BHARAT SOLANKI ,MUMBAI vs. DCIT, CENTRAL CIRCLE , MUMBAI
Income Tax Appellate Tribunal, MUMBAI BENCH “B” MUMBAI
Before: SHRI OM PRAKASH KANT () & SHRI SANDEEP SINGH KARHAIL ()
PER OM PRAKASH KANT, AM
These three appeals by the assessee are directed against a common order dated 01.08.2025 passed by the Ld. Commissioner of Income-tax (Appeals) – 52, Mumbai [in short ‘the Ld. CIT(A)’] for assessment year 2017-18 to 2019-2020 respectively.
Since all three common issue in di and therefore, these by way of this conso avoid repetition of fac 2017-18 as lead case mutandis in other ye of the assessee for a relevant grounds rais 1. On the erred i notice contrav issued 2. On the erred increm incrimi Appella 3. On the erred i docum group w 4. On the erred statem 5. On the erred i examin agains 6. On the erred i 3. The ground Nos by the Assessing Off on-money payment m ITA N appeals pertains to same ass ispute permeating from similar appeals were heard together a olidated order for the sake of c cts. The parties agreed to take a e and to follow the decision of th ears. Accordingly, firstly, we tak assessment year 2017-18 for ad sed by the assessee are reproduc e facts and circumstances of the case in in confirming the stand of A.O. about th u/s 153C of the Act without DIN. vention of the Circular No. 19/2019,da d by the CBDT e facts and circumstances of the case in in confirming addition without refe menting document. Besides,he has not r inating material in the satisfaction note ant. e facts and circumstances of the case in in confirming stand of A.O. for not sharin ments found during the course of search which was pertained to the appellant. e facts and circumstances of the case in in confirming stand of A.O. about the ment and materials used by him against th e facts and circumstances of the case in in confirming stand of A.O. about oppor nation of the person whose statemen st the appellant. e facts and circumstances of the case in n confirming addition of Rs.1,00,000/-u/ s. 3 to 6 of the appeal relate to ficer u/s 69C of the Act on acc made for purchase of shop in c Bharat Solanki 2 Nos. 6523 to 6525/MUM/2025 essee, involving r factual matrix and disposed off convenience and assessment year he same mutatis ke up the appeal djudication. The ced as under: law, Ld. CIT(A) hat issuing the It is blatant ated 14-8-2019 law, Ld. CIT(A) erring to any referred to any e issued to the law, Ld. CIT(A) ng incrementing h of rubberwala law, Ld. CIT(A) e not providing he appellant law, Ld. CIT(A) rtunity of cross nts were used law, Ld. CIT(A) s 69 of the Act. o addition made count of alleged cash and which has been upheld by has challenged issu document identificati 19/2019 dated 14.0 Taxes (CBDT). The g the addition made in reference to the incri parties agreed that if of the addition, then 4. Briefly stated, income for the asses the relevant period. under section 132 carried out on 17.03 including M/s Rubbe its promoters and dir the group, Shri Imran 4.1 During the cou recorded from Shri Im registration of shops Shaikh, Director and that cash componen consideration in res stated to have been ITA N the Ld. CIT(A). The ground No. ue of notice u/s 153C of th ion number which is in violation 8.2019 issued by the Central round No. 2 is also a legal grou n proceedings u/s 153C of the A iminating material in the satisfa f the assessee gets relief on the g ground No. 2 of the appeal may the assessee did not file a re sment year 2017-18 as he was Subsequently, a search and of the Income-tax Act, 1961 3.2021 in the case of the “Rubb erwala Housing and Infrastruct rectors Shri Tabrez Shaikh and n Ansari. urse of the search, statements mran Ansari, a key employee ha in the “Platinum Mall” project, d Promoter of RHIL. Shri Imra ts were received over and abov spect of sale of shops, which affirmed by Shri Tabrez Shaik Bharat Solanki 3 Nos. 6523 to 6525/MUM/2025 1, the assessee he Act without n of Circular No. Board of Direct und challenging Act without any action note. The ground on merit y be kept open. egular return of a minor during seizure action (“the Act”) was berwala Group”, ture Ltd. (RHIL), key employee of s on oath were andling sale and and Shri Tabrez an Ansari stated ve the registered statement was kh. A pen drive was also seized from allegedly recording d and alleged cash com 4.2 It was noticed fr booked in the name o of ₹12,87,900/- was financial years i.e. corresponding to as financial year 2017-1 (iii) Rs.5,78,700/- i assessment year 20 Rs.12,87,900/- has b in cash against the sheet. 