Bhagirath Aggarwal v. CIT (2013) 351 ITR 143(Delhi) (High Court)

S.132(4): Search and seizure-Statement on oath-Retraction-No evidence to establish that admission was

incorrect in any way ,hence addition made on basis of statementwas held to be justified.

During the course of search the assessee surrendered a sum of Rs. 1 crore in respect of the financial year 2005-06 for buying peace of mind and to avoid litigation. He also requested the Income-tax Department not to initiate any penalty proceedings against him. After ten days, during the further search conducted by the Income-tax Department, the assessee made another statement on November 21, 2005, wherein he surrendered an additional sum of Rs. 75 lakhs on behalf of himself and all family members, family firms and the companies. The request for no penal measures was reiterated. In the statement, however, he indicated that after receiving all the seized documents from the Income-tax Department he would provide the break up of the voluntary disclosure of Rs.1.75 crores in various hands. He also promised to pay the due tax as soon as possible. The sum of Rs. 1.75 crores which was surrendered by the assessee was bifurcated by him into sums of Rs. 1.5 crores and Rs. 25 lakhs. The former sum was, according to him, to be treated as undisclosed business income in his hands whereas the latter sum of Rs. 25 lakhs was to be considered in the hands of different family members or business concerns of the assessee's group. The Tribunal reversed the decision of the Commissioner (Appeals) and sustained the decision of the Assessing Officer in making an addition of Rs. 1.75 crores on the basis of the statements made by the assessee under section 132(4). On appeal by the assessee the Court dismissing the appeal, held that it was incumbent upon him to show that he had made a mistake in making that admission and that the admission was incorrect. He had access to all the documents which had been seized inasmuch as copies had been supplied to him. However, he did not produce anything to establish that the admission was incorrect in any way. Thus, the assessee could not reconcile from his statements made on November 10,11, 2005, and November 21, 2005. The statements recorded under section 132(4) were clearly relevant and admissible and they could be used as evidence. In fact, once there was a clear admission, voluntarily made, on the part of the assessee, that would constitute a good piece of evidence for the Revenue. Appeal of assesse was dismissed.(A.Y.2006-2007 )