TaxTMI 
TaxTMI 
TaxTMI 
2019 (9) TMI 149
X X X X Extracts X X X X
X X X X Extracts X X X X
.... found which was said to have been confirmed by the assessee. According to Assessing Officer, the assessee had suppressed the stock and cash discrepancy while submitting the return of income for the year under consideration and he added the above said amount to the total income of the assessee. 4. Before the CIT(A), it was reiterated that part of stock found on the premises during survey did not belong to the assessee and which actually belong to another concern i.e. M/s Shree Durga Metal Products which is a proprietary concern of assessee's son i.e. Shri Ajoy Kr. Das. It is noted from the record that it was contended that since the two premises were situated back to back, part of the stock of the latter concern was mistakenly counted as belonging to the assessee. The CIT(A) did not accept the submissions of the assessee and confirmed the addition made by the Assessing Officer by observing that the assessee has not brought on record any material that could explain this strange occurrence of any stock from other business concern present on the surveyed premises and the survey team could not conduct any further exercises to physically distinguish stock as belonged to assessee for th....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... factor is that not only was the statement of the appellant's son take, the appellant also was examined and he, during his statement, not only affirmed the statement of his son, but also, when specifically asked about the possibility of stock from any other concern being present on the said surveyed premises, once again categorically denied it. In these circumstances, it is difficult to see how the factual position of the stock belonging entirely to the appellant, could be denied at a later stage - after several years. This denial is not based on any cogent material on record, which would at least cast some doubt upon the stock-taking process. The appellant has not filed any application pointing out this issue between the time that the survey took place and the time when during the assessment proceedings this question came up. It is very strange that the appellant did not raise questions regarding the survey earlier. Even if for the sake of argument and without prejudice to the fact that this has not been established at all, it is conceded that the concern of the appellant's son was operating from premises that were located back to back from those of the appellant's b....
X X X X Extracts X X X X
X X X X Extracts X X X X
....a vide his order dated 18.04.2017. 7. He submitted that the Office 'M/s N. C. Das (Electricals) and Co. is situated at 9/1 and 12/5 Musalman Para Lane, Howrah-711101 and his godown is situated at 23/1, J Road, Howrah. The adjacent room of the assessee's godown having holding number P-56/14, Benaras Road, Belgachia Howrah, which also belongs to the assessee was given on rent to another business being i .e. M/s. Shree Durga Metal Products, a partnership firm having three partner being Smt. Maya Das, Sri Binoy Kumar Das and Sri Ajoy Kumar Das who is the assessee's son). The said M/s N. C. Das (Electricals) and Co. And M/s. Shree Durga Metal Products are two different business entities. The PAN and VAT numbers are different from each other. Unfortunately, during the survey proceedings, the survey team while making calculation of stock of the assessee, added valuation of stock from M/s. Shree Durga Metal Products godown at P-56 Benaras Road, Belgachia Howrah. 8. Further, the survey team took the entire stock for valuation from P-56, Benaras Road, Belgachia Howrah, which is the stock of M/s. Shree Durga Metal Products and merged it with assessee's business stock and referred to the tra....
X X X X Extracts X X X X
X X X X Extracts X X X X
....he ld. AR argued that there is no documentary evidence collected by the Survey team and in spite of producing all the necessary documents like trade, licence of M/s Shree Durga Metal Products, the Survey Team, the A.O, CIT(A) took the Stock of Shree Durga Metal Products and illegally merged it with the assessee without any reason or justification. 12. The ld. AR placed reliance on the decision of Hon'ble High Court of Madras in the case of CIT vs. M/s. S. Khader Khan Son in T.C.(A) No.867 of 2007 and submits that an admission is extremely an important piece of evidence, but, it cannot be said that it is conclusive and it is open to the person who made the admission to show that it is incorrect and the assessee should be given a proper opportunity to show that the books of account do not correctly disclose the correct state of facts and argued that the entire assessment is totally arbitrary, bad in law as well as on fact and contrary to the Principals of natural justice. 13. In reply, the ld. DR submits that the case law relied on by the assessee is not applicable to the facts of the case. The survey was conducted on business premises and godowns of assessee on 08.01.2013 and stat....
