AI OCR 
TaxTMI 
TaxTMI 
TaxTMI 
2025 (9) TMI 1441
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....ed u/s. 132(4) of the Act. The department seized certain documents from the possession of the assessee and documents relevant to the impugned additions are page 16 of Exhibit 3 (PB page 18) and Page 1 to 6 of Exhibit 11 (PB page 19-25). The assessee filed his return of Income Tax Act on 29/05/2019 for total income of Rs. 28,26,150/-, which later on revised wherein total income of Rs. 28,28,750/- was declared. The assessment of the assessee was completed u/s. 143(3) of Income Tax Act, 1961 on 07/04/2021 wherein the total income of the assessee was assessed Rs. 50,50,574/- by making the (i) Addition of Rs. 11,00,000/- u/s. 69 of Income Tax Act, 1961 on a/c undisclosed cash payment for purchase of land and taxed the same as per provisions of section 115BBE of Income Tax Act, 1961 and (ii) Addition of Rs. 11,24,424/- u/s. 69 of Income Tax Act, 1961 on a/c undisclosed house construction expenses and taxed the same as per provisions of section 115BBE of Income Tax Act, 1961. The assessee being aggrieved from the additions made by the ld. A.O., filed the appeal before CIT (A), but could not get success there and the appeal of the assessee was dismissed by CIT (A) vide order dated 27-05-20....
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....Also his submission that he was feeling unconformable during the search does not hold merit because he was given proper rest during recording of the statement whenever he desired. He had given his statement in his full consciousness. Further assessee is an individual and has been filing ITR-1 only, the so-called books of accounts i.e. cash book, Balance Sheet etc. has been prepared by assessee just to cover his undisclosed investment. The said copy of balance sheet had also not been filed while filing ITR online. It is just an afterthought to substantiate his undisclosed investment unearthed during the search proceedings. Further provisions of section 69 of the Act are also very explicit which reads as under: "Where in the financial year immediately preceding the assessment year the assessee has made investments which are not recorded in the books of accounts, if any, maintained by him for any source of income, and the assessee offered no explanation about the nature and source of the investments or the explanation offered by his is not, in the opinion of the Assessing Officer, satisfactory, the value of the investments may be deemed to be the income of the assessee of suc....
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....tatements recorded during the search was paid by Mr. Surya Singhal only. It is clearly a case of afterthought to attribute this unexplained cash paid amount of Rs. 11,00,000/- in three hands instead of only in the hands of the appellant as narrated in the seized documents and as admitted by him in his statements recorded during the search and therein offered for taxation. So, this ground of appeal on this sum of Rs. 11,00,000/- paid as unexplained investment towards purchase of agricultural land and added back by the ld. Assessing Officer u/s. 69C has no merits and deserves to be rejected. Therefore, this ground of appeal is rejected." 4.3 The Ld. AR of the assessee filed detailed written submissions and Paper Book containing Page 1-140 and during the course of hearing also filed the copy of some relied upon case law. The Ld. A.R. vehemently argued the case. The written submission filed by ld AR. is as under : - "(a) Brief Background of the addition and contention raised by the assessee. a.1. During the course of search at assessee's residence, some loose papers were found which were inventoried as Annexure "A" exhibit 03 having total pages 1 to 16. On the ....
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....be made solely on the basis of statement recorded during search. b.1. In Assessment order an addition of Rs. 11,00,000/- has been made to the appellant's income on the basis of a statement recorded during search proceedings under section 132 of the Act. During the search, a slip was found indicating a cash payment of Rs. 11,00,000/- towards the purchase of land, which was initially perceived as unaccounted. In the statement recorded under section 132(4) of the Act during the search, the appellant, under the pressure and circumstances of the search, surrendered Rs. 11,00,000/- as undisclosed income, stating that the payment was made out of undisclosed sources. Subsequently, upon verification of the books of account, the appellant realized that sufficient cash balance was available in the regular books of account to cover the said payment. The payment was, therefore, not from undisclosed income but from accounted sources. Accordingly, the appellant did not include the amount of Rs. 11,00,000/- as income in the return of income filed for the relevant assessment year, effectively retracting the earlier surrender made under a mistaken belief. However, the learned AO disrega....
