TaxTMI 
TaxTMI 
2023 (3) TMI 547
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....herefore, we decide to adjudicate the matter after hearing the ld.DR and considering the material available on record. 3. The grounds raised by the assessee are as under: "1. The CIT(A) has erred in law and on facts in adding Rs.3,76,670/- to the income of the assessee as unexplained investment. 2. The CIT(A) has failed to appreciate that the addition to the income of the assessee cannot be made in the absence of any positive evidence solely on the basis of confessional statement recorded during the survey proceedings." 4. A perusal of the order of the Revenue authorities below reveals that survey proceedings were carried out on the assessee on 3.2.2014 in which the assessee made voluntary disclosure of Rs.4,52,225/- for the impugned assessment year i.e.Asst.Year 2014- 15, but failed to file return of income. Accordingly, the case was reopened and notice issued under section 148 of the Act. In response to which, the assessee filed return of income declaring income of Rs.3,01,960/- as against disclosure made of Rs.4,52,224/-. The AO noted that survey proceeding was carried out at the premises of Vagheswari Jewellers, prop: Shri Vipul Rasiklal Soni on 3.2.2014. During the proce....
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....ess and duress at the fag end of the day of survey. It may please be noted that the survey party started the survey proceedings at 4 p.m., the recording of the statement started at 11.30 p.m. and was concluded at around 2.30 a.m. the next day. The fact was brought to the notice of the A.O. and the same has not been controverted by the A.O. in his order. Certain glaring errors in the statements recorded of my brothers which come to our notice were also pointed out to theA.O. TheA.O. has chosen to remain silent on this aspect also. 14. A copy of the document file based on which the admission was made by your appeallant is enclosed at PB Pg. 3 to 32. On perusal of the impugned documents file, it is clear that the total value of investment made in the impugned property is Rs.2,26,670/- as against Rs.13,56,670/-admitted by the assessee in his statement recorded at the time of survey. 15. Your appellant primarily relies on the submission made before the A.O. vide his letter dt 15.12.2017 & 22.12.2017filed before the A.O. during the proceedings u/s 148 (PB Pg. 67 & 76). 16. Your appellant further submits that he has not brought any new material on record but simply discovered a mist....
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....y itself. It is my humble submission that the ratio of the above decision is applicable in my case and therefore, the addition made by the A.O. should be ordered to be deleted. Similar decision is rendered by the Hon. Gujarat HC in the matter of The Commissioner of Income Tax-IV Vs Ramanbhai B. Patel in tax appeal no. 207, 208 to 210 of 2008 wherein it has been held that Admission u/s 132(4) of undisclosed income by assessee is not conclusive if no evidence is found to support the admission. A retraction, though belated, is valid. Similar decision is rendered by the Hon. Gujarat HC in [2015] 55 taxmann.com 292 (Gujarat) -Commissioner of Income-tax v. ChandrakumarjethamalKochar and Hon. Andhra Pradesh HC in [2015] 55 taxmann.com 176 (Andhra Pradesh) - Commissioner of Income-tax, Karnataka v. Shri Ramdas Motor Transport Ltd. 21. Still further reliance is placed on the decision rendered by the Hon. Gujarat HC in [2008] 174 Taxman 466 (Gujarat) wherein it has been held that a statement recorded under section 132(4) at mid night cannot be considered to be a voluntary statement, if it is subsequently retracted by assessee and necessary evidence is led contrary to such admission and f....
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....ed aside. Considering the foregoing discussion, it is beyond pale of doubt that there was a mistake in the recording of statement of the assessee during the survey, the said statement has been retracted by the assessee only to the extent of mistake and there is no evidence to support the addition made by A.O. except the admission by the assessee in his statement recorded during the survey which is proven to be factually incorrect. In view of the above facts, settled law and judicial pronouncements of the Hon. Gujarat High Court as well as the Hon. Supreme Court of India, the addition of Rs.3,76,667/- made by the AO deserves to be deleted and the assessment order being erroneous on factual aspects be struck down." 6. The ld.CIT(A) however upheld the addition made stating that the surrender made by the assessee was voluntary and there was nothing to prove that it was recorded under stress or duress. He also noted that the documents now produced by the assessee was not impounded during the survey, and therefore not subject to verification. Accordingly, he rejected the contentions of the assessee and upheld the addition made on the basis of surrender/admission made by the assessee i....
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....f the above discussion I find no merit in contentions of assessee. The addition made by the Assessing Officer on the basis of assessee's voluntary statement on being confronted with the document found during survey is fully justified. I find no reason to interfere with the action of Assessing Officer. The addition is sustained. The ground of appeal is rejected." 7. Before us the ld.DR relied on the finding of the authorities below. 8. We have gone through orders of the authorities below. We are not agreement with the ld.CIT(A). It is an undisputed fact that the addition of share of assessee's investment in the impugned property which was added to his income as unexplained was solelyon the basis of his statement recorded during the survey that the investment in the property was to the tune of Rs.13,56,670/-. It is also an undisputed fact that the assessee subsequently pointed out to the AO that he had mentioned wrongly the figure of investment in the impugned property and had produced relevant documents evidencing the quantum of investment made in the property to be far less than that admitted by the assessee in the statement made to the tune of Rs.2,26,670/-. Nothing has been....