TaxTMI 
TaxTMI 
2014 (10) TMI 486
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.... 2.1 Facts of the case, in brief, are that the assessee firm, which is engaged in the business of construction activity, belongs to Namrata Group. There was a survey action in respect of this group on 19th and 20th December 2008. During the course of survey action, statement of Shri. Shaiiesh Shah, one of the partners of the group concerns, was recorded u/s 133A of Income-tax Act. In reply to question No. 10, Shri Shailesh Shah offered additional income of Rs. 2.5 crores on behalf of the group concerns. It was also submitted that taxes will be paid on the additional income and the details of the same will be submitted latter on. Subsequently, Shri Dharmesh Shah, who looks after accounts of the group concern, filed letter dated 30.12.2008 in the letter head of "Sarjan Constructions" and submitted the bifurcation of the same and confirming the declaration made by Shri Shailesh Shah during the course of survey in the following manner : M/s. Sarjan Construction - For undisclosed stock of cement Rs. 1.00 crore included in WIP. M/s. Sarjan Construction - For undisclosed stock of Steel Rs. 1.50 crores included in WIP. 2.2 Subsequently, Shri Shailesh Shah as well as Shri Dh....
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....facts on record do not justify the same. It was further submitted that the retraction was made by way of filing of affidavits and since the Assessing Officer failed to cross examine the deponent, therefore, the affidavit becomes final. For this proposition, the assessee relied on the decision of Hon'ble Supreme Court in the case of Mehta Parikh & Co. Vs. CIT reported in 30 ITR 181. 4. Based on the arguments advanced by the assessee the Ld.CIT(A) deleted the addition of Rs. 2.50 crores by observing as under : "12. I have carefully considered the facts of this case as well as reply of the appellant. In this case the addition of Rs. 2,50,00,000/- has been made by the Assessing Officer on substantive basis as declaration of Rs. 2.5 crores was made by Shri. Shailesh Shah on behalf of Namrata Group and also considering the letter of Shri Dharrnesh Shah dated 30/12/2008 in which affirming the confirmation of Shri Shailesh Shah bifurcation of the declaration of Rs. 2.5 crores was given. In view of retraction and considering the fact that the declaration u/s. 133A was made by Shri Shailesh Shah, who happens to be partner of the firms M/s.Namrata Developers and M/s. Namrata Constructio....
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....s (exclusive of holidays) without obtaining the approval of the Chief Commissioner of Director genera/ or Commissioner of Director therefore, as the case may be, " 14. Thus, it can be seen that there is no provision to record the statement u/s 133A (3)(iii) of income-tax Act on oath and if done, the same cannot be said to have legal sanctity whatsoever. Hon'ble Kerala HC in the case of Paul Mathews & Sons v/s CIT(2003) 129 Taxman 416(Ker.) has also held that statement u/s 133A cannot be recorded on oath. Coming to the merit of the statement it is seen that upto question No. 9, the authorized officer asked general questions and thereafter in question No. 10, Shri. Shailesh Shah was asked as to whether he intends to say anything. In reply Shri. Shailesh Shah stated that he proposed to offer additional income of Rs. 2.5 crores, Question No. 10 of the statement is reproduced for the sake of clarity. "Q. No, 10 Do you want to say anything on your own ? Ans : On behalf of the group of concerns, I propose to offer a sum of Rs. 2.5 crores to taxation as additional income on and above, the book profit for the assessment year 2009-10 and also promised to make the payment of adva....
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....ection as an afterthought but the question is that whether addition can be sustained merely on the basis of declaration made u/s. 133A of Income-tax Act which stands retracted and the addition is not supported by any evidence gathered by the Assessing Officer either during survey proceedings or during assessment proceedings, In my view, the Assessing Officer was not justified in making addition of Rs. 2.5 crores merely on the basis of statement recorded u/s 133A of income-tax Act which was subsequently retracted. Therefore, action of the Assessing Officer making addition of Rs. 2.5 crores on that basis cannot be upheld. Accordingly, the Assessing Officer is directed to delete the addition. The ground is thus allowed." 4.1 Aggrieved with such order of the CIT(A) the Revenue is in appeal before us. 5. We have considered the rival arguments made by both the sides, perused the orders of the Assessing Officer and the CIT(A) and the Paper Book filed on behalf of the assessee. We have also considered the various decisions cited before us. There is no dispute to the fact that survey action was carried out on 19/20-12-2008 in Namrata group of cases. There is also no dispute to the fac....
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....dences of income which leads to information on what has not been disclosed or is not likely to be disclosed before Income tax department similarly while recording statement during the course of search and seizure and survey operations, no attempt should be made to obtain confession as to undisclosed income. Any action on the contrary shall be viewed adversely. Further in respect of pending assessment proceedings also, assessing officers should rely upon the evidence/materials gathered during the course of search/survey operation or thereafter while framing relevant assessment order. From the foregoing instruction, it is clear that it would not be open for A. O. to make an assessment wrongly relying on confessional statement of the assessee. The A. O. would be bound to make an assessment only on the basis of evidence and materials gathered during survey/search operations." 5.2 We find the Hon'ble Supreme Court in the case of Khadar Khan Sons reported in 210 Taxmann 248/254 CTR 228 has held that section 133A does not empower any ITO to examine any person on oath. The statement recorded u/s.133A has no evidentiary value and any admission during such statement cannot be made the bas....
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....at the road constructed by the corporation divided Plot A & B and therefore area of each building was less than one acre. The Assessing Officer also noted that approval for the project was taken from time to time and therefore each building was a different project, areas of which was less than an acre therefore, the assessee was not entitled for deduction u/s.80IB(10) of Income Tax Act. 7. In appeal the Ld.CIT(A) following his orders for A.Yrs. 2002- 03 to 2007-08 allowed the claim of deduction u/s.80IB(10). We find the order of the CIT(A) has been upheld by the Tribunal and the grounds raised by the Revenue have been dismissed vide ITA Nos. 505 to 510/PN/2011 for A.Yrs. 2002-03 to 2007-08. Since the Ld.CIT(A) has followed his orders for earlier years which have been upheld by the Tribunal, therefore, in absence of any contrary material brought to our notice, we find no infirmity in the order of the CIT(A) allowing deduction u/s.80IB(10) of the I.T. Act. The ground raised by the Revenue is accordingly dismissed. ITA No.2250/PN/2012 (M/s. Namrata Construction Company) : 8. Ground of appeal No.1 by the Revenue reads as under : "1. On the facts and circumstances of the cas....