9911796707
TMI Blog2019 (5) TMI 302X X X X Extracts X X X X X X X X Extracts X X X X ..... 018, whereby, the learned Tribunal dismissed the Appeal of the Assessee and upheld the orders passed by the lower Appellate Authorities for Assessment Year 2013-2014. 2. The purported Questions of Law, which are raised in this Appeal, are quoted below for ready reference : (1) Whether the Appellate Tribunal was right in holding that the provision of Section 69A of the Income Tax Act,1961, can be invoked, when the income is estimated at 3.5% of the profits ? (2) Whether the Appellate Tribunal was right in holding that de hors the provision of Section 69A of the Income Tax Act,1961, still the addition was very fair and in accordance with law ? (3) Whether the Appellate Tribunal is right in confirming the addition of Rs. 58,15,990/- as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... am Finance Ltd, to the extent of Rs. 17,45,898/-. 5. The Assessing Authority held that on account of failure of the Assessee to furnish the details of the purchasers, the Authority would estimate the income of the Assessee at 3.5% of the turnover of gold purchased and sold by him and not 1% as disclosed by him. This resulted in addition of Rs. 58,15,990/- under Section 69A of the Act in the hands of the Assessee. 6. A perusal of the Assessment Order, dated 05.02.2016, for Assessment Year 2013-2014 in the present case reveals that the Assessing Authority had given a Show Cause Notice to the Assessee for estimating the income of the Assessee at 3.5% as against 1% and the Assessee also filed a Reply to the said Show Cause Notice, dated 02.02 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ollected from the purchasers and they are actually entitled to credit of this TCS. The appellant did not identify the parties on whose behalf the jewellery was purchased in the auction held by Manappuram Finance. He therefore acted in a way to shield actual purchasers from disclosing their identities and PAN, thereby helped them to keep these transactions out of tax net. That could be the reason why those parties did not bother to get TCS, which is just 1% of purchases, in their names. This peculiar situation in which TCS was made in appellant's name cannot be a ground to get the TCS credit in his name and claim refund. The offer of TCS amount as his income has no rationale particularly when he states that he gets a commission of 50 pai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ehalf of others, when participating in the bid, the only reasonable presumption that can be drawn is that assessee himself was doing business. In such a situation, assessee having failed to produce any books of accounts, in our opinion, ld. Assessing Officer was left with no choice but to make an estimate of income, based on value of purchases made by the assessee. Estimation of 3.5% was in our reasonable. No doubt Assessing Officer has cited Section 69A of the Act while making the addition. However this by itself does not make the addition by estimating the income at 3.5% of the purchase turnover bad in law. Even dehors the said Section, the addition was very much fair and in accordance with law. We do not find any reason to interfere wi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Best Judgment Assessment framed by the Assessing Authority has to be a fair and reasonable estimate of the profit. 9. On the other hand, Mr.T.R.Senthil Kumar, learned Senior Standing Counsel for the Respondent-Revenue, supported the impugned orders and submitted that had the Assessee disclosed the details of the purchasers, the Assessing Authority not only could have inquired into the matter further, but could have also given credit of the Tax Collected at Source to the respective purchasers, on whose behalf the present Assessee acted, and the Assessee, in any case, was not entitled to claim any credit of such Tax Deducted at Source by M/s.Manappuram Finance Ltd., the Seller of gold. The learned Standing Counsel also submitted that the Ass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... disclose the details of identifiable purchasers of gold, which was sold by the Finance Company as mortgagee with whom such gold is said to have been pledged for Loans and Advances and upon defaults committed by the borrowers, the mortgagee Finance Company was entitled to sell the gold in question in open market. The Assessee, claiming to be only acting as an Agent, in the absence of any disclosure about the identity of the purchasers, could only be treated as engaged in the said business of his own and, therefore, the Estimate of Income in the business of purchase and sale of gold was required to be assessed by the Assessing Authority. Estimate of Income, in such cases, even undertaking Best Judgment Assessessment exercise while rejecting ..... X X X X Extracts X X X X X X X X Extracts X X X X
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