X X X X Extracts X X X X
X X X X Extracts X X X X
....rbitrary and illegal. Further it is noted at the time of conclusion of survey proceedings, a final statement of Shri Rohitaswa Das (the assessee before us) was recorded wherein he confirmed the contents of preliminary statement given by his son, was therefore according to Assessing Officer the stock found at 56/4, Benaras Road, Howrah belongs to assessee and held the assessee suppressed the same in the return of income. 15. Supporting the contention of the assessee, evidences such as a memorandum dated 12.03.2013 issued by the Office of Commissioner, Commercial Taxes, West Bengal is placed at Page No.57 in the Paper Book wherein it clearly shows the address of the assessee is at 11/2, Musalman Para Lane, Howrah indicating the new registration nos.W.B. Value Added Tax Act, W.B. Sales Tax Act and Central Sales Tax. A challan dated 19.06.12 issued by the W.B.S.T on Professions, Trade, Callings and Employment Act at page No.60 shows the address of the assessee at 12/5, Musalman Para Lane which clearly shows the address of the assessee at 11/2 as well as 12/5 at Musalman Para Lane, Howrah. So therefore it is established that the assessee conducts his business in the name and style M/s ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....recorded u/s 133A of the Act does not give any evidentiary value as the officer is not authorized to administer oath and to take any sworn statement which alone has evidentiary value as contemplated under law. In the present case, as discussed above, the survey u/s 133A of the Act was conducted on 08.01.2013 and a preliminary statement was recorded on 09.01.2013 stated to have been on oath of Shri Ajoy Kr. Das who is happened to be son of assessee. Again a final statement of Shri Rohitaswa Das was recorded to confirm the statement made by Shri Ajoy Kr. Das. We note that in the light of the observations made by the Hon'ble High Court of Madras in the case of S. Khader Khan & Sons (supra). It is to be held that no addition is maintainable on the basis of statement recorded during the course of survey unless there is evidence supporting the statement. The CBDT Circular dated 10.03.2003 clarified the same. The relevant portion of decision of Hon'ble High Court of Madras is reproduced hereinbelow: "5.4. The scope of Sections 132(4) and 133A also came up for consideration before the Kerala High Court in Paul Mathews and Sons v. Commissioner of Income-tax [(2003) 263 I.T.R. 101]. In the....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ration before this Court in Commissioner of Income-tax v. G.K.Senniappan [(2006) 284 I.T.R. 220], a Division Bench of this Court, in which one of us was a party (P.P.S.JANARTHANA RAJA, J.), answered the question in the affirmative, against the Revenue and in favour of the assessee, holding that the materials collected during the survey under Section 133A cannot be taken into consideration while determining the undisclosed income in respect of block assessment as per section 158BB, as the same has no evidentiary value. 5.6. Again, when an identical question whether the material found in the course of survey in the premises of the builder could be used in the block assessment of the assessee, came up for consideration before this Division Bench in an unreported case in T.C.(A) No.2620 of 2006, this Court, by order dated 22.11.2006, of course, following the earlier decision of this Court in G.K.Senniappan's case reported in (2006) 284 I.T.R. 220, while confirming the order of the Tribunal, answered the question in favour of the assessee, in limine. 6. What is more relevant, in the instant case, is that the attention of the Commissioner and the Tribunal was rightly invited to t....
X X X X Extracts X X X X
X X X X Extracts X X X X
....inister oath and to take any sworn statement which alone has evidentiary value as contemplated under law, vide Paul Mathews and Sons v. Commissioner of Income-tax [(2003) 263 I.T.R. 101]; (iii) The expression "such other materials or information as are available with the Assessing Officer" contained in Section 158BB of the Income-tax Act, 1961, would include the materials gathered during the survey operation under Section 133A, vide Commissioner of Incometax v. G.K.Senniappan[(2006) 284 I.T.R. 220]; (iv) The material or infomration found in the course of survey proceeding could not be a basis for making any addition in the block assessment, vide decision of this Court in T.C.(A) No.2620 of 2006 (between Commissioner of Income-tax v. S.Ajit Kumar); (v) Finally, the word "may" used in Section 133A (3)(iii) of the Act, viz., "record the statement of any person which may be useful for, or relevant to, any proceeding under this Act, as already extracted above, makes it clear that the materials collected and the statement recorded during the survey under Section 133A are not conclusive piece of evidence by itself. 8. For all these reasons, particularly, when the Commissioner and ....