“Section 171(6)”
The decision most relied on for Section 171(6) is Crystal Networks Pvt. Ltd. v. CIT (353 ITR 171), cited in 130 judgments on BharatTax.
Leading authorities on Section 171(6)
When an assessee furnishes sufficient evidence proving the identity, genuineness, and creditworthiness of loan or share application transactions under Section 68, the Assessing Officer cannot make an addition solely because summons issued to the creditors or subscribers were unserved or went uncomplied with. The inability of the tax authorities to secure the attendance or response of third parties does not automatically negate the evidence provided by the assessee.
Taxing provisions imposing new liabilities or affecting substantive rights are presumed to operate prospectively unless the statute expressly or necessarily implies retrospective application. Retrospective operation is generally not given if it impairs existing rights, creates new obligations, or imposes new liabilities, except for procedural matters.
Additions to income cannot be made solely based on a statement recorded under Section 132(4) during a search operation. Corroborative material or documentary evidence is essential to support any adverse decision against the assessee.
A statement recorded during a search under section 132(4) cannot form the sole basis for assessment additions unless corroborated by incriminating material recovered during the search. Post-search inquiry statements are also not considered incriminating material.
Additions to income cannot be made based solely on statements or confessions recorded at the time of a search, without corroborating evidence. Such confessions lack evidentiary value if not supported by other proof.
An assessment order is not erroneous and prejudicial to the interests of the revenue if the Assessing Officer conducted an adequate inquiry, preventing the initiation of revision proceedings under Section 263.
