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TMI Blog2015 (2) TMI 943X X X X Extracts X X X X X X X X Extracts X X X X ..... 1) dated 12/9/2011. During the survey, the Department impounded various documents on the basis of which the assessee has surrendered an amount of Rs. 1,21,24,500/-. Subsequently, the assessee retracted from the statement with regard to disclosure of Rs. 1,21,24,500/-. During the course of assessment proceedings, the assessee has also challenged the jurisdiction of the A.O. to frame the assessment. The A.O. observed as under:- "It is observed that the assessee has retracted the disclosure of Rs. 1,21 ,24,500/- made at the time of survey and has challenged the jurisdiction of survey u/s.133A by the I.T.O. 4( 1), Thane. The issue of jurisdiction and its legality brought out by the assessee is not tenable as the I.T.O. Thane's action is legal and proper in view of-the clause (a) of Section 133A(1). The details furnished by the assessee have been scrutinized and it is observed. that the assessee has not given any explanation regarding the entries made cash receipts from the following parties appearing in the book (Friendship) impounded in the course of survey as under :- Survey No. Guntha 141 51.50 (Vide Two agreements) 140 22 Guntha 141 45 Guntha 338 33 Guntha In additi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted are to 4 persons and the total area sold is 4.64 Gunthas. Thus, the total cash component received out of this transaction amounts to Rs.'6.96 lacs (4.64 x Rs. 150). In all, the total area sold amounts to 80.83 Gunthas and applying the cash component appearing on this note book of Rs.l,50,000/- per guntha,' the total cash component received by me amounts to Rs.l,21,24,500/-. Q, No.ll ; In answer to Question No.7 above you have stated that regular books of accounts have been maintained by you. Please state as to whether the cash component of Rs.l,21 ,24,500/- appearing in the register is accounted for in the regular books of accounts maintained by you. Ans;- The cash entries appearing in the note book found and inventorised are not accounted for in the regular books of accounts maintained by me. This element of cash component received by me is over and above the amounts received by me by way of cheques from various customers. In all, sales have been effected to 51 persons, out of which registration of sales has been done in respect of 22 persons. As for as the balance is concerned, though the registration has not taken place, sale of land has been confirmed and entire ca ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessee approached before the ld. CIT(A). The ld. CIT(A) dealt with each and every objection of the assessee and confirmed the order of the A.O. with regard to the undisclosed income of Rs. 1,21,24,500/- after having following observation:- "As far as the first objection is concerned, it is the contention of the appellant that the statement recorded during the course of survey was not voluntary and is not supported by any documentary evidence. Had the statement was not given voluntarily and it was taken by using coercive measures by the Assessing Officer, nothing prevented the appellant in approaching the higher authorities like Addl. CIT, CIT & CCIT. The appellant could have filed a detailed letter narrating how the statement was not voluntarily recorded before the above Senior Officers which was not done by the appellant. Hence the contention that the statement recorded was not voluntary by using coercive measures cannot be accepted. 2.3.3. During the course of assessment proceedings the copy of the impounded Register "Sundaram" was given to the appellant. In fact based on the content of this impounded document a specific questions were asked in the statement recorded which was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ve the registration charges from the above individuals. Accordingly he had disclosed Rs. 1,21,24,500/- as cash component received from 55 persons as per the impounded documents. The relevant portion are in answer to Question 10 & 11 which are reproduced as under:- Q. No. 10: During the course of Survey Action in the business premises carried out today i.e. on 16-10-2008, a note book namely true Friendship (Sundaram) which is inventorised at sr. No. 1, it is seen that there are certain entries on different dates. This note book also contains certain entries indicating receipt of cash components against the sales effected to various persons, please explain the entries appearing in the note book? Ans: The entries in the note book indicate sales made to various persons out of various survey numbers. The dates of entering into transactions with these parties are also indicted in the said note book. The area of land sold to each individual party is also mentioned in the note book. The entries appearing at the bottom in each page indicate the total number of Gunthas sold and the amount received by way of cash against such sale of lands. The entry written, namelv, 150 indicates the cash c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... buyers and the dates from the probable date of transactions. This contention of the appellant is not acceptable for the following reasons:- (1) In the front page of the Register, the following has been noted by the appellant: "A.K. DEVELOPERS Palhar Village, Vasai Phata, Western Express Highway, Vasai (E), Dist. Thane PARTY PAYMENT RECEIVED (Cheque + Cash payment) This noting clearly indicates that the payments have already been received, otherwise the heading should be "PARTY PAYMENT RECEIVABLE/PROJECTIONS" had it been really a projection which is not the case. ((2) As mentioned in the above para 2.3.3., in page No. 3 and 4 the date of registration is mentioned as 9-06-2008 and 9-7-2008. In page 4 the first column in the page indicates the date of receipt of the consideration is mentioned as 2.7.2008 for some of the buyers and 9-7-2008 for some of the buyers but the date of registration has been clearly mentioned as 9-7-2008 which means that he registration was over as on the date of survey and it is not the projection. (3) During the course of appellate proceedings the AR of the appellant was asked to file the details with regard to all 51 plots viz. no. of plots registe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd Balabux vs. CIT (Assam) 41 ITR 465 Assessee filed affidavit from some creditors - But failed to produce them before the Assessing Officer - Assessee failed to prove the genuineness of the affidavit and the averments made therein - Affidavits rightly rejected. 