9911796707
TMI Blog2014 (4) TMI 1103X X X X Extracts X X X X X X X X Extracts X X X X ..... Tax (Appeals)-II at Chennai. The appeal for the assessment year 1998-99 arises out of the assessment completed under Section 143(3) read with Section 147. The assessments for the remaining assessment years, except for assessment year 2005-06, have been completed under Section 143(3) read with Section 153C. The assessment for assessment year 2005-06 has been completed under Section 144 read with Section 153C of the Income-tax Act, 1961. 2. The assessee is an individual carrying on the business of auctioneers under the name and style of "Kankaria Auctioneers". The assessee is authorized under the Tamil Nadu Pawn Brokers Act, 1943, to auction pawned jewellery. 3. There was a search and seizure operation under Section 132 carried out in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he assessing authority was that whenever he collects money from the bidders, the amounts are deposited in the bank account and when the gold and valuables are released to the bidders on getting entire auction amounts and thereafter the assessee pays the money to the persons whose gold and valuables were auctioned by the assessee. Thus, according to the assessee, his income portion is only the margin/commission earned out of such auction sales. 5. The above explanation offered by the assessee was not acceptable to the Assessing Officer. The Assessing Officer found that the assessee has not maintained any books of accounts or any other personal accounts to show the details of cash deposits reflected in his bank account. Assessee did not furn ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rce and furnish such details, the Assessing Officer was justified in making additions in the hands of the assessee. He, accordingly confirmed the additions and dismissed the appeals. The assessee is aggrieved and therefore, these appeals before us. 7. We heard Shri T.N. Seetharaman, the learned counsel appearing for the assessee and Shri T.N. Betgeri, the learned Joint Commissioner of Income Tax, appearing for the Revenue. We heard both sides in detail. 8. As far as the appeal for the assessment year 1998-99 is concerned, the assessee has raised a ground against reopening of assessment under Section 147 of the Income-tax Act, 1961. We do not find much force in the said ground. Revenue has collected sufficient materials in the course of se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t be treated as income in his hands as his only income is the margin/commission in the auction proceedings. 11. Theoretically, the explanation of the assessee seems to be okay. But, what is the fact? Inspite of carrying on the business on a large scale, the assessee has not maintained books of accounts. The assessee is also carrying private auctioning business by using the documentation prescribed under Tamil Nadu Pawn Brokers Act, 1943. The assessee has not produced the details of persons who paid cash to the assessee against auctions. The assessee did not furnish the details of persons whose valuables were sold by the assessee in auction. It is very incredible to observe that the assessee, inspite of carrying on such large scale business ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ash deposits could not be added for the reason that the assessee being an auctioneer, is entitled only for margin/commission. The learned counsel also contended that alternatively the peak amount alone should have been added. But, we are not in a position to accept the above alternative grounds, because the facts of the case do not justify even those alternative grounds. The basic reason for addition is the absence of evidence and details with the assessee to prove the genuineness of the source of deposits. When that is the case, the argument of margin/commission is not sustainable. As the assessee has not produced any of the details regarding the flow of funds, it is also not possible to adopt the peak amount theory. 14. In the facts and ..... X X X X Extracts X X X X X X X X Extracts X X X X
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