TMI Blog2019 (6) TMI 467X X X X Extracts X X X X X X X X Extracts X X X X ..... e also found that the cash receipt against such plots as recorded in books of accounts is equal to or more than the cash receipt in seized documents. There is no reason to presume that the receipt recorded in books of accounts is different from the cash as per seized document. Further the cash receipt from the parties to whom these plots were sold is verifiable from books of accounts and affidavit submitted by such parties and there is no material available on record that the assessee received some payment from such parties over and above to whatever recorded in books of accounts. Cash was either not received actually or refunded by the assessee. We also found that proper documentary evidence like affidavits etc. were filed before the A.O. in support of the explanation so filed. Since, the assessee had filed the affidavit in the case of almost all the plot holders and the sale consideration received to assessee against sales of plots is duly verifiable from such affidavits, the CIT(A) was not justified in upholding addition by estimating the G.P. at 31% for sustaining the addition and rejecting the evidences submitted by the assessee in the form of affidavit of the parties. C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s received by the assessee. We found that for sustaining the addition and rejecting the evidences submitted by the assessee in the form of affidavit of the parties the CIT (A) did not give any cogent reason nor he referred any evidence/material/ document to prove that the assessee actually received amount against sales of plots over above to whatever recorded in books of accounts. Accordingly, we direct the A.O. to delete the addition under the head income from long term capital gains. Addition on account of undisclosed receipts from sale of plots - HELD THAT:- Addition so sustained by ld. CIT (A) is based only on the basis of presumption and assumption without considering the submission, evidences and explanation filed by the assessee in the right judicial perspective. From examination of the assessment order as well as order of CIT (A) it will reveal that the entire addition was made on the basis of presumptions, assumption, without having any material to prove the same to be correct. The submission and documents submitted by the assessee completed ignored and rejected without any cogent reason. Accordingly, we do not find any justification for the addition upheld by the l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s submitted by the assessee - HELD THAT:- No reason to interfere in the findings so recorded by the ld. CIT(A) which are as per material on record. Furthermore, no any positive material was brought on record by the ld. DR so as to persuade us to deviate from the findings so recorded by the ld. CIT(A) while deleting the addition made on account of excess silver jewellery found. Unaccounted business income alleged to be earned on sales of plot - noting found on Page 1 of exihibit-8, seized from 1, Gayatri Nagar, Main Tonk Road, Sanganer, Flyover, Jaipur - HELD THAT:- In the case of the assessee there is no tangible material available on record to form a reasonable belief that amount of sale consideration presumed to be received in cash against the sales of plot noted on the seized document was actually received to assessee. Further also there is no material that any consideration against the plots owned by third party was received by the assessee. No documents were found from the possession of assessee or from the other one to prove that any consideration was received/receivable to assessee against alleged sale of plot noted on the paper. No reason to interfere in the order of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 3. Firstly we take assessee s appeal being ITA No. 124/JP/2019 and Revenue s Appeal being ITA No. 286/JP/2019 (A.Y. 2015-16). Rival contentions have been heard and record perused. The facts in brief are that the assessee derived income from the business of Real Estate and the assessee is also a partner in the firm M/s Kedia Real Estate LLP., the assessee filed his original return of income on 11.1.2016 for the AY 2015-16 declaring total income at ₹ 98,16,820/-. The assessee belongs to Kedia Yadav Group, Jaipur on whose premises, a search u/s 132 of the Act was carried out on 19.11.2016. Various assets/ books of accounts and documents were found and seized as per annexure prepared during the course of search. Pursuant to this, AO issued a notice u/s 153A of the Act to the assessee, in compliance of which, the assessee e-filed his return of income on 21.4.2017 for the AY 2015-16 declaring total income at ₹ 98,16,820/-. Finally, the AO completed the assessment u/s 143(3) r.w.s. 153A of the Act vide order dated 22.3.2018 at a total income of ₹ 4,70,12,970/- making various additions. During the course of search and seizure operations u/s 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 20-11-2016 1.00 PM KEDIA HOUSE 20-11-2016 CONCLUDED 131 20-11-2016 4.30 PM SANGANER OFFICE 20-11-2016 8.30 PM 131 20-11-2016 11.30 PM SANGANER OFFICE 20-11-2016 CONCLUDED SHRI NITIN KEDIA 132(4) 19-11-2016 10.00 AM KEDIA HOUSE 19-11-2016 11.00 AM 131 19-11-2016 2.00 PM ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... LLP, Shop No. 8-10, Ganesh Nagar 6-A, Nadi Ka Phatak, Murlipura, Sikar Road, Jaipur. 3.2 Addition of ₹ 1,74,91,981/- on account of alleged unaccounted business income alleged to be earned on sales of plots in Kediaz Corridor computed on the basis of noting found on Page No. 23-28 of AS-9 impounded u/s 133(6) from M/s Kedia Real Estate LLP, Shop No. 8-10, Ganesh Nagar 6-A, Nadi Ka Phatak, Murlipura, Sikar Road, Jaipur. 3.3 The A.O. also made addition of ₹ 74,06,624/- on account of alleged unaccounted business income alleged to be earned on sales of plot at Ganesh Vihar Vistar computed on the basis of noting found on Page 21-22 of Annexure-AS-9 impounded u/s 133(6) from M/s Kedia Real Estate LLP, Shop No. 8-10, Ganesh Nagar 6-A, Nadi Ka Phatak, Murlipura, Sikar Road, Jaipur. 3.4 Moreover, the addition of ₹ 71,500/- was made by the A.O. U/s 69C r.w.s 115BBE of the Act being alleged undisclosed expenses on the basis of Page No. 16 of annexure AS-1 found impounded from Kedia House, Benar Road, Ganesh Nagar, Near Nadi Ka Phatak, Jhotwara, Jaipur. 4. By the impugned order, the ld. CIT(A) deleted the addition ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of ₹ 23,10,263/- + 3,59,276 totaling to ₹ 26,69,539/- by applying the GP rate of 31% on alleged unaccounted receipts of ₹ 74,52,461/- +₹ 11,58,956= ₹ 86,11,417/- on the basis of noting on page No. 23-28 of AS-9 Seized from Shop No. 8-10, Ganesh Nagar 6-A, Nadi Ka Phatak, Murlipura, Sikar Road, Jaipur. The addition was confirmed by bringing any positive material on record to prove that the assessee received some amount against the sales over and above to whatever recorded in books of accounts. 3. On the facts and in the circumstances of the case and in law the Id. CIT(A) erred in confirming the addition of ₹ 4,49,644/- on a/c of alleged brokerage income @ 4% earned on the sale of plots of ₹ 1,12,41,839/-found noted on Page No. 21-22 of exihibit-9, Annexure-AS seized from Shop No. 8,9,10, Ganesh Nagar-6-A, Nadi Ka Phatak, Murlipura, Jaipur. The addition was confirmed by bringing any positive material to prove the receipt of any brokerage income. 4. On the facts and in the circumstances of the case and in law the ld. CIT(A) erred in confirming addition of ₹ 31,81,606/- under the head income from long ter ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ced on the following judicial pronouncements: i) CIT v. K.K. Abdul Kareem [1996] 88 Taxman 323 (Kerala). Presumption u/s 132 (4A) can arise only if it is established that the paper was in the control on or in the possession of the assessee. ii) Chandalal Kalyanmal Vs ACIT 21 Taxworld 125 ITAT Jaipur Bench in ITA No. 385/JP/ 1992 order dated 3/2/1998. Held that on the basis of paper recovered from brother of partner, addition in the hands of firm cannot be made. iii) Mahendra Kumar Agarwal Vs ACIT 21 Taxworld 445 ITAT Jaipur Bench has held that on the basis of paper recovered from father of the assessee, addition in the hands of the assessee cannot be made. iv) CIT vs SMS Investment Corporation Private Limited 207 ITR 364 Hon ble Rajasthan High Court has held that if any document is found in the course of a search, then by legal fiction, a presumption has to be drawn that such document belongs to the person from whose possession or control it was found and the contents of such documents are true. v) Shardha Construction Vs ACIT 76 ITD 85 ITA ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... two places at same time. The statement at Ganesh Nagar shows that Shri Nitin Kedia was present at Ganesh Nagar in between 6.30 PM to 11 PM on 19/11/2016 where the statement at Evershine Tower in Vaisali Nagar shows that Shri Nitin Kedia was present at Vaisali Nagar office during this time. How it can be possible. Therefore, all the proceedings are vitiated in law. 9. As per the ld AR, the A.O. was justified in making addition of ₹ 1,22,26,044/- on the basis of e-mails since the print out of e-mail does not show receipts of cash but merely shows committing for booking. As per the ld AR, the copies of impounded document No. 13 to 19 on the basis of which the addition is made by the AO are print out of e-mails, these sheets are printout taken from email accounts of the assessee group on which the sheets were sent by the sales team/staff /business associates of the assessee group. As per modus operandi, the sales team approaches the different group or person for sale of the plots. Whenever, they get commitment of booking, they report the management for intended booking of the plots. From examination of the impounded document, as per the ld AR, there is no evidence ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... zed document it reveals that the name of the scheme developed by the appellant naming Kediaz Corridor is mentioned over the paper and the plot No. mentioned over the paper is also pertaining to this scheme and noting of seized documents in some of the cases is also correlating from the books of accounts of the appellant, therefore there remains no doubt that the seized documents pertain to business of appellant and the noting of the paper pertaining to the business affairs of the appellant. The appellant pleaded that the seized document were neither prepared by the assessee nor found from control of assessee and possession of the assessee and there is no evidence in the sheet that the cash amount noted in this sheet was actually received from the plot holders or if received the same was entirely only for plot sales and remitted to assessee is not acceptable because these sheets were found on the E-Mail id of the appellant and if the same would not having any bearing from the actual affairs there was no relevance of preparing such elaborate data. Further the sheets were recovered from the E-Mail id of the assessee, therefore the same cannot be said that the same was not found from ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 8.3 The appellant in the written submission bifurcated the addition of ₹ 1,22,26,044/- made by the AO as tabulated below : - S. No. Particulars Amount (in Rs. ) A) Cases where the booking cancelled and either re-allotted to other party or stock in trade 39,37,168/- B) Cases where cash amount mentioned in the seized document is fully recorded in books of accounts 57,08,521/- C) Cases where cash amount mentioned in the seized document is partly recorded in books of accounts 66,233/- D) Cases where the sales was made to party mentioned in the seized document but the cash amount noted in the seized document is not found recorded in books 25,14,122/- In support o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d and in such cases the acceptability of the affidavit cannot be denied by treating the same as self-serving evidences because here the seized recorded do not conclusively proves the unaccounted receipt from the other persons who are actual buyers of these plots. Further the profit cannot be determined on the plots which are in stock. As regard my finding elsewhere that affidavits are self serving documents is not applicable here because my own finding was given in the other instances where the unaccounted amount is apparent from seized records. Thus the addition to the extent of ₹ 39,37,168/- on these cases is uncalled for and the same is directed to be deleted. B C) Cases where cash amount mentioned in the seized document is fully/partly recorded in books of accounts: - From the examination of the documents submitted by the appellant it reveals that in some of the cases the cash receipt is entirely or partly recorded in books. There is no evidence on record that the cash receipt against such plots recorded in books of accounts is different from the cash receipt as per seized document and there is no material available on record that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ipt to appellant and why will the same will brought in knowledge of the appellant. Further it is impossible to imagine and accept that the appellant will leave the activity regarding the recovery of JDA and other expenses etc. on part of its staff/associates more so when it involves the volume of high amount and in case of any failure on part of staff/associate the liability/recovery of such amount by the respective party will be from the appellant only. Thus the argument of the appellant in this regard is not acceptable and the appellant failed to substantiate nature of these receipts, therefore it can be reliably and logically presume that such receipts are unaccounted cash receipt of the appellant which is not recorded in books of accounts. The affidavits submitted by the appellant cannot be considered as evidence because no party will admit the unaccounted payment made by him because the same also lead to them also in trouble. Thus, the affidavits submitted by the appellant are not corroborative evidences but the same are self-serving evidence which cannot be accepted. The appellant alternatively argued that the even in case of unaccounted sales, the entire rec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... op No. 8-10, Murlipura, Sikar Road, Jaipur. No specific question was raised on page 13-19 of Annexure AS-9 by the survey party. However general statement of Shri Nitin Kedia u/s 131 of the Act on Annexure AS-9 are in answer to question no 14 17. 