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TMI Blog2016 (5) TMI 93X X X X Extracts X X X X X X X X Extracts X X X X ..... ld not support the case of the Revenue because of the facts and circumstances as considered above. We, therefore, do not find any error in the order of the learned Commissioner of Income-tax (Appeals) in deleting the addition. - Decided in favour of assessee. - I. T. A. No. 241/CHD/2014 - - - Dated:- 20-1-2016 - Bhavnesh Saini (Judicial Member) And Rano Jain (Accountant Member) For the Petitioner : S. K. Mittal For the Respondent : Sudhir Sehgal ORDER Bhavnesh Saini (Judicial Member) 1. This appeal by the Revenue is directed against the order of the learned Commissioner of Income-tax (Appeals), Panchkula, dated December 4, 2013, for the assessment year 2009-10 challenging the deletion of addition of ₹ 90 lakhs. 2. According to the office, the Departmental appeal is time barred by 17 days. It is explained that the delay in filing of appeal was due to procedural lapses. Learned counsel for the assessee did not object to the condonation of delay. Considering the above and that learned counsel for the assessee has no objection, the nominal delay in filing the Departmental appeal is condoned. 3. Briefly the facts of the case are that the Assessing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Delhi. As per that letter, you had accepted that you had made payment of ₹ 90,00,000 (rupees ninety lakhs only) to M/s. Pearl India, New Delhi, and as on March 23, 2009, you had no balance outstanding to the said concern and you were asked to explain whether the said payment had been reflected in your books of account or not. In response, you had replied. At present I am unable to explain the details of this transaction. I am also not able to verify the same with my books. Therefore, I offer this amount of ₹ 90,00,000 (rupees ninety lakhs only) as my additional income over and above my regular income for the assessment year 2009-10 to buy peace of mind. Whereas in the return of income filed by you for the assessment year 2009-10, this additional income of ₹ 90,00,000 (rupees ninety lakhs only) has not been reflected. Please explain the reasons thereof. Answer My statement was recorded during the course of survey at around 3 a.m. in the next morning. By that time I was totally exhausted and depressed. I could not make out, what statement I was giving. That said document is not in my handwriting and has never been written by me. As a matter of fact, this ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat the retraction should be at the earliest opportunity or at least within the reasonable time. In the case of Dr. S. S. Gulati v. Deputy CIT (I. T. A. No. 671 of 2009 (P H)) it was held that where the appellant had himself surrendered the amount voluntarily, paid the taxes in advance on the surrendered amount ; the allegation of coercion and duress is base less and it is an afterthought. The statement given in a spontaneous and natural manner, cannot be ignored keeping in view the facts and circum stances of the case where there does not appear to be any reason for the appellant for retracting from the surrender, which it has already made during the survey and on which it has already paid advance tax voluntarily. Further, the assessee had signed the document and accepted the cessation of liability in his statement recorded during the course of survey proceed ings. In view of these finding, the Assessing Officer concluded that the retraction made by the assessee from the statement recorded during the survey proceedings in which the surrendered amount of ₹ 90 lakhs was involved was clearly an afterthought and, hence, unacceptable. An addition of ₹ 90 lakhs was made on a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... natures on this newly written letter. The assessee put his signature on the day of survey mentioning date as June 23, 2009, which was date of survey. This date was got interpolated as March 23, 2009, to make it relevant for the year under consideration. This is clear from the letter reproduced above it looks utopian that the assessee's letter was dated March 23, 2009, the day coinciding with the date of survey. This date was selected to min imise the cutting in the original date June 23, 2009, to make it March 23, 2009, to support surrender. This was the abuse of authority. The language of this letter is totally incorrect. As per this letter, it is written that as per the books for the year ending March 31, 2009, I have shown ₹ 90 lakhs as payable as on March 31, 2009, whereas as per the books of account and the balance-sheet already available on the file of the Assessing Officer, this figure was ₹ 1,35,10,686.18. Further, in this letter, it has been got written that I have in fact already paid this amount and nothing remains payable. Kindly note. This was factually incorrect. In this connection, the attention is drawn to the fact that this is totally ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of CIT v. S. Khader Khan Son [2012] 25 taxmann.com 413 ; [2013] 352 ITR 480 (SC) wherein the judgment given by the hon'ble Madras High Court in the case of CIT v. S. Khader Khan Son [2008] 300 ITR 157 (Mad) that section 133A does not empower any Income-tax Officer to examine any person on oath, so the statement recorded under section 133A has no evidentiary value and any admission made during such statement cannot be made basis of addition was upheld. 