AI Drafter 
TaxTMI 
TaxTMI 
TaxTMI 
2016 (7) TMI 973
X X X X Extracts X X X X
X X X X Extracts X X X X
.... whereby the Tribunal has reversed the findings of CIT (Appeals) and confirmed the order of the Assessing Officer. 2. While admitting the matter on 27.03.2008, the following substantial question of law was framed by the Court for consideration :- "(A) Whether the Appellate Tribunal is justified on facts and in law in restoring partial addition at Rs. 10 lacs towards probable speculation income?" 3. The facts of the case are as under :- The appellant - assessee is the legal heir of the deceased - Jagdishchandra K. Shah (original assessee) who was regularly assessed by the Income Tax Department at Ahmedabad Office. For the assessment year 1993-94, returns of income was filed which was processed by the Income-tax department where o....
X X X X Extracts X X X X
X X X X Extracts X X X X
....come. Any action on the contrary shall be viewed adversely." Circular vide letter (F.No.286/98/2013- IT (INV.II)], dated 18-12-2014. Relevant part reads as under :- "2. I am further directed to invite your attention to the Instructions / Guidelines issued by CBDT from time to time, as referred above, through which the Board has emphasized upon the need to focus on gathering evidences during Search/Survey and to strictly avoid obtaining admission of undisclosed income under coercion/undue influence. 3. In view of the above, while reiterating the aforesaid guidelines of the Board, I am directed to convey that any instance of undue influence/coercion in the recording of the statement during Search/Survey/Other proceeding under the I.T....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ation seems to be more convincing, has not been considered by the authorities below and additions were made and/or confirmed merely on the basis of statement recorded under section 132(4) of the Act. Despite the fact that the said statement was later on retracted no evidence has been led by the Revenue authority. We are, therefore, of the view that merely on the basis of admission the assessee could not have been subjected to such additions unless and until, some corroborative evidence is found in support of such admission. We are also of the view that from the statement recorded at such odd hours cannot be considered to be a voluntary statement, if it is subsequently retracted and necessary evidence is led contrary to such admission. Hence....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... Assessment in earlier years. The arguments and explanations of the assessee are not accepted because his statement u/s 132(4) of the Act was recorded voluntarily without replying any coercive measures by the search authorities and therefore now he cannot say that statement was recorded under pressure. The statement recorded u/s. 132(4) of the Act during the course of search as evidential value and the admission made by the assessee in his voluntary statement is an evidence itself to prove that the assessee had earned speculative income from the purchase and sale of shares which was not recorded in the books of accounts. The statement recorded u/s. 132(4) are very crucial and statement recorded under this sub-section are first in point o....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ber has reported at 205 ITR 52 and 209 IT at page no.1 has also relied on the time tested test of human probabilities in concluding those cases. In the present case, any person or ordinary prudence would find the contentions of the assessee to be merely and after through. This is because of surrounding circumstances as described above make it highly likely that the assessee actually had earned speculation income of Rs. 10,50,000/- from share transactions. Learned Advocate for the appellant has also taken us to the declaration which was made by the assessee at the time of filing of the assessment as also the statement u/s. 132(4) of the Act which was recorded on 24.08.1993 at 11.45 pm during the course of search proceedings and specifical....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ic that an assessee will or should admit any income which he had not earned and which the department had not found out. I do not find any thing against the arguments that disclosure u/s. 132(4) was subject to variation and once the assessee had access to seized documents and he realised subsequently that there was no occasion to make this disclosure, he was having an inherent right to clarify the situation so that he could be taxed only on real income and not on an income which was not there at all, since there was no evidence to prove otherwise too. In addition, the very important fact that remains that inspite of the search, no material/evidence was found to show that the assessee was having any other undisclosed assets which could be lin....