14. The AO treated the unaccounted sales of ₹ 1,22,26,044/- on the basis of the impugned impounded paper 13-19 of AS-9 without rebutting the explanation made by the assessee. We found that on being reconciliation of the sheet from the books of accounts of the assessee following facts emerges: - S. No Particulars Amount (Rs) Total of figure mentioned on impounded paper 13-19 of AS-9 (Copy at APB page 67-73) 1,22,26,044 Less (i) Plots not sold to the persons whose name are appearing in the sheet either sold to other party or in stock (Chart at APB page 739-746) Tabulated at pg 8-10 of order of ld CIT(A) In several cases the plots were not sold to the persons who ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cessive to market rate or they changed their mind to raise the construction of boundary wall etc. through our sales team. Whatever cash was received to the assessee against the sales of plot is duly recorded in books of accounts and except to that no cash was received to the assessee. The assessee filed the affidavit in the case of almost all the plot holders and the sale consideration received to assessee against sales of plots is duly verifiable from such affidavits. 15. During the course of assessment proceedings, the assessee made following submissions relevant to impugned page Nos. 13-19 to the A.O.. a) Vide letter dated 07.02.2018 (Copy at PB Page 136 to 172 relevant page PB Page 169) These sheets were neither prepared by the assessee nor found from control of assessee. Entries in these sheets do not show any undisclosed income of the assessee. These sheets are printout of email. Prima facie it appears that these sheets were prepared by the staff/sales team/business associates of the assessee group regarding amounts demanded by them from various customers regarding JDA and other expenses etc. against the plots in sc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... unts. The ledger a/c of the parties in whose cases the amount is recorded in books of accounts is also enclosed herewith. In cases where the initial booking mentioned in this sheet was cancelled and the plot was later on sold to other party we are enclosing herewith the copy of possession letter issued to party to whom the plot was finally sold to prove that the plot was not sold to the party whose name is mentioned in the sheet. After considering the above submission if any unaccounted cash receipt is required to be added by presuming the cash receipts as unaccounted business receipts then the same can be worked out ₹ 25,14,122/- only. ii) Working sheet of Page No. 23 to 28 marking the entries where the booking was cancelled or cases where the amount is duly recorded in books of accounts or cases where the entry is also appearing at page No. 13 to 19. The ledger a/c of the parties in whose cases the amount is recorded in books of accounts is also enclosed herewith. In cases where the initial booking mentioned in this sheet was cancelled and the plot was later on sold to other party we are enclosing herewith the copy of possession letter issued to party to whom ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hose cases the amount is recorded in books of accounts is also enclosed herewith. In cases where the initial booking mentioned in this sheet was cancelled and the plot was later on sold to other party we are enclosing herewith the copy of possession letter issued to party to whom the plot was finally sold to prove that the plot was not sold to the party whose name is mentioned in the sheet. After considering the above submission if any unaccounted cash receipt is required to be added by presuming the cash receipts as unaccounted business receipts then the same can be worked out ₹ 25,14,122/- only. ii) Working sheet of Page No. 23 to 28 marking the entries where the booking was cancelled or cases where the amount is duly recorded in books of accounts or cases where the entry is also appearing at page No. 13 to 19. The ledger a/c of the parties in whose cases the amount is recorded in books of accounts is also enclosed herewith. In cases where the initial booking mentioned in this sheet was cancelled and the plot was later on sold to other party we are enclosing herewith the copy of possession letter issued to party to whom the plot was finally sold to prove that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... party or in stock In several cases the booking mentioned in the sheet was cancelled, therefore there is no reason to add the amount of such plots as income of the assessee as in such cases if any amount is presumed to have been received against booking of such plots, then upon cancellation of booking, the same will have to be refunded back to the party. (-)39,37,168 Less (ii) Cash Amount mentioned in the seized paper fully recorded in books of account In several cases the cash amount mentioned on the sheet is completely recorded in books of accounts of the assessee as and when the same was remitted to the assessee, therefore the cash amount duly recorded in books of accounts against such plot cannot be treated as income of the assessee. Further there is no reason to presume that the cash amount recorded in the seized document is over and above to cash recorded in books of accounts. (-)57,08,521 Less (iii) Cash Amount mentioned in the seized paper partly recor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Copy of possession letter issued in the name of actual buyer at PB Page 449. 30 386 Vivek Shukla Pradeep Kumar 1,48,025.00 Copy of possession letter issued in the name of actual buyer at PB Page 450. 39 186 Radesh Hegda Sachin Pathak 1,100.00 Copy of possession letter issued in the name of actual buyer at PB Page 451. 40 270 Manmohan Mehta Pravesh Goyal 1,000.00 Copy of possession letter issued in the name of actual buyer at PB Page 452. 41 271 Laxmi Sharma Pravesh Goyal 1,000.00 Copy of aff ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Copy of affidavit of actual buyer of plot at PB Page 290-291 and Copy of possession letter issued in the name of actual buyer at PB Page 465. 73 275 Naval Kishor Jhaver Sanjay Shri Vastav 500.00 Copy of affidavit of actual buyer of plot at PB Page 296-297 and Copy of possession letter issued in the name of actual buyer at PB Page 469. 76 342 Arvind Jain P.k.icii Mittal 250.00 Copy of possession letter issued in the name of actual buyer at PB Page 471. 78 274 Gauri Shanker Akansha Joshi 2,100.00 Copy of affidavit of actual buyer of plot at PB Page 302-303 and Copy of possession letter issued in the name of actual buyer at PB Page 472. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Om Prakash Dhama Rachana Sharma 3,36,984.00 Copy of possession letter issued in the name of actual buyer at PB Page 483. 96 19 Sanjay Sharma Manju Singh 1,000.00 Copy of affidavit of actual buyer of plot at PB Page319-320 and Copy of possession letter issued in the name of actual buyer at PB Page 484. 97 316 Vikram Singh Saba Khan 1.75,000.00 Copy of possession letter issued in the name of actual buyer at PB Page 485. 98 317 Vikram Singh Saba Khan 1,75,000.00 Copy of possession letter issued in the name of actual buyer at PB Page 486, 101 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 7. 143 390 Rajkumar Mashwari Hari Mohan Sharma 1,62,500.00 Copy of affidavit of actual buyer of plot at PB Page351-352 and Copy of possession letter issued in the name of actual buyer at PB Page 508. 148 279 L. K. Gupta Ram Laxman Vijayvergiya 1,100.00 Copy of possession letter issued in the name of actual buyer at PB Page 509. 149 391 Ashish Sharma Praful Pareek 1,000.00 Copy of affidavit of actual buyer of plot at PB Page 355-356 and Copy of possession letter issued in the name of actual buyer at PB Page 510. 156 339 Shri Ram Shefali Bhagotiya ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ctual buyer at PB Page 529. 182 158 Vikram Singh Sanjay Bansal 500.00 Copy of possession letter issued in the name of actual buyer at PB Page 530. 183 139 Kailash Chand Saini Rachna Goadwal 100.00 Copy of possession letter issued in the name of actual buyer at PB Page 531. 189 370 Priyanka Singh Kamlesh 500.00 Copy of affidavit of actual buyer of plot at PB Page391-392 and Copy of possession letter issued in the name of actual buyer at PB Page 533. 190 233 Suresh Kumar Yadav Beena Rathore 2,100.00 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 0 Copy of affidavit of actual buyer of plot at PB Page427-428 and Copy of possession letter issued in the name of actual buyer at PB Page 548. 218 71 Umesh Kumar Goyal Devki Nandan Sharma 1,100.00 Copy of possession letter issued in the name of actual buyer at PB Page 549. Total 39,37,168.00 17. It is clear from the above documentary evidences that the booking in the name of parties, as mentioned in the seized document, in above cases was cancelled and the plots were later on sold to some other party. Once it is proved that the booking has been cancelled then it is admitted fact that upon cancellation of booking whatever amount was received from such party either against plots or JDA charges etc. will have to be refunded back to such party and in such a situation there cannot be income and no addition can be made against ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the party showing the cash receipt recorded in books of accounts at PB Page 443 16 227 Shailesh Gupta 50,000.00 53,062.00 Copy of ledger account of the party showing the cash receipt recorded in books of accounts at PB Page 444. 24 117 Jitandra Kumar Sharma 5,100.00 40,038.00 Copy of ledger account of the party showing the cash receipt recorded in books of accounts at PB Page 447. 48 231 R.G. Soni (full name Rak Govind Soni) 33,333.00 3,90,625.00 117 and Copy of ledger account of the party showing the cash receipt recorded in books of accounts at PB Page 456. 51 43 Mashesh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2,22,205.00 4,44,416.00 Copy of affidavit of buyer of plot at PB Page 294-295 and Copy of ledger account of the party showing the cash receipt recorded in books of accounts at PB Page 468 74 94 Pinky Garg 2,100.00 5,552.00 Copy of affidavit of buyer of plot at PB Page 298-299 and Copy of ledger account of the party showing the cash receipt recorded in books of accounts at PB Page 470. 80 S-11 Arvind Kumar Sharma 56,250.00 1,12,500.00 Copy of affidavit of buyer of plot at PB Page 306-307 and Copy of ledger account of the party showing the cash receipt recorded in books of accounts at PB Page 474. 82 200 Om Prakash Dhama (Solo to Manju Dhamor wife of Om Prakash) 2,1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at PB Page 327-328 and Copy of ledger account of the party showing the cash receipt recorded in books of accounts at PB Page 492. 119 338 Prabhakar Gaur 1,100.00 1,100.00 Copy of ledger account of the party showing the cash receipt recorded in books of accounts at PB Page 495. 122 251 Deepa Devi Rathi 2,05,100.00 5,41,645.00 Copy of affidavit of buyer of plot at PB Page 335-336 and Copy of ledger account of the party showing the cash receipt recorded in books of accounts at PB Page 496. 124 73 Seema Meena 11,000.00 11,000.00 Copy of affidavit of buyer of plot at PB Page 337-338 and Copy of ledger account of the party showing the cash receipt recorded in books of acco ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t at PB Page 357-358 and Copy of ledger account of the party showing the cash receipt recorded in books of accounts at PB Page 511. 152 322 Devilal Kumawat 1,76,676.00 3,55,552.00 Copy of affidavit of buyer of plot at PB Page 359-360 and Copy of ledger account of the party showing the cash receipt recorded in books of accounts at PB Page 512. 153 323 Prabhulal Yadav 1,76,676.00 3,55,552.00 Copy of affidavit of buyer of plot at PB Page 361-362 and Copy of ledger account of the party showing the cash receipt recorded in books of accounts at PB Page 513. 154 324 Vijander Yadav 1,76,676.00 3,55,552.00 Copy of affidavit of buyer of plot at PB Page 363-364 and Copy of ledge ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n wife of Pramod Jain) 1,000.00 41,664.00 Copy of affidavit of buyer of plot at PB Page 383-384 and Copy of ledger account of the party showing the cash receipt recorded in books of accounts at PB Page 527. 179 263 Sharwanlal Kumawat 5,100.00 4,00,000.00 Copy of affidavit of buyer of plot at PB Page 385-386 and Copy of ledger account of the party showing the cash receipt recorded in books of accounts at PB Page 528. 184 157 Kailash Goyal 1,100.00 2,375.00 Copy of ledger account of the party showing the cash receipt recorded in books of accounts at PB Page 532. 191 70 Kalicharan Jatav 1,100.00 31,248.00 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... B Page 542. Total 57,08,521.00 1,20,10,823 19. It is clear from the above chart that in the above-mentioned cases the cash receipt recorded in the seized document is duly recorded in books of accounts of the assessee as and when such receipts were passed on to the assessee by the sales team/staff/business associates. From the record we also found that the cash receipt against such plots as recorded in books of accounts is equal to or more than the cash receipt in seized documents. There is no reason to presume that the receipt recorded in books of accounts is different from the cash as per seized document. Further the cash receipt from the parties to whom these plots were sold is verifiable from books of accounts and affidavit submitted by such parties and there is no material available on record that the assessee received some payment from such parties over and above to whatever recorded in books of accounts. 20. From the record we also found that in the following cases, cash was either not received ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hish Gupta 500.00 - 500.00 - 59 S-27 Chanderkanta 58,050.00 - 58,050.00 Copy of affidavit of buyer of plot at PB Page 280-281 60 S-52 Chanderkanta 58,050.00 - 58,050.00 Copy of affidavit of buyer of plot at PB Page 282-283 63 207 Sameer Kasliwal (Sold Kamla Jain wife of Sameer) 1,05,100.00 - 1,05,100.00 Copy of affidavit of buyer of plot at PB Page 284-285 66 213 Vinod Kumar Sharma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Sawata Sharma 5,000.00 - 5,000.00 Copy of affidavit of buyer of plot at PB Page 339-340 144 282 Shivansh Nagepal 5,500.00 - 5,500.00 - 145 283 Shivansh Nagepal 5,500.00 - 5,500.00 - 147 343 Kavita Gupta 3,000.00 - 3,000.00 Copy of affidavit of buyer of plot at PB Page 353-354 159 268 Bhanu Ram Singh 1,100.00 - ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... S-38 Shazaed Hussain 55,000.00 - 55,000.00 Copy of affidavit of buyer of plot at PB Page 411-412 203 S-39 Shazaed Hussain 55,000.00 - 55,000.00 Copy of affidavit of buyer of plot at PB Page 413-414 214 102 Rajkumar Khandalwal 1,000.00 - 1,000.00 Copy of affidavit of buyer of plot at PB Page 425-426 Total 25,80,355.00 66,233.00 25,14,122.00 21. It is clear from the above table that the cash receipt recorded in the seized document in respect of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is similar to receipts recorded in books of accounts by assessee. In case of any doubt the AO could have made the direct verification/inquiry from parties but the same has not been made. It is relevant to mention here that during the course of assessment proceedings the assessee submitted the affidavits of several buyers who purchased the plots in the scheme of assessee group and out of that the AO examined to some of the plots holders by issuing the summons to them. However, the AO did not issue any summon to any of these party, therefore the sworn affidavit submitted by the parties confirming the amount paid to the assessee group for purchases of plot is liable to be accepted as admissible evidence, in so far as the AO has not rebutted the contents of the affidavits. The contents of affidavits, which are not vague should be accepted correct. For this proposition, reliance is placed on the following decisions: - (i) Mehta Parikh Co v CIT [1958] 30 ITR 181 (SC) (ii) Dilip Kumar Rao Vs CIT (1974) 94 ITR 1 (Born); (iii) Malwa Knitting Works Vs CIT (1977) 107 ITR 379, 381 MP (iv) Sri Krishna Vs CIT (1983) 142 ITR 618 (All) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ct to above addition/deletion, we are dealing with these grounds as under: In this regard, we found that statement of Shri Nitin Kedia was recorded u/s 131 of Income Tax Act during the survey proceedings u/s 133(6) over M/s Kedia Real Estate LLP, Shop No. 8-10, Ganesh Nagar 6-A, Nadi Ka Phatak, Murlipura, Sikar Road, Jaipur. No specific question was raised on page 13-19 of Annexure AS-9 by the survey party. However general statement of Shri Nitin Kedia u/s 131 of I.Tax Act on Annexure AS-9 are in answer to question no 14 17. The A.O. made addition of ₹ 74,06,624/- on the basis of Pages 21-22 of Exhibit AS-9 which were impounded from the shop no. 8, 9, 10 Ganesh Nagar 6A, Nadi Ka Phatak, Murlipura, Sikar Road, Jaipur. 