Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2019 (2) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2019 (2) TMI 2051 - AT - Income TaxAssessment u/s 153A r.w.s. 143(3) - Proof of incriminating material found during the course of search - whether, an addition can be made in an assessment u/s 153A r.w.s. 143(3) of the Act, which is not based on any incriminating material found during the course of search and seizure, when the assessment for the Assessment Year in question has not abated? - HELD THAT:- In the case on hand, the assessee filed its original return of income on 26/09/2010. The time limit for issual of notice u/s 143(2) of the Act, was 14/08/2014. The search and seizure operation was conducted in this case on 18/02/2013. The statutory period for issual of notice u/s 143(2) of the Act, in the case of the Assessment Years had expired prior to the date of search operation. Hence the assessment for the impugned Assessment Year has not abated. Additions in question are not based on any incriminating material found during the course of search. DR could not controvert this factual finding of the ld. CIT(A). His arguments do not reflect the findings and basis on which the Assessing Officer made the additions. Only addition made is of share application received u/s 68 of the Act and addition of commission paid allegedly for the share application money and finally a disallowance u/s 14A of the Act. No incriminating material has been found during the course of search. The alleged statements recorded from entry operators have admittedly been retracted and the Assessing Officer has not based the additions on these statements - when copies of the alleged statements recorded by the revenue officials have not been given to the assessee, no addition can be made based on such evidence which is not confronted to the assessee. The contents of the statements are also not brought out in detail in the assessment order. Only a general reference is made that there were certain statements recorded from various entry operators by the investigation wing. No addition can be made on such general observations. We also find that the assessee has not been given an opportunity to cross-examine any of these persons, based on whose statements, the revenue claims to have made these additions. Cross-examination a witness - The Hon’ble Supreme Court in the case of Kishinchand Chellaram [1980 (9) TMI 3 - SUPREME COURT] had held that opportunity of cross-examination must be provided to the assessee. The Jurisdictional High Court in the case of CIT Vs Eastern Commercial Enterprises [1993 (12) TMI 26 - CALCUTTA HIGH COURT] held as matter of fact, the right to cross-examination a witness adverse to the assessee is an indispensable right and the opportunity of such cross-examination is one of the cornerstones of natural justice. Even otherwise, it is not clear as to which of these statements were recorded during the course of search operation or whether the statements were recorded during the course of survey operations. It is well settled that a statement recorded during the course of survey operation cannot be used as an evidence under the Act. As none of these material gathered by the Assessing Officer can be categorized as incriminating material found during the course of search or found during the course of any other operation under the Act. Thus, we hold that the additions in question are not based on any incriminating material. Appeal of the revenue is dismissed.
|