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This appeal has been preferred by the Revenue thatthe Tribunal erred in holding that on the basis of the statement of the director Shri Saurabh N. Garg alone, the AO cannot come to the conclusion that the assessee has issued accommodation bills and reject the books of account of the assessee. ITAT ordered that "documents prove that the assessee is not engaged in issuing accommodation bills and acting as a dummy for importing diamonds bills. Thus, the contention of the ld. AO that the bills issued by the assessee are all accommodation bill is wrong. Just on the basis of the statement recorded he cannot come to the conclusion that the assessee has issued accommodation bills and reject the books of account of the assessee" (i) An admission is extremely an important piece of evidence but it cannot be said that it is conclusive and it is open to the person who made the admission to show that it is incorrect and that the assessee should be given a proper opportunity to show that the books of accounts do not correctly disclose the correct state of facts, vide decision of the Apex Court inPullangode Rubber Produce Co. Ltd. v. State of Kerala [(1973) 91 I.T.R. 18]; (ii) In contradistinction to the power under section 133A, section 132(4) of the Income-tax Act enables the authorised officer to examine a person on oath and any statement made by such person during such examination can also be used in evidence under the Income-tax Act. On the other hand, whatever statement is recorded under section 133A of the Income tax Act it is not given any evidentiary value obviously for the reason that the officer is not authorised to administer oath and to take any sworn statement which alone has evidentiary value as contemplated under law,vide Paul Mathews and Sons v. Commissioner of Incometax [(2003) 263 I.T.R. 101]; (iii) The expression "such other materials or information as are available with the Assessing Officer" contained in Section 158BB of the Income-tax Act, 1961, would include the materials gathered during the survey operation under Section 133A, videCommissioner of Income-tax v. G.K. Senniappan [(2006) 284 I.T.R. 220]; (iv) The material or infomration found in the course of survey proceeding could not be a basis for making any addition in the block assessment, vide decision of this Court inT.C. (A) No.2620 of 2006 (between Commissioner of Income-tax v. S.Ajit Kumar); (v) Finally, the word "may" used in Section 133A (3)(iii) of the Act, viz., "record the statement of any person which may be useful for, or relevant to, any proceeding under this Act, as already extracted above, makes it clear that the materials collected and the statement recorded during the survey under Section 133A are not conclusive piece of evidence by itself.” In view of the discussions made above, we see no reason to interfere with the order passed by the Tribunal. Consequently, the appeal fails and is accordingly dismissed. No cost.

Shanti Prime Publication Pvt. Ltd.

Sec. 133A of Income Tax Act, 1961 – Survey – Addition statement – AO cannot come to the conclusion that the assessee has issued accommodation bills and reject the books of account of the assessee on the basis of the statement of the director alone.

Facts: Whether the Tribunal erred in holding that on the basis of the statement of the director Shri Saurabh N. Garg alone, the AO cannot come to the conclusion that the assessee has issued accommodation bills and reject the books of account of the assessee?

Held, that Tribunal was satisfied that assessee was mainly engaged in the import of diamonds and sales in local markets to exporters who export the goods. Import of diamonds by the assessee was done through custom authorities and through regular banking channels in India. All the transactions relating to purchase and sales were made through account payee cheques and that there was not a single transaction by way of cash. Parties to the transaction were reputed in the trade; sales were made to reputed exporters who were assessed to tax and their identities were known to the Income Tax Department besides they were registered under the state tax laws. Thus, Tribunal noted that assessee had discharged the onus of proving the transactions as genuine by furnishing relevant documents, such as, copies of bank statements, ledger copies of various purchases, xerox copies of purchase invoices, relevant copies of daily stock register, confirmation letters etc. On such basis Tribunal recorded a clear finding of fact that assessee was not engaged in issuing accommodation bills and acting as a dummy for importing diamond bills. In arriving at such finding Tribunal noted that the survey party did not find any incriminating evidence and material that could establish the stand taken by the Assessing Officer. There was no dispute to the fact that no incriminating evidence was found on the day of the survey. It was also noted that merely on the basis of statement of one of the directors i.e. Shri Saurabh Garg that too recorded after 20- 25 days of the survey could not be a basis for bringing into assessment and making any addition to the income without further supporting or corroborative evidence. Statement recorded under Section 133A not being recorded on oath cannot have any evidentiary value and no addition can be made on the basis of such statement. – PR. CIT Vs. SUNSHINE IMPORT AND EXPORT PVT. LTD. [2020] 424 ITR 195 (BOM)