4.3 On the basis of the Act was issued t assessee filed a retu assessment was com 153A of the Act on treated the alleg expenditure/investm order dated 22.03.20 the Act an addition o the Act. ITA N m Shri Imran Ansari containin etails of shop sales, including n mponents. rom the said Excel sheets that a of the assessee and an aggregat s recorded as having been rece (i) Rs.1,00,000/- in financial ssessment year 2017-18 (ii) R 18 corresponding to assessment in financial year 2018-19 co 019-2020. In this manner to been claimed by Shri Imran An shop sold to the assessee bas f such material, notice under s to the assessee on 29.09.202. I urn on 18.10.2022 declaring N mpleted under section 153C re n 22.03.2024, wherein the As ged cash component as ment. For the assessment year 2 024 passed u/s 153C read with of ₹1,00,000/- was made under Bharat Solanki 4 Nos. 6523 to 6525/MUM/2025 ng Excel sheets names of buyers a shop had been te cash payment eived over three l year 2016-17 Rs.6,09,200/- in t year 2018-19 ; orresponding to otal amount of nsari as received ed on the excel section 153C of In response, the Nil income. The ad with section ssessing Officer s unexplained 2017-18, in the section 153A of r section 69C of 5. On appeal, the the ground that (i) statements and doc never supplied to th examination of Shri on the decision of the Jain in ITA No. 384 2020-21 and 2021-2 on-money payments additions were dele however, rejected the right of cross-exam opportunity had bee constituted corrobor statements and disc citing the various d finding of the Assess the assessee is in ap in short the ‘Tribunal 6. In the grounds issue that arises for the present case, th sustained solely on ITA N assessee primarily challenged the addition was based solely cuments, (ii) the incriminating he assessee, and (iii) no oppor Imran Ansari was granted. The e Co-ordinate Bench in the cas 2 and 3841/Mum/2023 for as 22, wherein, on similar facts rel for purchase of shops in the sa eted. The learned Commissio e contentions of the assessee, h mination is not absolute, en granted, and that the mater rated digital evidence suppo losure by the developer group. decisions in the impugned ord sing Officer on the issue in disp peal before the Income-tax App l’) raising the grounds as reprod raised by the assessee on me our consideration is whether, he addition of alleged cash p the basis of third-party digit Bharat Solanki 5 Nos. 6523 to 6525/MUM/2025 the addition on y on third-party g material was tunity of cross- e assessee relied e of Shri Rajesh ssessment years lating to alleged ame project, the oner (Appeals), holding that the that adequate rial relied upon rted by sworn The Ld. CIT(A) der, upheld the pute. Aggrieved, ellate Tribunal ( duced above. rit , the central on the facts of ayment can be tal records and statements, without to confront such mat 6.1 The facts, in b dispute, are that pu premises of M/s. Rub statements of its pro a key employee of the Imran Ansari was sta shops in the Platin statement, Shri Imra with the Rubberwala inter alia, entrusted registration of shops procedure ordinarily him, prospective pur availability of shops, units. Upon selectio communicate the pa registration charges, Ansari further state terms, a token amo ₹2,00,000/-, was col shop would be provi He claimed that, the ITA N providing the assessee an effec terial. brief, insofar as they relate t ursuant to a search action co bberwala Housing & Infrastructu moter and director, Shri Tabrez e group, Shri Imran Ansari, wer ated to be handling the sale and num Mall project developed by an Ansari deposed that he had a Group entities since the year with responsibilities relating t in the Platinum Mall project. H y followed for sale of the shop rchasers would approach him t whereupon he would show the on by the prospective purcha articulars of the shop, including and other terms and conditio ed that, upon the purchaser a