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2015 (7) TMI 398 - ITAT AHMEDABAD

2015 (7) TMI 398 - ITAT AHMEDABAD - TMI - On Money paid on the purchases of two plots in the name of his family members - CIT(A) deleted the addition - Held that:- Copy of both the Affidavit itself disclosed all the facts regarding inquiry, assurance of investigating officer, statement recorded without any witness, statement proceedings prolong from 07.09.2006 to 21.09.2006, submissions of records etc. On plain reading of affidavit, any prudent person can feel & realize the intention of person w .....

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e it & take action against the seller of the properties under such type of falsely confession.

Before us, DR simply relied on the order of the AO and could not point out any specific error in the order of the CIT(A). The DR even before us could not explain why and in what circumstances statement under section 131 of the assessee was recorded by the AO. Therefore, we do not find any good reason to interfere with the order of the CIT(A), which is confirmed and the ground of appeal of th .....

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law, the Id. CIT(A) has erred in deleting the addition of ₹ 15,12,000/- made on account of On Money paid on the purchases of two plots in the name of his family members despite-the fact that the addition was made on the basis of the statement recorded on oath u/s. 131 of the Act wherein the assessee had admitted to have paid On Money of ₹ 15,12,000/- on the purchases of the plots in the name of the family members. 2. On the facts and in the circumstances of the case and in law, the .....

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ccounted income. 3. It is therefore, prayed that the order of the Id. CIT(A) be set aside and the Assessing Officer's order be restored." 3. We have considered rival submissions and perused the orders of the lower authorities and material available on record. 4. Brief facts of the case are that the assessee is engaged in the business of manufacturing of grey cloth under the name and style of "Prakash Textile". The assessee filed return of income for the Asstt.Year 2002-03 on 4 .....

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for the Financial Year 2001-02 relevant to the Asstt.Year 2002-03. 6. However, on verification of the return filed by the assessee, the AO has found that the said disclosure of ₹ 15.12 lakhs for the accounting year 2001-02 relevant to the Asstt.Year 2002-03 was not reflected in his return of income for the year under consideration. Therefore, on 22.12.2009, a show cause notice was issued to the assessee. In response to the same, the assessee filed an affidavit retracting the statement reco .....

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disclosure before the income-tax authorities in respect of whom he was the best judge, he cannot go back on the same. The AO also observed that the disclosure made in the statement recorded u/s.131 of the Act cannot be swept away lightly. He, therefore, held that the retraction made by the assessee of ₹ 15.12 lakhs out of the undisclosed income during the course of statement recorded under section 131 of the Act on 21.9.2006 is added back to the income of the assessee. 6. On appeal, the CI .....

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here is no evidence brought out by the A.O. in the assessment order which indicates that payment of on money has been made in the purchase transaction of the said properties. iii) The A,O. has failed to appreciate the facts given in the affidavit filed by the appellant and by the real purchasers of the properties. The A.O. should have made inquiries in this regard to find out the factual position before coming to the conclusion that on money has been paid in this transaction by the appellant. iv .....

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In view of the above facts, I am of the opinion that the appellant has no concern with purchase transaction of the properties in question and the A.O. has not taken the right decision in adding the so called on money to the total income of the appellant. Accordingly, the addition made is hereby deleted and the ground of appeal is allowed." 7. Before us, the AR of the assessee submitted that in the course of assessment proceedings, the AO has not found any investment in immovable properties .....

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mount as his on - money payment for Purchase of the said plots for the F. Y. 2001- 2002 relevant to A. Y. 2002 -03. The relevant portion of the said statement on oath recorded u/s. 131 of the Income Tax Act is reproduced as under ........" If we can read and interpret the wordings of above referred para, it reveals that statement u/s. 131 of the Income Tax Act was recorded on 21-09-2006 by the assessing officer. The statement recorded in this case means assessment of A.Y. 2002-2003 of Shri .....

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that and made high peach assessment. In fact, the Income Tax Officer (Inv.) has called the assessee and inquired about transaction made for specific properties and sought the details of rate, who are the seller etc. and recorded the statement without having such authority u/s,131 of the Act to him. Without prejudice to above basic and legal issue of recording the statement by the Income Tax Officer (Inv.) , We further state that the assessing officer has stated in Para 4.1 of the Assessment Orde .....

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se to SCN issued by the assessing officer. (Copy annexed herewith marked Annx.-C). The learned assessing officer intentionally skipped the facts about SCN & reply of the assessee dated 16.12.2009 and no reference has been made in the assessment order. Similarly, the assessing officer has again failed to disclose the facts mentioned in the affidavit filed by the assessee in response to SCN Dated: 22.12.2009 and also the affidavit of purchasers submitted to the assessing officer in support of .....

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