TaxTMI 
TaxTMI 
2021 (3) TMI 221
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....Y. 2014-15 and A.Y. 2015-16 respectively. Later on, statutory notices were issued and A.O. completed the assessments by making additions/disallowances of Rs. 9,09,000/-, Rs. 4,99,500/-, Rs. 8,53,500/-, Rs. 13,44,000/-, Rs. 1500/- and Rs. 1,77,000/- for A.Y. 2009-10 to A.Y. 2012-13. A.Y. 2014-15 and A.Y. 2015-16 respectively on account of unaccounted commission income earned by the assessee. 3.1. The Ld. CIT(A) noted the background of the facts of the case which lead to the above additions. A search and seizure action under section 132 of the I.T. Act was conducted in the Yadav Singh, Rajesh Manocha and Meenu Group. During the course of search action at the residence of Smt. Kusum Lata wife of Shri Yadav Singh evidences in the form of slips were found which established that Shri Yadav Singh has indulged in the practice of awarding contract with the help of his other colleagues for which an unaccounted and illegal commission of 5% was paid to Shri Yadav Singh and his colleagues which includes the assessee also. This fact was categorically admitted by Shri Ramendra Kumar Singh, an employee of the Noida Authority who was subordinate to Shri Yadav Singh. During his statement recorded o....
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....so closed on the same day and thereafter summons were issued to the assessee under section 131(1) of the I.T. Act,1961 and statement of the assessee was recorded under section 131(1A) of the I.T. Act, 1961. The additions appears to have been made on the basis of the statement recorded under section 131(1A) of the I.T. Act, 1961, without corroborating evidence on record. Nothing was recovered during the course of search in the case of assessee. None of the papers found from other persons were connected with the case of the assessee. The assessee is not connected with Shri Yadav Singh or Shri Ramendra Kumar Singh in any manner. Copy of the Panchanama would show that nothing is recovered from the premises of the assessee at the time of search. The statement of assessee was never recorded under section 132(4) of the I.T. Act, 1961. The statement of assessee was recorded much later on after conclusion of the search on 03.02.2014 to 05.12.2014 in different sittings and assessee was required to write down in his handwriting a pre-written statement provided by the Investigating Officer. The wife and son of the assessee were also directed to appear in the O/o. Investigating Officer without ....
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....ayment on the award of contract works. A detailed statement of Shri Ramendra is produced by the AO in the assessment order. Further, in the post search proceedings statement of the appellant was recorded on oath u/s 131 (1A) of the Act, wherein it was categorically accepted by him that he is in receipt of illegal commission against contract awarded to the various contractors during his posting from 2003 onwards till the date of recording of statement. It is also categorically admitted by the appellant that quantum of such commission varies from Rs. 1,000 to Rs. 2,000 per bond. The detailed statement of the appellant is reproduced by the AO from page no. 20 to 29 of the assessment order. The AO estimated the illicit commission of the appellant @ 1500 per bond which cannot be faulted within absence of any other material on the contrary Therefore, AO has correctly estimated the commission income of the appellant during this relevant assessment years which is as follows : Even as A. Y. Contracts 100 to 2000 per bond lence average 1500/- 2009-10 606 90900 2010-11 333 499500 2011-12 569 853500 2012-13 896 1344000 2013-14 0 0 2014-15 1 1500 2015-16 11....
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....behalf of assessee. If the A.O. wanted to use the third party statement or material against the assessee, the A.O. shall have to follow the procedure provided under section 153C of the I.T. Act, 1961. However, the A.O. framed the assessments under section 153A of the I.T. Act, 1961, therefore, such statements or material recovered in the case of Smt. Kusum Lata or Shri Ramendra Kumar Singh cannot be read in evidence against the assessee. No addition could be made against the assessee under section 153A because no incriminating material is found or seized during the course of search. Therefore, the case of the assessee would be covered by Judgment of Hon'ble Delhi High Court in the case of CIT vs., Kabul Chawla 380 ITR 573. He has referred to reply of the assessee Dated 23.12.2016 which was filed before the CIT, Central Circle, Noida explaining under what circumstances statement of assessee was recorded under coercion and duress. The assessee denied to have made any voluntary statement. The assessee also explained that he has not made any investment in any house property in his name or in the name of his family members. He has also filed copy of the letter Dated 13.12.2014 which was....
