Revenue's Extrapolation of Shop Sales On-Money Invalid Without Buyer Verification or Corroborating Evidence Under Section 133A

ITAT ruled against revenue's extrapolation of alleged on-money receipts from shop sales based on loose papers found during search. The tribunal noted that sales manager A's statement denying receipt of on-money was not properly confronted with discrepancies, and no buyers were examined during search or assessment proceedings. Following precedents from Madras HC and Kerala HC, statements recorded under Section 133A lack evidentiary value. Without corroborating evidence, cash recovery, or buyer verification, the extrapolation for three assessment years was deemed unjustified. The tribunal emphasized that while search evidence can be used per Supreme Court's Pooran Mal ruling, it requires corroboration. Appeal partly allowed for all three years. .....

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