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2018 (2) TMI 1690
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.... his statement recorded during the course of search and seizure action u/s 132(1) of LT. Act 1961 on 22.11.2006 which the assessee retracted. Reliance is placed on the decision of the Hon'ble Supreme Court of India dated 25.10.1996 in Special Leave Petition (e) No. 14028 of 1996 in the case of Surjeet Singh Chhabra Vs. Union of India and Others wherein the Apex Court has held that the Revenue Officials are not Police Officers and the confession, though retracted, is an admission and binds the petitioner. Reliance is also place on the decision of the Punjab and Haryana High Court in the case of Rakesh Mahajan vs. ClT cited at 6420f 2007 (Taxpert) and 214 CTR 218 wherein it has been held that" It is well settled that admissions constitute best piece of evidence because admission are self-harming statements made by the maker believing it to be based on truth It is well known that no one will tell a lie especially harming one's own interest unless such a statement is true." Further reliance is placed on the decision of The Kerala High Court in the case of Kunhambu(V) and Sons vs. CIT cited at (1996) 219 ITR 235 wherein it has been held that "Assessmen....
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....ken prior to 1.4.2006; and therefore, no such income was earned in the earlier years. Moreover, agricultural commodities are seasonal products and only one transaction was undertaken by him in November, 2006 for which he has made a profit of approximately Rs. 48 lacs which has been surrendered by him in the return of income and other than this, no evidence of any other income or investment was found at the time of search to suggest some more income has been earned on this account. Entire speculative profit which has been earned in the earlier years has duly been declared in those years in the regular books of accounts. Apart from that, he also stated that similar disclosure was taken from his father and from the company MDH Ltd. and no corresponding investment/ expenditure were found from any of the premises during the search carried out at various places. However, the Ld. AO rejected the assessee's contention after observing and holding as under:- "The claim of the assessee that he was under mental pressure at the time of giving the statement u/s 132(4) on 22.11.2006 is not at all borne out by the facts on record. He has given the statement without any fear, favour or coe....
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....assets found from the assessee is acceptable. Apart from the reliance placed by the appellant on the Board Instruction, he has also given a reasonable justification regarding the improbability of earning such a huge amount within a calendar year. xxx xxx xxx xxx xxx xxx 7.5 As regards, the contention of the appellant that he was under pressure at the time of giving the statement and the counter argument of the Assessing Officer that two neutral witness were present to oversee the search proceedings. It is my view that such a issue shall not go to determine whether the assessee can retract the statement or not, for the fact remains that the surrendered income has to be quantified on the basis of the incriminating material found during the search or on the basis of any other evidence collected during the assessment proceedings. Neither in the assessment proceedings nor in the remand report has any such quantification of concealed income has taken place. 7.6 The further argument given by the Assessing Offi....
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....assessee deserves to be accepted. In support of her contention she relied upon judgment of Hon'ble Delhi High Court in the case of Raj Hans Towers (P.) Ltd. vs. CIT reported in (2015) 373 ITR 9 (Delhi), wherein it was held that where the assessee had not offered any explanation regarding surrendered amount being not bonafide and it was also not borne out from the contention raised by the assessee before the lower authorities, then such a surrendered income needs to be added. Similarly, she relied upon another judgment of Bombay High Court in the case of Paras Shantilal Shah vs. DCIT reported in (2015) 378 ITR 41. 7. We have heard the contentions made by the parties and also the relevant finding given in the impugned order as well as the order of the Tribunal. In the case, though it is seen that the assessee during the statement recorded on oath u/s 132(4) at the time of search has stated that he has earned Rs. 15 crores during the last eight months from speculative trading which he has spent in purchase of jewellery and investment in home and also advances against purchase of properties, but later on, this statement has been retracted and AO had also called upon the assessee pos....
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....g Officer. This statement recorded u/s 132(4) on 22.11.2006 was retracted by the assessee on 28.11.2006. As per the statement, this amount was earned from speculative business carried out by the assessee from 01.04.2006 till the date of search. The Assessing Officer made the reliance for the existence of such business on account of income declared by the assessee from such business in the months of June and August, 2003 for which the assessee received profit earned by the cheques. There was no incriminating document or supporting document found or seized during the search operation carried out at the premises of the assessee which could suggest that assessee was doing the business of speculation in commodities during the relevant period stated in statement. No incriminating document was found and seized which could put a light in respect of the speculative business stated by the assessee in its statement. This statement was recorded when the search was continuing for 28 hours from 8.00 AM on 22.11.2006 to 11.57 AM on 23.11.2006. We also find that although there was seizure of some papers/documents as per panchnama, annexure A-1 to A-11, however, no question was asked pertaining to ....
