AI Drafter 
TaxTMI 
TaxTMI 
TaxTMI 
2025 (7) TMI 1587
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....cts are intertwined, therefore, all these appeals were heard together and are disposed of by this common order for the sake of convenience and brevity. 3. The grievance of the assessee in I.T.A. No. 4542/Mum/2024, reads as under:- "1. On the facts and circumstance of the case and in law, Id. CIT(A) erred in confirming the action of Id.AO in making the addition of Rs. 2,68,91,329/- on account of jewellery seized by treating the same as undisclosed business income, for the reasons mentioned in the impugned order or otherwise. 2. On the facts and circumstance of the case and in law, Id. CIT(A) erred in confirming the action of ld.AO in making addition of Rs. 1,91,140/-on account of cessation of liability, for the reasons mentioned in the impugned order or otherwise." 4. Representatives of both the sides were heard at length. Case records carefully perused and the relevant documentary evidence brought on record were duly considered in the light of Rule 18(6) of the ITAT Rules, 1963. 5. Briefly stated the facts of the case are that the assessee is engaged in the business of trading and manufacturing of gold ornaments having head office at Mumbai and one branch....
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....lized. For the proceedings the dealer had also complied with provisions of the GST Act 2017. The dealer had also responded to the adjudication proceedings with the reply contending the transactions of their activity are not covered under taxable supply as the movement is for involving delivery challan for supply on approval which on display sent back with documents to the head office SS Jewellers Mumbai, they had maintained details for their activity with each of the consignment. and hence the proceedings of the case for adjudication is dropped for 2019-20 accepting the returns filed." 6.1.1. From the above it is amply clear that the transactions were mere movement of goods for display and back between the head office at Mumbai and branch at Bangalore. This can be substantiated from the following chart being quantitative statement of source of gold ornaments seized by City Market Police Station, Bangalore on 20/11/2020:- 7. This is further supported by the stock movement of the firm between 01/10/2020 to 30/11/2020 which is as under:- 8. Interestingly while dismissing the appeal of the assessee, the ld. CIT(A) was convinced that the unexplained jewellery was indee....
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....s. Therefore, the liability was outstanding. 13. In the considered opinion of the Bench, merely because liability was outstanding as on 31/03/2020 would not mean that it has ceased to exist. We do not find any merit in the impugned addition and the same is directed to be deleted. Accordingly, the effective grounds raised by the assessee are allowed. 14. Since we have deleted the addition u/s 69A of the Act, the appeal of the revenue in ITA No. 4652/Mum/2024, is automatically dismissed on this ground. 15. The second issue in the revenue's appeal pertains to the deletion of the legal expenses. The underlying facts in this issue are that the assessee from had claimed legal fee expenses in respect of legal fees paid to Shri Kiran Javali at Rs. 1,75,000/- and Shri Madhu N. Rao at Rs. 2,25,000/- totaling to Rs. 4,00,000/- for release of jewellery which was seized by the Bangalore Police on 20/11/2020. Since the AO has treated the seized jewellery as unexplained assets, the legal expenses were accordingly disallowed. Since we have held that there is no unexplained jewellery u/s 69A of the Act and deleted the impugned addition, we do not find any reason to interfere with the findi....
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.... 1340.72 24:1/2002 85-26 Beneath ! 1,030.52 :340.72 500,571.DC 0-21 131,371.00 A/36379 4499.25 402125 Calvary Ngucher 1569.64 1290.14 501.CC DC 11/202 DETAIL EL QUANTIMIME STATEMENT OF SOIL BOE DE GOL ORNAMENT SERTED IN OTY MARCET POUCE !LUIDON, BAVEALORE 0% 20.11.201; 1,030.52 :340.72 500,571.DC :337.75 UMS.47 54 567.00 1937.75 1,545.47 1:11/2020 06-22 Finta Dey SSIGEELERY 2,038.52 1340.72 24:1/2002 85-26 657.42 508.52 \11/2020 1,669.54 1450.24 747:/2020 Brantley housing Quamky Alar - el Gold me of Folk: smith 7,076. 2/11/2 -23 el Gold Isque Youthen No. DO0.DO :37,554.00 23/10/2000 11-19 11/10/23 3CMG50 004550 BCWGSa 204530 BCMG50 00!502 Document 2 S.S. Jewellery 74/A, Sheikh Memon Street, 2nd Floor, Opp. Hotel Bhagat Tarachand. Zaveri Bazar, Mumbai 1 Stock Gold Bar Stock Item Register 1-Oct-20 to 30-Nov-20 1-Oct-20 to 30-Nov-20 Page 1 Date Particulars Vch Type Vch No. Inwards Quantity |Outwards Quantity Quantity Closing 2-Oct-20 Somanath Dey Stock Journal IV No.14 942.730 gms Malabar Gold Pvt.Ltd. Mumbai Purchase 2061 571.480 gms Malabar Gold Pvt.Ltd....
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....chase 4781 490.630 gms Laxmi Gold Stock Journal IV NO.23 148,560 gms Laxmi Gold Stock Journal IV NO.24 855.470 gms 0.000 gms 6-Nov-20 Malabar Gold Pvt.Ltd. Mumbai. Purchase 5492 794:440 gms 794.440 gms 9-Nov-20 Malabar Gold Pvt.Ltd. Mumbai Purchase 6037 530.700 gms Malabar Gold Pvt.Ltd, Mumbai Purchase 6038 | 47.540 gms Carried Over 15,935.310 gms 14,612.630 gms |Outwards Quantity Inwards Quantity continued ... S.S. Jewellery Stock Gold Bar Stock Item Register : 1-Oct-20 to 30-Nov-20 Page 2 Date Particulars Vch Type Vch No. Inwards Quantity Outwards Quantity Quantity Closing Brought Forward 15,985.310 gms 14,612630 gms 9-Nov-20 Vaibhav Laxmi Jewellers Purchase 453 1,000.000 giTs Rinku Dey Stock Joumal IV NO.25 578.240 gms Somanath Dey Stock Joumal IV NO.26 1,794.440 gms 0.000 gms 15-Nov-20 Malabar Gold Pvt.Ltd, Mumbai Purchase 6813 91.500 gms Malabar Gold Pvt.Ltd. Mumbai Purchase 6814 244.200 gms Malabar Gold Pvt.Ltd. Mumbai Purchase 6815 370.490 gms Malabar Gold Pvt.Ltd. Mumbai Purchase 6816 172.300 gms Malabar Gold Pvt.Ltd. Mumbai Purchase 6817 411.150 gms Malabar Gold Pvt.Ltd. Mumbai Purc....