action under Section 132 of the Act was carried out by the revenue in respect of the appellant's premises. During the course of the search, on 20 March 1986, a locker key belonging to one Mrs. Sujata Malani was seized, who at the relevant time was staying with the appellant. 4. On 28 July 1986, the locker of Mrs. Malani (the key to which was seized on 20 March 1986) was opened by the revenue. On opening the locker, jewellery valued in the aggregate of ₹ 2.53 lakh was found therein. In the course of proceedings under Section 132(5) of the Act, the revenue on 25 November 1986 accepted the explanation of Mrs. Malani that jewellery valued at ₹ 2.41 lakh out of ₹ 2.53 lakh belonged to the appellant. The appellant also claimed to be owner of the same which was valued at the cost of ₹ 2.01 lakh. 5. On 21 March 1990, the Assessing Officer passed an order for the Assessment Year 1987-88 inrespect of the appellant. In the assessment order, it is recorded that the appellant had filed its wealth tax return for the Assessment Year 1987-88 on 25 June 1987 declaring jewellery valued at ₹ 2.15 lakh received as gift by him fro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the keys to the locker which contained the jewellery. In these circumstances, it was submitted that the jewellery was found in the previous year relevant to Assessment Year 1986-87 and not Assessment Year 1987-88. In support, Mr. Subramaniam also placed reliance upon the decisions of Gauhati High Court in Patoa Brothers Vs. CIT. 133 ITR 672, Madhya Pradesh High Court in Harlal Mannulal Vs. CIT. 147 ITR 11 and of this Court in Mathuradas Gokuldas Vs. CIT. 102 ITR 425. (b) As against the above, Mr. Pinto, the learned Counsel for revenue in support of the impugned order states that the locker keys which were seized on 20 March 1986 belonged not to the appellant but to one Mrs. Malani. Therefore it is only on opening the locker that the quantum/value of the jewellery could be ascertained for subsequent decision/finding on ownership. Consequently, in terms of Section 69A of the Act, the ownership of the appellant in respect of the jewellery in the locker of Mrs. Malani was found only on opening of the locker. Thus the Assessment Year 1987-88 is the correct assessment year to which jewellery has been brought to tax as deemed income in view of unexplained jewellery. (c) We have c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is was assessed to income under Section 69A of the Act. The search took place on 3 March 1970. The revenue assessed the applicant therein to tax for the Assessment Year 1970-71. However the applicant therein claimed that as ownership of the articles found in its residence was determined only when an assessment order was passed on 25 August 1971, the appropriate assessment would be the Assessment Year 1972-73. The Gauhati High Court on the basis of plain interpretation of Section 69A of the Act held that the date on which the applicant was found to be in possession of the jewellery, etc. would be the date to be taken into consideration while assessing the party to tax. The fact that the assessment order renders a finding that the applicant in whose possession the jewellery was found is the owner will have retrospective effect to the date the articles were seized. In this case, admittedly the jewellery was found and seized only on the opening of the locker of Mrs. Malani on 28 July 1986. Therefore the assessment year in the present case is correctly the Assessment Year 1987-88. (f) The next decision relied upon by the appellant was of Madhya Pradesh High Court in the case of Harla ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ee. 10. Question 2: (a) It was urged by Mr. Subramaniam that the jewellery found in the locker of Mrs. Malani belonging to the appellant was sourced from the amounts received by the appellant in cash from M/s Industrial Meters Ltd. in which he was Director and the same was a subject matter of consideration by the revenue for the Assessment Year 1986-87. Thus seeking to charge the tax on the same jewellery, as deemed income where the source of jewellery is found in diaries which were the subject matter of consideration during the Assessment Year 198687. Thus charging of tax in the Assessment Year 1987-88 would lead to double taxation. (b) As against the above, Mr. Pinto submits that the occasion to tax the jewellery found in the locker of Mrs. Malani valued at ₹ 2.01 lakh during the Assessment Year 1986-87 does not arise. This for the reason that it has never been the appellant's case that the jewellery which was found on opening of Mrs. Malani's locker was jewellery which had been purchased out of the cash entries found in the diary maintained by the employee of M/s Industrial Meters Ltd. evidencing receipt of cash by the appellant. (c) The contention urge ..... X X X X Extracts X X X X X X X X Extracts X X X X
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