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2013 (3) TMI 290 - HC - Income TaxPenalty under Section 271(1)(c) - assessee himself had admitted the unexplained investment made in gold and cash which was not disclosed in the book of accounts - ITAT deleted the penalty levy - assessee is doing business of manufacture of gold jewels for others on job work basis - whether material collected and the statement recorded during the survey operation under Section 133A has any evidentiary value? - Held that:- As decided in Pullangode Rubber Produce Co.Ltd. vs. State of Kerala, (1971 (9) TMI 64 - SUPREME COURT) that an admission is extremely an important piece of evidence but it cannot be said that it is conclusive and it is open to the person who made the admission to show that it is incorrect. Any statement recorded under Section 133A would have evidentiary value only if supported with materials and form the basis for assessment. In his explanation, the assessee stated that he has been doing job work and the remaining 2100 gms had been given to 3 Asaris. The Officers had not verified whether the gold was available with the said Asaris nor chosen to examine the said Asaris. The statement recorded during survey operation u/s 133A may be a relevant material but in the absence of further materials to substantiate the same, such statement recorded under Section 133A can hardly be the basis for assessment. During the survey, 900 gms of gold was found in the premises of the assessee and the statement of the assessee was supported only to the extent of actual seizure of 900 gms. Since the statement of assessee in respect of the remaining gold was not substantiated, the Tribunal rightly set aside the addition in respect of the gold. Unaccounted cash of Rs.2,49,770/-, the assessee tried to explain the cash by stating that he has sold the land at Kodaikanal for Rs.2,80,000/- and the same was deposited in Bank on 5.10.2002 and the amount was withdrawn from the Bank on 17.10.2002 and during the course of survey, the Department came across the said cash. The survey was on 29.10.2002 and the drawal of money from the Bank was a few days before search. Even though the said amount of Rs.2,49,770/- was not disclosed in his books, the assessee tried to explain the same. The Tribunal rightly set aside the addition and remitted to the AO to verify whether the cash balance as per the books of accounts has emanated from the cash withdrawn from the Bank on 17.10.2002. No error or infirmity in the order of the Tribunal to verify the correctness of assessee's statement. Addition of interest earned on the unaccounted investment in money lending business - the enhancement is based only on the statement recorded from the assessee. No other material or information was available that the assessee invested Rs.5.00 lakhs in money lending business and earned interest. the addition of Rs.5.00 lakhs as unaccounted investment in money lending business and addition of interest earned is based on only rough estimate and the Tribunal rightly deleted the addition on the interest of money lending business, household expenses and creditors. Since the Tribunal deleted the addition and ordered expunging the initiation of penalty proceedings under Section 271(1C) no reason to interfere with the finding of the Tribunal. Tribunal rightly set aside the order of Commissioner of Income-tax (Appeals) as its order making enhancement to the income determined by the Assessing Officer is based on the unsworn statement obtained under Section 133A. No substantial question of law arise for consideration and the Tax Case Appeal stands dismissed.
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