TaxTMI 
TaxTMI 
2012 (7) TMI 733
X X X X Extracts X X X X
X X X X Extracts X X X X
.... 3) 82 I.T.R. 821 (SC)(CIT V. Kurpan Hussain) 4) 59 I.T.R. 24 (Guj)(NyalchandMalukchand Dagli V. CIT,Gujarat) 5) 170 I.T.R.80 (Ker)(Sastkumar V. CIT) 6) 107 I.T.R. 164 (Cal)(CIT V. Hindustan Motors Ltd.) 7) 267 I.T.R.179 (Indian Banks Assn. V. Devkala Consultancy) c) Whether the finding of the Income Tax Appellate Tribunal that provision of Order 18 Rules 5 and 9 Code of Civil Procedure and Section 164 Cr.P.C. need not be followed while recording a confessional statement under sec.131 of the Income Tax Act 1961 is sustainable in law, in view of the specific language of sec.131(1) and sec.132(4) of the Income Tax Act, 1961? d) Whether an order of assessment could be passed merely upon a statement u/s 131 without any corroborative material? 2. The assessee also raised additional questions of law which are as follows:- a) Whether a notice issued under Section 158BD of the Income Tax Act, 1961 is valid if the Assessing Officer never recorded his satisfaction in the said notice that the alleged undisclosed income belonged to the Appellant? b) Whether the respondent could have issued a notice under Section 158BD of the Income Tax Act, 196....
X X X X Extracts X X X X
X X X X Extracts X X X X
....se bunch, sheet Nos. 159, 155 and 143, some amounts are credited in the name of PMS and in Sheet No. 155, an account was written under the PMS A/c. PMS A/c. 30.6.95 : 3,00,000 6.12.95 : 6,75,000 3.25 X 3= 9,75,000 : 9,75,000 Pl see this and give details about it. Ans. I have seen the above account, and it is the account of land purchased by me through VS.Kathirvel. The sheet Nos. 159, 155 and 143 (NR/ B & D? S-30) shows the A/c details as stated by me in the answer to the previous question. Accordingly, this is the amount paid as per the agreement for the purchase of 3 acres. On 30.6.95 and 6.12.95, I paid Rs.3,00,000 & Rs.6,75,000/- to Sri.V.S.Kathirvel. Q.11 : For purchasing 3 acres of land, you have registered for Rs.1,95,000/- only. Pl. Show me where it was accounted. Ans. This amount (Rs.1,95,000) was accounted in M/s.Sri Ragavendra Tex Prop.K.Sakthivel (Indl.). It was in L.F.NO. 4 dated 6.12.1995 in the day book. The total amount is Rs.2,21,000/- (including other charges). This amount was credited in my HUF personal books i.e. from 1.4.89 to 5.8.99. Now I am showing those books. Q.12 : You have shown th....
X X X X Extracts X X X X
X X X X Extracts X X X X
....affidavit wherein he had stated that on 5.8.1999, he received a summon dated 2.8.99 issued by DDIT (Inv.) Erode and when he appeared for the summons at IT Department, Erode, he was not allowed to meet the concerned DDIT (Inv.) Erode. Later one Inspector of Investigation enquired him about the land purchased from V.S.Kathirvel, Komarapalayam, but the Inspector recorded a different statement, that he was not told of the content of the said recorded statement but got his signature by threatening. He further stated in the affidavit that he was not allowed to read the statement written by that Inspector and hence, he had not given the statement voluntarily. Further he did not write the usual writings like "the statement is given by me voluntarily without threat or coersion. I read the statement and it was written correctly as I have said". Thus, in the sworn statement, filed on 26.6.2003, the assessee retracted the earlier statement by stating that the land was purchased by him at the cost of Rs.2,21,000/- inclusive of all expenses and not Rs.7,80,000/-. Apart from this, the assessee objected to the summons issued under Section 131 of the Act. In dealing with the said submission, the As....
