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2021 (9) TMI 697 - AT - Income TaxAssessment u/s 153A - Unexplained share capital and share premium - statement of 3rd party relied - whether no incriminating documents found during the course of search? - Assessment year 2012-13 - HELD THAT:- AO clearly stated that assessment order passed are based on the statement of Shri Mulchand Malu. In view of the above facts it is apparent that no evidence is available with the revenue with respect to the addition of ₹ 1.32 crores made during the year except the statement of Mr Malu. Naturally, merely the statement of third party cannot be considered an incriminating material unless is certain corroborative material substantiating or confirming the statement of that party is also found. Neither in the assessment order nor in the remand proceedings the learned assessing officer has stated that there is anything else against the assessee available corroborative the statement of Mr Malu. Admittedly, the assessment year 2012-13 is a concluded assessment and the date of issue of the notice u/s 153A read with section 153C is clearly dated 28.09.2016. In view of this, we constrain to hold that there is no incriminating material found during the course of search based on which the return income for the respective year can be disturbed. Only statement of 3rd party could not have been used for making an addition in the hands of the assessee in case of search in absence of any corroborative material. The learned departmental representative also could not produce any material other than the statement of Mr Malu for making the above addition. Assessment Year 2013-14 assessee has sought the cross examination of the persons whose statement are used by the ld AO. Naturally the persons is passed away and therefore, the cross examination could not be given. Even in that case also no fault can be found with the assessee and therefore, the statement recorded of that person could not have been used for making any addition in the hands of the assessee when the assessee has sought cross-examination of that person. The statement alone cannot be said to be any incriminating material based on which any addition can be made in the hands of the 3rd parties. Therefore on the solitary ground of appeals of the assessee are deserves to be allowed. As there was no incriminating material found during the course of search and both the assessment years are concluded the date on which the satisfaction is recorded by the ld AO of the assessee and therefore, no addition could have been made by the ld AO. Thus, on this ground the appeal of the assessee for both the years is allowed and orders of the lower authorities are reversed. - Decided in favour of assessee.
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