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....made merely on the basis of search statement more so when there is no supporting evidence with department to prove that the surrender made in the statement was correct. b.3. It is submitted that the action of the I.T. authorities in obtaining surrender of income is against the circulars of the CBDT which are binding upon them. Hence the surrender obtained from the assessee was illegal and addition made to tax such surrendered income is unlawful and deserves to be deleted. The Board of direct taxes issued instruction to the All-Chief Commissioners of Income Tax, (Cadre Contra) & All Directors General of Income Tax Inv. vide letter F. No. 286/2/2003-IT (Inv) dated 10.03.2003 in regard of confiscatory statement in the course of search and seizer as under: "Instances have come to the notice of the Board where assessees have claimed that they have been forced to confess the undisclosed income during the course of the search & seizure and survey operations. Such confessions, if not based upon credible evidence, are later retracted by the concerned assessees while filing returns of income. In these circumstances, on confessions during the course of search & seizure and s....
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....(SC) (ii) K.P. Varghese vs. ITO (1981) 131 ITR 597 (SC) (iii) UCO Bank vs. CIT (1999) 237 ITR 889 (SC) (iv) Union of India vs. Azadi Bachoo Andolan (2003) 263 ITR 706 (SC) Thus, in the above case laws including the decision of Hon'ble Supreme Court has reiterated that wherever CBDT has issued instructions/circulars to relieve hardships the same are binding nature. In view of this it is submitted that the surrender of income obtained in confessional statement goes against the spirit of the circulars issued by the Board. The addition made on the basis of such confessional statement deserves to be deleted. b.4. Search statement alone is not sufficient for addition :- Regarding to our contention that no addition can be made merely on the basis of search statement by brushing aside the submission and evidences filed by assessee during the course of assessment proceeding. We place reliance on following judgements: - i) Hon'ble Apex Court in the case of Pullangode Rubber Produce Co Ltd v/s State of Kerala & Anothers (1973) 91 ITR 18 (SC) has held that admission is an extremely important piece of evidence but it can'....
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....पाया गया है। एवं बही खातों के अनुसार Cash in hand Rs. 4,26,372/- रूपये है। इस प्रकार आपके यहां पर cash 11,76,838/- रूपये अधिक पाया गया, कृपया इस अधिक पाये गये cash के बारे में अपना स्पष्टीकरण देवे। उत्तर जो स्टॉक कम पाया गया है वो बिना बिल कटे सेल ....
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....xcess cash if any represents the cash sales made for which bills are to be made" and there is a no requirement of mentioning IT PAN Number and address, etc. in the cash sales up to Rs. 2,00,000/ -. It is noted that as per above facts, it is crystal clear that the learned CIT(A) has solely relied upon the statement of the Director of the appellant company without appreciating the complete facts of the statement and also ignoring the facts that no working details of alleged cash in hand Rs. 4,26,372/- as per IT department's findings / working as on date of search have been supplied. The ld. AR of the assessed also submitted that no defect or deficiency had been pointed out either by the AO or by the learned CIT(A) in maintenance of the daily regular cash book and other books of accounts. Thus, the action of the AO as well as CIT(A) appears one sided and not supported by legal legs. We noted that ld. CIT(A) relied upon the following judgments :- A. Commissioner of Income-tax v. Hotel Meriya [2010] 195 Taxman 459 (Kerala) / [2011] 332 ITR 537 (Kerala) [26.05.2010] - In this case, the issue decided was regarding evidence of the statement as per definition given in ....
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....erence to the case laws relied upon by the ld CIT(A) submits that as of now, it is a settled position of law that the statement of the assessee is an extremely important piece of evident but it cannot be conclusive and later on the same may be amended. In support of this argument, the appellant relies upon the judgment of the Hon'ble Supreme Court in Pullangode Rubber Produce Company Ltd. Vs. State of Kerala & Another, (1973) 91 ITR 0018 (SC), Hon'ble Court there in held that the admission is an extremely important piece of evidence but it cannot be said that it is conclusive. It is open to the assessee who made admission to show that it is incorrect and the assessee should be given proper opportunity to show the correct state of affairs. Reliance is also placed on the judgment of Madras High Court in M. Narayan and Bros. Vs. Assistant Commissioner of Income Tax, Special Investigation Circle, Salem, (2011) 13 Taxmann.com 49 (Madras) wherein retraction made during the course of assessment proceedings was entertained and relief was granted on merits of the explanation. Further, Hon'ble Delhi High Court in CIT vs. Sunil Aggarwal, 64 Taxmann.com 107 held that addition canno....