26. The ld. CIT(A) has dealt with this issue at para 14 to 14.8 at page 63 to 68 of his appellate order. The ld CIT(A) held that the plots mentioned on the impounded sheet are of the scheme naming Ganesh Vihar Vistar . Ganesh Vihar scheme has been developed by a cooperative society by the name of Sh. Ganpati Griha Nirmaan Sahkaari Samiti Ltd. The assessee has bifurcated additions made by the ld AO for the plots mentioned in the im ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of JDA, copy of registered sale deed, affidavit etc. before the A.O. The rates mentioned on the sheet is entirely not for sales of plot only but the same is inclusive of cost against construction agreed to be get done through assessee group which was subsequently did not carried out hence no consideration against the construction work was received and only the amount against plot sales was received which is entirely passed on to the respective owner of the plot or in the cases where the plot was pertaining to the assessee the same is duly accounted for in books of accounts. 28. Before the A.O., the assessee has furnished following chart in support of the above explanation Plot No. in respect of which the addition was made by ld. AO Name of the buyer of plot Name of the seller/owner of plot Addition made by ld. AO in the hands of assessee regarding to plot does not belongs to assessee. Addition made by ld. AO in the hands of assessee regarding to plot belongs to assessee. Documents submitted in support of exp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 47 Sangeeta Yadav Nirmal Kedia - 8,34,260 Copy of affidavit of the buyer confirming the payment made against sales consideration at APB page 595-596. C-24 Bhagwan Sahai Nirmal Kedia - 11,47,320 Copy of affidavit of the buyer confirming the payment made against sales consideration at APB page 597-598. Copy of registered sales deed of plot at APB page 599-606. C-162 Vimla Devi W/o Prahlad Narayan Surbhi 6,74,656 - Copy of affidavit of the buyer confirming the payment made against sales consideration at APB page 607-608. Copy of JDA allotment letter in the name of seller of plot at APB page 609. Copy of registered sales deed of plot at APB page 610-619. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1,41,750 - Copy of JDA allotment letter in the name of seller of plot at APB page 653. Copy of registered sales deed of plot at APB page 654-664. A-115 Deal cancelled as admitted by ld AO H-126-A Rahul Seth Ritu 4,65,809 - Copy of JDA allotment letter in the name of seller of plot at APB page 665. A-112 Deal cancelled as admitted by ld AO A-121 Deal cancelled as admitted by ld AO B-278 Nawal Kishore Saini Monika 3,81,810 - Co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lot at APB page 701-707. B-275 Babita W/o Gopi Krishan Vikrant 2,77,000 - Copy of affidavit of the buyer confirming the payment made against sales consideration at APB page 708-709. Copy of JDA allotment letter in the name of seller of plot at APB page 710. Copy of registered sales deed of plot at APB page 711-718. A-119 Deal cancelled as admitted by ld AO Total 42,25,018 31,81,606 29. It is clear from the above chart/explanation that the plots mentioned in the sheet entirely not pertaining to the assessee and no unaccounted payment was received against sales of the plots belonging to others. We also found that the AO herself admitted that transact ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... urchases of plots. In case of any doubt the AO could have made the direct verification from parties but the same has not been made. The AO did not issue any summon to any of these party, therefore the sworn affidavit submitted by the parties confirming the amount paid to the assessee group for purchases of plot should be accepted as admissible evidence. The impounded material does not show that the plots were actually sold at the same rate as mentioned in the impounded material. The AO/ld CIT(A) has not rebutted the contents of the affidavits. 32. We also found from the record that the plots belonging to the assessee was accepted by the A.O. herself as capital assets, therefore, whatever gain was assessable on sale of such plots is liable to be taxed under the head capital gains as against the income from business. Accordingly, the A.O. was not justified in bringing to tax such income from sale of plots held by the assessee as capital asset under the head business income. From the record we found that in the case of the assessee there is no tangible material available on record to form a reasonable belief that amount of sale consideration worked out by AO against the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is regarding plots sold by the assessee in scheme naming Ganesh Vihar Vistar . At initial stage of the dealing the buyer parties were asking for construction of boundary wall, room etc. Therefore, the rate of the plots cited to them inclusive of construction and JDA charges. The rates of plots mentioned in this sheet are against cost of the land+cost of construction of boundary wall and a room. But later on it was finally decided to sale the plot without construction and JDA expenses. Some of the parties found the rate quoted for the plots excessive which was also reduced on final bargaining by them. Therefore, the sale deed was executed on the price finally settled in between the buyer and assessee and no unaccounted money was taken by the assessee. In support of this contention, the assessee had also filed the affidavit in the case of almost all the plot holders and the sale consideration received to assessee against sales of plots is duly verifiable from such affidavits. The affidavits of several buyers which were not proved to be incorrect. Thus, the explanation given by the assessee was supported by the documentary evidence in the form of affidavit while there is no supporti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed and sold to other party ₹ 65,47,622/- B) Cases where the sales was made to party mentioned in the seized document ₹ 83,18,741/- The AR of appellant submitted that out of addition of ₹ 83,18,741/- by AO on a/c of difference in sales rate the addition to the extent of ₹ 8,66,280/- has already been made on the basis of cash amount noted on seized document Page No. 13 to 19 (PB Pg 67 to 73) and 23 to 28 (PB Pg 76 to 80) thus the same tantamount to double addition. 11.8 In support of the above bifurcation the appellant also submitted the documents to substantiate his claim which was examined and verified. The working and chart of above bifurcation is available in the submission of the applicant which has been reproduced herein above, therefore the same is not reproduced in the finding given in this regard. Now I decided the matter regarding addition made with regard to each class as bifurcated and mentioned in the para 11.7 above as under: - A) Cases where booking was cancelled: -It is estab ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... andable that if some receipts are not attributable to the appellant and the appellant is not having any concern from such receipt than why someone report such receipt to appellant and why the same will be brought in knowledge of the appellant. Further it is impossible to imagine and accept that the appellant will leave the activity regarding the recovery of JDA and other expenses etc. on part of its staff/associates more so when it involves the volume of high amount and in case of any failure on part of staff/associate the liability/recovery of such amount by the respective party will be from the appellant only. Thus, the argument of the appellant in this regard is not acceptable and the appellant failed to substantiate nature of these receipts, therefore it can be reliably and logically presumed that such difference in sales rates are unaccounted cash receipt of the appellant which is not recorded in books of accounts. In view of the evidence found in the form of seized record the affidavits submitted by the appellant cannot be considered as evidence because no party will admit the unaccounted payment made by him because the same also lead to them also in trouble. Thus, the affida ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 77; 23,10,263/- is confirmed. 11.11 In view of above against the total addition of ₹ 1,74,91,981/- made by AO the additions to the extent of ₹ 1,48,22,542/- 22,66,442/- (as Para 11.6 of order) + ₹ 1,25,56,100/- (as Para 11.10 of order)) is directed to be deleted and the addition of ₹ 26,69,539/- (₹ 3,59,276/- (as Para 11.6 of order) + ₹ 23,10,263 (as Para 11.10 of order)) is sustained. Thus the Appellant's Ground No. 3 of the appeal is partly allowed to the extent indicated above. 36. The observation and finding of the ld. CIT(A) with respect to addition of ₹ 26,25,618/- was as under: 11. I have considered the assessment order, the submissions made by the appellant along with paper book for the year under consideration and all relevant material placed on record. From examination of seized document (PB Pg 76-80) it reveals that the name of the scheme developed by the appellant naming Kedi-37 Corridor is mentioned over the paper and the plot No. mentioned over the paper is also pertaining to this scheme and noting of seized documents in some of the cases is also correl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ning which the initially plot was booked in the name of customer mentioned in the seized document and later on due to cancellation of booking the same was sold to some other party. iii) In some of the cases (PB Pg 76-80) the cash amount recorded in the seized document is recorded in books of accounts which is either equal to amount noted in the seized document, or by more amount or by less amount. However the date of cash receipt recorded in the books of account is not commensurate with the date noted in the seized document. The appellant in this regard submitted that the date noted on the seized record is not the date of receipt of amount from customer but the same is date of booking. This fact also elaborated from the fact that in the case of cheque receipts also the date is not same which proves that the date noted in the seized document is date of booking and not date of receipt. iv) Some of the entries of cash amount recorded in the seized document (PB Pg No. 76-80) are also repeating on the seized document (PB Pg No. 67-73). The AO made the addition on the basis of cash amount noted on both seized documents thus the same tantamount to double ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e applicant, which has been reproduced herein above, therefore the same is not reproduced in the finding given in this regard. 11.4 Now I decided the matter regarding addition made with regard to each class as bifurcated and mentioned in the para 11.3 above as under: - A B) Cases of duplicate entries on Page 13 to 19 and Page 23 to 28 of seized documents: - In the written submission the appellant gives the chart of entries which are noted on the seized document Page 13 to 19 as well as Page 23 to 28. The amount and other particulars of such entries are entirely matching with each other, therefore there is no basis to presume that the entries on both the documents are different. Further entries of ₹ 3,73,100/- are partly matching with the entries recorded in seized page 13 to 19. Since I have dealt with such entries while deciding the ground No. 2 taken regarding addition made on the basis of Page No. 13 to 19 and addition made on the basis of such entries has been dealt with therein, therefore addition of such duplicate entries to the extent of ₹ 6,20,880/-+3,73,100/- = 9,93,980/- is tantamount to double addition and the same is direc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The cheque amount is duly recorded in books of accounts and the same fact also admitted by the AO therefore there remain no reason to presume that the cash amount recorded in the seized document is entirely unaccounted receipt. In the light of cheque transactions noted in the sheet it can be considered that part of the amount noted in the sheet which are being verified from books of accounts are recorded transactions. Admittedly there is difference in the date noted in the seized document and date of receipt in books of accounts but as submitted the date noted on the seized record is not the date of receipt of amount from customer but the same is date of booking. This submission of the appellant is acceptable because of the reason that in the case of cheque receipts also the date is not same which proves that the date noted in the seized document is date of booking and not date of receipt. In view of above the cash receipt to the extent of ₹ 2,08,082/- found recorded in books of account cannot be added as income of the appellant and hence the same is directed to be deleted. E) Other cases where the sales made to party noted in the seized record and cash menti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cceptable that in case of unaccounted sales only GP on such sales should be estimated and such GP should only be added as income of the appellant. In this case the appellant himself declare the GP 30.60% in the regular books of accounts. Therefore, AO is directed to apply the GP rate of 31% on unaccounted receipts of ₹ 11,58,956/- which comes ₹ 3,59,276/-. Thus, the addition to the extent of ₹ 3,59,276/- is confirmed and the balance addition of ₹ 7,99,680/- is deleted. In this regard it is to further added that in the case of Shri Gulam Farooq Ansari vs ACIT ITA No 776/JP/2015 Hon ble ITAT, Jaipur bench, Jaipur after giving the finding that entire receipt cannot be added as income applied at the profit rate of 8% by following the decision of DCIT Vs Pahar Ganj Grih Nirman Sahkari Samiti Ltd 85 Othrs - IT(SS)A nos. 100,129,130 133/JP/2003. The GP rate estimated by me is though higher from the GP rate estimated by Hon'ble ITAT in similar cases but the same is based on the GP rate himself declared by the appellant in his books of accounts, therefore in my considered view logically the higher GP rate himself declared by the appellant in hi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1 -12 of her order c) No deduction was given for the amount already added in (a) above. 