Case Law Details
ACIT Vs Sreeleathers (ITAT Kolkata)
Firstly the survey statement has been recorded by DDIT(Inv) in some third party case and not that of assessee. Secondly the deponent has been administered oath before his statement was recorded, which is not in accordance to Section 133A of the Act and the Hon’ble Supreme Court in Khader Khan & Sons (surpa) has held that the statement recorded u/s 133A of the Act is not given evidentiary value for the reason that officer is not authorized to administer oath and to take any sworn statement in contra distinction to the power vested in authorities to record statement under oath during search u/s 132 of the Act. Therefore on the sole statement recorded u/s 133A of the Act of Shri Ashish Kumar Agarwal, no adverse view can be taken against the assessee since there is no evidentiary value to be given to it.
Moreover, if the AO still felt that he needs to use Shri Ashish Kumar Agarwal’s statement against the assessee, then in all fairness he should have given a copy of the statement well in advance and called for explanation from assessee and thereafter if the AO is not satisfied then he should have summoned and examined (Ashish Kumar) and thereafter given an opportunity to assessee to cross-examine Shri Ashish Kumar Agarwal. After doing these exercises, still if the AO finds that from the statement which has undergone cross-examination, a wrong-doing on the part of assessee, then he could have drawn adverse inference against the assessee.
However admittedly these actions were not taken by AO. So the statement of Shri Ashish Kumar cannot be relied upon against the assessee as held by Hon’ble Supreme Court in Andaman Timbers (supra). So when both foundation on which the AO drew adverse inference against the assessee goes, applying the legal maxim ‘sublato Fundaments credit opus” meaning in a case foundation is removed, the super-structure falls, the additions goes.
Therefore, in the light of the fact that all the eleven (11) lender companies from which the assessee had taken loan of Rs. 4,50 crore had replied directly to AO pursuant to section 133(6) notice of copy of which we have seen in the PB as discussed supra and the fact that all the lender companies are regular income tax assessee’s & having PAN as well as their ROC details were brought to the notice of AO & their respective balance sheet shows that all of them have enough creditworthiness to lend the amounts in question to assessee and the assessee had squared up the loan transaction with all these lenders (except 15 Lakhs) and all the payments/TDS were made & payments were made through banking channel, the addition made by AO was untenable and therefore the Ld. CIT(A) rightly deleted the addition which action is confirmed. And therefore Revenue appeal is dismissed.
Please become a Premium member. If you are already a Premium member, login here to access the full content.
