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20. Further, another aspect of the matter is that during the assessment proceedings when the statement of Shri Yash Paul Mittal was recorded, he has not denied the earlier version about the payment of Rs. 60 lacs including the payment through cheques but he simply added that his statement recorded on 13th Dec., 1995, was hearsay and stated further that no cash had been paid in his presence at any point of time. This is not to be treated that witness resiled from the earlier statement nor his statement is hearsay. The fact apparent from this is that whenever any payment was made by parties, these witnesses were apprised and on that basis he stated that it was hearsay. However, the fact remains that he still did not deny that amount of cash as stated by him did not exchange hands. The same thing is in respect of Shri Shital Vij who also stated that no cash payment was made in his presence. Apart from them, the AO rightly treated this changed version of witnesses as result of manipulation because both of them can easily be won over by the concerned party. So the AO was justified in placing reliance on the statements of these two witnesses recorded at the time of search and treating the changed version as result of manoeuvre on the part of the assesse and Shri Vijay Sehgal.

29. The learned JM emphasized in his order that when the statement of Shri Y.P. Mittal was recorded during the assessment proceedings, he had not denied the earlier version about the payment of Rs. 60 lakhs including the payment through cheques but he simply added that his statement recorded on 13th Dec., 1995, was on hearsay and stated that no cash was paid in his presence at any point of time. The learned JM, however, did not treat the second statement as a retraction from the earlier statement nor as hearsay as according to him it was apparent that whatever amount changed hands between the parties, the two witnesses were apprised. The learned JM also confirmed the view of the AO when he treated the "changed version" of both the witnesses as a result of manipulation because both of them could be won over by the concerned party. The view, in other words, was that the AO was justified in placing reliance on the statements of the two witnesses recorded at the time of search and treating the changed version as a result of manoeuvring on the part of the assessee and Shri Vijay Sehgal.