In search, the assessee declared a sum of Rs. 23.65 lakh as undisclosed income. He also stated in the statement that he had paid Rs. 5.6 lakh as capitation fees to an Engineering College. AO made addition in respect of both the amounts. High Court held that statement cannot be read out of context and no addition can be made without any corroborating material. It held that there was no statement that Rs. 5.6 lakh was paid out of undisclosed income and even if it is assumed that the same was paid out of undisclosed income, a sum of Rs. 23.65 lakh was already offered to tax as undisclosed income. Held, no addition can be made. (TA No. 584 of 2008 dt . 07.03.2019)
Bhoopathy, R. v. CIT (2019) 418 ITR 591/ 308 CTR 63 / 176 DTR 239 / 263 Taxman 411 (Mad.)(HC)
S. 132(4) : Search and seizure-Statement on oath–Statement made by the assessee that capitation fees paid by to the Engineering college–Held, cannot ipso fact make addition based on such statement–Held, no admission that engineering fees paid out of undisclosed income.-Addition held to be not justified [S. 158BB, 158BC]