5) Munilal Ramdayal vs. ITO & Ors. (Ori) 76 ITR 151 Reasons for reopening of assessment - Affidavit of assessee's representative that the item was brought to the notice of the then ITO is self-servicing statement - unless it is corroborated by intrinsic or extrinsic evidence - Hence claim cannot be accepted. In view of the above discussion, I conclude that mere retraction of the statement by filing the affidavit is not an acceptable evidence in the eyes of law. The affidavit filed before me is only a self-serving document without any corroborative material. Hence I conclude that the statement recorded by the Assessing Officer is valid in the eyes of Law. 2.3.6. Now I deal with the issue of the validity of the statement recorded during the course of survey u/s 133A of IT Act. It is a settled law that admission is extremely important piece of evidence as held by the Hon. Apex Court in the case of Pullamcode Rubber Co. L ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ies below before whom such declaration was made, there was no valid reason for retraction of the same after about a gap of two and half months in block assessment proceedings." (5) The ratio was laid down by the Hon.Punjab & Haryana High Court in the case of Surendra Kumar Charanjeet Kumar Singh vs. CIT 282 ITR 78 squarely applies to the facts of this case. The appellant surrendered certain sum during the survey u/s.133A of the I.T. Act. The adoption of gross profit rate based on the survey was justified by the ITAT. The onus in such cases falls on the assessee and not on the revenue to substantiate its claim. (6) It is worth to mention here that the decision of Punjab & Haryana High Court in the case of Bacchitarsingh vs. CIT 328 ITR 400. The head note is as under::- "The assessee in the course of survey under section 133A of the Income Tax Act, 1961 gave a statement on March 21, 2003 surrendering for taxation a sum of Rs. 19 lakhs. He stated that he had purchased a shop for Rs. 24 lakhs jointly with his brother and the source of investment was not reflected in the books of account. Later, the assessee sought to reconcile from the statement made taking the stand that he has agri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s not accounted. Hence where is the question of accounting the same in the regular books.. 2.3.9. The appellant had furnished the copies of reply filed by the buyers of the plot in response to notice issued u/s.133(6) and the statement recorded by the Assessing Officer in few cases u/s.131 of the Income Tax Act along with the submission. I have perused the same. The Assessing Officer had deviced a standard format calling for the details. A sample of notice u/s.133(6) issued to Shri Mukesh 0 Patel is as under- "You are hereby required to furnish the following information duly verified regarding the transactions as reflected in your Books of Accounts for A.Y.2009-10 i.e. F.Y.200B-09: 1. Nature of transactions entered into with the above said assessee 2. Copy of ledger account of the said assessee in your books. 3. Amount paid/payable, received/receivable along with the date and mode of payment (cash/cheque with date) 4. Copy of the bill/s 5. Copy of acknowledgement of return of income filed by you with copy of Balance Sheet for A.Y.2009-10." The above details were called for by the Assessing Officer in a general and routine manner without specifically calling for whether each o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es for getting it cancelled, but the advance taken was simply returned. He was not able to furnish any documentary proof regarding the cancellation. This submission of the Authorized Representative was noted by me in the order sheet. The alleged cancellation in respect of these 14 parties by the appellant is clearly an afterthought because no evidence to this effect was found during the course of survey. It was an event alleged to have occurred after the survey but without any documentary evidence. Hence the contention of the appellant is not tenable. In view of the detailed discussuion above the action of the A.O. in adding Rs. 1,21,24,500/- as undisclosed income is confirmed and this ground of appeal is dismissed. " 4. It was argued by the ld. A.R. that the A.O. was not justified in making the addition of Rs. 1,21,24,500/- based on the statement recorded on oath insofar as the statement was subsequently retracted. As per the ld. A.R., the action of the survey team as well as the A.O. is contrary to the CBDT Circular dated 10-03-2003 with regard to the confession of additional income during the course of search and survey. It was also contended by the ld. A.R. that the statement ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he competent authority regarding value of the plots. Thus, there is no issue of suppression of sale price of the plots and the appellant recorded the actual price received by him in the books of account and there is no, issue of any amount of cash element received by the appellant in excess of the sale price disclosed in the books of account. If the cash element of Rs. 1,50,000/- per Guntha is added to the price of plots, the resultant figure of sale would be unbelievable and unacceptable compared to the market value of plots in that area. It clearly shows that the actual market price was disclosed by the assessee which was also acceptable to the stamp duty authorities. It establishes that the addition made by the A.O. was based on conjecture and surmise. Hence, the addition is liable to be deleted. 6. It was also contended by the ld. A.R. that the assessee is a middleman. The appellant purchases land under a Memorandum of understanding and after making and developing plots, he sells the plots and earn profit.. Thus, there is sale and purchase ratio and seller of the land to the appellant are not stupid enough to sale the piece of land at throw away price to allow the appellant to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d not controvert the same. The A.O. has mentioned in his order in detail the survey number and the area in each survey which was plotted and sold on which the assesse was in receipt of 'on money'. The impounded documents clearly shows that the assessee had received Rs. 1,50,000/- per guntha by way of cash on sale of plots. The A.O. has reproduced the entries in the page No. 3 & 4 of the impounded documents in his assessment order. With respect to survey No. 141, the total area sold worked out to 10.78 and 13.69 Gunthas respectively. The assessee had also mentioned dates on which these documents were registered. A specific question was asked during the course of survey which was related to page No. 1 in respect of sale of 4.63 Gunthas to four persons. On the basis of these impounded documents, Proprietor Shri Aslam Chand Khan had agreed that Rs. 1.5 lacs in the above noting indicates the cash component received over and above the registration charges from individuals to whom the land was sold. Even before the ld. CIT(A), full opportunity was given to the assessee, however, nothing was brought on record by the assessee with regard to the actual receipt of on money. The ld. CIT(A) has ..... X X X X Extracts X X X X X X X X Extracts X X X X
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