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TMI Blog2016 (5) TMI 400X X X X Extracts X X X X X X X X Extracts X X X X ..... d in the circumstances of the case, and in law, whether the Tribunal was right in confirming the addition of ₹ 4,77,58,412/- as unexplained expenditure from undisclosed sources under Section 69C, without appreciating that this reimbursement was not debited to the profit and loss account ? (iii) Whether on the facts and in the circumstances of the case, and in law, the Tribunal was justified in confirming the addition law in rejecting the additional evidence contained in pages 1 to 21 and 28 to 228 of the paper book submitted without assigning any reason ? (iv) On the facts and in the circumstances of the case and in law, whether the Income Tax Appellate Tribunal was right in law in confirming the addition to the extent of ₹ 4,77,58,412/- as unexplained expenditure being the value of 3,400 gold coins although the cost of these 3,400 gold coins purchased by the appellant on behalf of Sagem Sa France are reimbursed expenditure ? (v) On the facts and in the circumstances of the case and in law whether there was any material before the tribunal to confirm the addition of ₹ 4,77,58,412/- as unexplained expenditure without fully and properly discussing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2,82,418 1,30,981 1,51,437 Commission 28,41,650 -- 28,14,650 Discount 39,94,866 -- 39,94,866 Sales Incentive 43,47,581 -- 43,47,581 9,53,21,476 7,72,35,055 1,80,86,421 Reimbursement from Sagem SA CMB ₹ 7,68,99,073 Reimbursement from Palmone Asia Pacific Ltd. ₹ 2,05,001 ₹ 7,71,04,074 5. In view of the additional evidence produced by the appellant a remand report was called for from the Assessing Officer by the Commissioner of Income-Tax (Appeals). During the proceeding the appellant was asked to explain as to how this expenditure of ₹ 4.77 crores on account of gold coins is to be treated as expenditure incurred for purposes of business. The appellant in response to the same pointed out that the g ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ce of more than a crore of rupees to Opal Industries who did not have requisite knowledge and ability to execute transaction in Gold. The proprietor of Opal Industries does not even remember the party from whom the gold was purchased. Neither does he remember to whom the gold was subsequently. The proprietor of Opal Industries also does not remember how the delivery was taken/given. Allegation by Director of Cenzer that proprietor of Opal Industries is of unsound mind, is totally baseless. The Director of Cenzer knew the proprietor of Opal Industries for the past 15 years. The Director of Cenzer also knew the Director of M/s. Riddhi Siddhi Bullion Ltd. both from the same native place. M/s Riddhi Siddhi Bullion Ltd. sold gold bars to Opal and Opal Industries sold the same in form of gold coins to Cenzer. Opal Industries did not have expertise in coversion of gold bars to gold coins. Opal Industries sold gold coins to Cenzer on 14.06.2005 even though it received the gold bar two days later. The transaction seems bogus since there was no opening stock of gold. The last delivery of gold bars (30kg) taken on 31.01.2006 at M ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be believable for more than one reason. Amongst them was the fact that the affidavit itself states that it is impractical and impossible to remember as to how the delivery of gold bars was taken or gold coins were given . Moreover, the Tribunal also came to the conclusion that no reliance can be placed on this affidavit in view of the averments made therein. It also notices the fact that the affidavit does not state as to why statements before the authorities of oath are contradictory to statements made on oath in the affidavit. The impugned order of the Tribunal also records the fact that although the Assesssing Officer had originally disallowed an expenditure of ₹ 8.77 crores in the course of remand proceedings on the basis of evidence placed on record, it was noticed that the advertisement expenses were in fact incurred by the appellant by calling in celebrities and expenditure to that extent was allowed. However it found there was not a single advertisement on record which would indicate that the gold coins were being inserted into the mobiles being sold by it except photocopies of advertisement placed on record of Jeeto India offer without mentioning size and/or quant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and Tribunal, it is not open to the appellant to urge a question on Section 69C of the Act as it does not arise from the order of Tribunal. Therefore, we see no reason to examine the application of Section 69C of the Act to the present case. 9. Thereafter Mr. Deepak Tralshawala, learned counsel relied upon the decision of the Apex Court in M/s. Andaman Timber Industries vs. Commissioner of Central Excise in Civil Appeal No.4228 of 2006 rendered on 2nd September, 2015 in support of his proposition that in case the revenue was relying upon statement of Shri Subhash Gujar, Proprietor of M/s.Opal Industries then the least that should have been given to the appellant was personal hearing. Thus this not having been done renders the orders not sustainable. We find that in the present case the appellant had not sought cross examination before the Commissioner of Income Tax (Appeals). In any case a fresh affidavit of Shri Subhash Gujar, proprietor of M/s.Opal Industries was filed before the tribunal. This affidavit does not seek to explain or point out circumstances under which the statement made earlier on oath by the deponent of the affidavit Shri Subhash Gujar was incorrect. The Trib ..... X X X X Extracts X X X X X X X X Extracts X X X X
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