2012 (11) TMI 497 - HC - Income Tax

Unaccounted Money fact finding authority - evidentiary value of the seized paper - during the search operation, a note was seized from the business premises of the assessee. Such note was written in his own handwriting. In the note several amounts were written and against each figure, names of persons connected with such amount was mentioned. On both sides of the page, all figures were totalled up. In his statement during the search, the assessee admitted that such amounts represented unaccounted money. - Only during the course of the assessment proceeding, the assessee produced a note written by Shri Bhanwarlal suggesting that he had never received any money from the assessee. Held that - Mere note purported to have been given by Shri Bhanwarlal would not dislodge other voluminous and material evidence. The Tribunal found that the contents of the note cannot be readily believed. Tribunal had taken into account all relevant factors, examined evidence on record and came to the conclusions which are purely factual in nature. The High Court should not have taken upon itself the responsibility to go into the question whether the findings of facts reached by the tribunal are correct. The only question that the High Court was called upon to determine was whether on the facts found by the tribunal, the receipt in question should not have been considered by the tribunal as Revenue receipt. Tribunal committed an error in appreciating the evidence on record and in particular the answers given by the assessee in his statement recorded by the Revenue Authority during the search and thereafter. Even if two views were possible, it would not be possible for to overturn the findings of fact arrived at by the Tribunal particularly when Tribunal had taken into consideration all relevant evidence. It is not a case of no evidence and in that view of the matter, the findings of the Tribunal cannot be categorized as perverse - In the result, Appeal is decided against the assessee and in favour of the Revenue.

Issues Involved:
1. Legality of the addition of Rs. 27,31,165/- as concealed income based on a seized loose paper.
2. Evidentiary value of the assessee's statement recorded during the search.
3. Consideration of retracted statements and their impact on the assessment.
4. Validity of the Tribunal's factual findings and the scope of interference by the High Court.

Detailed Analysis:

1. Legality of the Addition of Rs. 27,31,165/- as Concealed Income:
The main issue revolves around whether the Tribunal was justified in restoring the addition of Rs. 27,31,165/- as concealed income based on a loose paper seized during a search operation. The appellant argued that the loose paper alone could not substantiate such a significant addition. However, the Tribunal, after examining the evidence, concluded that the entries in the loose paper, which were in the assessee's own handwriting, indicated unaccounted money. The Tribunal noted that the assessee had himself totaled the amounts on both sides of the paper, which amounted to Rs. 37,81,165/-. After accounting for Rs. 6 lacs already disclosed by the assessee, the undisclosed income was computed at Rs. 31,31,165/-.

2. Evidentiary Value of the Assessee's Statement Recorded During the Search:
The assessee's statement recorded during the search on 18.7.1987 played a crucial role. The assessee had admitted that the entries in the seized document were made by him. Despite a later attempt to retract this statement, the Tribunal found the initial admission credible. The court emphasized that the retraction was not immediate and lacked detailed explanation, thus upholding the initial statement's evidentiary value.

3. Consideration of Retracted Statements:
The assessee retracted his statement on 4.11.1987, claiming he was mentally disturbed during the raid. However, the Tribunal and the High Court found this retraction unconvincing. The retraction did not provide a clear explanation or reconciliation for the figures in the seized document. The Tribunal noted that the retraction was not supported by any subsequent communication to the Revenue Authorities, thereby diminishing its impact on the assessment.

4. Validity of the Tribunal's Factual Findings and Scope of High Court's Interference:
The High Court reiterated that the Tribunal is the final fact-finding authority, and its findings can only be interfered with if they are perverse or lack evidence. The Tribunal had examined all relevant evidence, including the seized document and the assessee's statements, and provided detailed reasoning for its conclusions. The High Court found no perversity in the Tribunal's findings and emphasized that it is not within its jurisdiction to re-appreciate the evidence or substitute its view for that of the Tribunal.

Conclusion:
The High Court upheld the Tribunal's decision, finding that the addition of Rs. 27,31,165/- as concealed income was justified based on the evidence. The Tribunal's factual findings were deemed thorough and not perverse. The High Court dismissed the appeal, affirming the Tribunal's order and reinforcing the principle that the Tribunal's factual determinations are final unless shown to be unsupported by evidence or perverse.

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