9911796707
TMI Blog2021 (10) TMI 1207X X X X Extracts X X X X X X X X Extracts X X X X ..... . 3. Briefly stated, the assessee company is engaged in the real estate business and deriving income there from. In the instant case, search and seizure operation under Section 132 of the Act was carried out at the premises of the assessee on 19.09.2016. Consequent upon search, notice under Section 153A of the Act was issued to the assessee and the assessment was completed under Section 153A r.w.s. 143(3) of the Act. It was observed by the Assessing Officer that during the search operation, certain loose papers/incriminating documents were found relating to all the assessment years in question wherein some notings were found in respect of certain amounts of receipts. Such loose papers/incriminating documents were inventorized as "BS" and "LPS-20". The statement of Shri Shailesh Verma, Director of the assessee-company was recorded on 22.09.2016 wherein Shri Verma statedly surrendered an amount of Rs. 11,42,00,900/- voluntarily as unaccounted and undisclosed income in the hands of the assessee- company on the basis of loose-papers/books so seized. Thereafter, another statement of Director Shri Shailesh Verma was recorded on 20.12.2016 and another surrender of Rs. 75 lakhs was made o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt given by the assessee can be used as an evidence against the assessee and the assessee can have no grievance for taxation of income as per the surrender made in the statement. The Assessing Officer further observed that the disclosure of lesser amount in the return of income qua the amount surrendered in the statement tantamount to retraction which has no basis. In the absence of any coercion or force, as nowhere alleged, the statement made by the assessee has to be construed as voluntary statement and is required to be applied as such. The assessee has not discharged the onus lay upon it to prove that such declaration is made out of any misconception of facts or law. The Assessing Officer consequently rejected the explanation of the assessee towards its offer on additional income and concluded that the amounts surrendered in the statement under Section 132(4) is liable for taxation without any adjustment. As a sequel to such observations, the Assessing Officer replaced the additional income offered by the assessee with that of amount surrendered in the statement under Section 132(4) in the respective assessment years. Consequently, the Assessing Officer made an addition of Rs. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed in the business of the assessee only. Further more, the actual cash found in the course of search is about Rs. 5 lakhs only as against the surrender of receipt. Similarly, no unaccounted or unexplained or excess investments were found during the search either in the hands of the assessee or in the case of its Directors. These circumstantial evidences read with statement of the assessee would unequivocally suggest that the staggering declaration made at the time of search are only in the nature of gross receipts from real estate business and not the unaccounted taxable profit per se. It was contended that the averments made in the statement under Section 132(4) are 'rebuttable' in nature and, therefore, the assessee is entitled to explain the real state of affairs by direct or circumstantial evidence at any stage. The learned Counsel relied upon the decisions in the case of Pullangode Rubber Produce Co. Ltd. Vs. State of Kerala (1973) 91 ITR 18 (SC) and many other judicial precedents for the proposition that the addition cannot be made solely on the basis of averments made in the statements which are not final or conclusive. The statement so made can be deviated from by showing g ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... could not depart from the surrender and was legally bound to pay the tax on the surrender so made. It was further contended that the plea of the assessee towards absence of any excess cash or excess asset or excess investment detected, is not justified. It was submitted that such non-detection is irrelevant in the wake of unambiguous surrender made by the assessee. The learned CIT-DR accordingly submitted that the CIT(A) has correctly appreciated the law in the factual position and no disturbance of such order is called for. 6. We have carefully considered the rival submissions and perused the assessment order as well as the first appellate order. We have also gone through the statement recorded in the course of search and other material referred to and relied upon in the course of hearing in terms of Rule 18(6) of the IT(AT) Rules, 1963. At the outset, we take note of the undisputed fact that certain seized materials were found in the course of search showing unrecorded receipts of Rs. 12,17,00,900/- and consequently, a disclosure of this amount was made in aggregate in various assessment years by way of statement recorded under Section 132(4) of the Act at the time of search. Th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ITA No.5067/Mum/2010; Man Mohan Sadani Vs. CIT (2008) 304 ITR 52 etc.... In these decisions, it has been held that only profit can be taxed and not the entire receipts.
6.3 Having considered the facts of the case and the consistent position of law echoed by the Hon'ble High Courts and Co-ordinate Benches, we find merit in the plea of the assessee that the Assessing Officer was not justified in bringing to tax the whole amount of unrecorded receipts. In the light of judicial precedents cited above and many more, entire gross receipts cannot be brought to tax. The action of the assessee to restrict the inclusion of unaccounted income in ROI to the extent of profit embedded in such unaccounted receipts cannot be faulted in the facts and circumstances of the case.
6.4 The order of the CIT(A) for respective assessment year is thus set aside and the additions made by the Assessing Officer stand deleted in all the captioned appeals on this issue.
7. In the result, all the captioned appeals of the assessee are allowed.
Order pronounced on 26/10/2021 by placing the result on the Notice Board as per Rule 34(5) of the Income Tax (Appellate Tribunal) Rule, 1963 X X X X Extracts X X X X X X X X Extracts X X X X
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