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Court further held that unless shown or
explained to be wrong, they are an
efficacious proof of the facts admitted.
c) In CIT Central-III v. Lavanya Land Pvt.
Ltd. and Others [2017] 397 ITR 246
(Bom.), the Hon'ble Bombay High Court
dismissed an appeal filed by the revenue
against the order of the ITAT, Mumbai had
set aside the additions made by the revenue
based on the statement made by person
during search which was later retracted by
him. In this case, a search was conducted at
the premises of one of handlers of the
assessee company and his statement was
recorded which showed an admission that a
large sum of money was received by him to
purchase lands in the name of the assessee
company. The statement was retracted by
him after a period of two and a half months.
On appeal, the ITAT Mumbai set aside the
addition made. Adverting to the fact that
the concerned person has retracted his
statement, the Tribunal arrived at the
conclusion that merely on the strength of
the alleged admission in the statement,
the additions could not be made as the
essential ingredients of Section 69C of
the IT Act enabling the additions were
not satisfied. This was not a case of 'no
explanation'. Rather, the Tribunal
concluded that the allegations made by
the authorities are not supported by
actual cash passing hands. Bombay High
Court, held while dismissing the appeal of
the revenue: “It is not possible for us to
reappraise and re-appreciate the factual
findings. The finding that Section 153C
was not attracted and its invocation was bad
in law is not based just on an interpretation
of Section 153C but after holding that the
ingredients of the same were not satisfied in
the present case. That is an exercise carried
out by the Tribunal as a last factfinding
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authority. Therefore, the finding is a
mixed one. There is no substantial
question of law arising from such an order
and which alternatively considers the
merits of the case as well.”
d) Retraction of statements recorded at
odd hours: The admissibility of retraction
of statements which were given in an
exhausted state and at odd hours was
allowed by Gujarat High Court in
Kailashben Manharlcil Choksi v. CIT
[2010] 320 ITR 411 (Guj,). It was held that
a statement which has been recorded u/s
132(4) at odd hours is not a voluntary
statement if it is subsequently retracted.
The Court observed that the main
grievance of the A.O. was that the
statement was not retracted
immediately and it was done after two
months. It was an afterthought and
made under legal advise. High Court
held :Merely on the basis of admission
the assessee could not have been
subjected to such additions unless and
until, some corroborative evidence is
found in support of such admission. The
Court also held that the statement
recorded at such odd hours cannot be
considered to be a voluntary statement,
if it is subsequently retracted and
necessary evidence is led contrary to
such admission.
e) Principal CIT, Central III v. Krutika
Land (P.) Ltd. [2019] 103 taxmann.com
9 (SC): During search certain
incriminating documents were found in
possession of one DD, handling land
acquisition on behalf of assessee-
company and his statement was
recorded. He stated that there were
amounts disbursed for purchase of
lands and a certain amount of cash had
also been received by him to purchase