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Income Tax Appellate Tribunal, “E” Bench, Mumbai
Before: Shri B.R. Baskaran (AM)& Ramlal Negi (JM)
O R D E R Per B.R. Baskaran (AM) :-
The appeal filed by the assessee is directed against the order dated 15.7.2014 passed by learned CIT(A)-28, Mumbai and it relates to A.Y. 2010-11.
The assessee is aggrieved by the decision of learned CIT(A) in confirming the addition of ` 21,68,000/- made by the Assessing Officer.
The assessee had deposited cash aggregating to ` 26.98 lakhs in the savings bank account maintained by him with Union Bank of India. The Assessing Officer asked the assessee to furnish sources for the deposits. The assessee explained the sources to be savings made by him and his wife, loans taken from friends and relatives and sale proceeds of old jewellery. The Assessing Officer accepted the sources explained to be past savings and loans taken from friends and relatives. He did not accept the claim of sale of old jewellery. Accordingly, he added sale proceeds of old jewellery amounting to `
2 Shakeel Ahmed Imtiaz Shaikh 21.68 lakhs to the income of the assessee. The learned CIT(A) also confirmed the same and hence the assessee has filed this appeal before us.
We noticed from the assessment order that the Assessing Officer has asked the assessee to produce cash book and also to produce jewellers to whom gold ornaments were sold. The assessee filed copies of purchase bills given by M/s. Shreeji Art Jewllers and M/s. K.D. Sanghvi & co. Jewellers. The Assessing Officer appears to have tried to call the jewellers through telephone numbers given in the bills but the same was found to be non-existing. The Assessing Officer also deputed Inspector, who reported that the jewellers were not found at the addresses mentioned in the sale bills. Accordingly the Assessing Officer took the view that the assessee has failed to prove the claim of sale of jewellery. The learned CIT(A) also confirmed the same.
Learned AR submitted that the assessee is salaried employee working in medium grade level in a private firm. He submitted that the assessee was constrained to sell the jewellery to meet the education expenses of his only son named Sarosh, who proposed to go to Switzerland to study Hotel management course. Hence the assessee was constrained to sell the jewellery received by him and his wife at the time of marriage and also those acquired after marriage. He further submitted that the assessee has produced bills issued by the Jewellers to prove the sale of jewellery. The assessee being a small time employee could not enforce attendance of the jewellers. Even though the Assessing Officer has stated that the telephone numbers given in the bills were not existed and further they were not available in the address given below, yet the Assessing Officer did not confront those findings with the assessee. Even otherwise the assessee cannot be found fault with, since the jewellers were not under his control and he does not have any other continuing relationship with them.
On the contrary, the Ld D.R strongly supported the order passed by the Ld CIT(A) by submitting that the assessee has failed to prove the claim of sale
3 Shakeel Ahmed Imtiaz Shaikh of jewellery. He further submitted that the jewellery bills furnished by the assessee are not reliable.
We heard the parties and perused the record. We notice that the assessing officer has examined the deposits found in the bank account of the assessee in terms of sec. 68 of the Act. We further notice that the assessing officer has accepted the sources claimed to be past savings and loans. The Ld A.R submitted that the assessee has produced all the loan creditors before the AO and he has accepted the loans after examining the creditors. Thus, we notice that the assessee has fully co-operated with the AO vis-à-vis loan creditors, since he the loan creditors has obliged him.
In respect of jewellery sales, we notice that the assessee has sold jewellery belonging to him and his spouse to two jewellers. In support of the said claim, the assessee has produced copies of purchase bills issued by two jewellers. We notice that the assessing officer has conducted enquiries through his Inspector, who had reported that the said persons were not available at the given addresses. We notice that the AO, thereafter, did not call for any explanation in this regard. The alleged report given by the Inspector was used to take adverse inference against the assessee, without confronting the same to the assessee. In our view, this action of the AO is not justified. There is no dispute that the primary onus to prove the cash credits is placed upon the assessee. Once the assessee discharges the said primary onus, then the onus shifts to the shoulder of the AO. In the instant case, the assessee has furnished the copies of sales bills of gold ornaments and has also explained the reason, which compelled the assessee to sell the jewellery. The assessee has also furnished a copy of confirmation letter given by him to M/s Shreeji Art Jewellers, being one of the buyers, whose PAN no. is stated as BWOPS 0889 N. The photocopy of PAN card was also furnished. Hence it is not understandable as to how the Inspector could not find the shop, when the assessee has furnished PAN No. of M/s Shreeji Jewellers. Further the assessee has also furnished a confirmation letter obtained from his father-in-
4 Shakeel Ahmed Imtiaz Shaikh law/mother-in-law certifying the details of gold ornaments given at the time of marriage. Since the assessee is a salaried employee, he did not maintain regular books of accounts. Under these facts and circumstances of the case, we are of the view that the assessee has discharged the primary responsibility placed upon him u/s 68 of the Act. On the contrary, the AO has claimed to have conducted enquiries through Inspector, but the same was not provided to the assessee. We have also noticed that the alleged enquiry conducted by the Inspector is found to be deficient. Hence we are of the view that the assessing officer has not discharged the responsibility shifted upon his shoulders.
In view of the foregoing, we are of the view that there is no reason to disbelieve the claim of sale of jewellery and accordingly the same should be accepted. Accordingly we set aside the order passed by Ld CIT(A) and direct the AO to delete the addition of Rs.21,68,000/- referred above.
In the result, the appeal filed by the assessee is allowed. Order has been pronounced in the Court on 19.10.2016