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TMI Blog2025 (2) TMI 390X X X X Extracts X X X X X X X X Extracts X X X X ..... .. X X X X Extracts X X X X X X X X Extracts X X X X ..... he Co-ordinate Bench in the case of Vardha Enterprises Private Limited in ITA Nos. 3142, 3140 & 3141/Mum/2023; AYs 2017-18, 2020-21 & 2021-22 and ITA Nos. 2435, 2436 & 2437/Mum/2023; AYs 2017-18, 2020-21 & 2021-22, order dated 22/11/2024, has been supplied which has been duly considered. In the present appeal by the assessee, we are concerned with only two additions which have been partly affirmed by the ld. CIT(A) u/s 69C of the Act. 7. The first addition is in respect of payments made to Randolph Grey Design Co. Ltd. (hereinafter 'RGDCL'), being interior designer, Mr. Clive Grey. 8. During the course of search and seizure proceedings, ledgers pertaining to the unaccounted payments made to RGDCL for hotel purchase have been found to be recorded and seized from the residential premises of Mr. Jiten Pujari. The scanned copy of the document is reproduced below:- 9. The AO was of the opinion that the aforementioned payments are unaccounted and the total payments come to US$ 38500 equivalent to Rs. 29,40,245/-. The assessee was asked to provide complete details of the transactions and also provide the nature and source of payments. In its reply, the assessee explained that the alleg ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee has failed to establish the source of expenditure amounting to Rs. 3,23,99,505/- and made addition u/s 69C of the Act. 11.2. Both the additions were challenged before the ld. CIT(A). Insofar as, payments made to RGDCL, the assessee strongly denied having formally engaged the said interior designer. The ld. CIT(A) observed that US$ 20000 paid on 16/01/2020, has been paid by M/s. Capri Hospitality Ltd., UAE and in absence of any material evidence to show that the said UAE entity has made payments on behalf of the assessee, such addition cannot be sustained and accordingly the ld. CIT(A) confirmed the addition to the extent of Rs. 14,12,845/- and deleted the balance of Rs. 15,27,400/- for which the revenue is in appeal. 12. We have carefully perused the findings of the ld. CIT(A) qua the additions. The seized annexure being a scanned copy which is exhibited elsewhere, does not contain the name of the assessee anywhere. The said document was found and seized from the residential premises of Mr. Jiten Pujari. Therefore, the presumption is that the said document pertains to Mr. Jiten Pujari. As the name of the assessee is nowhere mentioned in the said document the presumpt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Receipt 75,392 70.50 53,15,129 14-01-2020 Receipt 35,677 70.72 25,23,063 08-01-2020 Receipt 17,241 71.85 12,38,771 31-01-2020 Receipt 72,285 71.25 51,50,323 2,89,17,232 16. It can be seen from the above that the aforementioned amount of Rs. 2,89,17,232/- was received during the year under consideration and which was found to be recorded in the books of account for which the ld. CIT(A) gave part relief to the assessee. 16.1. We do not find any cogent reason given by the lower authorities for confirming the balance of Rs. 36,87,273/-. As there is no basis for making the addition/partially confirming addition of the same, the AO is directed to delete the entire addition of Rs. 3,23,99,505/-. This ground is also allowed and the related grounds in the revenue's appeal are dismissed. 17. Coming to the revenue's appeal in I.T.A. No. 3122/Mum/2023, Ground Nos. 1 & 2 have already been dismissed as discussed hereinabove and as mentioned elsewhere, other additions were made on protective basis and the same have been either confirmed in M/s. Vardha Enterprises Pvt. Ltd. (supra) or deleted therein on account of duplicate addition. We do not find any error or infirmity in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd in the circumstances of the case, Ld. CIT(A) erred in deleting addition of Rs. 45.00,000/- made u/s 69C of the I.T. Act, without appreciating the fact that the assessee failed to explain the source of payment made to 'Vajavat-Udaipur'. 3. On the facts and in the circumstances of the case, Ld. CIT(A) erred in deleting addition of Rs. 1,07,80,000/- made u/s 69C of the I.T. Act, without appreciating the fact that the assessee failed to explain the source of payment made to Biosil Intl. Pte Ltd. 4. On the facts and in the circumstances of the case, Ld. CIT(A) erred in deleting addition of Rs. 1,18,63.500/- made u/s 69C of the I.T. Act, without appreciating the fact that the assessee failed to explain the source of payment. 5. On the facts and in the circumstances of the case, Ld. CIT(A) erred in deleting addition of Rs. 42,74,550 /- made u/s 69C of the I.T. Act, without appreciating the fact that the assessee failed to explain the source of payment made to Randolph Gray Design Company Ltd. through Wander Baker on behalf of the assessee. 6. On the facts and in the circumstances of the case, Ld. CIT(A) erred in deleting addition of Rs. 26,01,900/- made u/s 69C of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed in deleting addition of Rs. 1,80,00,000/- made u/s 69C of the L.T. Act, without appreciating the fact that the assessee failed to explain the source of the same. 4. On the facts and in the circumstances of the case, Ld. CIT(A) erred in deleting additions, without appreciating the fact that the issue in whose hands the addition is to be made has not reached finality." 30. We have carefully considered the orders of the authorities below. We find that the AO has made the addition on a protective basis in the hands of the assessee while the same has been added on a substantive basis in the hands of M/s. Vardha Enterprises Pvt. Ltd.. It was strongly contended before the ld. CIT(A) that the impugned additions have no linkage with the assessee and no such evidence has been brought on record to suggest that the impugned expenses have any relation with the assessee. 30.1. The ld. CIT(A) found that the AO himself as noted that M/s. Vardha Enterprises Pvt. Ltd., has failed to establish the source of expenditure and in such finding the ld. CIT(A) deleted the impugned additions from the hands of the assessee. 31. Since the AO himself has found these expenses relating to M/s. Vardha En ..... 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