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....dence of income which lead to information on what has been disclosed or is not likely to be disclosed before the revenue authorities. There is no evidence found and seized that assessee has carried out speculation trading during the relevant period. No document in this regard was seized from the premises of the assessee. The documents seized from the residence of Shri Prem Arora was related to the financial year 2003-04 and the income earned in those transactions has been received by the assessee through banking channels and not by cash and the same has been duly accounted for. In such a situation, the presumption that assessee might have carried out speculation business during the year on the basis of such document seized is completely untenable and unsustainable and additions based on such presumption cannot be sustained. The inference that Shri Prem Arora was in possession of the cash and being the close person of the assessee, assessee might have been indulging in the speculation business of the commodity trading is also unsustainable presumption. No adverse inference can be drawn about the assessee on such presumption. The Assessing Officer's reliance that assessee ha....
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....99-2000 - Whether while computing undisclosed income of assessee, Assessing Officer should take cognizance of such correct income as depicted in books of account as well as in seized material, and should not adopt a figure merely as per admission of assessee - Held, yes. c. Shree Chand Soni Vs DCIT (2006) 101 TTJ (JD) 1028 Search and seizure - Block assessment - consumption of undisclosed income - Addition based on the assessee's statement under s. 132 (4) - Admittedly, no incriminating document was found to support the impugned addition regarding bogus capital - Statement recorded under s. 132(4) does not tantamount to unearthing any incriminating evidence during the course of search - Therefore, no addition could be made only on the basis of such statement. d. Rajesh Jain Vs DCIT (2006) 100 TTJ (Del) 929 Search and seizure - Block assessment - Retraction of statement - Addition of Rs. 25 Lakhs made solely on the basis of confessional statement of assessee that he earned the said amount in the last Ten years was not justified - Confessional statement should be corroborated with some material to show that assessment made is just and fair - Conduc....
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....003) 181 CTR (Cat) 362 If in law an item is not taxable, no amount of admission or misapprehension can make it taxable. The taxability or the authority to impose tax is independent of admission. Neither there can be any waiver of the right by the assessee. The Department cannot rely upon any such admission or misapprehension if it is not otherwise taxable." We would also like to state that assessee retracted by filing a written submission before the DIT, Inv.-I, New Delhi on 28.11.2006 which is 6 days after the search. There was sufficient time with the Investigation Wing to carry on the investigation and to collect the evidence against the retraction. However, records show that nothing has been done in this regard. In such a situation, the retraction of the assessee cannot be said to be invalid in absence of any incriminating documents. In view of these facts, we uphold the order of the CIT (A)." 8. Since similar facts are permitting in this appeal also, therefore, respectfully following the aforesaid decisions rendered on similar facts, we also uphold order of Ld. CIT (A) on the ground that such a surrender made by the assessee is not supported by any incrimi....
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....ground that the differential amount as per the bill and the DVO's report must have been invested in cash. 11. After hearing both the parties, we find that the assessee has given following reconciliation of jewellery found and the jewellery declared by the assessee:- Jewellery found from the residence on November 22, 2006 (as per Departmental valuation report) : 38,45,840 Jewellery found from the bank locker on November 5, 2007 (as per Departmental valuation report) : 26,40,331 Total Jewellery found during the search : 64,86,171 Less : Declared by Mrs. Jyoti Gulati (wife of the assessee) : 17,27,702 Jewellery belonging to Mr. Rajiv Gulati (the assessee) : 47,58,469 Less : Already declared as per books by the assessee : 27,40,732 Declared in the return filed for the assessment year 2007-08 after search : 20,17,737 So far as the jewellery already declared by the assessee amounting to Rs. 27,40,732/- the same is not in dispute. The dispute is only with regard to certain items of jewellery which assessee has stated to have been purchased from the Jeweller M....
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....s no quantitative difference and the difference in on account of valuation, then AO should have made some sort of enquiry from the Jeweller, because as per the purchase bill the same quantity of jewellery, he has shown a particular value and if such value is less, than AO should have ascertain this fact. Once there is evidence in the form of actual purchase bill, then estimate made by the DVO cannot stand unless some material is brought on record to show that value shown in the bill has been suppressed. Thus, we do not find any reason to confirm such an addition merely on the basis of estimate made by the DVO when there is no difference in the quantity of jewellery. Thus, addition of Rs. 13,33,975/- is deleted. 13. Lastly, on the issue of Rs. 5 lacs as unexplained cash credit, the relevant facts are that, one seized document 'page No. 18 of Annexure A-1' mentioned receipt of Rs. 5 lacs in cash from Shri Rajiv Gulati (assessee) on 14.11.2006 by the owner of the flat No. B-525 Sushant Lok-I, New Delhi. The AO did not find assessee's submission as satisfactory and thus, had added the same as unexplained cash credit. Before the Ld. CIT(A) the assessee had stated as under :- "9....