JUDGMENT

Mohammad Rafiq, J. - This appeal under section 260A of the Income Tax Act, 1961, which seeks to challenge the order dated 29.12.2017 of the Income Tax Appellate Tribunal, Jaipur bench, Jaipur, was admitted to hearing on following substantial question of law:-

"Whether under the facts and circumstances of the case and in law the ld. ITAT was justified in upholding the additions made by the Assessing Officer merely on the basis of statements recorded under section 132(4) of the Income Tax Act, 1961 ignoring the presumption laid down under section 292C of the Income Tax Act, 1961 and the evidences brought on record by the Appellant?

2. Briefly stated, the facts of the case are that a search was conducted at the business/residential premises of Shri Banna Lal Jat, the Director of appellant company -M/s. Bannalal Jat Constructions Private Limited, on 10.10.2014, in which he was also operating his proprietary concern in the name of M/s. Bannalal Jat Contractor. During the search proceedings at residential premises of Shri Bannalal Jat, a cash worth of Rs. I, 21,43,210/- was found and inventorised as per Annexure CF of Panchnama dated II. 10.2014. He, in his statement, recorded under section 132(4) of the Income Tax Act, 1961 (for short 'the IT Act') during the course of search and even subsequent statement recorded under Section 131 of the IT Act, admitted the same as undisclosed income of the appellant-company. However, subsequently while filing the return of income for the relevant assessment year, the appellant-company did not offer the said undisclosed income to tax. The assessing officer therefore served upon the appellant-company a show cause notice as to why it has failed to disclose the said income and also to get the cash verified from the regular books of accounts. The appellant-company in response to the show cause notice, submitted written reply on 02.12.2016 contending that withdrawals were made from the account with Bank of Baroda and State Bank of Bikaner and Jaipur between the period from 20.09.2014 to 30.09.2014, which was kept at the residence and out of that amount, he kept a sum of Rs. 70 lakh in the morning in the car for making payment to labour, tractor, material etc. Thus, in the survey the appellant-company explained the amount of Rs. 98.92 lakh (70 + 19.92+9) pertained to his business. The extract from the account maintained in the computer books for the financial year 2014-15 was submitted. It was also stated that the print out of incomplete books of account in computer was taken by the ADI (Investigation) team, according to which cash balance of Rs. 4,21,691/- only was unaccounted in the balance-sheet of M/s. Bannalal Jat Construction Private Limited.

3. The survey was converted into search and the statement of the assessee under Section 132(4) was recorded on 10.10.2014 at 10:15 PM and thereafter search was concluded on 11.10.2014 in the morning and the assessee stated that such cash belonged to the appellant-company as undisclosed income. The assessee thereafter maintained that the subsequent statement of assessee under Section 132(4), whereby cash was surrendered was incorrect and obtained under pressure. In case, this cash balance seized from Shri Bannalal Jat belonged to his proprietary concern and cash balance of the company was only Rs. 4,21,691/- on the date of survey/search. The assessing officer rejected the statement of the assessee observing that on examination of books of account it was found that at several places there were instances of unaccounted incomes/profit, some of which were even surrendered by the assessee during the post search proceedings. In the statement of Shri Bannalal Jat recorded on 10.10.2014, he in reply to question no.6 admitted that the books of account of the appellant-company has been written up to 09.10.2014 but expenses for last 3-4 months were yet to be entered. Shri Bannalal Jat, in reply to question no.8, admitted that in his business of civil constructio