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....n is an extremely important piece of evidence but it can't be said that it is conclusive. It is upon to the assessee to show that it is incorrect. Further reliance may be placed on the decision of Hon'ble Rajasthan High Court in the case of CIT v/s Ashok Kumar Soni 291 ITR 172 (Raj.) wherein it was held that admission in statement during search is not conclusive proof of fact and can always be explained." vi) Hon'ble ITAT Jaipur Bench in the case of DCIT Vs Ashok Kumar Agarwal in ITA No 847/JP/ 2015 order dated 3/10/2016 that :- "16. We have heard the rival contentions of both the parties and perused the material available on the record. During the course of the first appellant proceedings, the assessee has contended that no incriminating document was found during the search operation showing payment of Rs. 1.50 crore to Ghulam Farooq Ansari. Further, no document was found from assessee's premises, showing generation of undisclosed income which could be said as utilized in the payment to Ansari. The crux of the issue is whether based on the statement of the assessee recorded u/s. "An admission is an extremely piece of evidence but it cannot be said....
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....nt of Rs. 1,50,00,000/- to Ansari." During the course of the arguments, the Revenue has not brought anything further to our notice and the findings of ld CIT(A) remain uncontroverted before us. The assessee has successfully demonstrated through its explanation and documentation in terms of re-casted books of accounts that the statement made during the course of the search cannot be made the sole basis for making the addition of Rs. 1,50,00,000 in his hands as there was sufficient cash balance in the books of accounts to make the said payment and discharged its onus as laid down by the decision of Hon'ble Supreme Court in case of Pullangode Rubber Produce Co (supra) and Rajasthan High Court in case of Ashok Kumar Soni (supra). We therefore do not find any infirmity in the findings of the ld CIT(A). Accordingly, we uphold the order of the ld. CIT(A) and the appeal of the Revenue in this ground is dismissed." Therefore, in view of the aforesaid order of Hon'ble Tribunal the addition made by the ld AO in the case of this assessee, on the basis of the similar type of statement, and on the same facts and circumstances, deserves to be deleted. Hon'ble MP High Court in....
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....rch and seizure operation. The instructions were followed by CBDT by issue of a circular on the lines desired by the finance minister. There can be an estoppel on the issue of the facts but there cannot be estoppel on the principle of law. It is not the case of the revenue that the assessee was not disclosing the amount received as a result of retirement from the firm. The assessee obtained the legal advice and was of the opinion that such revaluation is capital receipt which is not liable to tax. Hence, we feel that income cannot be added simply on the basis of surrender. The statement recorded u/s. 132(4) can be rebutted by the assessee and the case of the assessee is that the amount is not liable to tax." viii) Jagdish Narain Ratan Kumar V/s ACIT 22 TW 209 (JP) Statement recorded during search are generally influenced by extraneous circumstances & cannot be termed as free from all ambiguity. b.5 The following decisions of Hon'ble Rajasthan High Court is distinguishable on facts. Therefore, the addition cannot be sustained on the basis of the following decisions :- a) 2018 (11) TMI 953 - Rajasthan High Court Pr. Commissioner Of Income Tax (Central),....
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....unt which deserves to be accepted. c) 2019 (4) TMI 1120 - Rajasthan High Court in the case of M/S BannalalJat Constructions Pvt. Ltd. Versus ACIT, Central Circle-2, Ajmer In this case a search was conducted at the business/residential premises of Shri Banna Lal Jat, the Director of appellant company - M/s. BannalalJat Constructions Private Limited, on 10.10.2014, in which he was also operating his proprietary concern in the name of M/s. BannalalJat Contractor. During the search proceedings at residential premises of Shri BannalalJat, a cash worth of Rs. 1,21,43,210/- was found and inventorised as per Annexure CF of Panchnama dated 11.10.2014. He, in his statement, recorded under Section 132(4) of the Income Tax Act, 1961 (for short 'the IT Act') during the course of search and even subsequent statement recorded under Section 131 of the IT Act, admitted the same as undisclosed income of the appellant- company. However, subsequently while filing the return of income for the relevant assessment year, the appellant-company did not offer the said undisclosed income to tax. Therefore, in this case, surrender was backed by cash found during the search. ....
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....ed out by the ld. AO in the books of account therefore, the entries made in books of accounts should be accepted and no addition on account of alleged undisclosed investment in purchase of agriculture land should be made. For this purpose, we draw your kind attention towards the following decisions: - i) Hon'ble ITAT Jaipur bench in ITSSA No.103/JP/2002 dt. 4.4.2003 in the case of Shri Tarachand Jain. In this order, the Hon'ble ITAT has observed as under on page 2 para 5: "The first grievance of the department is pertaining to the deletion of addition of Rs. 1,20,240/- which was found from the bedroom of Shri Tarachand and his wife Smt. Anita Jain during the course of search. At the time of search, the books of accounts were not complete and day to day balancing of cash was not made. In the books of account, the cash balance of Rs. 80,291/- in the books of Shri Tarachand; and Rs. 51,335/- in the books of Smt. Anita Jain were shown by the assessee as per the explanation letter dated 12.1.2001. Thus in both the books of account the total comes to Rs. 1,31,626/ -. According to assessee, the said amount was sufficient to meet the recovered amount, but the AO o....