ount, stated to range between llected in cash, and upon rece sionally booked in the name of ereafter, a small diary was han Bharat Solanki 6 Nos. 6523 to 6525/MUM/2025 tive opportunity to the issue in onducted at the ure Ltd. (“RHIL”), z Shaikh, and of re recorded. Shri d registration of y RHIL. In his been associated 2010 and was, to the sale and He described the ps. According to to ascertain the em the available aser, he would g the area, rate, ons. Shri Imran agreeing to the ₹50,000/- and eipt thereof, the f the purchaser. nded over to the purchaser, wherein would then intimate Shaikh, Chairman a him, the balance purchaser in agreed formalities, the shop purchaser or in the explained that the sa Tabrez Shaikh, havin the shop was situate that each floor was the atrium, with L commanding the hi farthest, being priced shops on the lower fl on the upper floors. 6.2 Further, in resp Imran Ansari stated shops comprised two component payable that the quantum of Tabrez Shaikh. In re deposed that the pric communicated to him ITA N the cash amounts received w the details of the transaction and Managing Director of RHI consideration was thereafter d instalments, and upon com p was registered either in th name specified by such purcha ale price of the shops was dete ng regard to factors such as the ed and its proximity to the atr divided into four levels based Level-1 shops, being closest ighest price, and Level-4 sh d the lowest. He also stated tha loors was higher as compared to ponse to Question No. 15 of his d that the total consideration o components, namely, a cash co through banking channels. He f the cash component was dete esponse to Question No. 16, Sh cing so determined by Shri Tab m orally. In response to Ques Bharat Solanki 7 Nos. 6523 to 6525/MUM/2025 were noted. He n to Shri Tabrez L. According to r paid by the mpletion of the he name of the aser. He further ermined by Shri e floor on which rium. He stated on proximity to to the atrium, ops, being the at the pricing of o those situated statement, Shri for sale of the omponent and a e further stated ermined by Shri hri Imran Ansari brez Shaikh was tion No. 17, he stated that the ent maintained by him in has reproduced the statement, covering assessment order. 6.3 Further, durin conducted at the resi pen drive was foun statement, Shri Imra said pen drive had b format. The content drive have been repr 5.4 of the impugned that the Excel file, t multiple sheets, incl and “Cheque”, amo comprehensive detail Mall project were rec that the “Master” sh spread across 98 col in his statements re Imran Ansari explain columns maintained by Shri Imran Ans ITA N tire data relating to the sale n an Excel sheet. The learned A e relevant extracts of Shri Questions Nos. 15 to 17, in ng the course of the searc idential premises of Shri Imran nd and seized from his poss an Ansari stated that the data c been prepared and maintained b s of the Excel sheets retrieved roduced by the Assessing Office assessment order. Shri Imran A itled “Consolidated 1 2 3 Bala luding sheets captioned “Mast ng others. According to Shri ls relating to the sale of shops corded in these Excel sheets. H heet was particularly detailed, lumns. In response to Question ecorded on 17.03.2021 and 20 ned the nature and significance in the said sheet. The explana sari in this regard have been Bharat Solanki 8 Nos. 6523 to 6525/MUM/2025 of shops was Assessing Officer Imran Ansari’s n the impugned ch proceedings Ansari, a 16 GB session. In his contained in the by him in Excel d from the pen er in paragraph Ansari explained nce”, comprised ter”, “Payment”, Imran Ansari, in the Platinum e further stated containing data ns Nos. 22 to 24 0.03.2021, Shri e of each of the ations furnished n collated and reproduced by the impugned assessmen reproduced as under K Token L Date M Token N Date O 1st ins P Date Q 2nd In R Date S 3rd In T Date U Penalt V Days D W Due D X Date Y A Valu Z Rev A. ITA N
Assessing Officer at pages 5
nt order. For ready reference, t
:
n Amount A This means the amount in token in cash at the time from buyer as mentioned
This is the date of the am mentioned in Column K.
n Amount B
This means the amount in second token amount in c mentioned in Column B.
