Case Law Details
It is a normal presumption that statement under section 132(4) is given voluntarily unless it is proved otherwise. There is no evidence on record to show that this statement was given in any coercion. Therefore, I am unable to agree with the assessee that it was a forced statement. But I am reasonably impressed by the contention that this statement was subject to variation on either side after verification i.e. assessee could reduce the disclosure made or the Assessing Officer could enhance the same if the facts and evidence so warranted. May be, even if this fact is not mentioned in the statement itself, the point will still remain since it is no body’s case to get say any extra tax then is due.
In other words, there is no evidence to support the very existence of this income except the so called statement u/s 132(4) of the Act. It defies logic that an assessee will or should admit any income which he had not earned and which the department had not found out. I do not find any thing against the arguments that disclosure u/s. 132(4) was subject to variation and once the assessee had access to seized documents and he realised subsequently that there was no occasion to make this disclosure, he was having an inherent right to clarify the situation so that he could be taxed only on real income and not on an income which was not there at all, since there was no evidence to prove otherwise too. In addition, the very important fact that remains that inspite of the search, no material/evidence was found to show that the assessee was having any other undisclosed assets which could be linked with this disclosure. In view of the totality of the circumstances, arguments given by the assessee and reasoning as above, the addition made is deleted
Relevant Extract of the Judgment
3. The facts of the case are as under :-
The appellant – assessee is the legal heir of the deceased – Jagdishchandra K. Shah (original assessee) who was regularly assessed by the Income Tax Department at Ahmedabad Office. For the assessment year 1993-94, returns of income was filed which was processed by the Income-tax department where opportunity was granted to the assessee and ultimately order u/s. 143(4) of the Income tax was framed wherein several additions and/or disallowances were made. One of the major additions made by the Assessing Officer was in respect of alleged unexplained income from speculation business in shares at a figure of Rs.10,50,000/- earned over a period of several years based on tentative and qualified disclosure.
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