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Case Law Details

Case Name : Alankar Jewelers Vs DCIT (ITAT Indore)
Appeal Number : ITA No. 992/Ind/2019
Date of Judgement/Order : 30/04/2021
Related Assessment Year : 2016-17
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Alankar Jewelers Vs DCIT (ITAT Indore)

The CBDT vide its circular F.No. 286/2/2003-IT (Inv.) dated 10th March 2003 has issued an advisory to its field officer regarding confession of additional income during the course of search and survey operations. Relevant portion of the above said circular is reproduced hereunder:

“Instances have come to the notice of the Board where assessees have claimed that they have been forced to confess the undisclosed income during the course 0f the search and seizure and survey operations. Such confessions is not based u on credible evidence are later retracted by the concerned assessees while filing returns of income. In these circumstances. on confessions during the course of search and seizure and survey 0perations do not serve any useful purpose. It is. therefore. advised that there should be focus and concentration on collection 0f evidence 0f income which leads to in formation on what has not been disclosed or is not likely to be disclosed before the Income-tax Department Similarly. while recording statement during the Course of search and seizure and survey operations no attempt should be made to obtain confession as to the undisclosed income. An action on the contrary shall be viewed adversely.

Further. in respect of pending. assessment prot5eedings also. the Assessing Officers should rely upon the evidences/materials gathered during the course of search/survey operations or thereafter while framing the relevant assessment ‘orders.

From perusal of the judgment as well as the CBDT circular it opines that the statement given during the course of survey is not a statement on oath as given u/s 132(4) of the Act and therefore has no evidentiary value. Reliance should be placed upon the evidence/ materials gathered during the course of survey operations while framing the assessment orders. Therefore this finding of Ld. CIT(A) that the assessee was required to honour income surrendered during the course of survey at Rs.1,75,00,000/- and offer it to tax finds no merit.

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