TMI Blog2017 (3) TMI 960X X X X Extracts X X X X X X X X Extracts X X X X ..... KEDIA, ACCOUNTANT MEMBER For The Assessee : Shri P.F. Jain, AR For The Revenue : Shri James Kurian, Sr DR ORDER PER PRADIP KUMAR KEDIA, AM: These two above captioned appeals by different assessees are directed against the respective order of the Learned Commissioner of Income-Tax (Appeals)-XIV, Ahmedabad of even date 24.08.2012 passed for Assessment Year 2009-10. Since the issues involved in both the appeals are identical, these were heard together and are being disposed of by this consolidated order for the sake of convenience. ITA No.2259/Ahd/2012 Assessee- Smt. Geeta Anil Khosla 2. Grounds of appeal raised by the assessee in this appeal read as under:- 1. The learned CIT (appeals) has erred in law and on facts in upholding addition of ₹ 10,54,000/- in respect of deposit made in ICICI Bank without properly considering and appreciating the facts and explanation of the appellant. 2. He has erred in law and on facts in treating the business of cloth as an afterthought. 3. He has also erred in law and on facts in not considering the affidavit of Shri Piyush Patel confirming the sales made to the appellant and also terming the affi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on the suppliers under Section 133(6) for verification of facts asserted by assessee on this score. In response to notice under Section 133(6) issued on these two parties, one of the purported supplier of the goods M/s. Jay Ambe Sales Corporation denied having made any supply to the assessee as claimed and therefore, he expressed his inability to produce the copy of account of the assessee or her husband in his books of account as called for. Statement of the proprietor of supplier of M/s. Jay Ambe Sales Corporation, Shri Piyush Patel, was recorded by the Assessing Officer for such averments. In the statement so recorded, the supplier refused to acknowledge the bills purportedly issued by them to the assessee against the impugned purchases. The copy of the aforesaid statement of Shri Piyush Patel was provided to the assessee in the course of assessment proceedings. In respect of other party namely, M/s. Utsav Corporation, notice u/s 133(6) was not responded to by the supplier. It was asserted on behalf of the assessee that bills and confirmation of accounts furnished by the assessee and her husband are genuine and proper. The assessee further insisted that the Assessing Officer ma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as claimed by the assessee in reversal of his earlier oral statement before the Assessing Officer does not carry any weight. Such affidavit was alleged to be a self-serving document as an afterthought. It was, in essence, observed that the cash deposits so made by the assessee and her husband are not supportable by any independent tangible document. The CIT(A) further noted that the so-called trading business of the assessee is not evidenced by way of any registration with any authority, i.e., neither with Sales Tax Department nor with any other authority to corroborate that his claim of doing trading business was genuine and not an afterthought. The CIT(A) also noted that the statement of Shri Piyush Patel would show that he was not at all dealing in cloth but dealing in industrial goods and hardware items which are not related to the line of business claimed by the assessee. In substance, the CIT(A) observed that the entire modus to support the cash deposits out of non-existent trading business is an eyewash and without any discernible basis. The CIT(A) accordingly upheld the action of the Assessing Officer and dismissed the appeal of the assessee. 5. Aggrieved thereto, the as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... igations or further enquiry as requested in the letter filed dated 19.12.2011. The ld. AR vehemently contended that affidavit of the supplier in negation of the facts recorded in the statement by the Assessing Officer were crucial which has not been taken into account. The cross-examination of the statement of the supplier was also not given. Therefore, the principles of natural justice have been seriously offended in the present case. To support its case, the ld. AR relied upon the decision of the Hon ble Supreme Court in the case of Kalara Glue Factory, 167 ITR 498 (SC), for the proposition that in the absence of crossexamination of the statement of the third party, the conclusion reached by the Assessing Officer requires to be set aside. The ld. AR next relied upon the decision of the Madhya Pradesh High Court in the case of Prakashchand Nahta, 301 ITR 134 (MP), for the proposition that if the Assessing Officer not having summoned the supplier under Section 131 in spite of the request of the assessee, the evidence of the supplier could not have been used against the assessee. The ld. AR thus contended that the assessment order is vitiated. The ld. AR next relied upon the decisio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . As per the so called Sales Register, the assessee is not showing any sales after 14.09.2008. The sale proceeds just about meet the cash deposit requirements. Likewise, the assessee has also claimed to have purchased goods worth ₹ 9,74,000/- during the aforesaid period of 01.04.2008 to 11.09.2008 to effect sales. Thus, the trading is claimed to have been made for nearly six months during the year. No details of such trading in past or future is borne out from records. As noted by the Assessing Officer, the purported suppliers of the aforesaid purchases namely Utsav Corporation and Jay Ambe Sales Corporation have not been paid any amount against the said purchases at all, except a paltry amount of ₹ 15,000/-. The entire so called purchases is thus outstanding, whereas the sales have been claimed to be realized in cash and deposited in bank. It is not known as to when the purported outstanding liability towards purchases has been discharged and what is the mode of payment. The Assessing Officer, having noted the inexplicable story made out by the assessee, issued notice to the so called suppliers. While one of the parties has not appeared before the Assessing Officer at ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... here sale amounts received and deposited while entire purchase remained outstanding, is inherently improbable and unpalatable. The theory propounded is uncharacteristic of any business practices. The assessee failed to discharge onus of proving it except bald assertions. The explanation is highly unpalatable, particularly on the background of the fact that one of the suppliers shunned the statutory notice issued under Section 133(6) and other supplier denied the transactions of purported supply. There is no material on record whatsoever to endorse the explanation offered by the assessee. The assessee did not choose to place the bank statement showing cash deposits before us to get perspective on frequent of deposits and withdrawals etc. Neither the assessee has asked for cross-examination of the statement recorded by the statutory functionary nor has the supplier offered himself for any cross-examination in the subsequent affidavit. In the absence of any offer for crossexamination or other external evidence, the contents of affidavit cannot be admitted in evidence per se. The retraction of the earlier statement in total reversal of the earlier stand is without any corroboration. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee is thus precluded from taking this plea. When seen in perspective, the bald retraction of earlier oral statement has no probative value and is thus liable to be rejected. The decision in the case of Prakashchand Nahta (supra), relied upon by the assessee, is also of no consequence in the given facts. The retraction affidavit in the instant case has been filed which is totally contrary to the earlier statement. The supplier has not given any corroboration as to how he has received the payment and the source of the material supplied to the assessee etc. The circumstances given by the supplier for alleged coercion is prima-facie unsupportable. The subsequent inaction for wrongful statement in exercise of coercion or duress as alleged also evokes reason to believe that the cause assigned for wrongful statement is a sham. As noted, the supplier in its affidavit has not offered himself for any cross-examination. The contents of the affidavit, therefore, are meaningless and valueless and thus are inadmissible as evidence. In these circumstances, it was not, in our humble opinion, obligatory on the part of the Revenue to take cognizance of the retraction affidavit. To reiterate ..... X X X X Extracts X X X X X X X X Extracts X X X X
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