TMI Blog2011 (3) TMI 1611X X X X Extracts X X X X X X X X Extracts X X X X ..... ary, therefore, does not warrant any interference. Thus, the Appellate Tribunal was right in law in deleting the additions made on the basis of statements of third party. Decided in favour of assessee. - TAX APPEAL No. 79 of 2000 - - - Dated:- 25-3-2011 - MS. HARSHA DEVANI AND MS.JUSTICE B.M.TRIVEDI MR KM PARIKH for the Appellant MR SN DIVATIA for the Respondent ORAL JUDGMENT (Per : HONOURABLE MS.JUSTICE HARSHA DEVANI) 1. By this appeal under section 260A of the Income Tax Act, 1961 (the Act), the appellant-revenue has challenged the order dated 20.12.1999 made by the Income Tax Appellate Tribunal, Ahmedabad Bench C (the Tribunal) in IT (SS) No.58/Ahd/1998 for assessment year 1985-86 to 1994-95. 2. While admitting the appeal, this Court had vide order dated 25.9.2000, formulated the following substantial question of law : Whether, on the facts disclosed pursuant to a raid conducted on the premises of the assessee, the Appellate Tribunal was right in law in deleting the addition of ₹ 20 lacs on the basis of statements of Sureshbhai Deepakbhai and ₹ 25 lacs on the basis of the statements of Shri Ramanbhai Patel from the reasons c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the aforesaid documentary evidence and the statements of Shri Sureshbhai A. Patel, made additions of ₹ 20 lakhs in respect of the transaction relating to Silver Arc land deal and ₹ 25 lakhs in respect of the Kundan Nagar land deal as undisclosed income of the assessee for the block period in relation to the block year 1994-95. 7. Being aggrieved, the assessee carried the matter in appeal before the Tribunal, who vide the impugned order, deleted both the aforesaid additions. Being aggrieved, the revenue is in appeal before this Court. 8. Mr. S. N. Divetia, learned advocate appearing on behalf of the respondent assessee submitted that the question as formulated by the Court at the time of admitting the appeal is not properly framed inasmuch as, the question indicates that raid had been conducted on the premises of the assessee, whereas in the facts of the present case, the raid had been conducted on the premises of Shri Sureshbhai Patel and Shri Deepakbhai Mehta and not on the premises of the assessee. In the aforesaid premises the learned advocate submitted that the question requires to be re-formulated. 9. From the facts noted hereinabove, it appears that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd as such, the order of the Tribunal being based upon findings of fact recorded by it, does not give rise to any question of law. It was further submitted that the entire case of the revenue is based upon documents recovered during the course of search from the premises of third parties and the statements of the third parties. It was submitted that the assessee has not been granted an opportunity of crossexamining Shri Sureshbhai A. Patel and Shri Deepakbhai Mehta and as such, the statements of the said persons have no evidentiary value. 12. Inviting attention to the provisions of section 132(4A) of the Act, it was submitted that the presumption under the said provision would be in the case of a person from whom the documents have been recovered and as such, the Tribunal was justified in placing reliance upon the said provision in holding that there can be no presumption against the assessee under section 132(4A) of the Act in the facts of the present case. In support of his submission, the learned advocate has placed reliance upon the decision of the Supreme Court in the case of Kishinchand Chellaram v. Commissioner of Income Tax, Bombay City-II , (1980) 125 ITR 713. In the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... from the residence of Sureshbhai A. Patel who is a partner of Gokul Corporation, as well as other documents found during the search on 21.9.95. - If the evidentiary value of the said loose papers and documents is considered the same cannot possibly construed as books of account regularly kept in the course of business. Such evidence would, therefore, be outside the purview of section 34 of the Evidence Act, 1872 in the light of the ratio of the decision of the Supreme Court in the case of Central Bureau of Investigation v. V.C. Shukla Others, (1998) 3 SCC 410. - The revenue would not be justified in resting its case on the loose papers and documents found from the residence of a third party even if such documents contain narration of transactions with the assessee. - The presumption under section 132 (4A) of the Act would not be applicable to a third party from whose possession such papers and documents had not been found by the revenue. - The statements recorded at the back of the assessee would not conclude the case against the assessee particularly when the makers of the statements have not been allowed to be interrogated by the assessee. - Shri Suresh Patel and S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se, nor is it the case of the revenue that the Tribunal has taken into consideration any irrelevant material or that any relevant material has been ignored. The conclusion arrived at by the Tribunal on the basis of the findings of fact recorded by it cannot in any manner be said to be unreasonable. In the aforesaid premises, the impugned order of the Tribunal being based upon findings of fact recorded by it upon appreciation of the evidence on record, which findings have not been dislodged by the revenue by pointing out any evidence to the contrary, therefore, does not warrant any interference. 17.The question is accordingly answered in the affirmative. On the facts disclosed pursuant to the raid conducted on the premises of M/s Gokul Corporation and its partner Shri Sureshbhai A. Patel and Shri Deepakbhai Mehta, the Appellate Tribunal was right in law in deleting the additions of ₹ 20 lakhs as well as ₹ 25 lakhs made on the basis of statements of Shri Sureshbhai A. Patel and Shri Deepakbhai Mehta for the reasons recorded in Para 12 and 13 of the order of the Tribunal. The appeal is, accordingly, dismissed with no order as to costs. - - TaxTMI - TMITax - Income ..... X X X X Extracts X X X X X X X X Extracts X X X X
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