2014 (10) TMI 536

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.... counsel for the appellant, are that in the case of the respondent-assessee a survey u/s 133 A of the IT Act was carried out at the business  premises on 25/11/2009 and during the course of survey some incriminating documents were found, inventorised and impounded, inventory of cash & stock was also prepared. At the time of survey, statement of the assessee-respondent was also recorded wherein on the basis of impounded loose papers, diaries, documents etc. he surrendered a total sum of Rs. 8 crore which comprised of income of Rs. 2 crore in the assessment year 2007-08; Rs. 5 crore for the current year and Rs. 1 crore for the assessment year 2009-10. In the assessment year 2007-08, though the assessee had surrendered Rs. 2 crore but in ....

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....ther defects, transaction in the diary or other transactions in the books of accounts so as to make the total surrender to the tune of Rs. 3 crore and according to the assessee, the actual offer of Rs. 3 crore based on the material was proper and accordingly prayed for acceptance of the said surrender, however, the AO was not satisfied and merely because the assessee had surrendered an amount of Rs. 5 crore, during the course  of survey an addition of Rs. 2 crore was made by the AO. 4. Dissatisfied with the addition of Rs. 2 crore, as aforesaid, the matter was carried in appeal before the CIT(A) and the CIT(A), after analyzing the evidence on record and the explanation so offered, gave a further relief of Rs. 1.50 crores and sustain....

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.... question of law  arise out of the order of the ITAT. 7. We have considered the arguments of the counsel for the revenue and have also gone through the impugned order. 8. In our view, the ITAT, after appreciating the evidence on record and the evidence placed by the assessee, has accepted the surrender to the tune of Rs. 3 crore which was made in the return of income and is based on appreciation of evidence and it is a finding of fact. The assessee gave an explanation supported by material on record, that on the basis of the documents and whatever was un-recorded in the diary/loose papers/other unverifiable creditors, the total amount of surrender came to the tune of Rs. 2.20 crore only. However, additionally the assessee, on acc....

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....t of surrender made during this year at Rs. 3 crore was available to the assessee for the investment in the share capital, etc. of Rs. 3,76,89,000/- requiring telescoping therein. As  we have noticed earlier the  AO has not found or bothered to found or  traced anything additional as a result of survey from the assessee except relying on the recorded statements at the time of survey and therefore this view found favour with the two appellate authorities that the funds are arising from the same business and have a direct nexus and the income was invested/utilized during the year under consideration. In our view, the conclusion reached by the ITAT is based on the appreciation of evidence and is reached on the basis of finding o....