TMI Blog2008 (1) TMI 985X X X X Extracts X X X X X X X X Extracts X X X X ..... ines taken on lease and exports it through Minerals and Metal Trading Corporation of India Ltd., Madras. The assessee during relevant assessment years had filed the return of income. There was a search conducted on the premises of the assessee on 12th and 13th of December 1994. A statement under Section 132(4) of the Income Tax Act was recorded by the authorised officer at the instance of the partners of the assessee. They agreed to disclose voluntarily offering a tax on the income of ₹ 1,15,00,000/- subject to deductions under Section 80HHC for the assessment years 1992-93 to 1995-96. Later on one of the partners of the firm, on 25.01.1995 addressed a letter to the Department stating that the partners are willing to voluntarily offer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .01.1995 could not have been considered by the Assessing Officer and he could not have passed an order of assessment without considering the revised return filed by the assessee. Accordingly the appeal was allowed in part, however, the Tribunal has directed the Assessing Officer to consider the statement made under Section 132(4) of the Income Tax Act on 13.12.1994 before the authorised officer, wherein the respondent- assessee firm had agreed to offer voluntarily an income of ₹ 1,15,00,000/- subject to deductions under Section 80HHC of the Income Tax Act. Being aggrieved by the order passed by the Tribunal, the present appeal is filed by the revenue. 4. Though several grounds are raised as substantial questions of law in the appea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e assessee and that the Assessing Officer and the Commissioner of Income Tax (Appeals) were justified in rejecting the contention of the assessee. Therefore he requests the court to allow the appeal. 7. Per contra, Mr. Javali, learned Counsel appearing for the respondent contends that the letter dated 25.1.1995 cannot be treated as a statement said to have been recorded under Sub-section (4) of Section 132 of the Income Tax Act. He further contends that the letter dated 25.1.1995 cannot be treated as an admission while passing an order of assessment. According to him, the Tribunal was justified in allowing the appeal of the assessee by reversing the findings of the Commissioner of Income Tax (Appeals) and the Assessing Officer since the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... horised officer during the course of search or seizure can examine on oath any person who is found to be in possession or control of any books of accounts, documents, money, etc. and any statement made by such person during such examination may thereafter be used in evidence in any proceedings under the Income Tax. 10. In the instant case, letter dated 25.1.1995 cannot be treated as a statement said to have been made under Sub-section (4) of Section 132 of the Income Tax Act since the said letter is not recorded on oath by the authorised officer during the course of search or seizure. The search was conducted on the premises of the respondent-assesses on 12th 13th December 1994. The letter dated 25.1.1995 has been addressed by one of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iate any penal action against the partners of the assessee. Therefore it is clear that solely relying upon the letter dated 25.01.1995, the Assessing Officer could not have passed an order of assessment rejecting the revised return filed by the assessee. It was the primary duty of the Assessing Officer to scrutinize the revised return filed by the assessee and if the Assessing Officer after scrutinizing the return had noticed any irregularity, it was open for the Assessing Officer to pass an appropriate order either rejecting the contention of the assessee in claiming deduction under Section 80HHC or doubting the return of income filed by the assessee. Unfortunately such a disposal is not followed by the Assessing Officer. The same is the c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e contends that the Tribunal could not have rejected the letter dated 25.01.1995 addressed by a partner of the assessee since there is a clear admission on the part of the assessee in regard to undisclosed income. According to him it is an offer voluntarily made by a partner offering additional income of ₹ 1,47,00,000/- for a period of four years which is inclusive of ₹ 1,15,00,000/- disclosed at the time of recording the statement under Sub-section (4) of Section 132 of the Income Tax Act. But the letter dated 25.01.1995 cannot be made use of by the revenue as an admission since the letter dated 25.01.1995 is a conditional one and moreover the said letter cannot be treated as a return to be filed under the Income Tax Act when t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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