TaxTMI 
TaxTMI 
2026 (9) TMI 1712
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....ax Act, 1961 (the Act) on 20.02.2019 and Rs.14 lacs projected income for post survey period till the year end despite the fact that the statement was based on the books of accounts but on the basis of statement during the survey and was not an exclusive evidences of the assessee having earned the said income. 3. The facts in brief are that the assessee is a partnership concern and has filed the return of income on 24.10.2019, u/s 139(4), declaring total income of Rs.11,78,275/-. A survey u/s 133A of the Act was conducted on the premises of the assessee on 20.02.2019. During the course of survey on the basis of record available in the computer of the assessee, the assessee disclosed the net profit of Rs.1,09,32,127/- on the date of survey upto 19.02.2019 and further declared estimated net profit of Rs.14 lacs from 28.02.2019 to 31.03.2019. The ld. AO noted that the assessee has filed belated return of income declaring total income of Rs.11,78,280/- against the total declaration made in the statement recorded during the survey of Rs.1,23,32,127/-. The assessee on total gross receipt/ turnover of Rs.1,33,81,295/-, declared a net profit of Rs.11,76,418/- u/s 44AD of the Act which wa....
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....corded and in the said statement the assessee disclosed an additional income of Rs.1,23,32,127/- comprising of net profit upto the date of survey of Rs.1,09,32,127/- and from the date of survey to the year end Rs.14 lacs. We note that the Proforma accounts were prepared in the absence of the chartered accountant without referring to the actual books of accounts. We also note that no incriminating materials/evidences were found during the course of survey corroborating such estimation of income or disclosure by the assessee. In our opinion, the statement made during the course of survey has no evidentiary value unless the corroboration is there. We also note that the books of accounts of the assessee were also audited u/s 44AB of the Act. Therefore, the order of ld. CIT (A) confirming the order of the ld. AO is without any basis appears to be incorrect and cannot be sustained. The case of the assessee is squarely covered by the decision of Hon'ble Madras High Court in case of Commissioner of Income-tax vs. S. Khader Khan Son [2008] 300 ITR 157 (Madras)/[2008] 214 CTR 589 (Madras)[04-07-2007], wherein the Hon'ble Court has held as under:- "In the instant case, there ....
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....he Tribunal was based on facts and no question of law arose from it. A power to examine a person on oath is specifically conferred on the authorities only under section 132(4) of the Act in the course of any search or seizure. Thus, the Income-tax Act whenever it thought fit and necessary to confer such power to examine a person on oath, has expressly provided for it, whereas section 133A does not empower any Income-tax Officer to examine any person on oath. Thus, in contradistinction to the power under section 133A, section 132(4) of the Income-tax Act enables the authorised officer to examine a person on oath and any statement made by such person during such examination can also be used in evidence under the Income-tax Act. On the other hand, whatever statement recorded under section 133A of the Act is not given an evidentiary value, vide a decision of the Kerala High Court in Paul Mathews and Sons v. CIT [2003] 263 ITR 101. The scope of sections 132(4) and 133A also came up for consideration before the Kerala High Court in Paul Mathews and Sons v. CIT [2003] 263 ITR 101. In the said case, the assessee therein made an attempt to draw a distinction between the tw....
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....06] 284 ITR 220, a Division Bench of this court, in which one of us was a party (P.P.S. Janarthana Raja J.), answered the question in the affirmative, against the Revenue and in favour of the assessee, holding that the materials collected during the survey under section 133A cannot be taken into consideration while determining the undisclosed income in respect of block assessment as per section 158BB, as the same has no evidentiary value. Again, when an identical question whether the material found in the course of survey in the premises of the builder could be used in the block assessment of the assessee, came up for consideration before this Division Bench in an unreported case in T. C (A) No. 2620 of 2006, this court, by order dated November 22, 2006-since reported in CIT v. S. Ajit Kumar [2008] 300 ITR 152, of course, following the, earlier decision of this court in G.K. Senniappan's case reported in [2006] 284 ITR 220, while confirming the order of the Tribunal, answered the question in favour of the assessee, in limine. What is more relevant, in the instant case, is that the attention of the Commissioner and the Tribunal was rightly invited to the circul....
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....the officer is not authorised to administer oath and to take any sworn statement which alone has evidentiary value as contemplated under law, vide Paul Mathews and Sons v. CIT [2003] 263 ITR 101 (Ker.); (iii) The expression "such other materials or Information as are available with the Assessing Officer" contained in section 158BB of the Income-tax Act, 1961, would include the materials gathered during the survey operation under section 133A, vide CIT v. G. K. Senniappan [2006] 284 ITR 220 (Mad.) ; (iv) The material or information found in the course of survey proceeding could not be a basis for making any addition in the block assessment, vide decision of this court in T. C (A) No. 2620 of 2006 (between CIT v. S. Ajit Kumar [2008] 300 ITR 152 (Mad.); (v) Finally, the word "may" used in section 133A(3)(iii) of the Act, viz., "record the statement of any person which may be useful for, or relevant to, any proceeding under this Act", as already extracted above, makes it clear that the materials collected and the statement recorded during the survey under section 133A are not conclusive piece of evidence by itself. For all these reasons, particularl....
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....aginary and were not co-relating with the books of accounts. We note that proforma accounts were only drawn by to justify the hefty advance tax by the assessee. We have examined the proforma Profit and Loss account, balance sheet prepared by the survey team and also audited books of accounts, computation of income, etc. which are available in the paper book and find that the addition made by the ld. AO was only on the basis of presumption and surmises and lacked legitimate basis. 6.3. We also find merit in the contention of the assessee that section 69A of the Act is not applicable in the present scenario as the same deals with the unexplained money and is applicable where the assessee is found to be owner of any money, bullion, jewellery or other valuable articles and such money bullion jewellery and valuable article are not recorded in the books of account if any maintained by the assessee in respect of any source of income and the assessee offered no explanation or the explanation offered by the assessee is not satisfactory in the opinion of the ld. AO and not otherwise. However, in the present case, the assessee has maintained books of accounts and assessee was not found to ....
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..... However, the assessee has not furnished the tax audit report on or before the specified date. Finally, the ld. AO imposed the penalty of .5% on the total turnover of Rs.2,58,12,446/- by rejecting the reply of the assessee that Chartered Accountant CA Mahadeb Saha aged 80+ having more than 50 years of experience was suffering from Parkinson. It was submitted that all the books of accounts were audited and the assessee filed the ITR. The audited report dated 14.10.2019, was signed by him and handed over to the assessee but he inadvertently forgot to upload the tax audit report within the prescribed time. Therefore, this is a reasonable cause but the AO rejected the submission of the assessee and the ld. AO imposed the penalty. 9. In the appellate order, the ld. CIT (A) confirmed the order of the ld. Assessing Officer. The ld. CIT (A) while confirming the penalty noted that inadvertent mistake of the CA responsible for e-filing of tax audit report could not be treated as reasonable cause within the meaning of Section 273B of the Act. The ld. CIT (A) also relied on the decision of Hon'ble Apex Court in case of CIT Vs. P. Mohanakala (291 ITR 278) to sustain the penalty. 10. ....