TMI Blog2014 (10) TMI 486X X X X Extracts X X X X X X X X Extracts X X X X ..... deduction – the order of the CIT(A) is upheld - Decided against revenue. - ITA No. 2250/PN/2012, ITA No. 2251/PN/2012, ITA No. 2252/PN/2012 - - - Dated:- 14-7-2014 - R. S. Padvekar, JM And R. K. Panda, AM,JJ. For the Petitioner : Shri Nitin W. Khare For the Respondent : Shri S. P. Walimbe ORDER Per R. K. Panda, AM : The above 3 appeals filed by the Revenue are directed against the separate orders dated 02-08-2012 of the CIT(A)-V, Pune relating to Assessment Year 2009-10. For the sake of convenience, all these appeals were heard together and are being disposed of by this common order. ITA No.2252/PN/2012 (M/s.Sarjan Construction) : 2. Ground of appeal No.1 by the Revenue reads as under : 1. On the facts and circumstances of the case and in law, the CIT(A) erred in deleting the addition made of ₹ 2.50 crores made on substantive basis, without considering the fact that retraction filed lateron, i.e. after 18 days is only an afterthought and cannot be considered valid without any evidence to prove that declaration made of ₹ 2.5 crores was under duress. 2.1 Facts of the case, in brief, are that the assessee firm, which is engaged in th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... S.K. Shah immediately by filing an affidavit. Although the Income Tax department has impounded about 30 files containing various documents, the Assessing Officer during the course of assessment proceedings, has not found any incriminating documents therein. None of the impounded documents were scrutinised by the Assessing Officer during the course of assessment proceedings. The Assessing Officer has not cross examined the persons who have made the statements or the retractions, i.e. Shri S.K. Shah, or Shri Dharmesh Shah, Accountant of the firm, who has given the bifurcation of the declaration. The assessee was never confronted with any material on record including the impounded documents so as to justify the addition of ₹ 2,50,00,000/-. Relying on the decision of Hon ble Kerala High Court in the case of Paul Mathews and Sons Vs. CIT reported in 129 Taxmann 416 and various other decisions it was submitted that statement on oath cannot be recorded during action u/s.133A of the Income Tax Act. Referring to the decision of the Hon ble Delhi High Court in the case of CIT Vs. Dhingra Metal Works reported in 196 Taxmann 488 it was submitted that statement made during 133A action ca ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... section may - (i) if he so deems necessary, place marks of identification on the books of account or other documents inspected by him and make or cause to be made extracts or copies therefrom, 24[(ia) impound and retain in his custody for such period as he thinks fit any books of account or other documents inspected by him: Provided that such income-tax authority shall not- (a) impound any books of account or other documents except after recording his reasons for so doing; or 25(b) retain in his custody any such books of account or other documents for a period exceeding ten days (exclusive of holidays) without obtaining the approval of the Chief Commissioner or Director General therefore, as the case may be,]] (ii) make an inventory of any cash, stock or other valuable article or thing checked or verified by him, (iii) record the statement of any person which may be useful for, or relevant to, any proceeding under this Act. 24. Inserted by the Finance Act, 2002, w.e.f. 1-6-2002, 25. Substituted by the Finance Act, 2003, w.e.f: 1-6- 2003. Prior to its substitution, clause (b) read as under : (b) retain in his custody any such books of account or othe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t cannot be justified. The Hon'ble High Court of Delhi in the case of CIT vs. Dhingra Metal Works(2011) 196 Taxmann 488(Delhi) has held that statement made u/s 133A of Income-tax Act can be retracted if the facts on record do not justify the same. In this case, it is seen that Shri. Shailesh K. Shah has retracted the decoration made u/s 133A of Income-tax Act by way of filing an affidavit dated 07.01.2009 stating that survey action which was started on 19.12.2008 at 10.00 a.m. continued till 20.12.2008 till 4.00 a.m. and due to tension and distress caused by the survey action, he signed the declaration of offering additional income of ₹ 2.5 crores for the A.Y. 2009-10. It was further stated that declaration of additional income of ₹ 2.5 crores was never warranted in view of the facts that nothing incriminating was found by the survey team. As regards letter of Shri. Dharmesh Shah dated 30.12.2008 wherein bifurcation of declaration was given in respect of M/s. Sarjan Construction, it was submitted that Shri. Dharmesh Shah was merely an accountant and his offer was not binding on him. It is also seen that Shri. Dharmesh Shah also retracted his action by way of filing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... No incriminating documents were found by the survey team. Relying on various decisions he has also held that there is no provision to record the statement u/s.133A of the I.T. Act on oath. Since the addition was based merely on the basis of declaration made u/s.133A of the I.T. Act which has subsequently been retracted and since the addition was not supported by any evidence gathered by the Assessing Officer either during the survey proceedings or during the assessment proceedings he deleted the addition. The Ld. Departmental Representative could not controvert the above factual findings given by the Ld.CIT(A). 5.1 We find the CBDT vide Circular F. No.286/2/2003 dated 10-03-2003 has instructed its field officers which read as under: Instances have come to the notice of the Board, where assessees have claimed that they have been forced to confess undisclosed income during the course of search and seizure and survey operations. Such confessions if not based upon evidence, are later retracted by the concerned assessee while filing returns of income. In these circumstances confessions during the course of search and seizure and survey operations do not serve any useful purpose. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed and since no corroborative evidence was found either during the course of survey or during the course of assessment proceedings, therefore, in view of the Circular issued by CBDT dated 10-03-2003 and the detailed reasoning given by the CIT(A), we find no infirmity in the order of the CIT(A) deleting the addition made by the AO. Accordingly, the same is upheld and the ground raised by the Revenue is dismissed. 6. Ground of appeal No.2 by the Revenue reads as under : 2. On the facts and circumstances of the case and in law, the CIT(A) erred in holding that the road acquisition area is to be considerate as part of area of the plot for calculation of minimum 1 acre of area for claiming deduction u/s.80IB(10) of the Income Tax Act, 1961. 6.1 After hearing both the sides we find the AO during the course of assessment proceedings noticed that the area of different part of the project Shreerang Vihar Vrindavan at Talegaon Dabhade, Taluka Maval, Dist, Pune was less than one acre as the road divided the buildings as noted in para 8 of the assessment order (on the basis of earlier years orders) was as under : Part A - 3287.840 sq.m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be considered as part of area of the plot calculation of minimum 1 acre of area for claiming deduction u/s.80IB(10) of the Income Tax Act, 1961 . 9.1 After hearing both the sides, we find the AO noticed that the assessee has claimed deduction u/s.80IB(10) of the I.T. Act in respect of its projects Shrinivas Sankul and Little Heart located at Talegaon Dabhade, Taluka Mava, Dist. Pune. The AO further noted that after deducting area of internal road of 940.59 sq.mtrs the total area of the project was less than one acre and therefore the assessee was not entitled to deduction u/s.80IB(10) of I.T. Act. Accordingly, he disallowed the deduction claimed amounting to ₹ 8,50,780/- u/s.80IB(10) of I.T. Act. 10. In appeal the Ld.CIT(A) allowed the claim of deduction u/s.80IB(10) by observing as under: 18. I have carefully considered the facts of the case as well as reply of the appellant, it is seen that the issue is covered by the earlier decisions of my predecessors and also covered by the decisions of Hon ble ITAT in A.Y. 2004-05 and 2005-06, ITA No.503 504/PN/2011. Therefore, relying upon the earlier decisions of my predecessor as well as decisions of Hon ble ITAT in ..... X X X X Extracts X X X X X X X X Extracts X X X X
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