Case Law Details
RELEVANT PARAGRAPHS:
11. I have carefully considered the rival contentions and gone through the impugned orders. The Hon’ble Supreme Court in the case of Pullangode Rubber Produce Co. Ltd. v. State of Kerala (1973) 91 ITR 18 (SC) has clearly held that an admission by the assessee is not conclusive evidence and it is always open to the assessee who made the submission to show that it is incorrect. The assessee, in this case, has explained that nothing on the piece of paper has nothing to do with the unexplained investment made by the assessee. It has also been held in the case of CIT vs. Mrs. Devi S. Luis 96 ITR 646 that even when there is admission, it is incumbent upon the department to establish by relevant material that the amount in question was income in the hands of the assessee. Here, the department is relying upon the surrender of the amount in the course of survey and the piece of papers found n the courts of survey as basis for making the addition. The admission made by one of the partners has already been retracted within five days from the date of search. The Commissioner (Appeals) in fact has referred those letters to the AO in the remand proceedings. When the assessee has retracted the statement, an addition should be supported by enough material figures but does not, in any way, shown that it has some relationship with a business transaction of the assessee. The paper that was taken as a material for making the addition does not conclusively establish that it pertains to the business transaction of the firm. Now, the department is making the addition as a part of unexplained investment. What sort of investment the department has found is also not clear from the assessment order. The addition, in sum and substance, made by the department is clearly not supported by any material, which can point out to unexplained investment outside the books of the assessee. According to me, the addition has been correctly deleted by the Commissioner (Appeals) in the light of the principle laid down by the Supreme Court in the case of Pullangode Rubber Produce Co. Ltd. vs. State of Kerala cited supra. The Id. JM has correctly affirmed the finding of the Commissioner (Appeals) and in my view, there was no need for the matter again being set aside to the Commissioner (Appeals) for reconciliation of entries contained in the document inventorised as 64/107 of Annexure A-9 of the survey material. I agree with the findings of the Id. J. M. on the second issued.
