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TMI Blog2021 (5) TMI 149X X X X Extracts X X X X X X X X Extracts X X X X ..... evidence/material sought to be relied upon to the assessee and seeking his response on them. The Assessing Officer must also disclose to the assessee the material/information on the basis of which he has quantified the onmoney payment - If the Assessing Officer is able to establish on the basis of evidence gathered that the assessee has paid on- money to the extent quantified by him, then he can make the addition under S.69B. On the flip side, if there is no evidence available on record to directly link the assessee towards payment of on-money, then merely on the basis of the fact that some other buyers have accepted payment of on-money, no addition can be made. With the aforesaid observations, we remit the issue to the file of the Assessi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eassessment proceedings, the Assessing Officer relied upon the statement of one of the Directors of company, Sri Koneru Rajendra Prasad, and Shri Tummala Ranga Rao who marketed the plots and held that the assessee has paid the cash component of ₹ 29,85,000/- and he accordingly brought it to tax. Aggrieved, the assessee preferred an appeal before the CIT (A) who confirmed the assessment order and the assessee is in second appeal before the Tribunal by raising the following grounds of appeal: "1. The learned CIT (A) erred on facts and law. 2. The learned CIT (A) erred in confirming the addition of ₹ 29,85,000 towards unexplained money. 3. The CIT (A) based his order on presumption of facts and circumstantial evidences. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n whether he has paid on-money, he stoutly denied the same and insisted that apart from recorded sale consideration, he has not paid anything more. It is the plea of the assessee before the CIT(A) as well as before us that the Assessing Officer has utilised the material gathered as a result of investigation/enquiry adverse to the assessee without either supplying the same to him or allowing an opportunity to the assessee to cross examine Shri T.Ranga Rao, whose statement primarily formed the basis of the addition. We find that the aforesaid submissions of the assessee are acceptable. It is very much clear from the assessment order that though the Assessing Officer has Shri G. Mahesh Babu, Hyderabad, referred to the information received to s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... etter dated 13.3.2014 has specifically asked for cross examination of Shri T.Ranga Rao. In the aforesaid view of the matter, there is violation of rules of natural justice by the Assessing Officer while making the addition of ₹ 1,99,20,000. Therefore, the addition made by the Assessing Officer, on account of alleged payment of on-money, cannot be sustained. 24. Having held so, it is necessary to examine whether noncompliance of the rules of natural justice in the facts and circumstances of the present case has made the assessment void ab initio, or the Assessing Officer can be asked to decide the issue again after following principles of natural justice, as Shri G. Mahesh Babu, Hyderabad, requested by the earned Departmental Repres ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oney. Further, through a process of investigation, CBI has found irregularities in the activities of EHTPL and submitted charge sheet(s). As the statement of Srhi T.Ranga Rao, the entire charge sheet(s) filed by CBI and information gathered by the department through enquiry have not been brought on record before us either by assessee or department, we are unable to examine the extent of assessee's involvement, if at all, in the irregularities alleged by CBI or whether the assessee has also been implicated by the investigation agency or any other person. Therefore, in our view, issue relating to payment of on-money requires to be examined afresh by Assessing Officer after confronting evidence/material sought to be relied upon to the asse ..... X X X X Extracts X X X X X X X X Extracts X X X X
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