9911796707
TMI Blog2020 (2) TMI 150X X X X Extracts X X X X X X X X Extracts X X X X ..... of Income Tax (Appeals)-38, Mumbai (CIT(A)) erred in upholding the order of the Asst. Commissioner of Income Tax, Central Circle 42, Mumbai (A) in making an addition of Rs. 6.92 Crores to total income on account of unexplained paintings. 1.3 The Learned Sr. Counsel, at the outset, placed on record the decision of this Tribunal in the case of Ms. Kavita Singh, proprietress of M/s Reflections vide ITA No. 1242/Mum/2012 order dated 08/12/2017 rendered under similar factual matrix wherein substantial additions were deleted finding strength in the documentary evidences furnished by the assessee in support of source of paintings. The copy of the order has been placed on record. The Ld. Sr. Counsel further submitted that the assessee seek to rely upon similar documentary evidences in the present case, which are stated to have already been placed in the paper-book. It has further been submitted that both the assessee were subjected to common search proceedings and therefore, the facts are pari-materia the same in case of both the assessee. Au Contraire, Ld. DR submitted that assessee failed to discharge the onus of proving the source of paintings before lower authorities. 1.4 We have car ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es to establish the cost, date of acquisition and source etc. The assessee also submitted that some of the paintings were very old and acquired prior to AY 2002-03. However, the said submissions could not find favor with Ld. AO who proceeded to make additions on account of unexplained investments in the paintings. Since all the paintings pertaining to Chairman of the assessee company as well as other entities were stated to be belonging to the assessee, the additions on aggregate basis were made in the hands of the assessee. 2.5 The details of additions, thus made, worked out be Rs. 692.55 Lacs as per the following details: - No. Name of Entity Value (Rs.) 1. ACG Arts & Properties Pvt.Ltd.(3 paintings) Rs. 10,00,000/- 2. UPCL (21 paintings) Rs. 4,89,00,000/- 3. Sci-Tech (10 paintings) Rs. 49,95,000/- 4. Ajit Singh (13 paintings) Rs. 1,43,60,000/- Total Rs. 6,92,55,000/- 3.1 Aggrieved, the assessee contested the additions made by Ld. AO before learned first appellate authority vide impugned order dated 31/01/2014 wherein the assessee sought to explain the source of paintings by categorizing the unexplained paintings into 6 categories / groups in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hes the fact that the appellant never purchased the paintings from the said persons. (v) The appellant tried to establish that 11 paintings existed prior to 01.04.2001 and supported its arguments by producing copies of magazines. It is hard to accept such magazines as a proof because if the appellant was the owner of the said paintings, the same should have been forming part of the inventory of paintings made in the year 2001 during the earlier search. The A.O has also mentioned that it is not very clear to come to the conclusion that the paintings as appearing in the said magazines are the same as that of the paintings found during the course of search in the year 2007. (vi) 3 paintings were stated to be acquired before 01.04.2001 and photographs taken were given as a proof to establish the same. In this connection, I am of the view that the said photographs cannot constitute as evidences in support of the claim of the appellant since the date of taking such photographs is not proved. The appellant's submission that the persons who are appearing in the photographs are older as of now compared to their age in the photograph cannot a ground to accept that the photographs wer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pies of the bank accounts from which the said payments have been made. The appellant also failed to give information such as the name and address of the persons from whom these paintings were purchased. No purchase invoices have been produced. It was already established in the appellant's case that the appellant has been merely issuing cheques and obtaining bills from bogus billers and was also receiving the cash in return for cheque payments issued. Therefore, it is not possible to accept the self made vouchers issued by the appellant as evidence for purchase of the said paintings. (xi) No confirmations produced from the sellers from whom these paintings were purchased. (xii) The appellant tried to show CNBC interview of Shri Ajit Singh in which some of the above paintings are appearing on the background. The interview was alleged to have been given before 01.04.2001 but the date of such interview has not been proved. The appellant could have obtained confirmation from the Television Channel to prove its case. (xiii) The appellant's submission that in the earlier years the paintings were written off in the books of account has also not been proved by producing the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ld not be accepted in view of the surrounding circumstances and human probabilities. There were certain features of the case which belie the documentary evidence." (ii) In the case of M/s.Kachwala Gems vs. JCIT, ITA No.134/JP/2002 dated 10.12.2003, which has been affirmed by the Supreme Court in the case of M/s.Kachwala Gems vs. JCIT (2006) 206 CTR (SC) 585, 288 ITR 10 (SC), it was held that payment by account payee cheque is not sufficient to establish the genuineness of purchases. (iii) In the case of CIT vs. Prashant (P) (1994) 121 CTR (Cal.) 20, the Calcutta High Court has held that even payment by account payee cheque is not sacrosanct and it would not make an otherwise non-genuine transaction genuine. (iv) In the case of Sumati Dayal vs. CIT (1995) 214 ITR 801 the Supreme Court, interalia held as under : "in such cases, a superficial approach to the problem should be eschewed and the matter has to be considered in the light of human probabilities and further that any transaction about which direct evidence is rarely available should be inferred on the basis of circumstances available on the record. In that case, the majority opinion of the Settlement Commission was ap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of learned first appellate authority that the explanation furnished by the assessee was found to be non-satisfactory since the assessee failed to substantiate the source of paintings with cogent documentary evidences. Aggrieved, the assessee is under further appeal before us. 4. Upon due consideration, we find that the issue of addition on account of unexplained paintings, under similar factual matrix, was subject matter of appeal before this very bench in the case of Ms. Kavita Singh vide ITA No. ITA No. 1242/Mum/2012 order dated 08/12/2017. In the said order, the bench at paras 6 to 9, appreciated the various documentary evidences furnished by the assessee in support of acquisition of paintings and adjudicated the matter substantially in assessee's favor in the light of these evidences. Similar evidences are stated to have been placed before us in the paper-book and the assessee has drawn analogy by tabulating the same in the following manner: - Sr.No. Annexure Evidence No. of Paintings Addition by A.O. (Rs. ITAT order of Mrs. Kavita Singh-ITA No.1242/Mum/2012 dated 8 October, 2017 similar issue - Reference Page Prior to Block period (Annexure -I to ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
