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2019 (5) TMI 769 - AT - Income TaxAssessment u/s 153A - proof of seizure of document - addition based on loose papers - unexplained cash payments - HELD THAT - In the present case, as is clear from the answer given by Smt. Adlene Kagoo, it is clear that the document was neither written by her nor she is aware of the content, nor she is aware who had written the document and it is also not the case of the revenue that the assessee had taken and kept said document in the custody of Smt. Adlene Kagoo. On the other hand, the sole case of the revenue is this that the said document was allegedly kept by Shri Dayananda Pai. To prove the live link by the revenue , the statement of Shri Dayananda Pai should have been recorded categorically mentioning that this document belonged to the present assessee. In fact, the assessee under statement u/s. 131 had denied of the execution of this document and also the content. The document is required to be proved in accordance with principle of Evidence Act as applicable in Income Tax proceedings, either by primary evidence or secondary evidence. In the present case, none has been done by the revenue to prove seizure of document and contents thereof, so as to enable revenue to build up its case for the purpose of treating the document to be incriminating document. The document relied upon by the revenue has not been proved by the revenue that it belong to the assessee nor it was proved that it contain incriminating material on the basis of which addition can be made. Further we would like to put on record that neither Smt. Adlene Kagoo has admitted this document nor the assessee admitted this document during the course of recording of statement reproduced herein above. Therefore onus of proving the document belonging to the assessee lies on the revenue to prove that the document belonged to the assessee and is correct hence it can be relied upon in accordance with law. In our view, the revenue has failed to discharge its onus. The best case of the revenue that amount of ₹ 4.50 Crores was paid as an on money for purchase of Jakkur land, admittedly this was allegedly paid on 13.10.2006 whereas the sale deed were executed on 30.03.2007 and also on 06.08.2009. This amount of ₹ 4.50 Crores can be said to be on money given by the assessee for the purchase of the said land, if the said money is paid subsequent or at the time of registration of sale deeds. Further we may bring on record that the details of cheques given in the sale deed dated 30.03.2007, as per para 2 of sale deed on page no. 96 of paper book, cheque of ₹ 2.60 Crores bearing no. 719275 drawn on ICICI Bank is dated 30.03.2007 and in respect of second property the cheque of ₹ 60 Lakhs was paid for which a separate receipt was executed. If we compare the two cheque amount, one is of ₹ 2.60 Crores and the other is of ₹ 60 Lakhs then it is clear that the annexure AK/PDP/12-pg 125 does not have either the figure of ₹ 2.60 Crores or the figure of ₹ 60 Lakhs. Moreover there was no date of 30.03.2007 mentioning the cheque no. 719275 in annexure AK/PDP/12-pg 125. In view of the above, the observation recorded by the assessing officer that the transactions carried out in cheque which were reflected in the books of account were true, the seized evidence gains strength is also not correct. In view of the above, the conclusion drawn by the assessing officer was without any basis as neither the document AK/PDP/12-pg 125 was proved nor it pertains to the payment of on money on the jakkur land transactions nor the transactions were forming part of the sale transactions mentioned. In view of the above, the appeal of the revenue is without any merit and is liable to be dismissed and we accordingly dismiss the same. - Decided in favour of assessee.
Issues Involved:
1. Deletion of ?4.5 Crore addition by AO based on seized documents from third parties. 2. Acceptance of one cash transaction while rejecting another. 3. Reliance on decisions from other cases with distinguishable facts. 4. Maintainability of proceedings under Section 153A without incriminating material. 5. Condonation of delay in filing cross-objections (CO). Issue-wise Detailed Analysis: 1. Deletion of ?4.5 Crore Addition: The revenue challenged the deletion of ?4.5 Crore added by the Assessing Officer (AO) based on seized documents from third parties. The tribunal examined whether the document seized from Smt. Adlene Kagoo could form the basis for such an addition. The tribunal noted that the document was neither written by Smt. Kagoo nor was she aware of its contents. It was not proved that the document belonged to the assessee or contained incriminating material. The tribunal emphasized that the document must be proved in accordance with the Evidence Act, which was not done by the revenue. Therefore, the tribunal upheld the deletion of ?4.5 Crore. 2. Acceptance of One Cash Transaction While Rejecting Another: The revenue argued that the CIT(A) accepted one cash transaction but rejected another, despite both being based on seized material. The tribunal found that the document AK/PDP/12-Pg-125, which was the basis for the ?4.5 Crore addition, was not proved to belong to the assessee. The tribunal noted discrepancies in the cheque amounts and dates mentioned in the sale deeds and the seized document. The tribunal concluded that the addition was made without any basis, as the document was neither proved nor related to the on-money payment for the Jakkur land transactions. 3. Reliance on Decisions from Other Cases: The revenue contended that the CIT(A) erroneously relied on decisions from other cases with distinguishable facts. The tribunal noted that the CIT(A) relied on the decisions in Addl. CIT Vs. Lata Mangeshkar and DCIT Vs. Jaswant Singh Chawala. The tribunal found that the facts of these cases were indeed distinguishable and not directly applicable to the present case. The tribunal emphasized the need for proving the document as incriminating material, which was not done by the revenue. 4. Maintainability of Proceedings Under Section 153A: The assessee argued that proceedings under Section 153A were not maintainable without incriminating material found during the search. The tribunal noted that the seized material from third parties could not be considered as discovered from the assessee. The tribunal emphasized that the document must be proved to belong to the assessee and contain incriminating material. The tribunal concluded that the revenue failed to discharge its onus of proving the document as incriminating material. 5. Condonation of Delay in Filing Cross-Objections: The assessee filed an application for condonation of delay in filing the CO. The tribunal considered the reasons provided by the assessee and condoned the delay, emphasizing that procedural aspects should not hinder fair adjudication of legal issues. The tribunal noted that the decisions relied upon by the revenue were not relevant to the issue of delay in filing the CO. Conclusion: The tribunal dismissed the revenue's appeal, upholding the deletion of ?4.5 Crore addition, and found that the document seized from Smt. Adlene Kagoo could not form the basis for the addition. The tribunal also dismissed the assessee's CO as academic, given the dismissal of the revenue's appeal. The tribunal emphasized the need for proving documents as incriminating material in accordance with the Evidence Act.
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