Fusion-Jewels of South Vs. Dy. CIT & Ors. (ITAT Bangalore)
We have also carefully perused the stock summary as on 14-6-2011, the day before the arrest of employees and seizure of jewellery and we find that assessee- firm possess bullion gold of 1412.540 gms, gold 4869.565 gms. and gold labour 4146.680 gms. aggregating to Rs. 10,428.785 gms. It was also explained that the gold labour i.e., gold which is being given either by some other jeweler or the customers for the manufacturing of gold ornaments or repair meaning thereby the gold under the head gold labour does not belong to the assessee and the assessee has no right over it to manufacture jewellery of Ms own choice and to send it to other customers for its sale or approval. Meaning thereby the gold ornaments available with the assessee was only 4869.565 gms. for its sale or approval from the customers. Therefore the excess gold found from the employees of the assessee requires to be explained properly by the assessee- firm but the assessee- firm could not furnish a satisfactory explanation. However, the partners of the firm have come forward during the course of examination before the Additional Director of Income Tax to state that they do not have any evidence for 4.148 kgs. of gold ornaments valuing at Rs. 87,10,800, and they will offer it to tax but they did not offer it to tax.
Keeping in view the totality of the case, we find that since the excess gold was found from the employees of the assessee and the assessee could not furnish the satisfactory explanations, the addition under section 69 is called for and we therefore find no infirmity in the order of the Commissioner (Appeals) restricting the addition for the excess gold ornaments of 4.148 kgs. valuing at 87,10,800.
FULL TEXT OF THE ITAT ORDER IS AS FOLLOWS:-
