TaxTMI 
TaxTMI 
2020 (9) TMI 1290
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....n Goenka Group was engaged in the business of financing, trading and investments in commodities and shares, mutual funds, real estate and beverages. A search warrant was executed in the case of the assessee M/S. Golden Goenka Fincorp Ltd. and the panchnama was also drawn in its name. The last authorization for the search u/s 132 of the Act was executed on 21/04/2015. The Assessing Officer records that during the course of search operations, at the office premises of the assessee, the documents marked as GG/IO (Page-28) & GG-2 (Page- 7) were found and seized. Scanned copies of these documents are extracted at page 3 & 4 of the assessment orders. At page 4 & 5 of the assessment order, the Assessing Officer states as follows:- "On perusal of the said documents it is revealed:- a) Page-28 of GG-IO contains hand written recordings at the bottom that cash to the extents of Rs. 25 Crores were paid on 05.04.2012 for arranging share capital/premium in Golden Goenka Fincorp Ltd. b) Page-71 of GG-2 contains hand written recordings at the bottom that cash were paid for arranging share capital/ premium in Golden Goenka Fincorp Ltd. (Rights issue) in the following m....
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....014 in cash for arranging share capital/ premium for M/S. Golden Goenka Fincorp Ltd. The letter, retracting from the earlier recorded statement and making allegations against the Department is extracted by the Assessing Officer at pages 7 to 10 of the assessment order. Summary of this is extracted at para 4.2. of the of the assessment order. The Assessing Officer rejected these contentions of the assessee for the reasons given in para 4.3. pages 10 to 15 of his order. He made an addition of Rs. 25 Crores for the Assessment Year 2013-14 and Rs.15 Crores for the Assessment Year 2015-16. These are not extracted for the sake of brevity. 2.2. Aggrieved the assessee carried the matter in appeal before the Id. CIT (A). The Id. First Appellate Authority, deleted both these additions for the reason given at para 4 to para 8 (pages 24 to 26) of his order. The grounds on which the additions were made by the Assessing Officer and the reasons for which these additions u/s 68 of the Act were deleted by the Id. CIT (A) are identical for both the Assessment Years 2013-14 and 2015-16. 3. Aggrieved the revenue is in appeal before us. 4. The Id. CIT D/ R, Shri Imokaba Jamir, took this Bench ....
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....ure, tax was to be levied on the basis of admission without scrutinizing documents. He also relied on the judgment of the Hon'ble Rajasthan High Court in the case of M/S. Bannalal Jat Constructions vs. ACIT in D.B. Income Tax Appeal No. 140/2018, judgment dt 31/08/2018, for the proposition that the reliability, importance and sanctity of admission made during search could be refuted only by cogent and convincing evidence and it is open to the person who has made the submission to show that it is incorrect. 4.1. He prayed that the order of the Assessing Officer be restored on this issue and that of the Id. CIT (A) to be set aside. 5. The Id. Counsel for the assessee, Shri Miraj D. Shah, on the other hand, controverted the submissions of the Id. CIT D/ R and submitted that the Id. CIT (A) has correctly appreciated the factual position and has come to a correct factual conclusion on this issue. He submitted that the documents GG/IO (page 28) was a copy of the balance sheet of SKB from 1st April, 2002 to 31st March, 2003 and the notings in it refer to the date of April, 2012 which is 10 years after that. Similarly, GG/2 at page 71 refers to balance sheet of SKB from Apr....
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....other corroborative evidence or investigation and that additions were made for the very same amount in the hands of Shri Girdhar Lal Goenka. He prayed that the order of the Id. First Appellate Authority, be upheld. 5.1. In reply, the Id. CIT D/R, submitted that the statement u/s 132(4) of the Act is recorded in the presence of independent witnesses and that there is no evidence that the employee of the Group concern was forced to write with a pen, the writing in ink that appeared on the print outs taken from the pen drive. 6. We have heard rival contentions. On careful consideration of the facts and circumstances of the case, perusal of the papers on record, orders of the authorities below as well as case law cited, we hold as follows:- 7. A perusal of the seized documents relied upon by the Assessing Officer reveals that they are very old balance sheet pertaining to 1st April, 2002 to 31st March, 2003 and again to the period from 01/04/2004 to 14/03/2005, under the head SKB. There is no evidence as to whether the abbreviation SKB is an abbreviation of the assessee company M/S. Golden Goenka Fincorp Ltd. There is no denial of the fact that both these documents were printou....
