CIT vs. Ramanbhai B Patel (Gujarat High Court)

DATE: July 20, 2016 (Date of pronouncement)
DATE: August 3, 2016 (Date of publication)
AY: 1991-92
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S. 132(4): Admission of undisclosed income by assessee is not conclusive if no evidence is found to support the admission. A retraction, though belated, is valid. Failure to provide cross-examination to assessee of persons whose statements are relied up is fatal to the addition. CBDT Directive F.No.286/98/2013 IT (INV.II] dated 18/12/2014 prohibits additions on the basis of confession

In view of Andaman Timber Industries v. CCE [2015] 62 3 (SC) and CIT vs. Chandrakumar Jethmal Kochar [2015] 292 (Gujarat) we are of the view that the admission made by the assessee is not a conclusive proof and such admission can be used as an evidence unless it is not retracted. The assessee in this case has already retracted the statement which in our opinion is a valid retraction. Although there had been search in the case of Gokul Corporation and its partner Shri Suresh A Patel on which the Revenue has relied for making the additions in the case of the assessee but the Revenue could not bring any evidence or material except the statement of the assessee which was recorded on 8.1.96 and also the statements of Shri Subhash Pandey and Shri Kashyap Thakore and these statements were although recorded at the back of the assessee. When the assessee has asked for their cross-examination, the cross examination of Shri Subhash Pandey was not given to the assessee, although the statement of the assessee was recored in consequence of the statement of Shri Subhash Pandey recorded on 1.1.96 u/s. 131. The statements of Shri Suresh A Patel and Shri Kashyap Thakore nowhere state the name of the assessee. Thus the Revenue has not brought any evidence. The onus, in our opinion, is on the Revenue to prove that the assessee has earned the income. It gets shifted on the assessee once the assessee claims the exemption of income.

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