38. We further observe that while making the addition the AO grossly made the following further errors which are contrary to the documents submitted by the assessee: - i) Duplicate entries impounded page 13-19 (APB 67-73) as well as in impounded page 23 to 28 (APB 78A-80) In some of the cases the amount written in cash column of page No. 23 to 28 (APB 67-73) was also appearing at Page No. 13 to 19 (APB 78A-80) but the ld. AO made the addition of such amount on the basis of both the papers which tantamount to double addition. ii) Cash receipts already recorded in books against the same plots:- While adding the amount mentioned in cash column of page No. 23 to 28, the cash receipts already recorded in books of accounts (as and when the same was received by the assessee) has not been considered and eliminated but the same was treated as income of the assessee and addition was made. There is no reason to presume that the cash amount recorded in the impounded document is over and above to cash recorded ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s Amount Total of figure mentioned on impounded paper 23-28 of AS-9 26,25,618 Less Duplicate Entries impounded page 13 to 19 of AS-9 as well as 23-28 of AS-9 (Tabulated at page 29-30 of order of CIT(A)) -6,20,880 Less Addition already made on the basis of 13-19 (Tabulated at page 31-33 of order of CIT(A)) -3,73,100 Less Booking Cancelled either re-allotted to other party or in stock (Tabulated at page 30-31 of order of CIT(A)) -2,64,700 In several cases the booking mentioned in the sheet was cancelled, therefore there is no reason to add the amount of such plots as income of the assessee as in such cases if any amount is presumed to have been received against booking of such plots, then upon cancellation of booking, the same will hav ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g, the same will have to be refunded back to the party. Less Addition already made on the basis of amount mentioned under column Cash Amount of impounded pg 23-28 Under chart 3 (S.No 2, 11, 69, 70,71) pg 10-11 of Astt Order (Tabulated at page 38-39 of order of CIT(A)) -8,66,280 Balance Balance In some of the cases the sales was actually made to the same party as noted on the impounded document but the cash receipt is either not recorded in books or recorded by lesser amount. In such cases the cash as reported on the sheet was never received to the assessee (Tabulated at page 38-39 of order of CIT(A) 74,52,461 40. It was also contention of the ld AR that no addition can be made on the basis of impugned impounded papers. Detailed submissions was as under:- i) It is apparent that the impounded sheet is not prepared for the actual sales made by the assessee. It is apparent that in cases of many plots, the sal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... believe the actual consideration received and resort to presumption and assumption in arriving at erroneous conclusion of suppression of sales. v) It is relevant to mention here that during the course of assessment proceedings the assessee submitted the affidavits of several buyers who purchased the plots in the scheme of assessee group and out of that the ld. AO examined to some of the plots holders by issuing the summons to them (PB pg 801-808/APB Vol IV). The ld. AO did not issue any summon to other parties, therefore the sworn affidavit submitted by the parties confirming the amount paid to the assessee group for purchases of plot should be accepted as admissible evidence. The AO has not rebutted the contents of the affidavits. The contents of affidavits, which are not vague should be accepted correct. Reliance is placed on the following decisions:- (i) Mehta Parikh Co v CIT [1958] 30 ITR 181 (SC) (ii) Dilip Kumar Rao Vs CIT (1974) 94 ITR 1 (Bom); (iii) Malwa Knitting Works Vs CIT (1977) 107 ITR 379, 381 MP vi) It is an admitted fact that in the case of search assessment the additions ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Hon ble ITAT has held that:- 6. We have considered rival contentions and carefully gone through the orders of authorities below. From the record we found that AO has made addition on the plea that various flats booked and sold by the assessee was at a different price, even though situated in the same building. The AO found that flat No.701 having area of 1387 sq.ft was agreed to be sold on 23/06/2008 and for which payment was received by the assessee during the F.Y.2009-10 was at ₹ 41,456/- per.sq.ft, whereas flat No.702 having area of 710 sq.ft which was agreed to be sold on 22/06/2009 at a rate of ₹ 29,577 per sq.ft. Similarly other flats on the 8th and 9th floor was sold by the assessee at a lower price. The CIT(A) has given due justification with regard to the prevailing rate during the F.Y. 2008 vis- -vis 2009. The CIT(A) observed that sales price declined by the assessee was not below price declared by the State Government of Maharashtra or below the market price. The AO has simply applied deferential in the rates of booking of flat No.701 and other flats for arriving at the actual booking rate for all the flats other than falt No.701. We also ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fied with the assessee's explanation for charging a lower rate in comparison with a higher rate of other flats, he was required to bring on record certain material to demonstrate that the assessee, in fact, charged such higher rate. The rejection of assessee's explanation for charging a lower sale price cannot be jettisoned without positively showing that the assessee received a higher sale price. The Hon'ble Supreme Court, in context of section 52, in K.P Varghese v. ITO [198] 131 ITR 597/7 Taxman 13, has held that: Sub-s. (2) of s. 52 can be invoked only where the consideration for the transfer has been understated by the assessee or, in other words, the consideration actually received by the assessee in more than is declared or disclosed by him and the burden of proving such an understatement or concealment is on the Revenue. Sub-(2) has no application in the case of an honest and bona fide transaction where the consideration received by the assessee has been correctly declared was subsequently reiterated in CIT v. Shivakami Co. (P) Ltd {1986} 159 ITR 71/25 Taxman 80K (SC) Similar view has been expressed by the Hon'ble Supreme Court in CIT v. Godauari Corpn.Ltd. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... only during the prevalence of this provision that the Revenue has been discharged from the burden of proving that the sale price of land, or building of both is understand. Straight way, the declared sale consideration can be substituted with the stamp duty value, if it less. In the period anterior to the application of this provision, the burden is squarely on the Revenue to positively show that the sale price charged was actually more than that declared. We are confronted with a situation in which the assessee gave reasons for charging lower price in respect of some of the flats sold, which the AO failed to controvert. In such a situation, there can be no reason to me of sustain any such addition. We, therefore, order for the deletion of this addition in entirely. This ground is allowed. 7. The detailed finding recorded by CIT(A) has not been controverted by learned AR, accordingly, we do not find any reason to interfere in the order of CIT(A) for deleting the addition made on account of estimated sales price by disregarding the actual sale price shown by the assessee. 8. In the result, appeal of the Revenue is dismissed. 41. In view of the ab ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt and his family members. In support of the household expenses the appellant submitted the ITR and Balance sheet of the family and from examination of such details it is found that the total withdrawal of the family towards the household expenses was of ₹ 9,19,207/- (apart from the withdrawal of Shri Shiv Kumar Kedia father of appellant) which is quite sufficient to cover up the expenditure of this much petty amount spend on the mobile so purchased as per seized document. Therefore, in my considered opinion the Id. AO failed to controvert to the submission of the appellant. Thus, the AO is directed to delete the addition of ₹ 71,500/-. Thus, the appellant's Ground No. 5 of the appeal is allowed. 42.1 The revenue is in further appeal before us. 42.2 We have considered the rival contentions and found from the record that in support of household expenses, the assessee has submitted income tax return and balance sheet of the family members before the A.O. As per the balance sheet and ITR, we observe that there was a total withdrawal of the family members with regard to household expenses was ₹ 9,19,207/-. Looking to the household w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt for the relevant A.Yr. 8.2 I have perused the written submissions submitted by the Ld. A/R and the order of AO. I have also seen and perused the scanned seized document in the order of the AO. I have also gone through various judgments cited by the Ld. A/R and those contained in the order of AO. I am not in agreement with the contention of AO for the following reasons: The appellant has at the very outset has submitted that he is not related to plot no. 7 12 which is reflected in the seized document scanned on page 5 of AO order. Learned A/R has submitted that plot no. 12 was sold to Shri Vijay on 8.11.2016 and was registered on the same date, about 11 days before the date of search. The Ld. A/R submitted this plot is unsold till date. The Ld. A/R submitted that the cheque transaction of ₹ 30,50,000 on page 7/ Exh AS2 does not relate to plot no. 7 8s 12. In fact it is sum total of consideration for plot no. 8 13. Same can be verified from APB page no. 340 8s 350. The Ld. A/R admitted that for these 2 plots the appellant played a mediator and in fact these two plots are bought by Shri J. Bhutia 8s S.P. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has conceded that he has played a role of mediator in the sale of 2 plots a fair amount of commission shall be added in the hand of appellant. The commission is taken 4% of the total sale consideration of ₹ 1,58,00,000/-, which comes out to be ₹ 6,32,000/-. On the facts and in the circumstances of the case, the AO is directed to delete ₹ 1,27,50,000/- and tax a sum of ₹ 6,32,000/-. Ground No. 2 is partly allowed. 44. The Revenue is in appeal against the deletion of ₹ 1,27,50,000/- made by the A.O. on account of unaccounted business income on sales of plot as per the seized document. However, the assessee is in cross appeal with regard to addition of ₹ 6,32,000/- made by the A.O. on account of assessee having earned brokerage @ 4% on sale of plot which was sold to Shri Bhutia Ji by Shri Om Prakash Khandelwal and Shri Satya Prakash Agarwal found noted on the documents seized from the possession of Shri Harpal Yadav and the opportunity of cross examination of Shri Harpal Yadav and Shri Jitendra Bhutia was not given and without making any inquiry from owners of the plots namely Shri Om Prakash Khandelwal and Shri Satya Prakash Agarw ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... atements of Shri Harpal Yadav and statement of Shri Jitendra Bhutia the AO opined that the payment of ₹ 1,27,50,000/- noted on these papers were received by the assessee and the same was treated as income of the assessee. While taking the cognizance of the impugned seized paper and statement referred above, the copies of statements of persons relied by the AO has not been provided to the assessee and the opportunity of cross examination was also not provided. In this regard the assessee vide his letter dated 05.03.2018 submitted to AO as under:- In continuation of our this submission we further submit that the copies of statements of various persons replied by your honour in your show cause notice has not been provided to the assessee and the statements of these persons cannot be used against the assessee as the same were recorded behind the back of the assessee. Thus as per the natural justice once the assessee had objected to use the statements of the persons against the assessee which has been recorded behind the back of the assessee than in such a case it is duty of AO to provide the copies of such statements to the assessee and provide t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for A.Y 2010-11 to A.Y 2016-17. 52. We also found that during the course of the assessment proceedings the following documents were submitted to the AO to prove that the assessee was neither owner of the plot nor he sold the plot and the beneficial owner of the plots were someone other: - Particulars of documents Copy of JDA patta of the plot No. 12 in the name of Shri Nitin Kedia and registered sales deed of plot executed between Shri Nitin Kedia and Shri Vijay Kumar S/o Shri Narayan Bohara buyer of the plot No 12. Copy of JDA allotment letters issued in the name of Shri Om Prakash Khandelwal (Plot No A-8) and Shri Satyaprakash Agarwal (Plot No A-13). Copy of registered sales deeds of Plot No. A-8 and A-13 sold by Shri Om Prakash Khandelwal and Shri Satya Prakash Agarwal to Shri Jitendra Bhutia and Shri Satya Prakash Bhutia. Copy of ITR s of Shri Om Prakash Khandelwal and Shri Satyaprakash Agarwal of AY 2016-17 wherein the capital gain on sales of these plots has been reflected by them in their computation of total income. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee which has been shown by these persons in their ITR. The AO accepted the payment received though banking channels as taxable in the hands of Shri Om Prakash Khandelwal and Shri Satyaprakash Agarwal while alleged cash amount taxed in the hands of the assessee. It is not understandable that how a single transaction can be taxed in the hands of two different persons. To hold a person as Benami of another, one ought to have concrete evidences in contrast to sheer presumptions and suspicion and in such cases initial burden lies on revenue. The ld AO failed to appreciate the facts, evidence and the tests laid down by the Hon ble Apex Court and the Hon ble High Court. For this purpose, reliance may be placed on the following judicial pronouncements: 1. CIT Vs Daulat Ram Rawatmull 87 ITR 349 (SC) 2. Jaydayal Poddar vs. Bibi Hazra, AIR 1974 SC 171 Hon ble Supreme Court has held that it is well settled that the burden of proving that a particular sale is Benami and the apparent purchaser is not the real owner, always rests on the person asserting it to be so. 3. Prakash Narain Vs CIT 134 ITR 364 (ALL) 4. Lal C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... son who asserts its and sharing of same business place and employees is not sufficient to hold one person as Benamidar of another. 