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2017 (5) TMI 975 - AT - Income TaxAddition on accommodation entries - cross examination of person on whose statement addition is made not allowed - Held that:- As during the course of search conducted upon the Mukesh Choksi group, statement of Mukesh Choksi was recorded and in his statement he has admitted that he was providing accommodation entries to those who were interested to earn capital gain. On a careful perusal of the assessment order, I find that there is no finding with regard to the supply of statement of Mukesh Choksi to the assessee. Moreover, nothing is available on record, wherefrom it could be inferred that assessee was ever allowed to cross-examine Mr. Mukesh Choksi. It is settled position of law that statement or the evidence which is being relied upon by the AO for making the addition in the hands of assessee, the same should be confronted to the assessee and the assessee should be allowed to cross-examine the witness in this regard. It is quite evident that statement of Mr. Mukesh Choksi was relied on for making the addition, but assessee was never allowed to cross-examine him. In these circumstances, the AO was not justified in making addition in the hands of assessee, without allowing the assessee to crossexamine Mr. Mukesh Choksi, whose statement was relied upon for making the above additions. Thus restore the matter to the file of AO with a direction to first confront the statement of Mr. Mukesh Choksi to the assessee and allow him to cross examine - Appeal of assessee is allowed for statistical purposes.
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