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2014 (11) TMI 1243 - HC - Income TaxReopening of assessment u/s 147 - proceedings initiated against the appellants are the result of a survey - undisclosed transaction of purchase of an item of immovable property - appellants came forward with the plea that the statements were forcibly recorded, and even cheques were taken from them, under duress - HELD THAT:- In the instant case, the appellants' specifically pleaded that the statements were recorded from them by applying pressure, till midnight, and that they have been denied access outside the society. AO made an effort to depict that the withdrawal or retraction on the part of the appellants is not genuine. AO does not have any power, right or jurisdiction to tell, much less to decide, upon the nature of withdrawal or retraction. His duty ends where the statement is recorded. If the statements are retracted, the fate thereof must be decided by law meaning thereby, a superior forum and not by the very authority, who is alleged to have exerted force. It is not as if the retraction from a statement by an assessee would put an end to the procedure that ensued on account of survey or search. AO can very well support his findings on the basis of other material. If he did not have any other material, in a way, it reflects upon the very perfunctory nature of the survey. We find that the appellate authority and the Tribunal did not apply the correct parameters, while adjudicating the appeals filed before them. On the undisputed facts of the case, there was absolutely no basis for the Assessing Officer to fasten the liability upon the appellants. Our conclusion find support from the Circular dated March 10, 2003, issued by the Central Board of Direct Taxes, which took exception to the initiation of the proceedings on the basis of retracted statements. Appeal allowed and the orders of assessment are set aside.
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