TMI Blog2008 (11) TMI 733X X X X Extracts X X X X X X X X Extracts X X X X ..... That no satisfaction has been recorded by the Assessing Officer and nor any material has been found or forwarded to the Assessing Officer having jurisdiction over the case of the assessee. IV. That without prejudice to the above, the addition based on the alleged statement of the assessee under pressure is not justified and the addition as made in against the facts and circumstances of the case. 2. The brief background of the case is as follows. A search and seizure operation under section 132(1) was carried out on 20-11-2001 at the business premises of M/s. Anupam Sweets, Panchkula and the residential premises of its partners. In the impugned assessment order the Assessing Officer notes that in the course of such search, statements of its partners, namely, S/Shri Darshan Kumar and Ravinder Kumar were recorded. The partners stated that they had purchased a house from the assessee and his brother in 1990 for a total consideration of ₹ 13,00,000 whereas the transaction was registered for a sum of ₹ 4,50,000. The partners also confirmed that the on-money of ₹ 8.5 lakhs was paid in cash. Subsequently, the statement of the assessee was recorded on 5-2-2002 wh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sold by him of ₹ 13 lakhs and registry was made for ₹ 4.90 lakhs. He had also admitted that he received this house during partition and thus was full beneficiary of this property. Submission made during the assessment proceedings are merely an after thought. Assessee has submitted no evidence to convince the department to the fact that there was sufficient reason to retract from the statement given earlier. Therefore, cognizance of these submissions cannot be taken and total on-money amounting to ₹ 8.10 lakhs (13.00 - 4.90 lakhs) is treated as undisclosed income of the assessee. 4. In appeal before the CIT (Appeals), the assessee challenged the addition made by the Assessing Officer. One of the plea taken before the CIT (Appeals) was that a mere statement of the assessee obtained at the time of a search on a third person cannot be considered as an evidence so as to make a block assessment in the case of the assessee under Chapter XIV-B of the Act. The CIT (Appeals), however has reiterated the reasons taken by the Assessing Officer in order to justify the addition in question. The CIT (Appeals) has noticed that from the sequence of events starting from the sea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e hearing. The crucial issue which emerges from the orders of the lower authorities is that the addition of ₹ 8,10,000 made by the Assessing Officer under Chapter XIV-B as undisclosed income is based entirely on the basis of the statement of the assessee recorded on 5-2-2002 as well as those of the partners of M/s. Anupam Sweets recorded during the course of the search on the premises of M/s. Anupam Sweets on 20-1-2001. The primary grievance of the assessee, which he has been projecting before the Assessing Officer and as well as before the CIT (Appeals), is that the statements so recorded cannot be construed as an evidence detected as a result of search and therefore, the same cannot be made a basis to assess any undisclosed income of the assessee in terms of Chapter XIV-B of the Act. We have had an occasion to consider an identical proposition of law in ITSS Nos. 22 to 24 (Chd.) of 2007 in Partap Singh Rajindera Chamola Co.vide our order of even date. In the said decision, after relying on the decisions of the Tribunal in the cases of (i) Mrs. Chitra Devi (supra); (ii ) Shree Chand Soni v. Dy. CIT [2006] 101 TTJ (Jodh.) 1028 ; and (iii) Mrs. Catherine Thomas v. Dy. CIT [2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aforesaid statutory provision, and so any information could also form the basis for addition as undisclosed income. But now, as section 158BB(1) stands as amended vide Finance Act, 2002, w.r.e.f. 1st July, 1995, an information, available with the Assessing Officer, to form basis for addition in a block assessment, has essentially to be one related to or connected with the evidence/material found as a result of search/requisition, and it cannot be any information that may be available with the Assessing Officer, being unrelated to or unconnected with the evidence found as a result of search. However, in the instant case, this addition has been made on the basis of the statements of present assessee and her two sons recorded during search but these said statements though, may constitute information available with the Assessing Officer, but the same can, by no stretch of imagination, be treated to be relatable to 'such evidence', that is, to the evidence 'found' as a result of search, inasmuch as, the statement recorded during search cannot be said to be an evidence 'found' as a result of search though the same may be an evidence 'obtained' during searc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ons are not based on any material and are only on pure assumption. The CIT (Appeals) has also given the finding that that the Assessing Officer has not made any attempt to quantify the household expenses for the year when the statement was made. The CIT (Appeals) has further given the finding that there is merit in the assessee's contention, that the estimate is illogical and baseless. The revenue has not challenged this finding of the CIT (Appeals) before us. 10. It is thus evident from the above that, a consistent view that has been expressed in series of decisions is that, the statements recorded by itself cannot constitute evidence found as a result of search for purpose of determining undisclosed income under chapter XIV-B of the Act. Respectfully following the aforesaid principles, we hold that since in the instant case too, the addition has been made solely on the basis of statements recorded, there is no scope for adding the sum of ₹ 20,35,000 as undisclosed income of the assessee within the meaning of Chapter XIV-B of the Act. The addition is hereby deleted. 8. Further, it would also be of relevance to refer to the judgement of the Hon'ble Punjab Ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... acts are that as per the information obtained, the Assessing Officer found that the assessee had sold booth No. 12, Sector 11, Panchkula for consideration of ₹ 7,50,000 whereas the sale document was registered for sum of ₹ 3,00,000. Thus, the Assessing Officer confronted the assessee as to why not the balance of ₹ 4,50,000 be not treated as income of the assessee from Undisclosed sources for the same has not been voluntarily declared by the assessee. The explanation of the assessee did not find favour either with Assessing Officer or CIT (Appeals). 14. Before us, the only plea of the assessee is that the assessee was a co-owner of the property in question along with his brother and therefore, the addition be sealed down to that extent. 15. On this aspect, the learned DR had no objection if the matter be sent back to the file of the Assessing Officer to ascertain the factual position. 16. After considering the plea of the assessee, we find that the same being a factual aspect requires verification. Since the same does not emerge from the orders of the lower authorities, we deem it proper to set aside the order of the CIT (Appeals) on this issue and restore ..... X X X X Extracts X X X X X X X X Extracts X X X X
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