TMI Blog2023 (4) TMI 180X X X X Extracts X X X X X X X X Extracts X X X X ..... n to S R Co, so that the same can be used to strike good deal in diamond purchase. On the other hand, it is stated that the concerned bank accounts did not have enough bank balances. If the bank accounts did not have enough balances, how S R Co could have used the cheques to purchase diamonds on behalf of the assessee. Hence the reasoning given in the retraction statement about the cheques defies logic and hence on this count also retraction is liable to be rejected. The assessee could not bring any material to contradict the statement so given. On the contrary, the cheques were found with S R Co. Hence the legal principle that the statement given during the course of survey does not have evidentiary value will not apply to the facts and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ship firm and is engaged in the business of manufacture, import and export of diamonds studded jewellery, gold jewellery, imitation jewellery etc. The revenue carried out a survey operation in the hands of the assessee on 1.10.2007. This survey operation was conducted in consequent to another survey operation conducted in the hands of M/s S.R Co (Patel Somabhai Ramdas Co) on 10.01.2007, i.e., about nine months back. During the course of survey operation conducted in the hands of M/s S R Co, seven cheques issued by the assessee company mentioning the amounts only, which aggregated to Rs.4,11,91,000/-, were found. The cheques did not have date or payee name. The partner of the assessee firm Shri Gautam G Mehta was questioned about the above ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d by the assessee. (c) Even though the above said cheques were issues, the concerned bank accounts did not have major bank balances. (d) Hence the retraction of the statement has been made on credible reasoning. (e) In the original statement, the assessee has stated that it has mobilized cash by using cheques since it got good deal for purchase of diamonds at lower rates. However, the things did not happen as expected and the assessee could hardly break-even on sale of those diamonds. Hence the assessee could not have made any profits in the sales, if the statement is accepted as true. (f) The statement taken during the course of survey does not have evidentiary value as per the decision rendered by Hon ble Madras High Court in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... If the bank accounts did not have enough balances, how S R Co could have used the cheques to purchase diamonds on behalf of the assessee. Hence the reasoning given in the retraction statement about the cheques defies logic and hence on this count also retraction is liable to be rejected. 6. The Ld CIT(A) has also stated that the statement taken during the course of survey operations does not have evidentiary value. But the fact remains that the assessee has only explained the purpose of giving cheques to S R Co and it is not a case of general statement extracted from the assessee. The explanation of the assessee given in the statement is that the above said cheques were given to mobilize money for striking good deal in diamond purchase. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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