TMI Blog2017 (9) TMI 1960X X X X Extracts X X X X X X X X Extracts X X X X ..... ter dated 10.09.2009, almost after a year. Therefore it cannot be said that retraction is valid and there is no value of the statement recorded by the Revenue authorities. Moreover, sufficient opportunity was given to the assessee during the course of assessment proceedings to explain the source of expenditure incurred in extracting the ore but no satisfactory explanations were furnished by the assessee. He simply made a general/legal objections which were duly dealt with by the AO. Valuation of excess stock was done properly and the assessee was suppose to explain the source of expenditure incurred in mining the said ore and when he failed to do so, the AO has rightly made the additions on account of unexplained investment, which were latter confirmed by the CIT(A). We therefore find no merit in the assessee s appeal. - ITA No.1710/Bang/2013 Assessment year : 2008-09 - - - Dated:- 22-9-2017 - SHRI SUNIL KUMAR YADAV, JUDICIAL MEMBER AND SHRI JASON P BOAZ, ACCOUNTANT MEMBER Assessee by : Shri. V. Chandrashekar, Advocate Revenue by : Shri. Harinder Kumar, CIT(A)-3 O R D E R Per Sunil Kumar Yadav, Judicial Member This appeal is preferred by the asses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... authorities below are not justified in law in not allowing the deduction to the admitted cost as per the books of ₹ 5,96,74,794/- while determining the cost of extraction of iron ore under the facts and circumstances of the case. 9. Without further prejudice to the above, the valuations adopted by the learned authorities are highly excessive and the same is required to the reduced substantially under the facts and circumstances of the case. 10. Without prejudice to the right to seek waiver as per the parity of reasoning of the decision of the Hon'ble Apex Court in the case of Karanvir Singh 349 1TR 692, the Appellant denies itself liable to be charged to interest under section 234 A, 234 B and 234 C of the Income Tax Act under the facts and circumstances of the case. Further the levy of interest under section 234 A, 234 B and 234 C of the Act is also bad in law as the period, rate, quantum and method of calculation adopted on which interest is levied are not discernable under the facts of the case. 11. The Appellant craves leave of this Hon ble Tribunal to add, alter, amend, delete or substitute any of the grounds urged above. 12. In the view of the above and oth ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e we decline the admission of this additional ground. 4. So far as grounds on merit, we find that though various grounds are raised but they all relate to the disallowance of loss of ₹ 1,05,57,700/- and assessment of total income at ₹ 8,55,52,040/- resulting into addition of ₹ 11,10,01,980/-. The facts in brief borne out from the record are that the assessee s premises was searched in connection with search in the case of Fiza group of cases on 07.02.2008. A survey under section 133A was also conducted in the business premises of the assessee. During the course of search action and survey proceedings, the assessee was found to be in possession of excess stock for which he offered an additional income of ₹ 7,00,00,000/- subject to the valuation. On the basis of the valuation of the stock by the Mines Engineer (who is a registered valuer) vide report dated 18.02.2008, the appellant s total investment in raising the stock was estimated at ₹ 11,10,01,980/-. When the said report was confronted to the assessee/appellant, he agreed to it and offered additional income of ₹ 11,10,01,980/- for assessment years 2007-08 and 2008-09 (in addition to the add ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be used for making the addition in the hands of the assessee. 6. The learned DR on the other hand has contended that search under section 132 was conducted upon the residential premises of the assessees besides B. M. Farookh of Fiza Developers and Inter Trade Pvt. Ltd. In support of his contention, he invited our attention to the seizure memo (panchanama) appearing at page Nos. 51 and 62 of the compilation of the assessee, wherein assessee s name is specifically mentioned. During the course of search, the uninventorised books of accounts were found and for his non removal, an order under section 132(3) was passed (copy of the order is available at page 58 of the compilation). The search was conducted on 07.02.2008 and 08.02.2008 and the statement of the appellant was recorded on 14.03.2008, 31.03.2008 and during the course of statement, the appellant has agreed for the valuation made by the valuer for the excess stock of ore at ₹ 11,10,01,980/-. The valuation report dated 18.03.2008 is available at page No. 3 of the compilation and the statement admitting the excess stock is available at page Nos. 4 to 6 of the compilation. The learned DR further contended that assessee h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es asking the assessee to file the return of income but it was not filed and finally the return of income was sent by registered post on 25.11.2009 declaring a loss of 1,05,57,700/-. We have also carefully perused the assessment order and we find that assessee was repeatedly asked by the AO to explain the source of excess stock also to reconcile it from the books of accounts. Before the AO, the assessee was challenged the validity of the statement but he could not furnish or explain the source of investment in excess stock. He has also attacked the valuation report but did not find any other valuation report in support of his contentions. 8. A search was conducted on 07.02.2008 and thereafter survey under section 133A was also conducted at the business premises of the assessee and excess stock of iron ore was found at the mines of the assessee. The statement of the assessee was recorded on 14.03.2008 in which assessee/appellant has offered an additional income of ₹ 7,00,00,000/-. Besides, offering the additional income of ₹ 7 crore, the assessee has stated that he will arrive the actual amount and furnish the details based on the valuation report. The statement of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ear wise break up of the above amount and will pay the taxes shortly. Q.9: Do you want to state anything else. Ans: As stated above I have offered the above additional income of ₹ 11,10,01,980/- for assessment for the A Y 2007.08 and A Y 2008.09. I will update my books of accounts and produce before you shortly. I also want to add that I had completed construction of my residential house during Nov 2006 and I had disclosed the investment will 31.3.2006 at ₹ 62,67,504/- in my balance sheet for the F Y 2005.06. I offer the difference amount of ₹ 17,32,500/- for Asst for the AA.Y 2007.08 as already stated in my sworn statement dt 07.02.2008 during the course of the search. 10. The retraction from the offered income was first time made by the assessee on 10.09.2009 when the assessee was repeatedly asked to file the return of income. First notice under section 142(1) was issued on 24.02.2009 thereafter on 22.05.2009 and 28.08.2009. Moreover, the assessee did not retract from his earlier statement through letter dated 10.09.2009 specifically. He simply wanted time to update the books of accounts and to explain excess stock. But despite affording various oppor ..... X X X X Extracts X X X X X X X X Extracts X X X X
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