X X X X Extracts X X X X
X X X X Extracts X X X X
....inted out that there was no evidence of any coercion brought on record before the Assessing Officer as well as before the first Appellate Authority. The said statement made long after the recording of the statement. Thus, when the burden was on the assessee to prove that the statement was obtained by such means, in the absence of any material to substantiate such allegations, the Commissioner of Income Tax (Appeals) rejected the same as baseless. 7. As regards the admissibility of the retraction statement, referring to the decision of the Supreme Court reported in AIR 1997 SC 2560 SURJEET SINGH CHHABDA v. UNION OF INDIA, the Commissioner of Income Tax (Appeals), held that any admission made before the Assessing Authority would bind the person. Except for the bland denial of the statement dated 5.8.99, there was no retraction by the assessee for the Assessing Officer to take cognizance of. 8. As regards the failure to follow Rule 5 of Order XVIII of the Code of Civil Procedure, the first Appellate Authority held that there was no merit in such contention since the said statement was recorded before the DDIT (Inv.) Erode, who had also signed the statement on 5.8.1....
X X X X Extracts X X X X
X X X X Extracts X X X X
....are not Police Officers. The confession though retracted was an admission binding on the assessee. The Tribunal pointed out that though the assessee stated that the statement given was not voluntarily, yet, the said retracted statement was made after three years from the date of recording the statement, the delay thus, remained unexplained as to why the assessee did not make the allegations immediately after the statement was recorded. The assessee had also signed in all places where ever there were corrections in the statement recorded. The assessee had also read the statement before signing. In the circumstances, the Tribunal rejected the contention of the assessee that he was not allowed to read the statement and that he was not made the statement voluntarily. In the absence of any material to support the allegation, as had been raised in the affidavit filed in the year 2003, the Tribunal rejected the said plea of the assessee. 12. As regards the compliance of provisions of Order 18, Rules 5 and 8 of Code of Civil Procedure and provisions of Section 164 of the Code of Criminal Procedure, the Tribunal held that even though the said provisions are to be observed, yet, th....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ssee reported in 289 ITR 341 MANISH MAHESWARI v. ASST. CIT, the Apex Court considered the scheme of block assessment procedure and pointed out that Section 158BD provides the methodology to make block assessment in terms of Section 158BC in respect of any other person other than the person whose premises had been searched. The conditions required thereon are that there must be satisfaction recorded by the Assessing Officer that the undisclosed income belongs to any person, other than the person with respect to whom the search was made under Section 132 of the Act; the books of account or other documents or assets seized or requisitioned had been handed over to the Assessing Officer having jurisdiction over such other person and the Assessing Officer has proceeded under Section 158BC against such other person. As far as this aspect is concerned, on going through the file, we find that there is no difficulty in holding that there is compliance of the provisions of the Act. 16. As far as the non mentioning of the block period in the notice issued under Section 158BD is concerned, in the decision relied on by learned Standing Counsel for the Revenue reported in 287 ITR 242 SH....
X X X X Extracts X X X X
X X X X Extracts X X X X
....e purpose of the said proceedings and the block period for which proceedings were initiated. In the circumstances, it is too late for the assessee to contend that non mentioning of the block period would defeat the assessment proceedings. In the circumstances, we reject the assessee's contention. 18. As regards the contention of the assessee that the statement recorded was in violation of provisions of Code of Civil Procedure and Code of Criminal Procedure, we do not think that the said contention would be well received by this Court. The conduct of the assessee has to be seen herein. The assessee made a statement in the enquiry conducted by the department as regards the parting of a sum over and above what was recorded in the sale deed. A reading of the questions and answers which are extracted in the preceding paragaraph shows that the assessee was well aware of the content of the statement made by him. The statement was recorded in the year 1999 and the assessee thereafter too participated in the enquiry until 2003 and he had no doubt about the truthfulness of the statement made. However, for some reason best known to him, the assessee in the letter on 26.6.2003, took ....