2018 (7) TMI 736

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....ction 143(3) of the Income Tax Act, 1961 (in short "the Act") dated 29.12.2012 for the Assessment Year 2010-11. 2. The only issue involved in this appeal is as to whether the Ld. CIT(A) was justified in deleting the addition made in the sum of Rs. 60 lacs by the ld. AO based on the surrendered sum made by the assessee at the time of survey, in the facts and circumstances of the case. 3. The brief facts of this issue is that the assessee is a partnership firm deriving income from transportation and commission agency. It had filed its return of income for assessment year 2010-11 on 25.09.2010 declaring total income of Rs. 3,15,760/-. There was a survey conducted u/s 133A of the Act on 23.02.2010. During the course of survey, certain doc....

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....heque No. Date Amount 717703 26.02.2010 Rs. 10 lacs 717704 04.03.2010 Rs. 5 lacs 717705 10.03.2010 Rs. 5 lacs   The assessee honoured these cheques, but however claimed refund of Rs. 23,82,006/- while filing the return of income after declaring total income of Rs. 3,15,760/- . The assessee before the ld. AO stated that the firm is represented only by Mr. Alok Kumar Jain and Mr. Nirmal Kumar Samal and both were not present at the time of survey. It was specifically stated that Mr. Ajay Kumar Jain who was present at the time of survey was not authorized to give any statement on behalf of the firm. Accordingly, the assessee firm duly retracted the disclosure given by Mr. Ajay Kumar Jain as unauthoriz....

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.... that was recorded from Shri Ajay Kumar Jain was not out of his own free will. The Ld. CIT(A) placed reliance on the CBDT instruction in F. No. 256/2/2003-IT(Inv.) dated 10.03.2003 wherein the board has specifically instructed the survey officers and search officers not to record any confession statement from the assessee. The Ld. CIT(A) observed that: "In the case of the assessee, the action u/s. 133A of the Act was correctly taken up at the address of the Firm at 115, College Street, Kolkata - 700 012 and some papers/books were collected by the A.O. from there. However based on a statement by one Sri Subhankar Dey, the A.O. conducted another survey' at the premises No.47A, Park Street, Kolkata-700 016 believing that the books....

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....ee/or it does not have any evidentiary value. This decision of the High Court has since been confirmed by the Supreme Court in this case of CIT v. S. Khader Khan son (2012) 254 CTR 228(SC.). Thus even if the statement recorded during the course of the survey is not of any evidentiary value, it can be used to 'support' the findings of the survey. But in the instant case there are no documents or details with the A.O. suggesting any evasion of tax. The sole argument of the A.O. is that Sri Ajay Kumar Jain had been entrusted with signed blank cheques by the Partners in case of any need and that Sri Ajay Kumar Jain had given three cheques to the survey-team totaling Rs. 20,00,000/- as tax on the surrendered sum of Rs. ....

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....alue. With this argument the ld. DR tried to distinguish the case law relied upon by the Ld. CIT(A) in his order and accordingly, vehemently supported the order of the ld. AO. 8. We have heard rival submissions. We find from pages 6 to 8 of the paper book filed by the authorized representative of the assessee that the statement of Shri Ajay Kumar Jain was recorded on the date of survey on 23.02.2010 only u/s 133A of the Act. Hence, we are inclined to accept the argument of the ld. AR that the ld. AO had factually erred by stating the statement has been recorded u/s 131 of the Act thereby contemplating to give evidentiary value for the same. It is not in dispute that barring the statement from Shri Ajay Kumar Jain, no other corroborative ....