Statement recorded during survey u/s 133A and retracted thereafter have no evidentiary value

Issue – Whether statement recorded during the course of survey u/s 133A and retracted thereafter have any evidentiary value in case where assessee proved the genuineness of the same transaction?

The ITAT in its impugned judgment took note of the statement of D.K. Jain and the retraction of the assessee on 21.02.2008. It was also noticed that the said statement was recorded in the course of survey under Section 133A and consequently did not have any evidentiary value. The Tribunal also took note of the fact that no copy of the statement was given to the assessee to enable him to cross-examine D.K. Jain.

This Court is of the opinion that the ITAT cannot be faulted in its approach in rendering the findings of fact. Although the learned counsel for the Revenue endeavored to submit that the ITAT fell into error in overlooking and discounting the statement of D.K. Jain on the ground that it was retracted, the discussion quoted above would show that the ITAT took note of the materials before the AO and the CIT (A), which included the assessee’s books of accounts as well as the Sales Tax records of Shree Laxmi Industrial Corporation. These established firmly and conclusively that the claim of the assessee that it had purchased goods from Shree Laxmi Industrial Corporation were borne out. The ITAT also noted – and we agree with that approach entirely – that the income-tax authorities had not even rejected the books of the assessee even while finding the claim as genuine transaction to be bogus.

HIGH COURT OF DELHI AT NEW DELHI

Decided on: 22.01.2014

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