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....arly hearing appeals, both the parties argued the appeals finally. The Ld. D.R, therefore, submitted that there is no merit in the appeals of assessee, therefore, same may be dismissed. 6. We have considered the rival submissions and perused the material on record. Learned Counsel for the Assessee relied upon the Judgment of Hon'ble Delhi High Court in the case of PCIT [Central]-3 vs., Anand Kumar Jain (HUF) & Others vide Order Dated 12.02.2021 (supra), in which the Hon'ble Delhi High Court in paras 6 to 11 held as under : "6. We have considered the contentions of Mr. Sharma, however, we feel that the instant appeals do not raise any question of law, much less substantial question of law for our consideration. The relevant portion of the impugned order reads as under:- "5. (...) We find that the Ld. Counsel for the assessee has drawn our attention towards the relevant portion of the judgment / decision of the Hon'ble Supreme Court of India, Hon'ble High Courts and various Benches of the Tribunal on the legal issue on which he argued, Ld. Counsel for the assessee further submitted that admittedly from assessee's own premises during search u/s. 132 of the Act no incr....
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.... the record that apart from the statement of Mr. Jindal, Revenue has failed to produce any corroborative material to justify the additions. On the contrary we also note that during the course of the search, in the statement made by the assessee, he denied having known Mr. Jindal. Since there was insufficient material to support the additions, the ITAT deleted the same. This finding of fact, based on evidence calls for no interference, as we cannot re-appreciate evidence while exercising jurisdiction under section 260A of the Act. 8. Next, we find that, the assessment has been framed under section 153A, consequent to the search action. The scope and ambit of section 153A is well defined. This court, in CIT v. Kabul Chawla, concerning the scope of assessment under Section 153A, has laid out and summarized the legal position after taking into account the earlier decisions of this court as well as the decisions of other High Courts and Tribunals. In the said case, it was held that the existence of incriminating material found during the course of the search is a sine qua non for making additions pursuant to a search and seizure operation. In the event no incriminating material is fou....
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....xamination only where the books of accounts, documents and assets possessed by a person are relevant for the purposes of the investigation being undertaken. Now, if the provisions of Section 132(4) of the Act are read in the context of Section 158BB(1) read with Section 158B(b) of the Act, it is at once clear that a statement recorded under Section 132(4) of the Act can be used in evidence for making a block assessment only if the said statement is made in the context of other evidence or material discovered during the search. A statement of a person, which is not relatable to any incriminating document or material found during search and seizure operation cannot, by itself, trigger a block assessment. The undisclosed income of an Assessee has to be computed on the basis of evidence and material found during search. The statement recorded under Section 132(4) of the Act may also be used for making the assessment, but only to the extent it is relatable to the incriminating evidence/material unearthed or found during search. In other words, there must be a nexus between the statement recorded and the evidence/material found during search in order to for an assessment to be based on t....
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....s statement on oath recorded in the course of search conducted in the case of a third party (i.e., search of Pradeep Kumar Jindal) for making the additions in the hands of the assessee. As per the mandate of Section 153C, if this statement was to be construed as an incriminating material belonging to or pertaining to a person other than person searched (as referred to in Section 153A), then the only legal recourse available to the department was to proceed in terms of Section 153C of the Act by handing over the same to the AO who has jurisdiction over such person. Here, the assessment has been framed under section 153A on the basis of alleged incriminating material (being the statement recorded under 132(4) of the Act). As noted above, the Assessee had no opportunity to cross- examine the said witness, but that apart, the mandatory procedure under section 153C has not been followed. On this count alone, we find no perversity in the view taken by the ITAT. Therefore, we do not find any substantial question of law that requires our consideration. 11. Accordingly, the present appeals, along with all pending applications, are dismissed." 6.1. In this case initially search was conduct....
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....ents itself do not indicate any involvement of the assessee for getting any commission etc., therefore, such recovery of the Annexures A1 and A2 would not implicate the assessee for earning of any commission at any point of time. Thus, the evidences which remained with the Revenue was the statement of Shri Ramendra Kumar Singh recorded under section 132(4) of the I.T. Act, 1961. This statement of Shri Ramendra Kumar Singh is not corroborated with any evidence or material on record. Thus, his statement alone is not sufficient to fasten any liability upon the assessee so as to compute undisclosed income in the form of getting commission by the assessee. The assessee claimed that statement of Shri Ramendra Kumar Singh was not confronted to assessee and no right of cross-examination have been allowed to assessee. The Ld. D.R, however, submitted that while recording statement of assessee, statement of Shri Ramendra Kumar Singh have been referred to would clearly indicate that statement of Shri Ramendra Kumar Singh was confronted to the assessee. Therefore, there is a compliance to the provisions of Law. However, we do not agree with the submissions of the Ld. D.R. It is well settled Law....