TaxTMI 
TaxTMI 
2012 (11) TMI 1167
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....lant without any material, merely on the basis of statement recorded during survey under Section 133A of the Income Tax Act. 2. The learned counsel for the appellant submits that it was burden on the assessee to prove that the statement recorded by the Income Tax Officer, during the survey, was not correct. Both the authorities have erred in treating the statement under Section 133A of the Income Tax Act, as incorrect, in absence of any corroboration by documentary evidence. It was submitted that this appeal may be admitted on the substantial questions of law as framed in the memo of appeal. 3. We have gone through the record and orders passed by the CIT (A) and Income Tax Appellate Tribunal. 4. The facts of the case are that a survey un....
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....corded during the course of survey has no binding force nor it can be considered for the purposes of assessment as held by the Kerala High Court in the case of Paul Mathews and Sans vs. CIT, 263 ITR page 101 (Kerala). The assessee had submitted a detailed reply in this regard which has been verbatim reproduced by the Assessing Officer in the assessment order starting from page no.6 and completing on page no.11. The assessee had also filed a retraction of statement before the Commissioner of Income Tax. The Assessing Officer rejected the same that the retraction was submitted by the assessee after 2 1 /2 months of the survey. He however lost sight of the fact that all the books of accounts and documents were impounded by the survey authoriti....
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....on that basis has calculated its income and that had been offered for tax. Thereafter nothing remained to be explained as none is doubted by the Assessing Officer. It is thus manifest that income declared by the assessee fully covers all the accounts and documents found and seized by the survey party and there was absolutely no case for making any addition. The action of the Assessing Officer in making addition was based purely on statement recorded during the course of survey unless some other corroborative material was pointed out or brought on record by the Assessing Officer the action of AO is illegal. The Assessing Officer has not been able to substantiate the addition/surrender of Rs. 40 lakhs by bringing on record such material or ev....
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....ed any findings that the statement recorded under Section 133A of the Income Tax Act, was unbelievable, but considering the legal position as has been found by the CIT (A) and the Tribunal, the aforesaid contention has no merit. The view is supported by the judgments of various High Courts in (a) CIT Vs. Ms Dhingra Metal Works in ITA No.1111/2010 and (b) CIT vs. S. Khader Khan Son (2008) 300 ITR 157 (Mad), in which it has held thus : "In the instant case, there was a survey operation conducted under s. 133A in the assessee's premises and a statement was recorded from one of the partners. Assuming there were discrepancies and irregularities in the books of accounts maintained by the assessee, an offer of additional income for the respe....