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Income Tax Appellate Tribunal, DELHI BENCHES : F : NEW DELHI
Before: SHRI R.S. SYAL, AM & MS SUCHITRA KAMBLE, JM
ORDER
PER R.S. SYAL, AM:
This appeal by the assessee arises out of the order passed by the CIT(A) on 3.4.2008 in relation to the assessment year 2006-07. It is a recalled matter inasmuch as the earlier ex parte order was last recalled on 9.5.2014.
The only issue in this appeal is against the sustenance of addition of Rs.26,50,500/-.
Briefly stated, the facts of the case are that the assessee is a property dealer in real estate business. A survey action was taken at his business premises u/s 133A of the Act. During the course of survey, the assessee surrendered an additional income of Rs.40 lac in his statement recorded on the same day. Such surrender was made on the basis of impounded documents as per Annexure A-2, page 32 and 33. However, while filing the return, the assessee disclosed additional income of Rs.11,49,500/- only as against the originally surrendered amount of Rs.40 lac. The AO made addition of Rs.28,50,500/- (Rs.40 lac minus Rs.11,49,500/-). The ld. CIT(A) reduced the addition to Rs.26,50,500/-, against which the assessee has come up in appeal before us.
We have heard the rival submissions and perused the relevant material on record. It is observed that during the course of survey, two papers marked as Annexure A-2, page Nos.32 and 33 were found from the assessee’s briefcase, which duly recorded payments made by the assessee, viz., first payment of Rs.13 lac to Shri Amit Chauhan as advance for purchase of Plot No.C-270, Sector 122, Noida and second payment of Rs.25 lac as advance deposit in TDI (Taneja Development Infrastructure) through Shri Atul Jain for underwriting of project. The assessee was confronted with these documents and called upon, vide question no. 28, to explain the contents, nature of these recordings, and the source of the amount. In reply, the assessee submitted that a sum of Rs.25 lac was given by him on 13.1.2006 to TDI (Taneja Development Infrastructure) in cash through Shri Atul Jain for underwriting of the upcoming project in Dharuhera and the other sum of Rs.13 lac was receipt issued by Shri Amit Chauhan towards cash given by him for purchase of Plot No.C-270, Sector 122, Noida, as advance payment.
Vide question nos. 29 and 30, the assessee was required to give the source of the cash payment totaling to Rs.38 lac. In response, the assessee submitted that the payments were made out of commission earned on resale of plots, the details of which were not available and that 3 such commission income was not recorded in his books of account.
That is how, the assessee surrendered a sum of Rs.40 lac as undisclosed income.
In our considered opinion, the ld. CIT(A) was justified in restricting total surrender to Rs.38 lac as against Rs.40 lac offered by the assessee, because evidence was only for a sum of Rs. 38 lac and the remaining amount of Rs. 2 lac is not represented by any evidence/document found at the time of survey, except the bald statement of the assessee, which cannot be relied upon. The Revenue is rightly not in appeal against the deletion of addition of Rs.2 lac.
In so far as the total cash payment of Rs.38 lac not recorded in the books of account of the assessee is concerned, we find that the assessee, after making a categorical admission in this regard at the time of survey, tried to make out a case before the ld. CIT(A) that surrender was not voluntary. In this regard, we find that having surrendered the amount of income on 17.2.2006, the assessee’s retraction at the end of the year 2007, i.e., roughly quarter to two years, is of no consequence. It is more so because the surrender made at the time of survey was duly backed by the evidence of undisclosed income found from the possession of the assessee. The Hon’ble Delhi High Court in Raj Hans Towers Pvt. Ltd. VS. CIT (2015) 373 ITR 9 (Delhi) dealt with a situation in which the director of a company made some surrender during the course of survey.
That assessee did not retract it immediately or any time before show cause was issued to it. For first time, in reply to show cause notice, the assessee faintly urged that the statement by the director was not voluntary and sought to retract it. The tribunal refused to accept such retraction. Dismissing the assessee’s appeal, the Hon’ble High Court held that the tribunal was correct in adding back amount after adjusting expenditure. As the retraction in the extant case also came after a long time and further it is contrary to the evidence found at the time of survey, we, therefore, approve the view of the ld. CIT(A) in not accepting the retraction made by the assessee.
As regards the advance of Rs.13 lac, the assessee filed a letter before the ld. CIT(A) from one Shri Mohammed Jamil, stated to be the owner of the said property. The ld. CIT(A) noticed that the receipt showed the name of Shri Amit Chauhan as the recipient and not Shri Mohammed Jamil. When this discrepancy was pointed out by the ld. CIT(A), the assessee could not explain anything. However, on a later date, an affidavit from Shri Amit Chauhan was filed denying the above transaction. Similarly, for Rs.25 lac, the assessee filed a letter along with an affidavit in the name of Shri Atul Jain stating that he had not received the said amount from the assessee. In our considered opinion, these affidavits filed by the assessee before the ld. CIT(A) are self serving documents having no evidentiary value, when seen in the backdrop of the facts that the two documents evidencing the assessee having made payments of Rs.25 lac and Rs.13 lac were found from his own briefcase at the time of survey and he admitted that these represented payments made by him in cash out of commission income which was not recorded in the books of account.
The Hon’ble Delhi High Court in CIT VS. Nova Promoters And Finlease (P) Ltd. (2012) 342 ITR 169 (Del) has held that : `Thus the affidavits need not be accepted as reliable when there is enough material on record to doubt the veracity of the transaction. In such a case it cannot be said that the affidavits can be rejected only after cross examination. In the present case, there is enough material on record to negate the claim of genuineness of the transactions and in the light of over-whelming material, the plea that the Assessing Officer should not have rejected the affidavits without cross-examination of the deponents has no force.’ Adverting to the facts of the instant case, we find that the assesee came out with some self serving affidavits for the first time at the stage of the first appeal. These affidavits in our considered opinion have been rightly jettisoned by the ld. CIT(A) as the averments in them run contrary to the evidence found at the time of survey, which evidence was accepted by the assessee as correct.
Under the given circumstances, we are of the considered opinion that no exception can be found from the impugned order sustaining the addition to the tune of Rs.26,50,500/-. The same is, therefore, upheld.
In the result, the appeal is dismissed.
The order pronounced in the open court on 08.10.2015.