TMI Blog2004 (12) TMI 294X X X X Extracts X X X X X X X X Extracts X X X X ..... t. The facts of the case are that the action under s. 132(1) was carried out by the IT authorities at the premises of the assessees' father late Shri Ravi Dutt Sharma on 26th March, 1993. During the course of such action, the authorised officer recorded joint statement of both the assessees and their father under s. 132(4) of the IT Act. In their joint statement, late Shri Ravi Dutt Sharma (father) disclosed income of Rs. 5 lakhs in his hands, Shri Anil Kumar (son) disclosed income of Rs. 3.5 lakhs and Shri Anoop Kumar (son) disclosed income of Rs. 3 lakhs for the asst. yr. 1993-94. Such disclosure was retracted thereafter as income was not disclosed in the respective returns of income filed. On the basis of seized material and other eviden ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... search, their late father developed chest pain and was feeling restless. Despite repeated requests made to the authorised officer, not to persist with the recording of statement, the authorised officer went ahead and somehow recorded the statement and obtained joint signatures of both the assessees and their father had signed the statements in order to save themselves from harassment. As their late father was not feeling well, ultimately such harassment also resulted in the death of their father. Such statements were duly retracted by both the assessees. Therefore, no addition could be made by relying on the statements recorded under s. 132(4). The learned CIT(A) considered these submissions. He upheld the action of the AO in reopening the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... xpenses and addition of Rs. 2,20,600 was upheld. However, he deleted the addition made by the AO by relying on the statement made under s. 132(4) of the IT Act. While the assessee has accepted the various orders of learned CIT(A) in sustaining various additions, the Revenue is aggrieved with the order of the learned CIT(A) in deleting the addition made on income disclosed at the time of search. 5. The learned Departmental Representative heavily relied on the orders of the AO. He brought my attention to pp. 1 to 4 of assessee's paper book, which is copy of joint statement of the aforesaid persons, where it was mentioned that income was disclosed voluntarily without any pressure from the Department. He submitted that CIT(A) should have acc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f Hon'ble Andhra Pradesh High Court in the case of CIT vs. Shri Ramdas Motor Transport (2000) 163 CTR (AP) 403 : (1999) 238 ITR 177 (AP), where the Hon'ble High Court has held that confessional statement without there being any documentary proof cannot be used in evidence against the person, who made such statement. He further relied on the decision of the Tribunal, Delhi 'C' Bench, in the case of R.P. Locks vs. Dy. CIT (2000) 67 TTJ (Del) 588, where it was held that the statement recorded under s. 132(4) surrendering certain amounts is legally relevant, but it is open to a party making an admission to explain clearly and demonstrate on the basis of positive material under and on what circumstances, the admission was made or to prove that w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rson who had made a statement under sub-s. (4) to s. 132 surrendering income which had not been disclosed in the return of income in the form of immunity from penalty under s. 271(1)(c) subject to his disclosing the manner in which such income was derived and the payment of tax and interest in respect of such income. Thus, the income surrendered during the course of recording of statement under s. 132(4) is also for the benefit of the assessee. Now the question arises as to whether the income surrendered during the course of recording of statement under s. 132(4) could be retracted, if there is no material to justify such disclosure. It is not in dispute that income disclosed under s. 132(4) was subsequently retracted by the assessees. It w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lower side than the income based on material and evidence found during the course of search or post-search enquiry. In such a case, the AO would be fully justified in completing the assessment on higher income, as such additions would be backed by evidence and material on record. The only implication would be that the assessee would not be entitled to immunity from penalty and prosecution in respect of income, which was not disclosed under s. 132(4) of the IT Act. In the light of these facts and circumstances of the case, I am of the considered opinion that no addition could be made merely by relying on the statement recorded under s. 132(4) when there is no evidence or material to justify such addition. The retraction to the extent of dif ..... X X X X Extracts X X X X X X X X Extracts X X X X
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