17. Radhey Shyam Ojha vs. ACIT 32 Tax World 81 held that it is the duty of AO to bring on record sufficient material to prove Benami nature. 55. In view of the above discussion and the findings recorded by the ld. CIT(A), we do not find any reason to interfere in the order of the ld. CIT(A) in deleting the addition. 56. We found that the ld. CIT(A) had deleted the main addition but upheld the income on account of brokerage @ 4% alleged to be earned on the said transaction. However, for sustaining the addition on account of brokerage the ld. CIT (A) did not give any cogent reason or did not referred any evidence/material/document to prove that the assessee actually received any brokerage in these dealing or any brokerage was receivable to the assessee. In the case of assessee in support of addition so sustained neither there is any evidence/material/document was found as a result of search which show that any brokerage was received/receivable to the assessee on these transactions nor during the course of asses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rtment to show that the undisclosed income in the hands of the assessee was utilized for other purposes except to undisclosed expenses of the assessee. In absence of any evidence otherwise for utilization of undisclosed income, it can prudently be presumed that such income was utilized for incurring undisclosed expenditure. Thus, we direct the A.O. to allow credit of ₹ 3,66,000/- being commission income confirmed by us hereinabove by estimating the same at 2% against the alleged expenditure of ₹ 4,08,781/-. Accordingly, we confirm addition of ₹ 42,781/- (4,08,481 3,66,000) under the head Section 69C of the Act. We direct accordingly. 57. In the result, appeal of the revenue is dismissed whereas the appeal of the assessee is allowed in part. 58. Now we take assessee s appeal in ITA No. 126/JP/2019 and Revenue s appeal in ITA No. 288/JP/2019 (A.Y. 2017-18). Brief facts of the case are same as we have already quoted hereinabove while dealing with the appeal for the A.Y. 2015-16. During the course of assessment U/s 143(3) read with Section 153A of the Act, for the A.Y. 2017-18, the A.O. has made addition in respect of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d the cash balance was also available as per balance sheets of such year. It is relevant to mention the appellant group is engaged in the business activities and for the purpose of day to day requirement they have to maintain the cash balance. Further the appellant group is also making the withdrawal for household expenses. Therefore, by no stretch of imagination it cannot be presumed that as on the date of search the appellant group would not having any cash balance as per their books of accounts. 8.4 In view of above finding, respectfully following the judgements on which the reliance was placed by appellant and the fact that as on the date of search the sufficient cash balance was available in the cash book of appellant group which was produced before AO and the AO has not pointed out any defects therein, therefore the impugned addition of ₹ 13,52,328/- made for no valid reasons deserves to be deleted and it is directed to delete the addition of ₹ 13,52,328/-. Thus, the appellant's Ground No. 2 of the appeal is allowed. 60. The Revenue is in further appeal before the us against the deletion of addition of cash in hand found durin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rd we found that the AO doubted the genuineness of the cash balance appearing on the cash book of above named parties by holding that no explanation was filed by the assessee group with respect to cash found seized during the post search proceedings . In this regard we observe that the books of accounts of the assessee group was maintaining in Tally software of accounting which was running on the laptop of accountant of the assessee group. The assessee group could not contacted from the accountant as on the date of search, therefore no explanation regarding the cash balance available as on the date of search could be submitted. Further during the course of post search proceedings no explanation was called from the assessee group in this regard. The post search proceedings and assessment proceedings are separate proceedings. The documents or explanation submitted during the course of assessment proceedings cannot be summarily rejected by holding that the same were not submitted during post search proceedings. 64. While dealing with the cash in hand found as on the date of search the AO completely failed to appreciate the fact that the assessee group is engaged in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... led finding has been recorded by the ld. CIT(A) to the effect that during the course of assessment, the assessee has produced cash book before the A.O. alongwith supporting bank statements, bills and vouchers and documents wherein no figure has been pointed out by the A.O. The ld. CIT(A) has further recorded a finding to the effect that in the return of income for the A.Y. 2016-17 which was already filed before the date of search, the cash balance was also available as per balance sheet of such year. In view of the documentary evidences, the ld. CIT(A) concluded that the cash found during the course of search were as per the books of account wherein no figure has been pointed out by the A.O.. The finding so recorded by the ld. CIT(A) are as per material on record which do not require any interference on our part. 67. In the result, ground No. 1 taken by the revenue is dismissed. 68. The A.O. has also made addition of ₹ 1,02,81,252/- on account of gold jewellery. The A.O. alleged unaccounted business income utilized in making undisclosed investment in alleged excess Gold Jewllery found at the time of search by applying the provisions of section 69 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ra Kumar Kedia and Shri Murli Manohar Kedia were completed by the same AO. Regarding surrender made in the search statement it is pertinent to mention here that the statement alone is not sufficient to make an addition. In other words the statement must corroborate with some seized material found during the course of search. The appellant has correctly relied on various judgements in this regard in his written submission. It has been held in many judgements that mere statement is not sufficient to make an addition. A statement made must be relatable to incriminating material found during the course of search or statement must be made relatable to subsequent inquiry/investigation. Otherwise also, the jewellery found from the bed room of father cannot be taxed in the hands of assessee. Thus AO was not justified in making an addition of ₹ 1,02,81,252/-solely on the basis of disclosure made in the statement u/s 132(4) of the Act. 11.4 It may be pointed out that the appellant group was also subjected to search and seizure action u/s 132(1) of the Act on15.09.1996. During that search certain amount of jewellary was found to be owned by Shri Sunder mal Media grandfa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e judicial pronouncements referred by the lower authorities in their respective orders as well as cited by the ld. AR and ld. DR during the course of hearing before us in the context of factual matrix of the case. From the record we found that following jewellery was found during the course of search: Ann No. Particulars Net Weight of Metal (In Gms.) Weight of Stones (in Cts.) Total Value Metal Total Value of Stone JF-1 (APB 15-21) Bedroom of Shri Shiv Kumar Kedia Ji and Smt. Saroj Kedia 7901.351 281.250 2,33,87,982 47,11,760 JF-2 (APB 6-8) Bedroom of Shri Nirmal Kedia and Smt. Ritu Kedia 1526.837 135.760 45,19,431 31,10,160 JF-3 (A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he reply on this issue vide letter dated 07.02.2018 and vide letter dated 05.03.2018 along with supporting documents. The replies so submitted by the assessee are reproduced as under: - a) Submitted vide letter dated 07.02.2018 2. Explanation regarding Gold Jewellery found during search i) The Jewellery found by Party No 6 6A from the possession of Shri Rajendra Kumar Kedia/Shri Murli Manohar Kedia pertains to Shri Rajendra Kumar Kedia/Shri Murli Manohar Kedia and their family. The above named assessee has no concern from Jewellery found from the possession of these persons. ii) During the course of search the department found bullion/jewellery from residence of assessee group and from lockers. As per the inventory prepared by the search party the details of Jewellery found is as under: - Ann No. Particulars Net Weight of Metal (In Gms.) Weight of Stones (in Cts.) Total Value Metal Total Value of Stone ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Shri Nitin Kedia (Copy of W. tax return for AY 2006-07 to AY 2014-15 along with valuation report filed with the W.Tax Return is enclosed herewith at Page No. 99-139) 952.860 78.500 4. Smt. Monika Kedia w/o Shri Nitin Kedia (Copy of W. tax return for AY 2007-08 to AY 2014-15 along with valuation report filed with the W.Tax Return is enclosed herewith at Page No. 140-179) 2630.350 368.430 (B) Received at the time of marriage or other auspicious occasions in cases where W.Tax returns not filed 5. Shiv Kumar Kedia HUF (Ancestral) 550.00 6. Ritu Kedia W/o Shri Nirmal Kedia 500.00 7. Tanishk Kedia S/o Shri Nirmal Ji 100.00 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2. Shri Nirmal Kumar Kedia 4258.180 219.000 3. Shri Nitin Kedia 952.860 78.500 4. Smt. Monika Kedia w/o Shri Nitin Kedia 2630.350 368.430 (B) Received at the time of marriage or other auspicious occasions in cases where W.Tax returns not filed 5. Shiv Kumar Kedia HUF (Ancestral) 550.00 6. Ritu Kedia W/o Shri Nirmal Kedia 500.00 7. Tanishk Kedia S/o Shri Nirmal Ji 100.00 8. Harsh Kedia S/o Shri Nirmal Ji ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Since all the Jewellery/articles so found are duly verifiable from the documents submitted along with our letter dated 07.02.2018, therefore the entire Jewellery found as a result of search may kindly be treated as explained. Without prejudice to above this is to submit that if still your honour wants to make any addition on this account by not accepting the submission of the assessee than the same may treated as utilization of alleged on money received on sale of plots. 77. The assessee has also filed supporting documentary evidence for the jewellery found during the previous search from the grandfather s residence and father of the assessee. From the record we found that the Jewellery found during the course of search was completely explained. However, the AO made the addition by rejecting the submission of the assessee on presumption basis. The submission of the assessee on the findings of the AO given in this regard is as under: - Issue Findings of ld AO Explanation of Assessee (i) Jewelry must be divide ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ellery in the name of Sh. Shiv Kumar Kedia is being provided. In this regard this is submit that the father of the assessee Shri Shiv Kumar Kedia was 61 years old as on the date of search and belonging to the reputed family. Shri Shiv Kumar Kedia Ji acquired the Jewellery over the year time of time on marriage and other various auspicious occasions solemnized time to time in family. After the marriage of Shri Shiv Kumar Kedia Ji there was birth of three children in the family, marriage of two sons and birth of four grandsons of Shri Shiv Kumar Kedia Ji. As per customary of the Hindu family apart from Jewellery received at the time of marriage of Shri Shiv Kumar Kedia Ji he would receive some Jewellery on the birth of his child, marriage of his child and birth of his grandsons and the same fact cannot be ruled out. The ld. AO allow the benefit only of the 100 Gms by relying the CBDT instruction No. 1916 dated 11.05.1994. In this regard we would like to catch your kind attention towards the clause (iii) of the instruction which said that The authorized officer may having regard to the status of the family and the customs and practices of the community t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 20-11-2016 4.30 PM SANGANER OFFICE 20-11-2016 8.30 PM 131 20-11-2016 11.30 PM SANGANER OFFICE 20-11-2016 CONCLUDED SHRI NITIN KEDIA 132(4) 19-11-2016 10.00 AM KEDIA HOUSE 19-11-2016 11.00 AM 131 19-11-2016 2.00 PM GANESH NAGAR 19-11-2016 2.00 PM 131 19-11-2016 5.30 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tement provided to assessee, Shri Nitin Kedia surrendered the income against jewellery in statement recorded on 20-11-2016 which started at 9 AM from question no. 4. In question no. 12 (after recording and writing the statement in five pages), the assessee was asked to explain the jewellery found from residence and locker. 81. We also observe from the statement of Shri Nitin Kedia that at Evershine Tower, he was at Evershine Tower Vaishali Nagar, Jaipur from 5.30 PM on 19-11-2016 to 21-11-2016 (upto conclusion of statement). Then how could be his availability at Kedia House on 20-11-2016 from 9.00 AM to conclusion of statement on 20/11/2016. Shri Nitin Kedia could not be present at two places at same time. The statement at Evershine Tower, Vaisali Nagar shows that Shri Nitin Kedia was present at Vaishali Nagar in between 5.30 PM on 19/11/2016 to 21-11-2016 (upto conclusion of statement) whereas the statement at Kedia House shows that Shri Nitin Kedia was present at Kedia House during 9.00 AM on 20/11/2016 to conclusion of statement. How it can be possible to record the statement of Shri Nitin Kedia at Kedia House on 20/11/2016. 82. We minutely go throu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 9/11/2016. This shows that the statements were prewritten and the search/survey team got the signature of Shri Nitin Kedia. 