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....s bank statement, vouchers and other related documents of sales and purchase which could be relied upon for the purpose of making the income tax assessments. iii) Hon'ble ITAT Jaipur Bench in the case of DCIT Vs Ashok Kumar Agarwal in ITA No 847/JP/ 2015 order dated 3/10/2016 that :- "16. We have heard the rival contentions of both the parties and perused the material available on the record. During the course of the first appellant proceedings, the assessee has contended that no incriminating document was found during the search operation showing payment of Rs. 1.50 crore to Ghulam Farooq Ansari. Further, no document was found from assessee's premises, showing generation of undisclosed income which could be said as utilized in the payment to Ansari. The crux of the issue is whether based on the statement of the assessee recorded u/s. 132(4) of the Act, an addition towards undisclosed income can be made in the hands of the appellant. Both the Revenue as well as the assessee have relied on the decision of the Hon'ble Supreme Court in case of Pullangode Rubber Produce Co. Ltd vs State of Kerala (91 ITR 18) wherein the Hon'ble Supreme Court has laid d....
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....e the AO. There were sufficient cash balance available with assessee and his family members/group concern to cover the payment of Rs. 1,50,00,000/- to Ansari." During the course of the arguments, the Revenue has not brought anything further to our notice and the findings of ld CIT(A) remain uncontroverted before us. The assessee has successfully demonstrated through its explanation and documentation in terms of re-casted books of accounts that the statement made during the course of the search cannot be made the sole basis for making the addition of Rs. 1,50,00,000 in his hands as there was sufficient cash balance in the books of accounts to make the said payment and discharged its onus as laid down by the decision of Hon'ble Supreme Court in case of Pullangode Rubber Produce Co (supra) and Rajasthan High Court in case of Ashok Kumar Soni (supra). We therefore do not find any infirmity in the findings of the ld CIT(A). Accordingly, we uphold the order of the ld. CIT(A) and the appeal of the Revenue in this ground is dismissed." c.4. For not accepting the books of accounts produced by the assessee the Ld. A.O. gave another perverse finding that the assessee did not subm....
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....ppellant realized that sufficient cash balance was available in the regular books of account of the assessee and also in the books of account of other co-owners of the land to cover the said payment. The payment was, therefore, not from undisclosed income but from accounted sources. Accordingly, the appellant did not include the amount of Rs. 11,00,000/- as income in the return of income filed for the relevant assessment year, effectively retracting the earlier surrender made under a mistaken belief. The department cannot take the benefit of this mistake of the assessee. In this regard it is relevant to refer the Article 265 of the constitution of India which says that "No tax shall be levied or collected except by authority of law". The CBDT circular No. 14 (XL-35) dated 11.04.1955 is also relevant to be mention here, which says that: - "para-3 - - department must not take advantage of ignorance of an assessee as to his rights. It is one of their duties to assist a taxpayer in every reasonable way, particularly in the matter of claiming and securing reliefs and in this regard the Officers should take the initiative in guiding a taxpayer where proceedings or other particul....
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....ase of Vinay ChandulalSatia v. Shri N.O.Parekh., the Commissioner of Income Tax, Special Civil Application No. 622/1981, rendered on 20-8-1981, has laid down the approach that the authorities must adopt in such matters in the following terms : "The Supreme Court has observed in numerous decisions, including Ramlal and Ors. v. Rewa Coalfields Ltd., AIR 1962 SC 361; The State of West Bengal v. The Administrator, Howrah Municipality Ors., and AIR 1972 SC 749, and BabutmalRaichandOswal v. Laxmibai R. Tarte, AIR 1975 SC 1297, that the State authorities should not raise technical pleas if the citizens have a lawful right and the lawful right is being denied to them merely on technical grounds. The State authorities cannot adopt the attitude which private litigants might adopt." ii) In the case of Commissioner of Income Tax Vs. Bharat General Reinsurance Co. Ltd. (1971) 081 ITR 0303, Delhi High Court has held as under: "It is true that the assessed itself had included that dividend income in its return for the year in question but there is no estoppel in the Income-tax Act and the assessed having itself challenged the validity of taxing the dividend during the y....
