Chidambara Gurunathan Sundarraj Vs ITO (ITAT Chennai)
In this case, the assessee faced an addition of ₹20 lakh based primarily on a statement recorded during a survey under section 133A, where he had admitted unexplained investment in house construction. The Assessing Officer disallowed the claim under section 57 and made the addition, which was partly sustained by the CIT(A).
Before the Tribunal, the assessee demonstrated multiple sources for the construction (housing loan, LIC compensation, HUF funds, and loan from a relative) and argued that reliance solely on a survey statement is legally unsustainable without corroborative evidence.
The ITAT held that a statement recorded during survey proceedings does not have conclusive evidentiary value and cannot, by itself, justify an addition. Relying on the landmark Supreme Court ruling in Khader Khan Son, the Tribunal observed that no independent corroborative material was brought on record by the Revenue.
Further, the Tribunal noted that the AO failed to properly consider supporting evidences like HUF records, confirmation of loan, and LIC receipts. Mere delay in PAN/return filing or absence of agricultural records could not invalidate the genuineness of transactions.
Accordingly, the ITAT set aside the CIT(A)’s order and deleted the entire addition of ₹20 lakh, allowing the assessee’s appeal in full.
FULL TEXT OF THE ORDER OF ITAT CHENNAI
