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TMI Blog2025 (1) TMI 1172X X X X Extracts X X X X X X X X Extracts X X X X ..... onted.
Therefore, information if any found in the pendrive etc., cannot be considered as 'credible evidence', unless they have been corroborated with any other evidence. In my humble opinion, since the assessee was not provided with the adverse material, if any, based on which notice u/s 148 of the Act, was issued, it hampers the primary and fundamental requirement of natural justice.
Information claimed in pendrive - The same was not found from the possession of the assessee but was found as per order of assessment, during search and seizure conducted in the case of third party therefore, in the absence of corroborative evidence to establish that the contents of pendrive are correct and authenticated to the extent assessee paid 'on-money' in cash. No addition can be made and even otherwise during the entire reassessment proceedings the veracity and reliability of the data recorded in the pendrive was not checked or tested. Therefore, in such a scenario no addition is warranted in the case of assessee - Decided in favour of assessee. X X X X Extracts X X X X X X X X Extracts X X X X ..... AC, Delhi has erred in confirming the action taken by the Ld. AO and has grossly erred in concluding that the appellant alongwith three other co-owners has indeed paid Rs. 1.29,15,000/- in cash, especially since the learned Assessing Officer has neither collected any evidence of any incriminating nature whatsoever in the course of assessment proceedings nor any of the answers to the questions raised pursuant to statement recorded u/s 131 even remotely suggest that the appellant has paid any "On Money" whatsoever. 7. The Learned CIT(A), NFAC, Delhi has erred in confirming the action taken by the Ld. AO in making a reference to the Indian Evidence Act, 1872 which states that "whoever desires any Court to give judgment as to any legal right or liability dependent on the existence of facts which he asserts, must prove those facts exist." It is pertinent to note that the appellant has extremely clearly stated during the entire assessment proceedings that no cash payment has been made and thus there can be no documentary evidence for proving the fact that no cash has been paid. On the other hand, the department claims that the appellant has made cash payment to Natr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dated 18/03/2014 stating that the original return of income may be treated as return filed in response to notice u/s 148 of the Act. On perusal of Para 5.3 of the order, it is emphatically stated that the Learned AO has received information vide letter dated 24/03/2014 from DCIT Central Circle-44/Kamala Group search/2013-14 only during assessment proceedings. In other words, the Learned AO did not have any information prior to issuance of notice u/s 148 of the Act. It is pertinent to note that the copy of such letter dated 24/03/2014 was received by the Learned AO only after issuance of notice u/s 148 on 27/02/2014. It is therefore concluded that the Learned AO did not have any "reason to believe" to reopen the case of the Appellant before issuing notice u/s 148 of the Act. Hence, the notice issued u/s 148 is illegal, bad in law and ultra-vires the provisions of the Act. Without prejudice to the above, the Appellant emphatically denies having paid any amount over and above the agreement value to purchase immovable property valued at Rs. 2,39,15,000/- along with 3 other family members which please note. Copy of the purchase agreement is enclosed as Exhibit 1. Para 5. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion as to whose statements on oath, recorded if any from the aforesaid Kamala Group have been relied upon as information received by the DGIT(Inv), Mumbai before making such wild allegations and thereby questioning the conduct of the Appellant It is learnt from all the members of Vibgyor CHS' that none of them has made any payment in cash as alleged and it is further learnt from the records of Vibgyor CHS that the agreement value of Flat No. 1002 displays the highest rate per sq. feet and hence the question of arriving at any adverse view only in the case of the Appellant just does not arise 2. The Learned AO in the reasons that prompted reopening of the case has further alleged that the Appellant has paid Rs. 2,39,85,000 in cheque and Rs 1,29,15,000 in cash for which the source of investment needs to be verified. The Appellant emphatically denies of having paid anything in cash as alleged. 4. The copy of the reasons recorded relied upon by the Learned AO, the contents of the "Pen- drive', statement of Shri Nilesh Gawade and Shri Mahendra Rawal recorded under section 132(4) of the Act and such other related documents seized and relied upon by the Learned AO have no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Assessment Order, the Learned Assessing Officer has quoted Section 101, 103, 106 of the Indian Evidence Act, 1872 which is stated as follows: "5.6 Section 101 of the Indian Evidence Act, 1872 states that whoever desires any Court to give judgment as to any right or liability dependent on the existence of facts which he asserts, must prove that those facts exits. When a person is bound to prove the existence of any fact, it is said that the burden of proof lies on that person. According to Section 103 of the Indian Evidence Act, 1872, the burden of proof as to any particular fact lies on that person who wishes the Court to believe in its