Subscription   Feedback   New User   Login      
Tax Management India .com
TMI - Tax Management India. Com
Articles Highlights TMI Notes SMS News Newsletters Calendar Imp. Links Database Experts Contact us More....
Extracts
Home List
← Previous Next →

Assistant Commissioner of Income Tax, Central Circle-2, Jaipur Versus Shri Johari Lal Sodhani and Vica-Versa

2015 (10) TMI 815 - ITAT JAIPUR

Unexplained advances - CIT(A) deleted the addition - assessee has income from salary and other sources - Held that:- CIT (A) has decided the case categorically and assessee has not honoured the disclosure in the return because no incriminating documents were found during the course of search. The ld. CIT (A) had given various reasons of retraction and also has considered the evidence for not honouring the statement made under section 132(4) of the IT Act. The ld. D/R had not controverted the fin .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ustment of amount lying in P.D. Account - Held that:- The case laws referred by the assessee are squarely applicable. Therefore, interest charged under section 234B is not justified as assessee’s cash was lying with the department in P.D. account. The assessee had made request to adjust the advance tax from the cash seized and lying in P.D. Account, from time to time. - Decided in favour of assessee. - ITA No. 145/JP/2013, C.O. NO. 09/JP/2013 - Dated:- 7-9-2015 - SHRI R.P. TOLANI, JM & SHRI .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

vances amounting to ₹ 29,23,937/- without appreciating the fact that the AO has made the impugned addition based on the evidence that assessee has admitted in the search proceedings and further in the post search proceedings by filing an independent letter dated 10.11.2009 before the Investigation Wing that he has made undisclosed advances, but in the return an amount of ₹ 5,36,063/- only was declared as against the surrendered amount of ₹ 34,50,400/-. (2) On the facts and in t .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

rce and coercion and was read over the assessee who understood before signing. (3) On the facts and in the circumstances of the case, the ld. CIT (A), Central, Jaipur has erred in ignoring the letter dated 10.11.2009 filed by the assessee before the Investigation Wing reiterating the admission about the undisclosed advances in sworn statement earlier without giving any cogent reason to ignore the same. Despite the fact that the letter has been filed by the assessee on his own; that too after 20 .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

from salary and other sources. There was a search and seizure action under section 132 of the I.T. Act and/or survey action under section 133 of the IT Act on the members of Sodhani Sweets Group on 20.10.2009 of which the assessee is the most important member. During the course of search, cash, jewellery, stock-in-trade, valuables, documents, books of account and loose papers were found and seized from the premises of the members of the Sodhani Sweets Group of which one such member happens to be .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

as no account of the amounts of loans advanced to persons which according to him was done only on the basis faith and confidence of his close relatives as well as friends. This fact was again admitted by the assessee in reply to question no. 19 in which he additionally stated that he has discussed the matter of surrender with his wife. The AO further observed that the assessee vide his letter dated 10.11.2009 submitted to the Income Tax Department and gave details of the surrender under various .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ard on this issue which was availed by the assessee by letter dated 27.12.2011 which has been reproduced by the AO at pages 3 & 4 of the assessment order. After considering the assessee s reply, the AO held that the assessee himself has re-affirmed the fact of surrender of ₹ 34,60,400/- in his above referred letter at point no. 3. Having re-affirmed the fact of advances of loans to people on more than one occasion including admitting the same in his statement recorded on oath under sec .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

n be transported to the statement of the assessee. The AO further relied on the decision in the case of Hotel Kiran vs. CIT, 82 ITD 453 (Pune) wherein it was held that where statement under section 132(4) was voluntarily made and there was no coercion or threat whatsoever, the same would be binding on the assessee, even if subsequently retracted. In the instant case of the assessee, there has been instance of any threat or coercion which renders the statement of the assessee invalid. In case of .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

see. 4. Being aggrieved by the order of the AO, assessee carried the matter before ld. CIT (A) who had deleted the addition by observing that the assessee admitted the following income by way of statement dated 20.10.2009 under section 132(4) of the IT Act :- Particulars Amount Cash found 98,39,600/- Advances given by Rajul Sodhani through Manish Tambi 10,00,000/- Advance through Anil Maheshwari Ann. A-9 pg.77 10,00,000/- Payment for cash purchases as per annexure A-5 pg. 3-8 10,00,000/- Constru .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

enhanced to ₹ 1,10,40,000/-. The amount was offered in the return of income filed by the assessee and that of M/s. Sodhani Sweets Pvt. Ltd. The difference between original disclosure of ₹ 2,00,00,000/- and the revised disclosure of ₹ 1,10,40,000/- was on account of two reasons. First, the cash surrendered at the time of search was ₹ 98,39,600/- which was subsequently reduced to ₹ 21,63,512/- which resulted into less disclosure of ₹ 76,76,080/-, because at the .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

77; 2,00,00,000/-. The ld. CIT (A) further observed that the assessee also made further disclosure in the return itself of ₹ 8.40 lacs in the income of M/s. Sodhani Sweets Pvt. Ltd. which was not a surrender during the course of search. The assessee also surrendered ₹ 5,36,063/- in his own case while filing the return of income to cover up any other issue/incriminating paper/document etc. Such surrender has not been made in the original at the time of search. He further observed that .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

nce to indicate that the appellant has made advances to such an extent. It is stated that such surrender of ₹ 34.60 lacs was shown to make out round figure of total surrender at ₹ 2 Cr. It may be noted that when initial surrender of ₹ 2 Cr. Was made, except the surrender of ₹ 34.60 lacs the other items of surrender were based on specific incriminating documents of assets. For example in the original surrender, cash amounting to ₹ 9839600/- was found and the same was .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ng document. Surrender of ₹ 10 lacs on account of cash purchases was also based on incriminating documents. Surrender of construction of factories at Kartar Pura Industrial areas at ₹ 22 lacs and on account of constriction of house in front of shop of Sodhani Sweets for ₹ 10 lacswere also based on specific investment made by the appellant. Another surrender of ₹ 5 lacs on account investment in jewellery is also very specific. However the surrender of ₹ 34.60 lacs wh .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

