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TMI Blog2016 (10) TMI 201X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee is the owner of the said gold ornaments and jewellery and silver utensils and in making the impugned addition of Rs. 29,32,344/- u/s 69A of the Income Tax Act, 1961. 1.2 That the assessee being a man of low means, having no taxable income in the past, nor during the year under appeal, earning small income on account of being carrier of goods, the ld. Lower authorities grossly erred in holding that the assessee is real owner and in not deleting the said addition. 1.3 That the ld. lower authorities grossly erred in assuming and presuming that the said goods were purchased by him and that he is liable to be assessed as the owner when he is a carrier of goods earning Commission and the ld. Assessing Officer has accepted the Income shown by way of Carrier. 1.4 That the ld. CIT(A) having been satisfied that out of the many parties, goods relating to 3 parties having been admitted by them, he having deleted the addition to the extent of Rs. 4,82,756/- (admitted by 3 jewellers) the ld. CIT(A) gross erred in not deleting the balance of addition of Rs. 29,32,344/- when facts and circumstances for all the parties remain the same. 2. That on the facts and in the circumstances ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ld AR further submitted that as per provisions of section 78(5) of the RST Act. 1994 , the Incharge of check post is empowered to impose the penalty on the owner of goods or a person authorise in writing by such owner or the person incharge of the goods where the requisite documents related to goods are not found available with the goods during their movement. Similarly sales tax is also leviable on the value of goods a per provision of section 78(11) on the transporter or a Carrier of goods by presuming that goods so transported have been sold in the state of Rajasthan by him and he is deemed to be a dealer for those goods under the said Act. Therefore, imposing of penalty as well as charging of Sales Tax in the value of goods founds in the possession of the appellant as a "Carrier of goods" does establish his ownership but as done as provided under the Sales tax law. The ld AR further submitted that the ld. AO was not proper and justified in making addition of Rs. 34,15,100/- in appellant's income u/s 69A of the IT Act, 1961 by treating the value of goods belonging to other persons as appellants goods which he was carrying as a Carrier. He has done this merely on the basis of or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Dept. has seized the material found in the possession of the appellant & created demand of Rs. 11,03,077/-. The appellant has collected the amount from the concerned owners of goods in proportion to the value of their goods & deposited the same with the Commercial Taxes Dept. After payment of demand said goods were released by the Commercial Taxes Deptt. which the appellant has handed over to them. Thus treating payment of Rs. 11,03,077/- by the appellant to the commercial taxes Dept. as unexplained expenses in the hands of the appellant u/s 69C of the IT Act, 1961 is also not proper & justified. The ld AR has further relied on the following decisions: * Mangilal Agarwal vs ACIT 163 Taxman 399 (Raj) * CIT vs. S. Pitchaimanickam Chettiar 15 Taxman 68 (Mad) 2.2 The findings of the ld. CIT(A) are as under: "In case of movable assets (gold, silver, Currency etc.), possession is considered proof of ownership (unless otherwise is proved). The assessee in all the proceedings before sales tax authorities admitted that the jewellery belonged to them. The assessee in all the proceedings before I.T. authorities states that jewellery belonged to others. The assessee paid penalty of Rs. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gs as well as through furnishing of an affidavit has consistently stated that he is not the owner of the gold, Jewellery and other articles found in his possession. It is also noted that the AO while framing the assessment has acknowledged this fact that the assessee is maintaining consistent position stating that the gold, jewellery and other articles doesn't belong to him and belong to other 10 specified persons whose particulars have been disclosed in his earlier statement. At the same time, the AO did not agree with the said position of the assessee and has stated that contrary to the statements made by the assessee, the documentary evidence received from the Commercial Tax Department proves that the assessee was the owner of the gold and other items found in his possession by the Commercial Taxes Dept. 2.5 In this regard, we have gone through the statement of the assessee dated 09.05.2003 made before the Commercial Taxes dept wherein the assessee has stated that he is a courier of the goods and also disclosed the name of the persons having jewellery shops in Gangapur for whom he was carrying the goods from Delhi to Gangapur City. The order has been passed by the Commercial Ta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... u/s 78(5) in terms of the order issued by the Commercial Taxes Dept. dated 09.05.2003 can only be said to be levied on the appellant as the in-charge/ carrier of the goods and not as the owner of the goods. The said order issued by the Commercial Taxes Dept. dated 09.05.2003 nowhere states that the ownership of the gold lies with the assessee. Further, subsequent filing of an appeal against the said order wherein the appellant is the signatory again doesn't prove the ownership of the appellant. Therefore, the contention of the Assessing officer that the documentary evidence received from the Commercial Tax Department proves that the assessee was the owner of the gold and other items found in his possession by the Commercial Taxes Dept. is contrary to the legal and factual position which cannot be accepted. Further, the AO has recorded the statement of the three persons who have admitted that gold belongs to them and inspite of that, he has gone ahead and made an addition in the hands of the asessee. The ld. CIT(A) has taken a note of the said admission and has given partial relief to the assessee. This also support the case of the assessee that gold found in his possession does no ..... 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