existence. Section 106 of Indian Evidence Act, 1872 says that when any fact is especially within the knowledge of any person, then burden of proving that fact is upon him. 5.7 All the above provisions are applicable to the case of our assessee, in this case assessee claims that the information w.r.t. cash payment towards the flat purchase from Natraj Realtors is false. This is a fact which she asserts. Therefore, burden lies on her to prove the said facts (Section 101 and 103 of Indian Evidence Act, 1872). However, the burden of proof has ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e has escaped assessment and there must exist objective reasons for that belief. The said belief must be held in good faith and founded on material which is not irrelevant or arbitrary. The said reason to believe cannot be based on conjectures. The Appellant submits that it is very clear from the reading of the reasons recorded for the reopening that the entire belief is based on certain information disregarding the well settled law laid down by the Hon'ble Supreme Court and the High Courts and, hence, the belief cannot be valid in law. The Learned Assessing Officer has erred in assuming jurisdiction to issue notice under section 148 of the Act without any 'reason to believe' that income has escaped assessment and has proceeded on an erroneous assumption that the Appellant has entered into "On Money" payments by buyers/ prospective buyers with Kamala Group against whom the Appellant was neither provided any opportunity to cross examine the person/s who had given statement on oath nor the appellant has received any such "incriminating evidences" such as "pen-drive" till date on the basis of which such reassessment proceedings was initiated a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as been forwarded to the Ld. CIT (A)-31, Mumbai. While the Appellant is striving to get a copy of this remand report, the JAO has not made the same available yet. Hence, the Appellant has been deprived of the remand report which has been relied upon by the Ld. CIT (A), NFAC, Delhi before passing the order. The Learned CIT(A) on Page 2 of the order reproduces the Grounds of Appeal raised by the Appellant which is as under: - II GROUNDS OF APPEAL 1. On the facts and circumstances of the case and in law, the addition of Rs 32,28,750 made by the assessing officer is bad in law 2 On the facts and circumstances of the case and in law, the Assessing Officer legally erred in making addition of Rs 32,28,750 being non-existent ON MONEY paid by the assessee to the builder. 2.1 The assessing Officer with a pre-determined mind made an addition of Rs 32,28,750 as On Money paid by the appellant in the hands of the appellant, which is purely based on predetermined mindset by the assessing officer. 2.2 The assessing Officer legally erred in mentioning that the appellant has brought no evidence under Indian Evidence Act, whereas the reply to the show cause notice filed by the appellant dul ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... yees of Kamla Group, 3. The admission by the employees of Kamla Group was ratified by directors/partners of the Group. None of the above details/documents has been provided to the Appellant despite continuously requesting for the same and the Ld. CIT (A) has preferred to stay silent on this aspect which your goodself may please note. Legal Position Hence, the proceedings-initiated u/s 147 of the Act is bad in law, null and void and ultra vires the provisions of the Act. We place our reliance on the following judgements: 1. Padmashree Dr. D.Y. Patil University vs DCIT CC 7(1), Mumbai before the Hon'ble ITAT C Bench, Mumbai dated 4 January 2024 We have heard the parties and perused the record. We have held that the information found in the pen drive/laptop of employees cannot be considered as credible evidences, unless they have been corroborated with any other evidence. Accordingly, no credence could be given to the abstract entries made in the pen drive/laptop. Accordingly, we are of the view that the AO could not have made additions on the basis of those information. Accordingly, we confirm the decision of Ld CIT(A) in deleting the additions in both the years f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ich was confirmed through statement of Shri Nilesh, Gavade and Mahendra Rawal recorded U/s 132(4) of the Act and on this basis, reassessment order was framed and the same was upheld by the Ld.CIT(A). 9. Whereas throughout the proceedings, the assessee categorically denied having paid any amount in cash over and above the agreement value. The AO has neither confronted assessee with any of the material found during the search on Kamla Group and even no evidence or seized document has been referred to where any name of the assessee has been explicitly mentioned of paying on-money. Although it has been claimed in the order of assessment that summons u/s 131 of the Act were issued to gather further details, but again no such statement has been confronted, neither the seized material /documents /pendrive was confronted to the assessee nor the copy of statement of Nilesh Gavade or Mahendra Rawal was confronted. 10 Therefore, in my view, the information if any found in the pendrive etc., cannot be considered as 'credible evidence', unless they have been corroborated with any other evidence. In my humble opinion, since the assessee was not provided with the adverse material, if any, based ..... X X X X Extracts X X X X X X X X Extracts X X X X
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