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....harge assessee more tax than that which is due and payable by the assessee. It is in ITA 678/JP/2018 Birma Devi Vs. ITO 13 aforesaid circumstances that as far back as in 11/04/1955 the Central Board of Direct Tax had issued a circular directing AO not to take advantage of assessee's ignorance and/or mistake. Therefore, the Circular should always be borne in mind by the officers of the respondent- revenue while administering the said Act. vi) Stream International Services Private Limited (2013) 023 ITR 0070/2013 (9) TMI 339 - ITAT MUMBAI Having heard the rival submissions and perused the relevant material on record, we find that the purpose of income tax assessment is to determine correct income of the assessee. As the Revenue cannot allow an assessee to depress his income, in the same manner, it is not permissible to the Revenue to take advantage of the ignorance or mistake of the assessee in offering more than due income. It is trite that no tax can be collected except as per law. Circular No. 14(XI-35) of 1955 dated 1.4.1955 cautions the Officers of the Department from taking advantage of ignorance of an assessee as to his rights. The Hon'ble Bombay High Court in....
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.... e. The onus u/s. 69 of the Act was on the department which was not discharged e.1. The Ld. A.O. made the addition u/s. 69 by treating the payment made by the assessee as made from undisclosed income, however, the onus lied under section 69 of the Act was not discharged. The ld AO erred in taxing the investment by applying the provision of section 69 which is not applicable as the assessee has properly explained source of cash by furnishing cash flow statement (Copy at PB Page No. 63), cash book (Copy at PB Page No. 64-75), All Ledger A/c (Copy at PB Page No. 82-120), balance sheet before the ld AO during the assessment proceedings and which were not proved to be incorrect. e.2. Thus, in the case the assessee In the instant matter, assessee has duly discharged his initial burden of substantiating the genuineness of source of payment of cash for making the investment and the same is duly recorded in cash flow statement, cash book, bank book, ledger, balance sheet etc. submitted by assessee, wherein Ld. A.O. did not pointed out any defects. Thus, the assessee has proved his onus by submitting documents thereafter the onus shifted to Ld. AO. The Ld. AO has on....
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....y recorded in the books of accounts submitted to Ld. A.O. The cheque amount and stamp duty and registration fees was paid in proportionate to share of ownership in the property then cash amount must have been paid in same proportionate. The Ld. A.O. erred in treating the entire cash payment of Rs. 11,00,000/- as made by the assessee. h. Addition u/s. 69 and levy of higher tax by applying the provisions of section 115BBE without issuing show cause notice and where source of cash was explained. h.1 The Ld. AO has issued show cause notice dated 23/01/2021 (Copy at PB 44 to 47), wherein the Ld. AO did not issue specific show cause for applying the section 115BBE but the same was applied in the assessment order addition was made and income was computed by applying the provision of section 115BBE, therefore this is clear violation of Principle of Natural Justice. It is also pertinent to mention here before applying the provisions of section 115BBE of the Act the specific show caused notice was not given to the assessee and in absence of specific show cause notice the provisions of this section cannot be applied automatically and mechanically. In this regard the....
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....nt proceeding the assessee has submitted that he has share of 11.89% in the above said land and the cash payment against his share comes to Rs. 1,30,770/- which was made out of the cash balance available in his cash book. The assessee has filed before the ld AO his complete books of account i.e. cash book, (Copy at PB Page 64-75), Journal (Copy at PB Page 76-81), All Ledger account (Copy at PB Page 82-120), bank statement (Copy at PB Page 60-62), cash flow statement (Copy at PB Page 63) balance sheet (Copy at PB Page 34-35) and copy of ITR and Balance Sheet of other co-owners in the land (Copy at PB Page 36-43), in which this cash payment of Rs. 11,00,000/- made against purchase of land by him and by other co-owners in the land was duly accounted for and thus the source of cash payment was duly available in such books of account of assessee and other co-owners in the land . The ld AR of assessee submitted that the Ld. A.O. did not point out any error or mistake in the books of accounts produced during the course of assessment proceeding. The ld AO in para 8 of his assessment order mentioned that the assessee has filed return in Form No 1 and the copy of the balance sheet had also n....