7. The submissions made by the assessee and the facts stated therein were forwarded to the Assessing Officer, vide this office letter No. 1139-40, dated December 10, 2012, to verify from the books of account/assessment record/survey record of the assessee vis-a-vis the creditor, M/s. Pearl India Ltd., and submit a report. Simultaneously, a letter No. 1148-49, dated December 11, 2012, was also issued to Pearl India Ltd. (PACL Ltd.), New Delhi, seeking information under section 133(6) of the Act in the assessee's case asking copy of account of the assessee as per the books of Pearl India Ltd. as on March 31, 2009, and March 31, 2010. In response a reply from PACL Ltd. dated January 17, 2013, was received with copies of state ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d the same was again corrected by putting the correct date, i.e., March 23, 2009. It is an afterthought story made by the assessee just to retract the surrender amount. He has also given bifurcation of head-wise surrender amount of each assessment year. 3) On examination of the information submitted by Pearl India Ltd., vide letter dated May 6, 2013, it has been observed that the assessee has made the payment of ₹ 1,00,00,000 through account payee cheques of different dates to M/s. Pearl India Ltd. (PACL India Ltd.), New Delhi. The amount of ₹ 1,00,00,000 is also reflected in the books of account of the assessee-company maintained with Union Bank of India, Delhi. 4) Pearl India Ltd., vide its letter dated May 31, 2013, has informed that the amount outstanding against M/s. Mussadi Lai Hari Kishan Dass Jewellers, Kasera Bazar, Ambala Cantt., shown in the loans and advances in the balance-sheet. The company has shown loans and advances at ₹ 16,64,69,11,284 as on March 31, 2009. (ii) The Assessing Officer concluded that the assessee-company has given advances for purchase of land to M/s. Mussadi Lai Hari Kishan Dass Jewellers, Ambala Cantt. All the documents ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t this is assumed figure only for the purpose of survey. (v) This was the original hand written paper, had it been sent to the addressee it should have been a carbon copy with the postal receipt attached on it as this was an important communication. (vi) This was not accompanied by any corroborated evidence from other side, i.e., a printed or at least hand written receipt sent by the addressee. (vii) The document was not in the handwriting of the assessee as deposed by him in his duly sworn statement under section 131 during the course of the assessment proceedings. 2. The Assessing Officer in its remand report has admitted that there is a cutting in the date and that the appellant has corrected the date by overwriting and has repeated that date. In the ordinary course of action, no one repeats the dates after correcting the original dates as it is an only official way of certifying the dates. This clearly conveys that this was dictated by some official and written by an officer. 3. The Assessing Officer has not contradicted that the statement was recorded at 3 a.m. of the next morning but in a way have confirmed the same. The Assessing Officer has confirmed all the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ial so as to be ruled out of consideration in totality of facts, particularly in the absence of regular books of account. The assessee failed to produce the books of account or any other authentic contemporaneous evidence of agricultural income. In the present case, the above decision of the Punjab and Haryana High Court is not applicable as the assessee is maintaining regular books of account and were produced before the Assessing Officer. In the case of Surinder Kumar Charanjit Kumar v. CIT (supra) nowhere it has been observed that retraction should be at the earliest opportunity or at least within a reasonable time. Rather in this case, the Commissioner of Income-tax (Appeals) deleted the addition of ₹ 2,94,632 on account of low gross profit and the Tribunal restored the said addition on account of low gross profit and the High Court of the Punjab and Haryana has declined to entertain the appeal. As regards the case of Dr. S. S. Gulati v. Deputy CIT (supra), the facts of this case too are totally different to the facts of the appellant case and, hence, this judgment too as relied upon by the Assessing Officer does not supports the case of the Assessing Officer. 9. The l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n made by the assessee from the statement recorded during the survey proceedings in which the surrendered amount of ₹ 90 lakhs was involved was clearly an afterthought and acceptable. The Assessing Officer made the addition of ₹ 90 lakhs on account of unexplained investment under section 69 of the Act. 5.12 During the appellate proceedings, the appellant submitted that the document was fabricated, did not belong to the appellant and the statement given on the basis of the query raised on document was given under stress and duress. The appellant submitted that as per the language of the letter the contents are factually incorrect as the letter shows the payable amount of ₹ 90 lakhs for the year ending March 31, 2009, whereas as per the books of account and the balance- sheet was ₹ 1,35,10,686.18. The appellant has further brought the facts that the content of the letter showing the year ending March 31, 2009, cannot be written on March 23, 2009, which is prior to March 31, 2009, moreover, if such letter was written by the appellant the original copy would not remain in his office rather the appellant would keep carbon copy. No evidence of dispatch of suc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ated that no such letter existed in his record till the time of survey. It was only created during the course of survey to extract more surrender. The appellant denied the content of the letter as totally incorrect as submitted in paragraph 5.8 (ante). 