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TMI Blog2006 (6) TMI 417X X X X Extracts X X X X X X X X Extracts X X X X ..... truction and sale of premises at Bhumi Building. The unit premises include both office premises and residential flats. During the course of survey one diary belonging to the firm was found. As per the entries recorded in the diary the appellant firm had received Rs. 30 per sq.ft. for residential flat and Rs. 65 per sq.ft. for office premises as 'on money' i.e. the excess sales consideration in addition to the consideration shown and agreed to have been received as per booking agreements." 3. Defect memo was issued to assessee as the appeal fees paid was short by Rs. 4,450. The same has been made good by making payment vide receipt dated 6th June, 2006 placed on record. 4. Notice of hearing was sent to assessee which has duly been served v ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... filed at Rs. 89,080. 7. The Assessing Officer issued show-cause notice to the assessee as to why the said sum of Rs. 6,07,830 should not be added separately being disclosed income. The Assessing Officer vide letter dated 15th February, 2000 asked assessee to submit explanation as to why its income should not be computed at Rs. 5,94,547 as per computation below :- 1. Sales receipts Rs. 28,30,800 Rs. 2,26,464 x 8% Less: (A)Interest to partners Rs. 92,860 (B) Salary to partners Rs. 1,46,887 Rs. 2,39,747 (-) Rs. 13,283 2. Disclosed income Rs. 6,07,830 Total Income Rs. 5,94,547 In res ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that admission or confession is irrelevant in view of the facts on record. Reference has been made to the decision of Hon. Supreme Court in the case of Shri Kishan v. Kurukshetra University AIR 1976 SC 376 that admission made in ignorance of legal rights or without the knowledge of the correct facts does not bind the maker of admission and it is pleaded that similar view was expressed by ITAT in the decision in the case of ITO v. Ratan Devi Dugar [1987] 20 ITD 483 (JP) and also by Himachal Pradesh High Court in the case of Satindar Kumar (HUF) v. CIT [1977] 106 ITR 64 . Finally it is pleaded that as per valuation report the returned profits should be accepted. 9. On the other hand, ld. DR relied on the orders of Assessing Officer and the C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he purpose of the business referred to in sub-section (1) shall be deemed to have been calculated as if the assessee had claimed and had been actually allowed the deduction in respect of the depreciation for each of the relevant assessment years. (4) The provisions of sections 44AA and 44AB shall not apply insofar as they relate to the business referred to in sub-section (1) and in computing the monetary limits under those sections, the gross receipts or, as the case may be, the income from the said business shall be excluded. [(5) Nothing contained in the foregoing provisions of this section shall apply, where the assessee claims and produces evidence to prove that the profits and gains from the aforesaid business during the previous yea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Assessing Officer cannot assess income of an assessee more than 8% unless assessee himself show more than 8%. The Assessing Officer does not have power to assess anything in excess of returned income if the returned income is more than 8% while computing the income of assessee under section 44AD of the Act. A perusal of assessment order will reveal that addition of Rs. 6,07,830 has been made only on the basis of the fact that partner of assessee firm in the statement recorded at the time of survey had admitted to show the said "on money" as income. Ld. CIT(A) has also upheld the addition on this score only. Otherwise there is no dispute regarding the applicability of section 44AD of the Act on the facts of the case of assessee. 11. Now ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... icer to examine a person on oath and any statement made by such person during such examination can also be used in evidence under the Income-tax Act. On the other hand, whatever statement is recorded under section 133A of the Income-tax Act it is not given any evidentiary value obviously for the reason that the officer is not authorised to administer oath and to take any sworn statement which alone has evidentiary value as contemplated under law. Therefore, there is much force in the argument of learned counsel for the appellant that the statement elicited during the survey operation has no evidentiary value and the Income-tax Officer was well aware of this." In the present case the statement has been recorded under section 133A of the Act ..... X X X X Extracts X X X X X X X X Extracts X X X X
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