84. With regard to statement of Shri Nitin Kedia we observe that the search started on 19-11-2016 at residence situated at Kedia House near Nadi ka Phatak, Murlipura, Jaipur. Statement of Shri Nirmal Kumar Kedia started at 9.00 AM at residence on 19-11-2016 and suspended at 10.00AM. The department also carried out survey at office situated at Sanganer (about 30 Km from residence) on same day. Shri Nirmal Kumar Kedia was taken there by the officers of the department his statement was started to record at 6.40 PM on 19-11-2016 at Sanganer office which continued upto 11.50PM on 19-11-2016 which are placed at APB Page 45-50. There was no break in statement for dinner and he was without dinner in night. He was sick and tired. So, a break in statement was given at 11.50 PM on 19-11-2016. In Sanganer Office there was no bed or other basic facilities. The assessee was kept awaken whole night and he was not allowed to go at home. On 20-11-2016 at early morning his statement was resumed at 6.30 AM. The assessee was kept tired, sleepless and without food, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ia and Shri Rajendra Kedia. 86. We found from the record that the survey/search party after recording of statement of assessee did not provide copy of statements to the assessee group. The assessee made the repeated request by following letters (copy at PB page 791-800/Vol IV in APB for AY 2015-16) :- S.No Date of letter Addressed to Copy of letter given to 1 Dated 21/11/2016 ADIT-3 Jaipur 1. Principal Director of Income Tax, Investigation, Jaipur 2. Additional Director of Income Tax, Investigation, Jaipur. 2 Dated 08/03/2017 DCIT Central Circle-3, Jaipur 1. Principal Commissioner of Income Tax, Central, Jaipur 2. Principal Director of Income Tax, Investigation, Jaipur 3. Additional Director of Income Tax, Investigation, Jaipur. 4. Joi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... members. The clarification regarding admission of payment of ₹ 5 Crore has been given in forgoing para. The excess Jewellery found as a result of search pertains to our grandparents which was found in search held in the year 1996. No evidence regarding other unaccounted investment/expenses was found to the search party. 89. In view of above, it was also the contention of the ld AR that the surrender of ₹ 1,02,32,236/- made by brother of the assessee and Assessee during the course of search was not voluntarily but the same was because of mental tension, fear and under immunity conditions. 90. We also found that except to search statement which was later on retracted by assessee by filing affidavit there is nothing with the department to visualize that the assessee made undisclosed investment in jewellery. It is well settled principal of law that no addition can be made only on the basis of survey/search statement more so when there is no supporting evidence with department to prove that the surrender made in the statement was correct. The department has no evidence/documents which prove that surrender in statement by assessee is correct, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... case of Harjeev Agarwal (70 Taxmann.com 95) held: A plain reading of Section 132 (4) of the Act indicates that the authorized officer is empowered to examine on oath any person who is found in possession or control of any books of accounts, documents, money, bullion, jewellery or any other valuable article or thing. The explanation to Section 132 (4), which was inserted by the Direct Tax Laws (Amendment) Act, 1987 w.e.f. 1st April, 1989, further clarifies that a person may be examined not only in respect of the books of accounts or other documents found as a result of search but also in respect of all matters relevant for the purposes of any investigation connected with any proceeding under the Act. However, as stated earlier, a statement on oath can only be recorded of a person who is found in possession of books of accounts, documents, assets, etc. Plainly, the intention of the Parliament is to permit such examination only where the books of accounts, documents and assets possessed by a person are relevant for the purposes of the investigation being undertaken. Now, if the provisions of Section 132(4) of the Act are read in the context of Section 158BB (1) read ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... entails civil consequences. Therefore, under judicial review, courts have to exercise due care and caution that no man is condemned, due to erroneous or arbitrary exercise of authority conferred . If the assessee makes a statement under Section 132(4) of the Act, and if there are any incriminating documents found in his possession, then the case is different. On the contra, if mere statement made under Section 132(4) of the Act, without any corroborative material, has to be given credence, than it would lead to disastrous results. Considering the nature of the order of assessment, in the instant case characterized as undisclosed and on the facts and circumstances of the case, we are of the view that mere statement without there being any corroborative evidence should not be treated as conclusive evidence against the maker of the statement vi) Naresh Kumar Agarwal [2015] 53 taxmann.com 306 (Andhra Pradesh) it is admitted by the Revenue that on the dates of search, the Department was not able to find any unaccounted money, unaccounted bullion nor any other valuable articles or things, nor any unaccounted documents nor any othe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ellery, bullion, valuable article or documents containing any undisclosed income having been found during the search 92. We also observe that the ITAT Jaipur Bench in the case of Shri Pawan Lashkary ITA No 808/JP/2011 dated 06.01.2012has held that income cannot be assessed merely on the basis of statement. Hon ble ITAT has observed in Para 2.37 to 2.38 as under:- 2.37 The revenue has relied upon the statement of the assessee recorded during the course of search in which the assessee surrendered the amount on account of revaluation of land as undisclosed income. Kelkar Panel studied the problem of confessions and surrenders during its studies and deliberations in para 3.27 and the same is reproduced as under: A cross section of people cutting across 4trade and industry complained of a high handed behaviour of raiding parties particularly while recording a statement. It was pointed out that overenthusiastic aiding parties would often coerce a surrender . As a result, all follow up investigations are distracted and generally brought to a stand still. Since the surrender is not backed by adequate evidence, the tax evader invariably ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... retracted from the statement after receipt the copy of statement. Hon ble ITAT has deleted the addition in all these cases. The findings of Hon ble ITAT in the case of Shri Radhey Shyam Mittal are produced as under:- 6. We have heard parties with reference to material on record and case laws brought to our notice. The action under section 132 was carried out at assessee s premises on 27.8.2008 and in the statement assessee made surrender of income of ₹ 30,00,000/- on account of income earned from trading of items in pharmaceutical business outside the books. The appellant, however, had been approaching the authorized officer to provide copy of statement so obtained in proceedings under section 132 of the Act. When these statements were not provided, the appellant vide letter dated 3.10.2008 addressed to the authorized officer and another letter dated 18.12.2008 addressed to the assessing authority requested to provide the copy of statement in case the same were to be used against him. Till such time the copy of statement was not provided, assessee entertained a bonafide belief that in the absence of any documentary evidence or corroborative evidence having b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ence in corroboration in the form of any correspondence of otherwise on this point. Shri G.S. Pathak contended rightly before us that the Tribunal was not entitled to reject the affidavit on this point on such a ground. After the assessee had filed the affidavit, he was neither cross-examined on that point, nor was he called upon to produce any documentary evidence. Consequently, the assessee was entitled to assume that the Income-tax authorities were satisfied with the affidavit as sufficient proof on this point. If it was not to be accepted as a sufficient proof either by the Income-tax Officer or by the Appellate Assistant Commissioner of Income-tax or by the Income-tax Appellate Tribunal, the assessee should have been called upon to produce documentary evidence, or, at least he should have been cross-examined to find out how far his assertions in the affidavit were correct. (emphasis supplied) The reliance placed by the assessee on the judgment by Hon'ble Apex Court in the case of Pullangode Rubber Produce Co. Ltd. (supra) and Hon'ble Rajasthan High Court in the case of Ashok Kumar Soni (supra) are well placed as the assessee has succe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y, the assessee vide letter dated 16.01.2013 informed the AO that the agreement found during the survey was cancelled by his son though the assessee was not aware about this fact and, therefore, the surrender of ₹ 5,75,000/- on account of investment in the plot was mistakenly made during the survey. The assessee filed his return of income declaring undisclosed income of ₹ 24,50,000/- inclusive of ₹ 1,00,000/- on account of the advance given for purchase of land. The AO made an addition of ₹ 5,75,000/- which was not offered by the assessee to tax in the return of income but was surrendered during the course of survey proceedings. The assessee challenged the action of the AO before the ld. CIT (A) but could not succeed. 3. Having considered the rival submissions and the relevant material on record, we note that the assessee produced a sale deed dated 18.05.2012 whereby the owner of the land Shri Daya Kishan sold the said plot of land to third party Mrs. Nirmala Devi and, therefore, once the said plot of land was sold by the owner to third party and not to the assessee or his son, then the question of investment of ₹ 5,75,000/- which was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessment proceedings. From the documents and submission of the appellant its reveals that the appellant claiming that 16015 grams silver items lying with his father Shri Shiv Kumar Kedia and these items were originally belonging to grandmother of assessee Late Smt Ginni Devi Kedia, which was lying with late Sh. Sunder Mal Kedia at the time of previous search. In support of this contention the appellant submitted the copy of Panchnama and annexure of Jewellery found of previous search. Due to some sentimental issues, two other sons of Shri Sunder Mal Kedia (Shri Rajendra Kedia and Shri Murli Manohar Media) have not taken their share in this jewellery and was lying with Shri Shiv Kumar Kedia in a separate box. 14.3 From examination of record its reveals that the alleged excess silver articles were found from the possession and control of father of Assessee Shri Shiv Kumar Kedia and the search party has not recorded the statement of father of appellant Shri Shiv Kumar Media regarding the Jewellery and silver articles found from his bed room. The appellant or his brother could not explain this fact to the search party as they were not aware about this fact at the tim ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mar Kedia Ji and Smt. Saroj Kedia 26,522 34 Coins 11,19,906 SF-2 Bedroom of Shri Nirmal Kumar Kedia and Smt. Ritu Kedia 6,476 2,66,811 SF-3 Bedroom of Shri Nitin Kedia and Smt. Monika Kedia 1,251 51,541 Total 34,249 34 Coins 14,38,258 ii) The explanation of Articles and Jewellery so found is as under: S. No. Name of Person Net Weight of Metal (In Gms.) 1. Declared in W. Tax return of Smt. Monika Kedia w/o Shri Nitin Kedia. (Copy of W. tax return for AY 2007-08 to AY 2014-15 along with valuation report filed with the W.Tax Return is enclosed herewith at Page No. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... with our letter dated 07.02.2018, therefore the entire Jewellery found as a result of search may kindly be treated as explained. Without prejudice to above this is to submit that if still your honour wants to make any addition on this account by not accepting the submission of the assessee than the same may treated as utilization of alleged on money received on sale of plots. 98. We have gone through the orders of the authorities below and we found that the documents which were relied by the assessee during the course of assessment proceedings and the same were not accepted by the AO are as under: - Particulars of Documents Submitted PB Page No. Panchnama dated 15.09.1996 regarding previously search carried out at assessee group. 248 Copy of annexure J-2 dated 18.09.1996 regarding gold Jewellery found at the time of search held in year 1996. 249 Copy of assessment order dated 30.09.1997 of Shri Sundermal Kedia of bl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... recorded by the ld. CIT(A) while deleting the addition made on account of excess silver jewellery found. 101. The A.O. also made addition of ₹ 4,33,350/- on a/c of alleged unaccounted business income alleged to be earned on sales of plot at Ganesh Vihar computed on the basis of noting found on Page 1 of exihibit-8, seized from 1, Gayatri Nagar, Main Tonk Road, Sanganer, Flyover, Jaipur. The addition was made by rejecting the submission evidences submitted by the assessee and further ignoring the fact that plot mentioned in the seized documents does not pertain to the assessee and the assessee is neither buyer nor seller of this plot, therefore the income of such plots cannot be added in the hands of the assessee. Further the deal of the plot also did not materialize. 