5.14 After consideration of the rival submissions and on a perusal of the document in question, it is noted that the date has been corrected by overwriting and the date has been repeated below on the letter. The letter is not written on any letter head of the appellant nor properly addressed. The date of survey was June 23, 2009, and corrected date was March 23, 2009, which cannot be said to be a mere coincidence. The content of the letter says for the year ended March 31, 2009, whereas the letter after correction is supposed to be signed on March 23, 2009. The language of the letter depicts that such language can be only after the close of the year, i.e., March 31, 2009. Further, the amount payable in the letter is shown to be ₹ 90 lakhs whereas as per the appellant's books of account the opening balance was ₹ 1,35,10,686.18. The accounts for the subsequent period also shows that the appellant has made payment o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by him on the basis of the books of account or any inquiry made with Pearl India Ltd. Rather, the inquiry conducted at the appellate stage shows that the appellant had running account and there exists, opening and closing balances in the account as per the books of account of Pearl India Ltd. 5.16 It is worthwhile to quote the circular issued by the Central Board of Direct Taxes dated March 10, 2003, which reads as follows : 'Instances have come to the notice of the Board where the assessee have claimed that they have been forced to confess the undisclosed income during the course of the search and seizure and survey operations. Such confessions, if not based upon the credible evidence, are later retracted by the concerned assessees while filing the returns of income. In these circumstances, on confessions during the course of search and seizure and survey operations do not serve any useful purpose. It is, therefore, advised that there should be focus and concentration on collection of evidence of income which leads to information on what has not been disclosed or is not likely to be disclosed before the Income-tax Department. Similarly, while recording the statement ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... der of the Assessing Officer and submitted that statement of the assessee was recorded during the course of the survey in the presence of his counsel. Therefore, it could not be said that the statement of the assessee recorded during the course of survey was recorded under pressure. He has relied upon the decision of the hon'ble Punjab and Haryana High Court in the case of Bachittar Singh v. CIT [2010] 328 ITR 400 (P H) and submitted that since the assessee retracted from the statement around three months, therefore, retraction was not valid. (i) On the other hand, learned counsel for the assessee reiterated the submissions made before the authorities below and referred to various documents from the paper book to show that the seized paper book page 82 was fabricated and did not lead to any payment of ₹ 90 lakhs. He has submitted that seized paper is not corroborated by any evidence because M/s. PACL Ltd. has shown the amount outstanding in their books of account and later on, payments have been received by them through cheques. This information is verified by the Assessing Officer in the remand proceedings. Copies of the balance-sheet of the assessee and M/s. PACL Ltd ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... m M/s. PACL Ltd., New Delhi, through notices under sections 133(6) and 131 which shows that there were running accounts with the assessee and M/s. PACL Ltd. has shown in its account the payment received on subsequent dates. The learned Commissioner of Income-tax (Appeals) also noted that there is a considerable force in the submission of the assessee because when original seized paper (paper book page 82) is written, how the same remained in the office of the assessee because it should have reached M/s. PACL Ltd. but recovery of the original shows that no payments have been made by the assessee as alleged in the seized paper. The learned Commissioner of Income-tax (Appeals) also noted that there is a break in the recording of the statement on the date of the survey and the assessee was not able to explain the details of the transactions. This shows that the document in question was not verified from the books of account of the assessee. There was also no finding of the survey team about the balances as per the books of account of the assessee. The learned Commissioner of Income-tax (Appeals), therefore, rightly considered the Board's circular that in such a situation, the confe ..... X X X X Extracts X X X X X X X X Extracts X X X X
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