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2015 (12) TMI 1322 - ITAT DELHI

2015 (12) TMI 1322 - ITAT DELHI - TMI - Confession of additional income during the course of search and seizure and survey operations - Held that:- No hesitation in holding that no addition can be made merely on the basis of surrender without existence of any corroborative evidence found against the assesee. We would also like to state that the assessee had retracted by filing a written submission before the DIT, Inv.-I, New Delhi on 28.11.2006 which is 6 days after the search. There was suffici .....

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esee - Decided in favour of assessee. - ITA No: 1573/Del/2012 - Dated:- 14-10-2015 - SHRI J.SUDHAKAR REDDY ACCOUNTANT MEMBER AND SHRI SUDHANSHU SRIVASTAVA, JUDICIAL MEMBER For The Appellant : Shri Kartar Singh, ACIT DR For The Respondent : Shri Vinod Kumar Bindal, CA ORDER PER SUDHANSHU SRIVASTAVA JUDICIAL MEMBER This Department s appeal is filed against the order dated 5.1.2012 passed by the Ld. CIT(Appeals-1), New Delhi. The facts in brief are that a search and seizure action u/s 132 of the In .....

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eafter surrendered a sum of ₹ 2 crores in his statement recorded during search and seizure proceedings. However, the asessee retracted the statement of surrender on 28.11.2006. In the assessment proceedings, u/s 143(3) the AO however added the sum of ₹ 2 crores and made an assessment at an income of ₹ 2,05,90,430/- . In the first appeal the Ld. CIT(A) given a categorical finding that the addition was made merely on the basis of the surrender made during the search and retracted .....

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that the addition of ₹ 2 crores could not be sustained because no incriminating material justifying such an addition had been found during the search and further the assessee had retracted the statement within a period of 6 days, therefore if the investment wing had any grievance, it could have carried out further investigation in this regard. 2. In the appeal before us the Ld. DR strongly relied on the assessment order and also placed reliance on the decision of Hon ble Supreme Court in a .....

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on truth. He further submitted that no one will tell a lie especially harming one s own interest unless such a statement was true. Ld. Dr accordingly pleaded for the quashing of order of the Ld. CIT(A). 3. On the other hand, the Ld. AR relied on the order of the Ld. CIT(A) and drew attention to page 12 of the paper book which is a copy of the retraction statement dated 28.11.2006 wherein the assessee had submitted that the statement u/s 132 (4) of the Act was recorded under pressurised mental st .....

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ered u/s 132(4) of the Act. This amount was added back to the income of the assessee by the AO on the basis of a surrender which was recorded on 22.11.2006 and retracted on 28.11.2006. We also find that some papers and documents were seized. However the issue has not been dealt in the assessment order. This shows that the addition was not based on any calculation of undisclosed income on the basis of seized papers and documents. 5. The CBDT has issued instructions with regard to the confession o .....

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pon credible evidence, are later retracted by the concerned assessees while filing returns of income. In these circumstances, such confessions during the course of search & seizure and survey operations do not serve any useful purpose. It is, therefore, advised that there should be focus and concentration on collection of evidence of income which leads to information on what has not been disclosed or is not likely to be disclosed before the Income-tax Department. Similarly, while recording s .....

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he basis of surrender without existence of any corroborative evidence found against the assesee. Instruction No. F. No. 286/2/2003-IT(Inv. II) dated 10.3.2003 (reproduced herein above) is has made the position very clear on the issue. Reference may also be made the following cases : • Kailashben Mangarlal Chokshi vs. CIT (2008) 174 Taxmann 466 (Guj.) / 2008 14 DTR 257 (Guj.) : Merely on the basis of admission, the assessee could not have been subjected to additions, unless and until some co .....

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me as depicted in books of account as well as in seized material,' and should not adopt a figure merely as per admission of assessee - Held, yes. • Shree Chand.Soni Vs DCIT (2006) 101 TTJ (JD) 1028: Search and seizure - Block assessment - computation of undisclosed income - Addition based on the assessee's statement under s. 132 (4) - Admittedly, no incriminating document was found to support the impugned addition regarding bogus capital - Statement recorded under s. 132(4) does not .....

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