2007 (9) TMI 254

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....hat additions made on the basis of material collected during the course of such survey was illegal ?" 2.  The Revenue had moved an application for seeking reference on three questions pertaining to the order of the Tribunal in I. T. A. Nos. 765, 663 and 664/JP/92. Out of the three questions, the Tribunal referred only question No.3 with some modification. 3. The brief facts giving rise to the question referred is that a survey under section 133A of the Income-tax Act was conducted on February 25, 1987, during the course of survey, excess stock was found, thereby addition was made by a sum of Rs. 3,24,544 by the Assessing Officer. Aggrieved by the said addition, the assessee preferred an appeal before the Commissioner of Income-ta....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....llected during such illegal search. The only requirement is that court or the authority before which such material or evidence brought to be cautious and circumspect in dealing with such material or evidence. 6.  In other cases reported in Pooranmal v. Director Inspection (Investigation) [1974] 93 ITR 505 (SC) the hon'ble apex court held that material obtained in search made in contravention of the provisions can be used. 7. According to the learned counsel for the Revenue, the ratio of the two judgments applies even in the matter of survey because after collection of material in search and seizure and collection of material in survey, it stands the same footing for the purposes of use of material by the Assessing officer. Thus, ....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....taining to the issue in reference. 10. Fromthe facts available on record, it has come out that the action of the r to conduct survey under section 133A was not legal under section 133A though no prohibition has been imposed on the Inspector to conduct such a survey however unless an authority is given under the provision of section 133A, survey conducted by the Inspector is not held to be legal and the Tribunal has recorded its finding accordingly. Now, the moot question comes as to whether material collected during the course of illegal survey can be taken into consideration by the Assessing Officer or in other words whether additions can be made on the basis of material collected during the course of illegal survey. In the present matt....