Case Law Details
Brief of the case
In the case of Asst Shri Ashokkumar Bhailal v Income Tax Officer, ITAT Ahmedabad has held that addition made on basis of witness statements, without giving assessee an opportunity to cross examine the witness and without collaborating other independent evidence is not sustainable in law.
Facts of the case
1. On first of July, 1995, FERA Authorities (Foreign Exchange Regulation Authorities) had carried a search at LT Shroff of Group at Suthar Chal, Javeri Bazar, Mumbai. Subsequently, a search u/s. 132 of the income tax act was also carried out at various business/residential premises of the LT Shroff Group by the income tax department. Statement of Shri Kalpesh Thakkar who was managing business by LT Shroff was recorded u/s. 132(4) on 2nd August, 1996. During the search of FERA authorities, a diary containing entries of cash receipts and payments to various parties for the period 01-11-94 to 28th May, 1995 on day to day basis was found and seized. The LT Shroff Group was found carrying out the business of accepting deposits in cash on interest and advance loans in cash by charging interest on large scale from the four different branches situated at Modasa, Manek Chawk, Ahmedabad, Manhaton Building, Mithakali, Ahmedabad and Zaveri Bazar, Mumbai.
2. The statements of various persons in this group were recorded at different places and at different times. Lots of documents were seized from different places. According to the Assessing Officer, DCIT, Central Circle 2(1) vide letter dated 05-09-1999 has forwarded the extract of transactions recorded in the name of B D Ahoskbhai, on various dates, with extract of ledger prepared on the basis of this diary for the period starting from First November, 1994, to 28th May, 1995 was supplied to the Assessing Officer having jurisdiction over the assessee. The ld. Assessing Officer has recorded reasons and issued notice u/s. 148 of the income tax act which was duly served upon the assessee on 23rd January, 2001. The Assessing Officer thereafter issued a notice u/s. 143(2)/142(1).
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