Miss Rooby Dhawer vs Deputy Commissioner Of Income Tax
2010 Latest Caselaw 4661 Del

                                              UNREPORTED
I-5

*     IN THE HIGH COURT OF DELHI AT NEW DELHI


+                         ITA 945/2008



MISS ROOBY DHAWER                                     ..... Appellant
             Through:           Mr. Kaanan Kapur, Advocate


                 versus


DEPUTY COMMISSIONER OF INCOME TAX         ..... Respondent
            Through: Ms. Rashmi Chopra, Advocate


%                         DATE OF DECISION: October 04, 2010


CORAM:
HON'BLE MR. JUSTICE A.K. SIKRI
HON'BLE MS. JUSTICE REVA KHETRAPAL

1. Whether reporters of local papers may be allowed
   to see the judgment?
2. To be referred to the Reporter or not?
3. Whether judgment should be reported in Digest?


A.K. SIKRI, J. (ORAL)

1. A search and seizure operation was conducted at the

business/residential premises of the appellant-assessee on 02.11.2004.

During this operation, certain amount of jewellery was seized. The total

jewellery seized was to the tune of ` 85,44,147/-. The appellant could

give satisfactory explanation accounting for the jewellery to the extent of

` 77.38 lakhs. The dispute is in respect of balance jewellery of

` 8,06,035/-. In respect of this jewellery, specific questions were put to

the appellant during the search. Questions No.36 and 37 put to the

appellant are relevant in this context and are reproduced below:-

"Q.36 Jewellery valued at ` 8,06,035/- was found from the G.F. living room. Can you explain the source of this jewellery. Ans. This jewellery was picked up on approval from K.K. as per card given - was to be returned.

Q.37 What is the complete name and address of this person.

Ans. The name is K.K. Jewellers, G-23, South Extension Part-I, N. Delhi."

2. It is clear from the above that explanation of the appellant was that

this jewellery was taken from M/s. K.K. Jewellers, South Extension, on

approval basis and was to be returned. Thus, the case set up by the

appellant was that this jewellery did not belong to her and it in fact

belonged to K.K. Jewellers, from where she had taken the same on

approval basis.

3. On the basis of this statement, the officials of the Department

examined Mr. Kailash Chand Jain, partner of K.K. Jewellers on the same

day. For this purpose, the officials of the Department visited the

premises of K.K. Jewellers on 02.11.2004 itself and recorded the

statement of Kailash Chand Jain, its partner. He, however, in this

statement stated that no jewellery was given to the appellant on approval

basis and no issue voucher was pending in the name of Rooby Dhawer,

i.e., the appellant.

4. Thus, insofar as M/s. K.K. Jewellers is concerned, the categorical

case was that no such jewellery was given to the appellant. In fact, the

appellant ultimately conceded to this during the assessment proceedings.

5. The explanation, however, which was later on given by the

assessee was that the aforesaid jewellery was in fact supplied by M/s.

Kesri Chand & Co., another associate concern of K.K. Jewellers on

approval basis. This is contained in her representation/communication

dated 26th December, 2006 addressed to the assessing officer.

6. It so happened that during the assessment proceedings Mr. Kailash

Chand Jain was again summoned by the assessing officer. On

11.12.2006, his statement was recorded. In this statement, he stated that

he was partner both of K.K. Jewellers as well as M/s. Kesri Chand &

Co. and that he knew the appellant. Thereafter, a question was put to

him regarding supply of the jewellery by M/s. K.K. Jewellers. The said

question and the answer given by him are reproduced hereunder:-

"Q.6 It has been claimed by Ms. R. Dhawar during the course of search u/s 132 of I.T. Act which took place on 2.11.2004 that jewellery valued at ` 8,06,035/- found with her was received by her on approval basis from M/s. K.K. Jewellers. Please confirm. A. I confirm that no such jewellery was given by K.K. Jewellers to Ms. Rooby Dhawar on approval basis, however it is submitted that some jewellery was given on approval basis to Rooby Dhawar through from M/s. Kesri Chand & Co."

7. It is clear from the above that insofar as supply of jewellery by

K.K. Jewellers is concerned, Mr. Kailash Chand Jain maintained that no

such jewellery was given by the said firm. At the same time, he stated

that jewellery was given on approval basis to the appellant through M/s.

Kesri Chand & Co. Significantly, this statement was recorded on

11.12.2006, and till this date the appellant had not changed her stand that

the jewellery was in fact supplied by Kesri Chand & Co. and not by K.K.

Jewellers. It is after this statement was recorded that she addressed

communication dated 26th December, 2006 stating that jewellery was in

fact supplied by M/s. Kesri Chand & Co.

8. It is in these circumstances that the question arises for

consideration as to whether this change of statement by her was an

afterthought and should be accepted or not. The Income Tax Appellate

Tribunal has arrived at a finding to the effect that the aforesaid plea

taken by the appellant, namely, that the jewellery was supplied by M/s.

Kesri Chand & Co. on approval, was an afterthought. In coming to this

conclusion, the Tribunal has mentioned that initially Shri Kailash Chand

Jain had denied having sent any jewellery on approval basis. This

remark is based on the statement of Kailash Chand Jain, which was

recorded on 2nd November, 2004. No doubt, the statement of Kailash

Chand Jain was recorded on that date by visiting the premises of M/s.

K.K. Jewellers, however, he is partner of M/s. Kesri Chand & Co. as

well. Even if he had stated that no jewellery was supplied to the

appellant and it is inferred therefrom that he was referring to K.K.

Jewellers, he could have very well stated that jewellery was supplied on

approval basis by M/s. Kesri Chand & Co. Be that as it may, the onus to

show that jewellery was in fact supplied by M/s. Kesri Chand & Co. was

on the appellant having regard to the provisions of Section 132(4A) read

with the provisions of Section 292C of the Act. The appellant did not

come forward with any such explanation and became wiser only after the

second statement of the Kailash Chand Jain was recorded on 11 th

December, 2006. Otherwise, from the date of the search, i.e., 2nd

November, 2004, till 26th December, 2006 (which means for more than

two years), the appellant maintained stoic silence in this behalf.

9. It would also be relevant to point out here that in her

communication dated 26th December, 2006, the assessee has stated "This

jewellery was sent by M/s. Kesri Chand & Co., another associate

concern of K.K. Jewellers on approval basis a day earlier to the date of

search." It means that, according to her, jewellery was given on 1 st

November, 2004 as the search was conducted on 2nd November, 2004.

However, the voucher, on which she relies, is dated 29th November,

2004. The Tribunal has also commented upon the sale voucher by

observing that this sale voucher does not contain the name of the firm,

the phone number, the sales tax number, the registration number of M/s.

Kesri Chand & Co., though a stamp of M/s. Kesri Chand & Co. has been

affixed on the sale voucher.

10. It will also be of interest to mention here that in her

communication dated 26th December, 2006, the assessee has referred to

Voucher No.30 dated 29.10.2004, vide which the jewellery was sent to

her by M/s. Kesri Chand & Co. If she was in the possession of the said

voucher, we are unable to understand as to how she could give the name

of the wrong jeweller on 2nd November, 2004 when she was questioned

about the jeweller from whom she had taken the jewellery on approval

basis. Even if it was an unintentional slip on her part, no explanation has

been given by her as to why she did not realize this fact for almost two

years.

11. In view of the aforesaid, we are of the opinion that the finding of

fact recorded by the Tribunal cannot be stated to be perverse. No

question of law arises. This appeal is accordingly dismissed.

A.K. SIKRI, J.

REVA KHETRAPAL, J.

OCTOBER 04, 2010 km