TMI Blog2019 (9) TMI 149X X X X Extracts X X X X X X X X Extracts X X X X ..... s not maintainable. Therefore in view of our discussion made hereinabove paras, we delete the addition made by the Assessing Officer and confirmed by the CIT(A). Thus order of CIT(A) is set aside, only ground raised by the assessee is allowed. - I.T.A No.1949/Kol/2017 - - - Dated:- 28-8-2019 - Shri P. M. Jagtap, Vice President And Shri S.S. Viswanethra Ravi, Judicial Member For the Appellant : Shri Arya Das And Anibarya Das, Advocate For the Respondent : Shri C.J. Singh, JCIT, Sr. DR ORDER SHRI S.S. VISWANETHRA RAVI, JM: This appeal by the assessee against the order dated 28.04.2017 passed by the Commissioner of Income Tax (Appeals)-14, Kolkata [ CIT(A) ] for Assessment Year 2013-14. 2. The only issue to be decided is as to whether the CIT(A) is justified in confirming the addition made on account of valuation of stock found in the survey proceedings in the facts and circumstances of the case. 3. The brief facts relating to the issue on hand is that the assessee is an individual engaged in the business of manufacturing of electrical goods of u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lant's concern, he very categorically replied in the negative. It would stand to reason that at least he would know if any stock that was being included in the survey stock-taking process, belonged to his concern or not, especially after this possibility was pointed out to him during the statement. It is true that the statement taken during survey, u/s 133A, does not have a evidentiary value on its own. But it must be remembered that such a statement is specifically prescribed, by the Act itself, for the purpose of collecting information. So, while there are limitations placed upon its evidentiary value, it cannot be rejected as not being pertinent. Such a statement can undoubtedly be rebutted, but this has to be done with evidence as well as strong reasoning. In this case, the appellant has not produced any evidence. He has, by accepting that the entire stock belonged to the appellant, deliberately prevented the survey team from proceeding to ask him to segregate the two stocks, if such a thing was true. He has deliberately ensured that no identification or identifying marks are placed for identifying at a later date, the stock that was claimed to belong to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... any further exercises to physically distinguish stock as belonging to this concern or that, it appear to be an after-thought by the appellant to try and confuse matters and reduce the stock discrepancy by attributing a part of the surveyed stock to a different business concern. In view of this, this later date plea of the appellant can hardly be accepted either at the assessment or at the appeal stage. The grounds therefore are dismissed. 5. Aggrieved by the order of CIT(A), the assessee before us by raising the abovementioned ground challenging the action of CIT(A) in confirming the view of Assessing Officer. 6. The ld. AR submits that in the financial year 2012-13, a survey was conducted at the business 'premises as well as at the godown situated at 12/5 and 9/1 Musalman Para Lane, Howrah and at 23/1, J Road Howrah respectively, of the assessee i.e. M/s N. C. Das [Electricals) and Co. (proprietary concern of the assessee). During such survey proceedings , the survey team alleged to have found discrepancy of stock of ₹ 85,83,834/- and cash of ₹ 3,17,000/- taking into account the stock of another company being M/s. Shree Durga Met ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... having address of P-56/14, Benaras Road, Belgachia, Howrah 711108 is not the business premises of M/s. N.C. Das (Electrical and Co.) and being given on rent by the assessee to another entity by name M/s. Shree Durga Metal Products and the stock presented at this premises was wrongly taken into the calculation of total stock . In spite of the documentary evidence like the Rent Agreement and the trade licence and the Audited Accounts of M/s. Shree Durga Metal Products Ld A.O Added the stock of M/s. Shree Durga Metal Products to the stock of the assessee. 10. Further, when the question was asked to assessee that Q.2 During the course of survey operation u/s 133A of the Act your son Sri Ajoy Kr. Das had given a preliminary statement. Do you confirm the same? The assessee clearly stated Yes, I confirm to some extent the statement given by my son and it is quite clear that assessee partly disagreed with the statement given by his son. It is correct that the property situated at P-56/14, Benaras Road, Belgachia, Howrah 711108 belongs to assessee but it is also a fact that the said property was given for rent to M/s. Shree Durga Metal Products. It is quite clear th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t as rightly pointed out by the CIT(A) that the survey team mistakenly merged the stock of another concern with that of assessee. The assessee failed to prove the same by valid documents before the Assessing Officer and as well as in the first appellate proceedings and argued that the arguments made by the ld. AR are contrary to the record cannot be taken into consideration by this Tribunal. He prayed to dismiss the grounds raised by the assessee. 