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34. The learned Departmental Representative, on the other hand, supported the decision of the Commissioner of Income-tax (Appeals). According to him, the search party found defective vouchers. The senior partner agreed to disclose it as income and also claimed it as deduction. According to him, when a voucher is defective, it is not a curable defect. Therefore, the claim of expenditure could not be allowed.

35. We have duly considered the submissions of the parties and the paper compilation and the record. After careful consideration of the matter, we are of the opinion that the claim of deduction made by the assessee is admissible. From the recorded statement under Section 132(4) it is seen that unsigned vouchers which would mean bogus vouchers and defective vouchers which would mean rectifiable vouchers and also unrecorded but paid vouchers, were noticed by the search party among the loose bundles of vouchers. It is only on account of these three facts and also on account of the pressure and heat generated by the search, the assessee volunteered to declare a sum of Rs. 6,13,000 as income. Thus, the declaration of income has direct nexus and live connection with the various kinds of vouchers found in the loose bundle of vouchers. There is no contradiction coming forth from the Department to the contention of the assessee taken before the Commissioner of Income-tax (Appeals) and also before us that at the time of regular assessment, no defective vouchers or unsigned vouchers were noticed by the Assessing Officer and no addition was "made on that account. Even there is no finding given by the Assessing Officer as regards unrecorded transactions with reference to vouchers found in the loose bundle of vouchers. All that the Assessing Officer stated in paragraph 8 of his assessment order was that "Since the assessee has declared the amount of Rs. 6,13,000 in its return of income, the same has been accepted as the income of the assessee. However, the assessee could not prove that the expenses were on account of defective vouchers, etc." In our opinion, the Assessing Officer has misplaced the burden on the assessee instead of proving the same to the hilt, because in the absence of any findings given in the regular assessment order to support the addition of Rs. 6,13,000, he cannot turn round and ask the assessee to prove the expenses on account of defective vouchers. Except the declaration made under Section 132(4), there is nothing on record to impeach the veracity of the vouchers found at the time of search. Even though the assessee has disclosed the sum of Rs. 6,13,000 to cover unsigned, defective and unrecorded paid vouchers though under the pressure applied by the search party as claimed by the assessee, there is no material to warrant such findings and conclusion in the regular assessment order passed by the Assessing Officer. Therefore, the Assessing Officer is on weaker ground to disallow the claim of expenditure in respect of which the assessee has disclosed the income of Rs. 6,13,000. What the assessee has disclosed is to cover up the so-called unrecorded expenses or possible omission and commission of such expenses, but after having disclosed an amount of Rs. 6,13,000 to cover up such expenses imputed by the Department at the time of search, it is not open to the Department to turn round and ask the assessee to prove the expenses while at the same time accepting the disclosed income as part of the total income. It is not open to the Department to do so. Inasmuch as the Department has been merely content to accept the income declared under Section 132(4) of the Income-tax Act, it is not open to reject the claim of deduction of expenditure incurred by the assessee covering the income which has been declared. This point has not been appreciated by the authorities. As a matter of fact, as seen in retrospect with reference to the regular assessment made by the Assessing Officer no defective memo, no defective vouchers, no unsigned vouchers, no unrecorded paid vouchers were found out so as to warrant or justify the additional income declared by the assessee under Section 132(4). When the Department wanted the assessee to disclose certain amount as alleged by the assessee for which no contradiction is coming forth from the Department side, it is only equitable or justifiable to allow deduction by way of expenditure to cover which the amount has been asked to be declared. As a matter of fact, neither the assessee could prove the expenditure nor the Department could disprove the expenditure because really no unsigned vouchers, no defective vouchers and no unrecorded paid vouchers were found out by the Department so as to warrant any additional income in respect of them. Even the assessment order makes only passing reference to the disclosure made by the assessee under Section 132(4) on the spur of the moment and it is not supported by material evidence gathered in support of the additional income declared by the assessee. If the Department proceeded on the assumption and presumption that there are unrecorded expenses, the inference that could be drawn is in favour of the assessee because it is only on account of unproved expenditure noticed by the Department, the assessee was called upon to declare the amount under Section 132(4). Having declared the amount, the assessee could not be asked to prove the expenditure which is an established fact. Therefore, the claim of the assessee deserves to be accepted as the Department has misplaced the burden of proof on the assessee without discharging it itself. Consequently, we modify the order of the Commissioner of Income-tax (Appeals) and direct the Assessing Officer to allow deduction of Rs. 6,13,000.