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2016 (4) TMI 346 - ITAT DELHI

2016 (4) TMI 346 - ITAT DELHI - TMI - Addition on undisclosed income - addition made by the AO on the basis of statement of Mr. Ajay Singhal at the time of survey recorded u/s. 133A - Held that:- We find considerable cogency in assessee’s submissions that addition cannot be made on the basis of the statement recorded during the survey under section 133A of the Act, in view of the various judicial decisions wherein, it has been held that such statement does not have any evidentiary value, especia .....

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the considered opinion that the addition made on the basis of the statement in the present case recorded u/s. 133A is not sustainable in the eyes of law, hence, we delete the addition - Decided in favour of assessee. - I.T.A. No. 6509/DEL/2014 - Dated:- 8-3-2016 - SHRI H.S. SIDHU, JUDICIAL MEMBER AND SHRI PRASHANT MAHARISHI, ACCOUNTANT MEMBER For The Assessee : Dr. Rakesh Gupta, Adv. & Sh. Somil Aggarwal, CA For The Department : Sh. T. Vasanthan, Sr. DR ORDER PER H.S. SIDHU : JM This appeal .....

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y treating it as undisclosed income of the assessee and that too without providing any adverse material on record and without considering the facts and circumstance of the case and without cross examination and in violation of principles of natural justice. 3. The brief facts of the case are that the assessee filed its return of income of ₹ 45,465/- on 30.3.2011. A search and seizure operation was carried in Mahesh Mehta Group of Cases on 30.6.2009 and the assessee company was covered u/s. .....

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-10 from various sources which he wanted to surrender in the hands of his Group Companies, himself and his immediate family members over and above the income from all the sources accounted for till date and ready to pay taxes on this undisclosed income of ₹ 70 lacs subject to condition that no penalty proceedings will be initiated. After considering the reply filed by the Assessee as well as other documentary evidence in response to the notices issued by the AO, the AO made the addition of .....

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peal before the Tribunal. 6. At the time of hearing, Dr. Rakesh Gupta, Ld. Counsel of the Assessee stated that although the Assessee has raised 06 grounds in the Appeal, but he is only pressing the ground no. 2, as aforesaid. At the threshold, he drew our attention towards the Paper Book filed by the Assessee containing pages 1 to 101 in which he has attached the Written Submissions filed by the Assessee before the Ld. CIT(A) alongwith the Statement of Sh. Ajay Singhal recorded u/s. 133A of the .....

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/s. 133A of the Act which cannot be stained because such statement does not have any evidentiary value and the addition made on such statement recorded u/s. 133A of the Act is not sustainable, in view of the following case laws, which were mentioned in the Assessee s Paper Book. - CIT vs. S. Khader Khan Son 214 CTR 589 (Mad.). - Unitex Products Ltd. vs. ITO (2008) 22 SOT (Mumbai) - CIT vs. P. Balasubramanian 354 ITR 116 (Mad.) - ITO vs. Ram Prakash ITA No. 61/Agra/2013 dated 18.7.2014. - Mahesh .....

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ations no attempt should be made to obtain confession as to the undisclosed income. Ld. Counsel of the Assessee further stated that moreover the alleged statement of Mr. Ajay Singhal cannot be used to make impugned addition in the hands of the assessee company under any circumstances which is clear from the plain reading of the answer to Question No. 22 in which he has not surrendered the impugned amount in the hands of the assessee company. He stated that the said statement is quite vague. Furt .....

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ay be dismissed accordingly. 8. We have heard both the parties and perused the records, especially the orders of the revenue authorities, statement recorded u/s. 133A of the Act and the case laws cited by the Ld. Counsel of the assessee, as aforesaid as well as the CBDT s Circular dated 10.3.2003. We find that in the present case an addition of ₹ 70 lacs was made by the AO on the basis of statement of Mr. Ajay Singhal at the time of survey recorded u/s. 133A of the I.T. Act. We find consid .....

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tatement recorded during survey under section 133A-Sect. 133A does not empower any IT Authority to examine any person on oath, hence, any such statement has no evidentiary value and any admission made during such statement cannot, by itself, be made the basis for addition and the decision of the Hon ble High Court of Jharkhand delivered in the case of CIT, Ranchi vs. Ravindra Kumar Jain reported in (2009) 33 SOT 251 (Delhi) wherein, it has been held that addition made by the lower authorities me .....

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F.No. 286/2/2003-IT (Inv) Government of India, Ministry of Finance & Company Affairs, Department of Revenue Central Board of Direct Taxes, Room No. 254, North Block, New Delhi, the 10th march, 2003 To All Chief Commissioners of Income tax (Cadre Contra) & All Directors General of Income Tax Inv. Sir, Sub:- Confession of additional Income during the course of search & seizure and survey operation - regarding Instances have come to the notice of the Board where assessees have claimed .....

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