14. Heard both parties and persued the material available on record. On perusal of the assessment record, we note that a survey u/s 133A of the Act was conducted at the premises bearing no.12/5, Musalman Para Lane, Howrah-711101 on 08.01.2013. Right from the assessment proceedings, the contention of the assessee was that the premises bearing no.12/5 is not the business premises of assessee but it is the business premises of a concern by name M/s Shree Durga Metal Products which is a partnership firm consisting of Smt. Maya Das, Shri Ajoy Kr. Das, Shri Bijoy Kr. Das. One of the partners by name Shri Ajoy Kr. Das is the son of the assessee. On the date of survey, a preliminary statement of Shri Ajoy Kr. Das, son of Rohitasw ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Sales Tax(Registration and Turnover) Rules, 1957, W.B Value Added Tax Sales 2005 and W.B. Sales Tax on Professions, Callings and Employments Act 1979 which shows the principal place of business of M/s Shree Durga Metal Products is at 12/5, Musalman Para Lane and its warehouse at premises bearing no.56/14, Benaras Road, Howrah. Therefore, it is clear from above said evidences that the said Shree Durga Metal Products has warehouse at 56/14, Benaras Road Howrah and we find force in the arguments of Ld. AR that the said premises at 54/14 is nothing to do with assessee and the excess stock alleged to have been found by the survey team does not belong to the assessee. 17. The contention of the ld. AR is that the in spite of showing all these necessary documents to prove the business premises of N.C. Das Electrical Co. and M/s Shree Durga Metal Products are different, the Assessing Officer added such amount and despite raising the same argument before the CIT(A) did not consider the same. Further the contention of the ld. AR is that the survey team taken a statement from Ajoy Kr. Das who is the son of the assessee having a different concern engaged in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nded on behalf of the assessee that any material collected or any statement recorded during the survey under Section 133Acannot be put against the assessee, as the same has no evidentiary value. The Division Bench of the Kerala High Court, appreciating the stand taken by the assessee and after referring to Section 133A of the Act, held as hereunder: .. we find that the power to examine a person on oath is specifically conferred on the authorised officer only under section 132(4) of the Income-tax Act in the course of any search or seizure. Thus, the Income-tax Act, whenever it thought fit and necessary to confer such power to examine a person on oath, the same has been expressly provided whereas section 133A does not empower any Income-tax Officer to examine any person on oath. Thus, in contradistinction to the power under section 133A, section 132(4) of the Income-tax Act enables the authorised officer to examine a person on oath and any statement made by such person during such examination can also be used in evidence under the Income-tax Act. On the other hand, whatever statement is recorded under section 133A of the Income-tax Act it is not given any evident ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... etracted by the concerned assessees while filing returns of income. In these circumstances, on confessions during the course of search seizure and survey operations do not serve any useful purpose. It is, therefore, advised that there should be focus and concentration on collection of evidence of income which leads to information on what has not been disclosed or is not likely to be disclosed before the Income-tax Department. Similarly, while recording statement during the course of search seizure and survey operations no attempt should be made to obtain confession as to the undisclosed income. Any action on the contrary shall be viewed adversely. Further, in respect of pending assessment proceedings also, assessing officers should rely upon the evidences/materials gathered during the course of search/survey operations or thereafter while framing the relevant assessment orders. 7. From the foregoing discussion, the following principles can be culled out:- (i) An admission is extremely an important piece of evidence but it cannot be said that it is conclusive and it is open to the person who made the admission to show tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 9. The Hon ble Supreme Court in Civil Appeals No.6747 of 2012 vide its order dated 20.09.2012 confirmed the view of Hon ble High Court of Madras which is reproduced hereunder: 1.Heard Learned Counsel on both sides. Leave grated. 2. This civil appeal filed by the Department pertains to asst. yr. 2001-02. 3. In view of the concurrent findings of fact this civil appeal is dismissed. No order as to costs. 20. In view of the decision of Hon ble Supreme Court in the case of S. Khader Khan sons (supra), it is to be noted that there cannot be addition made on account of statements recorded under survey proceedings conducted u/s 133A of the Act and therefore the addition made in the present case in the hands of assessee is not maintainable only for the reason that the addition was made by Assessing Officer and confirmed by the CIT(A) is solely based on the statement of Shri Ajoy Kr. Das which was alleged to have been confirmed by the assessee during the course of survey. 21. As discussed above, there was no evidence to show that the excess stock alleged to have been found at the warehouse premises ..... X X X X Extracts X X X X X X X X Extracts X X X X
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