TMI Blog2012 (8) TMI 1101X X X X Extracts X X X X X X X X Extracts X X X X ..... ny was recorded on oath in which he has surrendered a sum of ₹ 5,00,000/- as undisclosed income on account of commission. During the assessment proceedings, the A.O. noticed that the assessee did not offer this undisclosed amount of ₹ 5,00,000/- in the return of income filed by the assessee. The A.O. made addition of ₹ 5,00,000/-. The A.O. also made addition of ₹ 5,000/- out of Telephone expenses and ₹ 5,000/- out of miscellaneous expenses. 3. The CIT(A) confirmed the order of the A.O. as under :- (page nos.4 5) 3.2 I have analyzed the matter and find that in this case survey u/s 133A of the Act was conducted by the department on 30.1.08. During the course of survey, statement of the Director of the company Shri Neeraj Kumar Maheswari was recorded and in his statement in answer of Question no.5, he stated that for the A.Y. 2006-07 he was declaring undisclosed commission income of ₹ 5 lacs. He further stated that though he had already filed the return of income for this year but he will revise the return of income declaring undisclosed income of ₹ 5 lacs subject to the condition that no penalty be levied. The retraction of the state ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rvey folder. Ld. Departmental Representative produced photocopy of the folder. The crux of the issue to be examined by us whether the CIT(A) is correct in confirming the order of the A.O. sustaining addition of ₹ 5,00,000/- as disclosure made at the time of survey. The contention of the assessee was that at the time of survey the assessee was forced to surrender. The assessee while referring instruction of CBDT No 286/2/2003-IT(INV) submitted that restriction is given to the Revenue Authorities that while recording statement during the course of search, seizure and survey operations no attempt should be made to obtain confessions as to the undisclosed income. The assessee vide his letter date 02.05.2008 stated that all the books of account, documents and computer data were seized and lying with the office of the Department. The assessee is ready to pay tax, if any, in case discrepancies are found in the seized documents. 5. The ld. Departmental Representative, on the other hand, submitted that in the case under consideration detection was made after a gap of four months which does not help the assessee in the light of the order of I.T.A.T., Ahmedabad Bench in the case of M ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ave also been impounded, details thereof are placed on respective survey files/folders of the group. Highlights of the statements recorded at the time of survey and declaration of unexplained and undisclosed income on the basis of various discrepancies pointed out on the basis of books of accounts etc. found and examined over survey proceedings - 1. Mr. Varun Maheshwari Pro of M/s Maya Commodities PAN AGTPM 6997P Mr. Varun Kumar Maheshwari, S/o. Sri Jugal Kishor Maheshwari, is a regular income-tax assessee filing his return with wd 1(3), Agra. He is proprietor of M/s Maya Commodities, being one of the sub-broker of M/s L.D.K. Commodities Pvt. Ltd. dealing in speculative business of commodities on commission basis. Maya Commodities started its business from October 2005 and continued till 31st March 2007, and thereafter no business was done in this proprietary concern as deposed by him. At the time of survey operations, following disclosures were made after considering the discrepancies in books of accounts etc. impounded. Unexplained and undisclosed income for AY 2006-07 ₹ 10.00 lac, for AY 2007-08 ₹ 15.00 lac, AY 2008-09 ₹ 05.00 lac, thus total s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ars. Shri Satish Chand Goel, other partner in M/s Maya Trading Co., assessed with ITO 4(2), Agra engaged in wholesale trading of Supari, Menthol, Ilachi and also derived income as commission agent, has also confirmed the surrender made by his partner Shri Neeraj Maheshwari, vide his statement on oath recorded on 30.01.2008. To sum up, the assessee group has made total surrender of ₹ 99,75,782/- in different concerns/hands in assessment years mentioned hereinabove. During the course of survey proceedings, books of accounts and other papers in this group were impounded at different places and permission to retain them further has been taken from worthy DGIT (Inv.), Lucknow till 30.06.2008. 7. In addition to above, on perusal record, we noticed a letter dated 02.06.2008 furnished by the assessee to the Addl. Director of Income Tax (Inv), Agra wherein it is stated that the assessee made surrender of ₹ 30,00,000/- in the case of M/s. Maya Commodities and the assessee has deposited a sum of ₹ 3 lacs as advance income tax. In the said letter, the assessee confirmed the surrender in case of the assessee ₹ 5,00,000/- in A.Y. 2006-07 ₹ 7,00,000/- in A.Y. 2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of building. Similarly, in case of M/s. Maya Trading, the surrender by Shri Neeraj Kumar Maheshwari, one of the partners of the firm of ₹ 37,11,782/- was on account of unexplained undisclosed investment in his stock which were not found recorded in the books of account. Thus, it is evident that the surrender was supported by cogent material and on the basis of material and discrepancies found at the time of search. It is well settled in law that such admission by party under such circumstances during the course of survey is the best evidence of a point in issue, though not conclusive as this issue of the matter unless successfully withdrawn or proved erroneous. What is admitted by a party to be true must be presumed to be true unless contrary is shown. After 01.06.2002 Section 292C is very clear in this regard. In the case under consideration, when the assessee surrendered the amount supported by cogent evidence and discrepancies found at the time of survey, such surrender cannot be said to be a surrender merely on the basis of statement, particularly under the facts and circumstances when on the basis of surrender in the statement recorded during the course of survey the Dep ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oes not help to the assessee and it cannot be said that the assessee has retracted from the statement and surrender made at the time of survey by submitting such self-serving document in the form of affidavit. The assessee in it s written submission filed before us stated that the surrender amount of ₹ 5,00,000/- on account of commission was properly recorded in the books of account but the assessee has failed to produce any supporting evidence. In the light of the fact, such vague submission is not acceptable unless filed some material or evidence in support of that. We, therefore, find that the so-called retraction from the statement given at the time of survey is without basis and not acceptable. This finding is in accordance with the judgment of jurisdictional High Court of Allahabad in the case of Dr. S.C. Gupta vs. CIT, 248 ITR 782 (All). The facts in that case were that the assessee was a Medical Practitioner. A survey was conducted and inter alia recorded his statement in which the assessee surrendered additional income. During the assessment proceedings, the assessee submitted that the additional income declared at the time of survey was not acceptable because his st ..... 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