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2024 (2) TMI 746 - AT - Income TaxAddition based on voluntary disclosure made by the key person of the assesse group during the course of search which has subsequently been retracted - assessee surrendered additional business income - addition on basis of statement recorded u/s 132(4) - HELD THAT:- It is, a settled law that no addition can be made solely on the basis of statement recorded u/s 132(4) of the Act in the absence of any corroborative material or evidence to support the disclosure or the addition. We, therefore, conclude AO was not justified in making addition only on the basis of statement recorded during the course of search u/s 132(4) of the Act which has subsequently been retracted and no other incriminating material was found during the course of search which could have a live link with the alleged addition made in the hands of the assessee. Treatment to income u/s 115BBE - We find that he assessee is private limited company. Though a disclosure has been made in the statement made to offer Rs. 75 Lakhs for tax but there is no reference to any incriminating material found during the course of search. The assessee has disclosed Rs. 75 Lakhs as extraordinary item in the profit and loss account and offered it as income. The said income cannot be treated as unexplained unless any seized material has been referred by the revenue authorities. In absence thereof and also considering the fact that the assessee is into the regular business, the alleged sum of Rs. 75 Lakhs can be considered only as a business income and, therefore, the ld. Assessing Officer erred in treating it as an income u/s 115BBE of the Act liable to be taxed. This action of the ld. Assessing Officer is not justified. We accordingly, allow the cross-objection raised by the assessee.
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