TaxTMI 
TaxTMI 
2013 (5) TMI 496
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....by disallowing the assessee's claim u/s. 80IB and also depreciation of Rs.22,244/-. Aggrieved by the order of A.O., assessee carried the matter before the CIT (A). CIT (A) vide order dated 17-8-2010 granted substantial relief to the assessee. Aggrieved by the aforesaid order of CIT (A), the Revenue is now in appeal before us and has raised the following grounds:- "1. On the facts and circumstances of the case and in law, the Ld. CIT(A) has erred in deleting the disallowing made of Rs.27,65,303/- by denying the deduction u/s. 80IB of the Act. 2. On the facts and circumstances of the case and in law, the Ld. CIT (A) has erred in not appreciating the fact that the assessee does not full fill the conditions laid down in Section 80-IB(2)(ii) read with explanation-2. 3. On the facts and circumstances of the case and in law, the Ld. CIT (A) has erred in granting relief to the assessee without distinguishing the judgments relied in the assessment order in the cases of Canara Wire & Wire Products vs. CIT 196 ITR 426 and Kerala State Cashew Development Corporation 205 ITR 19 on the issue of reconstruction." The only effective ground is with respect to the deduction u/s. 80IB. ....
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....n account of the legal position as discussed hereinabove, we find no force in the grounds of the Revenue, hence dismissed." 9. Respectfully following the decision of the co-ordinate Bench, we allow the claim of deduction u/s. 80IB and dismiss appeal of the Revenue. ITA No.3742/AHD/2010 -A.Y. 2005-06 (Assessee's appeal) The grounds of appeal raised by Assessee reads as under:- "01. The order of assessment is contrary to the facts and prejudicial to the appellant. 02. On appreciation of the facts and circumstances of the case and law, the additions made by the Learned Assessing Officer and confirmed by the Learned Commissioner of Income Tax (Appeals) are contrary to law and based on erroneous understanding of the facts. 03. On appreciation of the facts and circumstances of the case the Learned Commissioner of Income Tax (Appeals) has erred in confirming the action of the Learned Assessing Officer in making addition to the tune of Rs.25,05,900/- on account of additional income made during the course of survey proceedings U/s. 133A of the Act. The action of the Learned Commissioner of Income Tax (Appeals) is contrary to the facts and law and deserves to be deleted. ....
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....ure of Rs.25,05,900/- made during the survey proceedings. Retraction made by the assessee was not found acceptable to the A.O. for the reason that the retraction had taken place after considerable lapse of time and the partner of the firm had voluntarily made the disclosure of additional income. He was further of the view that even if the expenses were not incurred on investment in items prescribed by the partner the onus was on the assessee to prove that the expenses were incurred on the particular date and recorded in the regular books of accounts. He therefore considered the retraction of disclosure made as an after thought by the assessee. He was further of the view that the disclosure of the additional income of Rs.25,05,900/- was made by the assessee-firm under different specific heads which prove that the admission was voluntarily. He thus made addition of additional income of Rs.25,05,900/-. 13. Aggrieved by the aforesaid order of A.O. assessee carried the matter before the CIT (A). CIT (A) upheld the order of the A.O. by holding as under:- "16.6. I have perused the assessment order, submission filed before me by the appellant and the remand report obtained from the A....
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.... additional income made during the survey proceedings was retracted by the assessee. It was further submitted that Sec. 133A does not empower the A.O. to examine any person on oath and therefore the submission has no evidentiary value and any admission made during the search proceedings cannot be the basis of addition. For this proposition A.O. relied on the decision of CIT vs. Khader Khan Son reported in 300 ITR 0157. He also placed reliance on the decision in the case of Shri Abbas Nabi Shaikh in ITA No.366/AHD/2009 order dated 31-8-2012 and placed a copy of the same on record. He therefore submitted that since the addition has been made only on the basis of the statement, addition cannot be sustained. He therefore urged that the addition made by the A.O. be deleted. 16. On the other hand, Ld. D.R. submitted that the survey in the case of the assessee took place on 9-3-2005 whereas the retraction was made by the assessee vide letter dated 26-10-2005 after a gap of around six months. He further submitted that the assessee has not brought anything on record to prove that how it was prevented from making retraction earlier. Further nothing has been brought on record except the st....
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....m and I am ready to pay tax due as per law." 19. Assessee vide its letter dated 26-10-2005 has retracted the disclosure by stating as under:- "A survey was conducted on our premises on 09-03-2005 and a statement was recorded. In answer to question No.23 and 26 a declaration was obtained from me to the effect that unaccounted income by way of purported investment and expenditure to the tune of Rs.25,05,900/- was earned by me. In this connection, I would like to humbly state as under:- 1. The survey was started at 9 a.m. on 09-03-05 and was extended till 7 a.m. net day. 2. I reached the premises on 8-30 p.m. on the date of survey after driving 200 kms. I was not allowed to sleep and the answers were recorded when I was sleepy and I was not in full consciousness. I have now noticed these questions and answers, which are not in accordance with the facts, and not given in a stable mental and physical condition stated above. I humbly request your honour to treat the said answer to question No.25 and 26 as being retracted and oblige." 20. From the questions and answers referred above it is seen that a specific question was asked to the assessee with respect to the invest....