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....ld that the books of account prepared by the assessee are after thought and just to cover the undisclosed investment in the land more so when the source of the payment is available in the books of account. Cash book is recording of receipts and payments in chronological order. The extraneous payment can only be recorded by inflating the receipt or understating other payments. There is no finding of ld AO or CIT(A) in this regard. It is a settled position of law that the statement of the assessee is an extremely important piece of evident but it cannot be conclusive and later on the same may be amended. In support of this argument, the appellant relies upon the judgment of the Hon'ble Supreme Court in Pullangode Rubber Produce Company Ltd. Vs. State of Kerala & Another, (1973) 91 ITR 0018 (SC), Hon'ble Court there in held that the admission is an extremely important piece of evidence but it cannot be said that it is conclusive. It is open to the assessee who made admission to show that it is incorrect and the assessee should be given proper opportunity to show the correct state of affairs. The assessee admitted the payment of Rs. 11,00,000/- made out of his undisclosed incom....
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....urya Singhal in his statements recorded during the search proceedings, submitted that Rs. 2,60,000/- the cost of purchases of plot has been shown in books of accounts and remaining expenses of Rs. 11,24,424/- were incurred from his unaccounted income and surrendered such expenses from his unaccounted income for the F.Y. 2018-19. Also, Shri Surya Singhal has accepted that he has incurred Rs. 11,24,424/- in construction of Plot No. B-157, Gopal Vihar, Kota, which is exactly the same amount evidence from the part found during the course of search. Also his submission that he was feeling unconformable during the search does not hold merit because he was given proper rest during recording of the statement whenever he desired. He had given his statement in his full consciousness. Further assessee is an individual and has been filing ITR-1 only, the so-called books of accounts i.e. cash book, Balance Sheet etc. has been prepared by assessee just to cover his undisclosed investment. The said copy of balance sheet had also not been filed while filing ITR online. It is just an afterthought to substantiate his undisclosed investment unearthed during the search proceedings. Further provisions ....
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....sked the appellant that why not this sum of Rs. 2,60,000/- on account of purchase of plot and sum of Rs. 11,24,424/- on account of expenses thereon totaling to Rs. 13,84,424/- be considered as his expenses from his unaccounted income for the FY 2018-19. In reply to Question No. 16 regarding Exhibit-11 the appellant had categorically accepted the sum of Rs. 11,24,424/- out of the total investment on this account of Rs. 13,84,424/- as his unexplained expenses as detailed on 07 pages of this exhibit and offered the same for taxation as investment out of his unexplained income. From the perusal of these pages and entries made therein it is clear that these are datewise entries of payments towards building material, architect, cement, labour, freight, marble, bricks, etc. The appellant could give no justification of the same during the search. Later on, during the assessment proceedings and at appellate stage the appellant has made a claim to justify it with the cash in hand but could not substantiate it with any evidence and books. Hence, this ground of appeal of addition of Rs. 11,24,424/- u/s. 69 has no merits and in view of the above factual matrix deserves to be rejected. ....
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....stily during the search without verifying the books of account. Upon subsequent verification, it was found that sufficient cash balance existed in the books to explain the payment, rendering the initial surrender erroneous. The appellant retracted the statement by not including the amount in the return of income and has substantiated the retraction with the books of account, which demonstrate adequate cash availability. No incriminating material was found during the search to contradict this explanation. Admittedly, during the course of search the assessee admitted the investment was made out of his income but such admission was not wilful and not correct. As submitted to Ld. A.O. the during the course of search, the assessee was feeling uncomfortable, therefore he could not understand the question properly. He was in very tense and in fear atmosphere of search. Further, it is a fact that the statement during search proceeding are given extempore and under the tense and fear atmosphere and also not having in possession the sufficient material to state facts correctly, so the assessee could not spell out the correct facts to the search team. a.2. During the course of search....
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....same was utilised for making cash payments and part payment was also made through banking channel. Since, the entire payment is recorded in the books of account, the copy of which was submitted before Ld AO and AO did not point out any defect in the books of account maintained by the assessee, therefore, no addition was warranted u/s. 69 of the Income Tax Act, 1961. The ld. AO has not point out any discrepancies and defect in the books of accounts submitted by the assessee which was prepared on the basis of bank statement as well as other documents. The Ld. AO has not considered the books of account though as per the admitted position of law the books of accounts always carry a great evidentiary value. a.5. The Ld. AO failed to examine and considered the books of accounts produced during the course of assessment proceeding and rejected the same by solely relying of the statement recorded. Though the assessee was not liable to maintain the books of account as he was not carrying out any business in his own capacity, however he prepared and produced the same to work out the source of investment available with him and in such a case the onus was on Ld. A.O. to examine the sam....