2022 (1) TMI 1094

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....elopers. The return of income for the assessment year 2013-14 was filed on 24.09.2013 declaring total income of Rs. 80,96,061/-. Against the said return of income, the assessment was completed by the Assistant Commissioner of Income Tax, Circle-1, Nashik ('the Assessing Officer') vide order dated 12.02.2016 passed u/s. 143(3) of the Income Tax Act, 1961 ('the Act') at total income of Rs. 2,38,73,310/-. While doing so, the Assessing Officer made the following disallowances:- (i) Disallowance under valuation of work in progress - declared in survey action u/s. 133A of Rs. 26,00,000/-. (ii) Disallowance of expenditure partly supported by self made vouchers and not fully supported as declared in survey action u....

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....s are self made. However, in the return of income, no income was offered to tax in respect of the statement made by the assessee. During the course of assessment proceedings, the assessee had contended that there is no undervaluation of work in progress and the statement was given by the appellant under wrong impression that there is undervaluation of work in progress. 5. Similarly, as regards to the statement given in respect of unverifiable expenditure of Rs. 5,00,000/-, it is contended that the expenditure which is supported by self made vouchers was totalling to Rs. 7,55,188/- and the Assessing Officer disallowed a sum of Rs. 5,00,000/- out of Rs. 7,55,188/- is unreasonable. It is further submitted that the evidence in respect of the....

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.... in the case of CIT vs. S. Khader Khan Son, 210 Taxman 248 (SC); CBDT Instruction bearing F. No. 286/2/2003-IT(Inv) dated 10.03.2003 and CBDT Instruction bearing F. No. 286/98/2013-IT (Inv. II) dated 18.12.2014. 9. On the other hand, ld. CIT-DR placing reliance on the orders of the lower authorities submitted that the addition is made based on the admission as made by the assessee and no further corroborative evidence is required for the purpose of making any addition based on the statement. 10. We heard the rival submissions and perused the material on record. The issue in the present appeal relates to the addition of Rs. 31,00,000/- made by the Assessing Officer based on the statement recorded during the course of survey operations ....

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....appellant had categorically stated before the Assessing Officer that there was no discrepancy in the valuation of work in progress, as well as no doubts as to the genuineness of expenditure incurred, inspite of this fact, the Assessing Officer proceeded with making of addition based on the mere statement given by the assessee u/s. 133A of the Act. It is not the case of the Department that, the discrepancy if any in the valuation of closing work in progress as on date of survey, still existed in the valuation of closing work in progress as on date of end of previous year, nor no addition can be made based on discrepancies, if any, in the valuation of work in progress in the middle of previous year. This approach of the Assessing Officer does....