102. By the impugned order, the ld. CIT(A) deleted the same after recording finding at para 20 to 20.6 of his appellate order, which reads as under: 20. I have considered the assessment order, the submissions made by the appellant along with paper book for the year under consideration and all relevant material placed on record. From examination of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... this scheme of the society and the plots purchased by the appellant group from the society was also purchased after making the payment of same consideration which the outsiders paid. Thus the society naming Sh. Ganpati Griha Nirmaan Sahkaari Samiti Ltd cannot be treated as pertaining to the appellant group and the same is the independent person in the eye of law including Income Tax Act. 20.4 The finding of the AO that the scheme as well as the plot sold, pertain to the Kedia family and the 'on money' recorded in these pages were received by the applicant through the sale of plots listed therein which were on paper sold by some other person on behalf of the applicant group is perverse and contra to the material/documents available on record. There is no material available on the record the beneficiary owner of such plots was the applicant. The AO himself did not tax the cheque and loan amount in the hands of the applicant meaning which she herself admitted the ownership of such plot in the hands of respective seller thus there remains no reason to on money of such plot in the hands of the applicant. The single transaction cannot be taxed in two hands only ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee u/s 131 on 23-02-2017. The Ld AO has reproduced relevant question and answer at page 11 of her order. The assessee has stated that it is ruff noting noted by our sales staff during the decision and this deal not executed and the assessee and his family members have no concern with this plot. 105. We found that the AO at page 11 of her order in para 2 has mentioned as under:- From the perusal of the details, it is evident that in this deal M/s Kedia Real Estate LLP has taken On Money' in cash amounting to ₹ 4,33,350/-. Shri Nirmal Kumar Kedia was asked about this transaction in his statement recorded on 23-02-2017 and the assessee was also issued a show cause in this regard. The AO has made a categorical finding that in this deal M/s Kedia Real Estate LLP has taken On Money' in cash amounting to ₹ 4,33,350/-, then no addition can be made in the hands of assessee. The copies of seized document No. 1 on the basis of which the addition is made by the AO is at PB Page 96. During the course of assessment proceedings on these papers the assessee made the following submission to the AO: - a) Vi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the JDA allotment letter and the name of prospective buyer was noted on seized document itself. In case of any doubt the direct inquiry could be made from the respective parties but the same was not get done. 108. From the record we found that Sh. Ganpati Griha Nirmaan Sahkaari Samiti Ltd was an independent registered society under Cooperative Laws. This finding of AO is not backed with any material/document/evidence. The society naming Sh. Ganpati Griha Nirmaan Sahkaari Samiti Ltd was an independent registered society under Cooperative Laws. This society was independent person and was being run by several members and office bearers of the society. The AO herself has admitted that the plots were sold in 1995. Thus this finding of the AO is made on the basis of presumption and assumption basis without having any evidence of the same. Admittedly large number of plots in these scheme are owned by the assessee, his brother and his father but it is a fact that many outsiders have also purchased the plots in this scheme of the society. Further, the plots purchased by the assessee group from the society after making the payment of same consideration which the outsiders pa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd the detailed findings so recorded by the ld CIT(A) at paragraphs 20 to 20.6 of his appellate order, which could not be controverted by the ld DR by bringing any positive material on record, therefore, we do not find any reason to interfere in the order of the ld. CIT(A) deleting the addition of ₹ 3,99,816/-. 111. In so far as the addition of ₹ 33,534/- made by the A.O. by estimating brokerage @ 4% is concerned, keeping in view the nature of assessee s business, we direct the A.O. to take brokerage income @ 2%. Thus, we uphold the addition of ₹ 16,767/-. 112. During the course of assessment, the A.O. has also made addition of ₹ 5,96,73,213/- made on account of alleged undisclosed business income admitted by the assessee in his statements recorded during search. The addition was made solely on the basis of income surrendered by the assessee in his statements recorded during the course of search without having any evidence/documents in support to that and further by ignoring the fact that such statements was later on retracted by the assessee by filing affidavit and further in his statement recorded during the course of assessme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s reproduced as under for ready reference: 9.1 On perusal of the return filed by the assessee in response to notice u/s 153A, it was observed that the assessee failed to declare the undisclosed income of ₹ 20 crores as admitted during the course of search proceedings in his statement recorded u/s 132(4). Further, an affidavit dated 22.01.2018 was also filed by the assessee as per which he retracted from the confession made during the course of the search proceedings. In this affidavit, the assessee stated as under: 9.2 In view of the retraction made and the affidavit filed, the statement of the assessee was once again recorded on oath u/s 131 of the IT Act, 1961 on 23.02.2018. The relevant extract of the statement is as under: 9.3 Further, a specific show cause was also given to the assessee with respect to the retraction, wherein he was specifically asked as to why such retraction affidavit filed after more than one year of the search may not be taken as an afterthought, since, no such reason was pointed out during t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed to ADIT-Investigation-Ill, Jaipur to provide the copies of statements recorded by the search/ survey party but the same was not provided by the ADIT. Thus the assessee was under bona fide belief that the statement would not be used against him or his business concerns and the real income of the group will be assessed on the basis of documents/assets found as a result of search survey. Thereafter vide letter dated 08.03.2017, 17.04.2017, 18.05.2017 and 08.01.2018, we further requested to your honour to provide the copies of statements recorded by the search survey party. Vide letter dated 18/05/2017 and 08/01/2018 filed before your honour under copy to JCIT, it was clearly mentioned that the department is not providing the copy of the statement for the reason that it does not want to use these statements against assessee/assessee group and it want to make the search assessments on the basis of documents seized during the course of search. However, the AO provided the copies of the statement to our council on 19.01.2018 (Friday). Thus upto the 19.01.2018 the assessee was under bona fide belief that the statement would not be used against him or his business co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ce found as a result of search and in such statement the assessee categorically denies to earned any undisclosed income or making any undisclosed investment/expenses. Without prejudice to above and consent of the assessee, if still your honour wants to assessee some income only on the basis of income of ₹ 20 Crores surrendered by the assessee during the course of search in his statement than this is to request that: - i) In your show cause notices issued by your honour in the case of assessee, Shri Nitin Kedia and Kedia Real Estate LLP your honour proposed certain other additions in the group on the basis of other seized documents/evidences. If the submission of the assessee group given on such issues is rejected and the additions are being made on such issues than such addition may kindly be treated as covered as additional income of ₹ 20 Crores surrendered by the assessee because such additions are not separate income of the assessee group but part of the overall income of ₹ 20 Crores or utilization of such income... 9.4 The reply of the assessee has been considered but not found acceptable due to the following ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s of M/s Kedia Real Estate LLP, Sh. Nitin Kedia and Sh. Nirmal Kumar Kedia in different assessment years starting from AY 2012-13 to AY 2017-18. Since the assessee disclosed an unaccounted income of X20 crores during the search proceedings earned from the business activities, the balance undisclosed amount of ₹ 5,96,73,213/- (20,00,00,000- 14,03,26,787) is being added to the total income of the assessee for the AY 2017-18 in view of the confessional statement of the assessee regarding undisclosed income recorded during the course of search proceedings u/s 132(4) of the IT Act, 1961. 23.3 Perusal of para 9 of assessment order it reveals that the addition was made by ld. AO by solely relying on the search statement u/s 131 of the act which were later on retracted by filing an affidavit. The AO in fact has concluded that since ₹ 1,43,26,787 has already been added as undisclosed income, the balance, ₹ 5,96,73,213 (20 Crores-total disclosure ₹ 14,03,26,787- added by the AO in different AYrs) is taxed as undisclosed income for this A.Yr. Clearly In support of the addition so made the AO has not relied upon any evidence or seized ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nted out that this judgement has already been confirmed by Hon'ble Supreme Court. Further, Hon'ble Delhi High court in case of Harjeev Agarwal (70 Taxmann.com 95) also has held as under: A plain reading of Section 132 (4) of the Act indicates that the authorized officer is empowered to examine on oath any person who is found in possession or control of any books of accounts, documents, money, bullion, jewellery or any other valuable article or thing. The explanation to Section 132 (4), which was inserted by the Direct Tax Laws (Amendment) Act, 1987 w.e.f. 1st April, 1989, further clarifies that a person may be examined not only in respect of the books of accounts or other documents found as a result of search but also in respect of all matters relevant for the purposes of any investigation connected with any proceeding under the Act. However, as stated earlier, a statement on oath can only be recorded of a person who is found in possession of books of accounts, documents, assets, etc. Plainly, the intention of the Parliament is to permit such examination only where the books of accounts, documents and assets possessed by a person are relevant for the pur ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... should take cognizance of such correct income 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 Till (JD) 1028 Search and seizure - Block assessment - consumption 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 tantamount to unearthing any incriminating evidence during the course of search - Therefore, no addition could be made only on the basis of such statement. Pranav Construction Co. Vs Asstt. CIT (1998) 3 DTC 719 (Mum-Trib) (1998) 61 TTJ (Mum.-Trib) 145 It was held that the admission cannot be read as an Act of Parliament and that it has to be read in the context fairly and reasonably. The burden of incurring the expenditure can be discharged either by direct evidence or if such evidence is not available the assessee can always point out to circumstantial evidence supporting the claim. Thus, s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rs. In such a case, when the managing director or any other persons were found to be not in possession of any incriminating material, the question of examining them by the authorised officer during the course of search and recording any statement from them by invoking the powers under section132(4) of the Act, does not arise. Therefore, the statement of the managing director of the assessee, recorded patently under Section 132(4) of the Act, does not have any obviously based on the well-established rule of evidence that mere confessional statement without there being any documentary proof shall not be used in evidence against the person who made such statement. Hon'ble Gujarat High Court, vide its order dated 14.07.2016, in the case of CHETNABEN J SHAH LEGAL HEIR OF JAGDISHCHANDRA K. SHAH, in TAX APPEAL NO. 1437 of 2007, laid down the ratio that no additions can be made in the hands of the assessee merely on the basis of statements recorded, during the course of search, under section 132(4). Hon'ble High Court in the above mentioned case relied on its earlier order in the case of Kailashben Manharlal Chokshi [2008] 174 Taxman 466 (Guj.),wherein a similar r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... corded under fear duress and serious other discrepancies in recording of the Statement of Shri Nitin Kedia:- (a) If we see the copy of statement Shri Nitin Kedia recorded at F-110 Evershine Tower, Vaisali Nagar, Jaipur (APB 85-92), we find that here the statements were commenced at 5.30 PM on 19/11/2016, which remained continued up to 21-11-2016 except a small break for rest on 20-11-2016 (APB 89). Inhumanity is apparent. Shri Nitin Kedia was not allowed for break for dinner, sleep, breakfast, rest etc. as the statement at Evershine Tower started at 5.30 PM on 19/11/2016 which remained continuous upto 21-11-2016 except a small break for rest on 20-11-2016 (APB 89). This attitude of search party is against CHARTER OF RIGHTS AND DUTIES OF PERSONS SEARCHED AS REPORTED IN (1994) 208 ITR 5 (ST), which provides that the assessee has right to have facility of having meals etc at normal time. Shri Nitin Kedia was not allowed for break for dinner, sleep, breakfast, rest etc. Shri Nitin Kedia was kept whole night in office situated at Evershine Tower Vaisali Nagar, Jaipur where there is no facility of bed in office to sleep. Therefore, Shri Niti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t of the statement and postponing the statement at same time which shows no time consumed in question, answer and in writing of 7 question answer on paper. c.ii) Shri Nitin Kedia could not be present at two places at same time on 19/11/2016. After postponing the statement at 2.00 PM, the statement was resumed at 6.30PM on 19-11-2016 (APB page 77) at Shops at Ganesh Nagar. This statement was again postponed at night 11.00 PM on 19-11-2016 (APB page 78). These statements were resumed at 10.00AM Morning on 20-11-2016 (APB page 79) and concluded on 20-11-2016 after recording answer to question no. 11 to 23. As per the copy of statement given, the assessee should be at Premise situated at Ganesh Nagar from 6.30PM to 11PM on 19-11-2016 and 10 AM to conclusion of statement on 20-11-2016. Question and answer for Q.No. 18-19 was in between 6.30 PM to 11PM. But if we see the copy of statement Shri Nitin Kedia recorded at F-110 Evershine Tower, Vaisali Nagar, Jaipur (APB 57-64), we find that here the statements were commenced at 5.30 PM on 19/11/2016, which remained continue upto 21-11-2016 except a small break for rest on 20-11-2016 (APB 61). ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Then the assessee was taken to Kedia House. The search party started to recorded the statement of the assessee at 1.00 PM (APB page 41). Here in very first question the assessee had to confirmed the surrender of ₹ 5 Crore made at Sanganer office and has to overall surrender ₹ 20 Crore without any corroborative material or incriminating documents. The assessee made surrender under inhumanity conditions created by search/ survey party. The search/survey party kept the assessee and his brother Shri Nitin Kedia whole night without sleep and without food, and they created an atmosphere of fear and duress where the assessee was forced to make the desired surrender. Therefore, no cognizance can be given the statements recorded during the search and survey. Copy of statement was not given in spite of repeated requests: - The survey/search party after recording of statement of assessee did not provide copy of statements to the assessee group. The assessee made the repeated request by following letters (copy at PB page 791-800/Vol IV in APB for AY 2015-16):- S.No Da ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1994) 208 ITR 5 (ST), which provides that the assessee has right to have a copy of any statement that is used against him by the department. After the survey/search several requests were made to Investigation wing as well as AO to provide the copy of statements recorded by the survey/search party. After the continuous efforts of the assessee group, the copy of the statements were provided on 19.01.2018 (Friday) and thereafter on very first working day i.e. 22.01.2018 the assessee filed the affidavit (Copy at APB Page 97-107) before ld. AO to retract the statements. The relevant para of the affidavit is as under: - (ii) In reply to the Q. No. 4 and 5 of the statement I accepted to having been earned undisclosed income of ₹ 20 Crore from sales of plots/buildings by my concern naming Kedia Real Estate LLP while no such income was actually earned by me or our business concerns or my family members. The entire receipts and payments pertaining to our group are duly recorded in books of accounts/ITR of respective person. No unaccounted money was received by me or our business concerns or my family members against any transactions and likewise no unacco ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nder coercion/undue influence. But in spite of clear-cut board circular the surrender of income was taken by the search/survey party without having any corroborative or incriminating material. The Addition cannot be made merely on the basis of search statement Except to search statement which was later on retracted by assessee by filing affidavit there is nothing with the department to visualize that the assessee has undisclosed income. The AO herself has made addition for the balancing amount merely on confession statement. Further, in confession statement the person wise and year wise bifurcation was not given by the assessee. Further, the confession statement is not in relation to incriminating documents. It is well settled principal of law that no addition can be made only on the basis of survey/search statement more so when there is no supporting evidence with department to prove that the surrender made in the statement was correct. The department has no evidence/documents which prove that surrender in statement by assessee is correct, therefore the same cannot be relied upon. Further Reliance is placed on the following decisions :- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... red to examine on oath any person who is found in possession or control of any books of accounts, documents, money, bullion, jewellery or any other valuable article or thing. The explanation to Section 132 (4), which was inserted by the Direct Tax Laws (Amendment) Act, 1987 w.e.f. 1st April, 1989, further clarifies that a person may be examined not only in respect of the books of accounts or other documents found as a result of search but also in respect of all matters relevant for the purposes of any investigation connected with any proceeding under the Act. However, as stated earlier, a statement on oath can only be recorded of a person who is found in possession of books of accounts, documents, assets, etc. Plainly, the intention of the Parliament is to permit such examination only where the books of accounts, documents and assets possessed by a person are relevant for the purposes of the investigation being undertaken. Now, if the provisions of Section 132(4) of the Act are read in the context of Section 158BB (1) read with Section 158B (b) of the Act, it is at once clear that a statement recorded under Section 132(4) of the Act can be used in evidence for making a block assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e of authority conferred . If the assessee makes a statement under Section 132(4) of the Act, and if there are any incriminating documents found in his possession, then the case is different. On the contra, if mere statement made under Section 132(4) of the Act, without any corroborative material, has to be given credence, than it would lead to disastrous results. Considering the nature of the order of assessment, in the instant case characterized as undisclosed and on the facts and circumstances of the case, we are of the view that mere statement without there being any corroborative evidence should not be treated as conclusive evidence against the maker of the statement Naresh Kumar Agarwal [2015] 53 taxmann.com 306 (Andhra Pradesh) it is admitted by the Revenue that on the dates of search, the Department was not able to find any unaccounted money, unaccounted bullion nor any other valuable articles or things, nor any unaccounted documents nor any other valuable articles or things, nor any unaccounted documents nor any such incriminating material either from the premises of the company or from the residential houses of the m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Held, that additions cannot be made merely on the basis of statements. The Jodhpur ITAT Bench in Maheshwari Industries v. Asstt. CIT [2005] 148 Taxman 74 (Jodh) (Mag.) has held that additions should be considered on merits rather than on the basis of the fact that the amount was surrendered by the assessee. It is settled legal position that unless the provision of statute warrant or there is a necessary implication on reading of section that the principles of natural justice are excluded, the provision of section should be construed in manner incorporating principles of natural justice and quasi judicial bodies should generally read in the provision relevant section a requirement of giving a reasonable opportunity of being heard before an order is made which will have adverse civil consequences for parties effected. Rajesh Jain Vs. DCIT 100 TTJ 929 (ITAT, Delhi 'A' Bench) Search and seizure - Block assessment - Retraction of statement - Addition of ₹ 25 lacs made solely on the basis of confessional statement of assessee that he earned the said amount in the last ten years was not justified - Confessional statement should ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pur Bench in the case of Shri Pawan Lashkary ITA No 808/JP/2011 dated 06.01.2012has held that income cannot be assessed merely on the basis of statement. Hon ble ITAT has observed in Para 2.37 to 2.38 as under:- 2.37 The revenue has relied upon the statement of the assessee recorded during the course of search in which the assessee surrendered the amount on account of revaluation of land as undisclosed income. Kelkar Panel studied the problem of confessions and surrenders during its studies and deliberations in para 3.27 and the same is reproduced as under: A cross section of people cutting across 4trade and industry complained of a high handed behaviour of raiding parties particularly while recording a statement. It was pointed out that overenthusiastic aiding parties would often coerce a surrender . As a result all follow up investigations are distracted and generally brought to a stand still. Since the surrender is not backed by adequate evidence, the tax evader invariably retracts from the statement of surrender by which time it is too late for the Department to resume investigations. Similarly, where adequate evidence is indeed found, a sur ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... adhey Shyam Mittal are produced as under:- 6. We have heard parties with reference to material on record and case laws brought to our notice. The action under section 132 was carried out at assessee s premises on 27.8.2008 and in the statement assessee made surrender of income of ₹ 30,00,000/- on account of income earned from trading of items in pharmaceutical business outside the books. The appellant, however, had been approaching the authorized officer to provide copy of statement so obtained in proceedings under section 132 of the Act. When these statements were not provided, the appellant vide letter dated 3.10.2008 addressed to the authorized officer and another letter dated 18.12.2008 addressed to the assessing authority requested to provide the copy of statement in case the same were to be used against him. Till such time the copy of statement was not provided, assessee entertained a bonafide belief that in the absence of any documentary evidence or corroborative evidence having been found as a result of search, such statement would not be used against him. If such statements were to be used, the department was under legal obligation to have provided ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he affidavit on this point on such a ground. After the assessee had filed the affidavit, he was neither cross-examined on that point, nor was he called upon to produce any documentary evidence. Consequently, the assessee was entitled to assume that the Income-tax authorities were satisfied with the affidavit as sufficient proof on this point. If it was not to be accepted as a sufficient proof either by the Income-tax Officer or by the Appellate Assistant Commissioner of Income-tax or by the Income-tax Appellate Tribunal, the assessee should have been called upon to produce documentary evidence, or, at least he should have been cross-examined to find out how far his assertions in the affidavit were correct. (emphasis supplied) The reliance placed by the assessee on the judgment by Hon'ble Apex Court in the case of Pullangode Rubber Produce Co. Ltd. (supra) and Hon'ble Rajasthan High Court in the case of Ashok Kumar Soni (supra) are well placed as the assessee has successfully demonstrated that the admission made during the course of search is not correct. The ingredient for retraction of statement made during the search, therefore, stand duly satisfied as th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ender of ₹ 5,75,000/- on account of investment in the plot was mistakenly made during the survey. The assessee filed his return of income declaring undisclosed income of ₹ 24,50,000/- inclusive of ₹ 1,00,000/- on account of the advance given for purchase of land. The AO made an addition of ₹ 5,75,000/- which was not offered by the assessee to tax in the return of income but was surrendered during the course of survey proceedings. The assessee challenged the action of the AO before the ld. CIT (A) but could not succeed. 3. Having considered the rival submissions and the relevant material on record, we note that the assessee produced a sale deed dated 18.05.2012 whereby the owner of the land Shri Daya Kishan sold the said plot of land to third party Mrs. Nirmala Devi and, therefore, once the said plot of land was sold by the owner to third party and not to the assessee or his son, then the question of investment of ₹ 5,75,000/- which was to be paid at the time of sale deed does not arise. The AO has made the addition only on the basis of surrender made by the assessee during the course of survey though there was an agreement found during ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ating documents, cash, jewellery etc., in statements recorded under Section 132(4) on 9.11.1995 and later, however, it was contended by the assessee that the statements under Section 132(4) of the Act was not correct and the amounts which were taken into lakhs are in thousands and attempted to retract from the statements made at the time of search and seizure operation. But in the case of the assessee, the surrender is not relatable to any material. Further, the surrender was obtained under duress, coercion, and in the atmosphere of fear. Further, in view of several discrepancies pointed out by the assessee in recording of the statement, the recording of statement is against the principle of natural justice vitiated in law and no cognizance of these statements should be taken. c) 2019 (4) TMI 1120 - Rajasthan High Court in the case of M/S Bannalal Jat Constructions Pvt. Ltd. Versus ACIT, Central Circle-2, Ajmer In this case a search was conducted at the business/residential premises of Shri Banna Lal Jat, the Director of appellant company - M/s. Bannalal Jat Constructions Private Limited, on 10.10.2014, in which he was also operat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was resumed on 20-11-2016 at 9 AM starting from question no. 4. This was again suspended for rest after recording the statement up to question no 14. 119. As per mater on record, post search statement was recorded on 02.12.2016 wherein the assessee confirmed his earlier statement but here also no year wise or person wise bifurcation of undisclosed income could be given or worked out by the ADIT. Here the assessee has specifically stated that he has surrendered ₹ 20 Crore for peace and self satisfaction. 120. The assessee retracted the from the surrender by not disclosing the said income in his return filed on 31-10-2017. The assessee could obtain the copy of statement on 19-01-2018 (Friday). Subsequent to that the assessee and his brother Shri Nitin Kedia filed affidavit on 22-01-2018. They said that they admitted the undisclosed income under mental tension fear. Subsequent to the retraction affidavit filed by the assessee and his brother Shri Nitin Kedia the Ld AO recorded the statement u/s 131 of the Act. The copy of statements are at APB page 108-118. 121. Finding of the A.O. with regard to the addition at page 19-21 wherein ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ING MENTIONED ABOUT SUSPENSION 132(4) 20-11-2016 1.00 PM KEDIA HOUSE 20-11-2016 CONCLUDED 131 20-11-2016 4.30 PM SANGANER OFFICE 20-11-2016 8.30 PM 131 20-11-2016 11.30 PM SANGANER OFFICE 20-11-2016 CONCLUDED SHRI NITIN KEDIA 132(4) 19-11-2016 10.00 AM KEDIA HOUSE 19-11-2016 11.00 AM ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ncorrect. The Hon ble Rajasthan High Court in the case of CIT v/s Ashok Kumar Soni 291 ITR 172 (Raj.) has held that admission in statement during search is not conclusive proof of fact and can always be explained. 125. Hon ble Gujarat High Court, vide its order dated 14.07.2016, in the case of CHETNABEN J SHAH LEGAL HEIR OFJAGDISHCHANDRA K. SHAH, in TAX APPEAL NO. 1437 of 2007, laid down the ratio that no additions can be made in the hands of the assessee merely on the basis of statements recorded, during the course of search, under section 132(4). Hon ble High Court in the above mentioned case relied on its earlier order in the case of Kailashben Manharlal Chokshi [2008] 174 Taxman 466 (Guj.), wherein a similar ratio was laid down. Further, in the case of Narendra Garg Ashok Garg (AOP) [2016] 72 taxmann.com 355 (Gujarat), Hon ble Gujarat High Court held that .It is required to be borne in mind that the revenue ought to have collected enough evidence during the search in support of the disclosure statement. It is a settled position of law that if an assessee, under a mistake, misconception or on not being properly instructed, is over assessed, the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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