2 Cr. If genuinely such advances have been made, names of the relatives through loans are advances, person to whom amount have been advances or any other incriminating documents in the form of interest received/money advances would have been found or seized. It may further be noted that the surrender for cash on at ₹ 9839600/- was original made but subsequently cash amounting to ₹ 7676080/- was explained and accordingly while filing the return of income only difference of ₹ 21 .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

rson who makes the admission can show and prove that it is conclusive. The person who makes the admission can show and prove that it was incorrect. (Pannangode Rubber Producing Co. Ltd. vs. State of Kerala 91 ITR 0018). In the jurisdictional High Court in the case of CIT vs. Ashok Kumar Soni 291 ITR 172 also held that admissions are relevant and strong piece of evidence but they are not conclusive proof and statement of admission can always be explained. The AO has referred to the decision of Ho .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ircumstances i.e. when the statement was obtained under coercion threat duress or undue interest, or the statement has been given under mistaken belief either of fact or law etc. Therefore even in this judgment it has been stated that the statement made u/s 132(4) can always be retracted by the person who make such statement. Keeping in view the proposition of law laid down by Hon ble Supreme Court and Hon ble Jurisdictional High Court it is noted that surrender and admission may be a strong pie .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ed ₹ 3460400/- on account of loan and advances through relatives but retracted the same by stating that such surrender was obtained under duress to make total surrender of ₹ 2 Cr. And that there was nothing on record documentary and otherwise that such advances have been ever been made by the appellant. There is no dispute on the fact that during the course of search no documentary evidence or any corroborative evidence are found which may indicate that any such advances have been ma .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

evenue is before us. The ld. CIT D/R supported the order of the AO and argued that statement recorded under section 132(4) is binding on the assessee. The ld. CIT (A) was not right to accept the assessee s retraction without any evidence and requested to confirm the order of the AO. 6. At the outset, the ld. A/R of the assessee reiterated the argument made before ld. CIT (A). He further relied upon following decisions Pullangode Rubber Produce Co. Ltd. vs. State of Kerala and Another (1973) 91 I .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

from the original disclosure by giving explanation supported by the material on record. Kailashben Manharlal Chokshi vs. CIT (2010) 328 ITR 411 (Guj.HC) - Statement recorded u/s 132(4) under coercion & duress and not voluntary u/s 132(4). CIT vs. Dhingra Metal Works (2010) 328 ITR 384 (Del.HC) - Statement recorded under section 133A and discrepancy in stock reconciled by the assessee. M. Narayanan & Bros. vs. ACIT (2011) 339 ITR 192 (Mad. HC) - Retraction made by producing material evide .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

A). 7. We have heard rival contentions and perused the material on record. The ld. CIT (A) has decided the case categorically and assessee has not honoured the disclosure in the return because no incriminating documents were found during the course of search. The ld. CIT (A) had given various reasons of retraction and also has considered the evidence for not honouring the statement made under section 132(4) of the IT Act. The ld. D/R had not controverted the findings given by ld. CIT (A). It is .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

gainst charging of interest under section 234B without considering the adjustment of amount lying in P.D. Account. 9. The AO charged the interest of ₹ 1,89,739/- under section 234B in ITNS 150 which was challenged before ld. CIT (A). The cash was lying in the P.D. account at ₹ 98,45,770/-. The AO should have adjusted such cash against the advance tax liability on the request of the assessee. The assessee had requested to adjust the seized cash against the advance tax liability as und .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

22.3.10 ACIT, CC-2 Again request for adjusting the cash lying in PD account against advance tax with Power of attorney 32 The assessee filed return on 27.10.2010 according to which the tax liability was worked out at ₹ 34,51,200/-. It was requested to adjust the amount from P.D. account vide letter dated 27.10.2010. The adjustment was finally made on 06.12.2010. As per section 234B, the interest is chargeable in case assessee had not paid advance tax. In assessee s case the total cash was .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

to 6.12.2010 i.e. for 9 months is not attributable to the assessee. This was due to delay on the part of the department in making the adjustment. The ld. A/R relied on the following decisions CIT vs. Arun Kapoor (2011) 334 ITR 351 (P&H) CIT vs. Ashok Kumar 334 ITR 355 (P&H) Satya Prakash Sharma vs. ACIT 20 DTR 561 (Delhi ITAT) Anand Shankar Mittal vs. DCIT 34 DTR 589 (JP) Vishwanath Khanna vs. Union of India & Ors. (2011) 61 DTR 318. 10. The ld. CIT (A) called for a report from the A .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

 

 

 

 

 

what is new what is new
  ↓     bird's eye view     ↓  


|| Home || Acts and Rules || Notifications || Circulars || Schedules || Tariff || Forms || Case Laws || Manuals ||

|| About us || Contact us || Disclaimer || Terms of Use || Privacy Policy || TMI Database || Members || Site Map ||

© Taxmanagementindia.com [A unit of MS Knowledge Processing Pvt. Ltd.] All rights reserved.

Go to Mobile Version