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15-03-2019, Sri. Dilbagh Rai Arora, Section 260a, 132(4),HIGH COURT OF ALLAHABAD

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1 month 4 weeks ago #8812 by amit
Section - 260a, 132(4)
Order Date - 15-03-2019
Favouring - Revenue
Appellant - CIT
Respondent - Sri. Dilbagh Rai Arora
Justice - Bharati Sapru,J. & Piyush Agrawal,J.
Citation - 319Taxpundit357
Appeal No. - INCOME TAX APPEAL No. - 304 of 2009
Asstt. Year - 2006-2007


PER : Bharati Sapru,J

The present appeal has been filed under Section 260A of Income Tax Act, 1961 arising out of order dated 27.2.2009 passed by Income Tax Appellate Tribunal, Lucknow Bench 'A', Lucknow in ITA No. 658/Luc/2008 for the assessment year 2006- 2007. The aforesaid appeal was admitted by this Court on 6.12.2012 on the following questions of law-

"1. Whether on the facts and in the circumstances of the case, the order of the Hon'ble ITAT is perverse in as much as on identicalissue and on similar facts in the case of Mr. Ravindra Kumar Verma in ITA No. 892/Luc/05 dated 04.02.2009, the same bench held the retraction to be void & illegal.

2. Whether on the facts and circumstance of the case the Hon'ble ITAT was right in law in deleting the addition of Rs. 7 crore inspite of the fact that the surrender was made voluntarily with due care and caution and after necessary consultation, with all concerned.

3. Whether on the facts and circumstance of the case the Hon'ble ITAT was right in law in holding that the addition was not based on any evidence. In doing so the ITAT ignored the fact that statement recorded under Section 132(4) of the I.T. Act was itself an evidence."

On 1.9.2005, the business premises and residence of the respondent-assessee was searched. During the course of search operation cash, jewellery and other valuables were found and seized. On 30.10.2006, the respondent-assessee filed its return and declared its income of Rs. 24,05,86,630/-. Thereafter, notices under Section 143(2) and 142(1) were issued on 2.7.2007 and 5.11.2007 and questionnaires were issued on 14.12.2007 and 17.12.2007. In response to the notice and questionnaires, the detailed written replies were submitted and case was also discussed in detail with representative of Assessee.

On 6.10.2005 the statement on oath of assessee-respondent was recorded under Section 132(4) in which he has offered to surrender a sum of Rs. 31 Crores for taxation for the Assessment Year 2006-07. In the statement, it has been accepted that out of said surrender a sum of Rs. 18 crores were surrendered on account of investment made in the acquisition of jewellery/precious stones and balance Rs. 6 crores were in the form of cash for which necessary entries in his books of account under the head capital accounts were being shown. He further added that details of remaining Rs 7 crores would be given in due course of time. It was also stated that the income has been earned from trading in commodity exchange

Further on 15 9 2005 the statement of Raj Kumar Arora son of assessee was also recorded who reiterated the surrender of Rs. 31 crores to be taxed. But, seen the return filed by the Assessee disclosing taxable income of Rs. 24 crores (even after surrendering Rs. 31 crores) has retracted fromhis statement.

The assessing authority while framing the assessment order dated 31.12.2007 has assessed the total income at Rs. 31,03,04,332/- and imposed tax accordingly. The assessing authority added back Rs. 7 crores to the income of assessee on the basis of statement given by the assessee-respondent under Section 132(4) of the Act.

Feeling aggrieved by the aforesaid order the assessee preferred appeal before the CIT (Appeals) who by its order dated 18.6.2008 has allowed the appeal and deleted the addition of Rs. 7 crores.

Feeling aggrieved by the order of CIT (Appeals), the Revenue filed an appeal before ITAT Lucknow Bench, Lucknow, who by the impugned order has confirmed the order passed by CIT(Appeals) deleting addition of Rs. 7 crores. Heard Mr. Gaurav Mahajan, counsel for the appellant and Mr. Ashish Bansal, counsel for the respondent.

On perusal of the record, it reveals that the business premises of the appellant was searched on 1.9.2005 and during the course of search, cash, jewellery and other valuables were found and seized and the statement of the assessee-respondent was recorded. On 6.10.2005, the statement given by the assessee that Rs.18 crores were in the form of investment and Rs. 6 crores were in cash which has been shown in the books of account for the Assessment Year 2006-07 and balance Rs. 7 crores due details would be given in due course of time. The counsel for the revenue has argued that

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