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....nt of Shri Goenka was recorded wherein although he affirmed his offer ofRs. 40 crores but specifically stated in reply to Question' No. 6 of the said statement that his statement given in response to earlier Q 21 was incorrect and that he was not in the proper state of mind while answering the queries back then. In sum & substance, he denied the contents of the document ID Marked GG/IO- Page 28. From the aforesaid facts it is therefore obsewed that although Shri G L Goenka in his initial statement recorded u/s 132(4) which is an important and decisive piece of evidence affirmed the notings on document ID Marked GG/IO- Page 28 but in his last statement recorded by the Investigating Officer, he had specifically denied the same. 2. Subsequently, in response to notice u/s 153A the appellant-company filed return of income of In response to the notices issued u/s 143(2) & 142(1) were issued which the appellant company duly complied with. In the course of proceedings, Shri G L Goenka also filed another retraction statement dated 09.04.2015 stating that he is denying the statement given on 17.03.2015 and that it was given under duress and coercion. The Ld. AO however was not a....
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....e factual findings made by the Id. CIT (A) could not be controverted by the Id. D/R. The decisions relied upon by the Id. D/R are not applicable to the facts of the case. In the case of B. Kishore Kumar (supra), the sworn statement was not retracted. In this case the retraction was during the course of search itself. In the case of M/S. Bannalal Jat Constructions (supra), the Hon'ble High Court after discussing a number of case-law has held that the assessee may retract from the statement and that admission made u/s 132(4) of the Act is an extremely important piece of evidence though it is not conclusive. In this case, no corroborative evidence has been brought on record by the Assessing Officer in support of his findings that the notings made on the printouts of the balance sheets taken from the pen drive, are in fact the income of the assessee. Writing on a paper taken as a print out from a pen drive found during the course of search cannot be income by any stretch of imagination. When the assessee makes certain serious allegation during the search operations and denies the content of the statement recorded from him u/s 132(4) of the Act, the burden shifts to the revenue t....
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....action was subsequently re-affirmed by way of an affidavit dated 21.02.2016. Having regard to the aforesaid and the provisions of Section 132(4), I note that the words 'may thereafter be used' in Section 132(4) of the Act only gives an 'option' to the authorities concerned to presume the things. The said presumption however is indeed rebuttable. The assessee has every right to rebut the same by producing evidence in support of its claim and contentions. In the facts of the instant case, it is noted that on the date of search i.e. 17/18.03.2015 the appellant had owned up the notings found in document ID Marked GG/10- Page 28. This was however retracted and in his second statement recorded on 20.04.2015 he vehemently denied the same and stated before the Investigation. Officer that such statement was recorded when he was stressed and under a depressed state of mind, without actually going through the contents of the documents. On these facts therefore I hold that the initial statement u/s 132(4) relied upon by the Ld. AO to justify the impugned addition was wholly untenable.. Having regard to the numerous retractions filed by the appellant an....
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.... In view of the above I find that the Ld. AO has not brought on record any corroborative evidence or any unexplained assets etc. to back the alleged notings found in document ID Marked GG/10- Page 28. The Ld. AO has referred to the fact that the appellant company had indeed raised share capital during the year which justified and correlated with the notings found in the document. This corroboration made by the Ld. AO may appear justified at the first instance; I however note glaring infirmities in this correlation made by the Ld. AO. It is noted that although the Ld. AO has discussed the fact that cash was paid to route monies by way of accommodation entries into the appellant company but no cash trail etc. whatsoever has been established by the Department. It is also an undisputed that fact the share application monies were paid by the appellant's group entities and it was not a case where monies was received by any outside entities or shell companies which would in any manner raise suspicion with regard to the source of funds. It is also an admitted fact that the group entities have been assessed to tax in their own rights and the investm....