PCIT vs Vir Sen Sindhu | Delhi High Court 2024 | BharatTax

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PCIT vs Vir Sen Sindhu | Delhi High Court 2024 | BharatTax

1961 ["Act"]. 3. Subsequently, the group in terms of a letter dated 24 April 2012 offered an ad hoc estimated additional income of INR 150 Crores. According to the respondents-assessees the aforesaid offer was made in order to cover the errors or mistakes in the records of the business owned and controlled by varied/diverse group units. Subsequently, and on 11 June 2012 the respondents-assessees submitted a break-up of the INR 150 crores which was offered as additional income along with details of individuals against whose names the income was proposed to be offered for taxation. 4. Subsequently, the respondents-assessees took the stand that the additional income of INR 150 crores included a sum of INR 86 crores which represented a waiver of a loan taken by Cellcap Securities Limited from Lehman Brothers. It was thus asserted that the additional income of INR 150 crores was inclusive of the aforesaid sum. The details in respect of the loan waiver were also duly placed before the authorities concerned. Subsequently, and when the respondent-assessee proceeded to file their returns pursuant to the mandate of Section 153A of the Act, the amount of INR 86 crores was not included therein. It is this which led to the Assessing Officer ["AO"] holding against the respondents. 5. While dealing with this aspect, the ITAT has in paragraph 18 observed as follows:- " 18. There are many judicial precedents relied up on by both the parties. We have carefully considered them while deciding the issues before us. We Now coming to various case laws, which we think are relevant, which have been relied upon by the revenue as well as assessee to show their implications. First decision relied upon is of Hon'ble Madras High Court in case of B Kishore Kumar Vs. Dy. CIT 52 Taxmann.com 449. In that particular case the addition was of Rs. 5273920/- on the basis of document and the This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 03/07/2025 at 00:23:07

statement. No such statement was retracted by the assessee. In the present case the assessee has ample made clear that though the waiver may be the income but same is not taxable. Further in the case the seized paper were shown which showed that assessee was giving cash loan to the several persons. In the present case before us there is no reference of any seized material. The second decision relied upon is in case of Bhagirath Aggarwal Vs. CIT 351 ITR 143. In that particular case the original statement made was further confirmed by the assessee by another letter. Further, there was no retraction of the statement. The courts have further held that the assessee has not produced any evidence to show that the admission made by him were incorrect. In the present case before us the assessee has demonstrated that waiver of Rs. 86. crores is not chargeable to tax in the hands of the individual assesses but in case Cellcap Securities only. Further such company being a foreign company same is not taxable in India. The revenue on the above information reopened the case of that particular company for several years. In view of this in the present case, assessee has demonstrated that his admission was incorrect. In case of Smt. Dayavanti Vs. CIT (supra) there was statements as well as incriminating materials also. In the present case the revenue could not lay hands on any incriminating material with respect to the disclosure corrected by the assessee. The reliance on the decision of M/s. Peeble Investment and Finance Ltd Vs. ITO (supra) there was absence of contrary evidence, and explanation as to why such statement was not reliable. In the present case, the assessee has shown the amount not taxable in India at all. Further, the reliance on Pr. CIT Vs. Avinsash kumar Setia (Supra) the Hon'ble Delhi High Court held that when the assessee has surrendered income by ways of declaration and withdrew the same after two years without any satisfactory ·explanation such retraction could not be bonafide. In the present case assessee disclosed Rs. 150 crores and immediately after that retracted Rs. 86 crores based on legal advise that above sum is not chargeable to tax in India. In view of this the decision relied upon by the revenue cannot help its case. Furthermore, the Hon'ble Allahabad High Court in 184 ITR 404 has held that erroneous admission by the assessee cannot be a foundation for the assessment whereas it was offered under erroneous impression or misconception of law. It is always possible for assessee to demonstrate and satisfy the authorities that particular income was not taxable and it was offered under erroneous impression. In the present case before us the revenue also could not bring forth any material to show that disclosure0 of Rs. 86 crores or even Rs. 150 crores is backed by any credible evidence. In view of this we do not find any infirmity in the order of the ld CIT(A) in deleting the addition on account of admission made by Shri R. S. Sindhu in his statement· u/s 132(4) of the Act which was subsequently retracted."