This is the date of the am mentioned in Column M.
st. Payment
This means the amount in first instalment amount in mentioned in Column B.
This is the date of the am mentioned in Column O.
nst. Payment
This means the amount in Second instalment amoun as mentioned in Column
This is the date of the am mentioned in Column Q.
nst. Payment
This means the amount in third instalment amount as mentioned in Column
This is the date of the am mentioned in Column S.
ty
This means the estimated on the basis delayed paym same has never been colle
Delayed
This means the number o payments of any instalme previous columns.
Date
This means the last due d made in cash
This means the cut off da delayed as mentioned in C ue
This means old agreemen
Rs. which has been derive
(as mentioned in column rates as mentioned above
. Value
This means Revised agree shop which has been deri area (as mentioned in colu the rates as mentioned ab
Bharat Solanki
9
Nos. 6523 to 6525/MUM/2025
and 6 of the the said table is n Rs. accepted as of booking of shop in Column B.
mount paid in cash n Rs. accepted as cash from buyer as mount paid in cash n Rs. accepted as n cash from buyer as mount paid in cash n Rs. accepted as nt in cash from buyer
B.
mount paid in cash n Rs. accepted as in cash from buyer
B.
mount paid in cash d penalty to be levied ments, however the ected.
of days delayed in the ents as mentioned in date of payment to be ate to calculate days
Column V nt value of shop in ed from the old area
F multiplied by the e) ement value in Rs. of ived from the revised umn G multiplied by bove)
AA
G-P
AB
Rev G
AC
Parkin
AD
95% A AE
TOTAL
6.4 Shri Imran Ans of Master sheet as un
Q.22 Please state the above mentioned exc
Ans. Following are the above mentioned exce
Column Headin
A Floor
B
0Name
C
0Agree
D
Mobile
E
Shop N
F
Area
6.5 Further, in resp
Imran Ansari elabor
ITA N
This means the difference value (as mentioned in Co agreement value of the sh
Column Y)
-P
This means the difference total value (as mentioned revised agreement value o mentioned in Column Z).
the cash component of sa particular shop.
ng A.V.
This means Parking Agree addition to agreement val
AMT
This means 95% of revise mentioned in Column J
L RECVD. CASH
This means the addition o and S. This means total c from buyer over and abov ari also explained different colu nder:
e meaning of each heading of column in "M cel sheet.
e meaning of each heading of column in "Mas l sheet:
ng
Meaning
This means the floor number of Platinum Mall which has comm e
This means the name of person shop in Platinum Mall.
ement Name This means the name of person agreement of the shop in Platin will be done. Wherever "IMR" ha means it has not been sold. Thi name which was put to identify e
This means the mobile number name has been mentioned in C
No.
This means the Shop number o floor, the shop number starts fr the maximum number.
Old Area of the shops ponse to Question No. 26 of his rated upon the manner in whi
Bharat Solanki
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Nos. 6523 to 6525/MUM/2025
e between old total olumn I) and old hop (as mentioned in e between Revised in Column J) and of the shop (as Thus, this denotes ale related to that ement Value in lue of sale of shop.
ed total amount as of column K, M, O, Q cash amount received ve agreement value.
umn from A to F
Master Sheet" in the ster Sheet" in the f the project mercial shops.
n who booked the n in whose name the num Mall was done or as been mentioned, it is is initial of my y unsold shops.
r of the buyer whose olumn B.
on the floor. On each rom 1 and goes up to statement, Shri ch buyers were informed of the paym collection of amounts sake of completeness below. Shri Imran A shop, the buyer was consideration payab channels. According accordance with the would contact the b pending payments.
over to him by the b forward to the Accou cases where paymen would inform him e
With regard to cash verifying the amoun would accompany th to be the cashier of M and was stationed a Dr. A.R. Nair Road,
400011. According to Shri Abrar Ahmed, w the cash to him. He f would record the de and amount, in a dia
ITA N ment structure and the procedu s through cash and banking ch s, the substance of his response
Ansari stated that, at the time informed of the respective com le in cash and through cheq to him, payments were made b e agreed schedule, and in cas buyers telephonically to remin
He further stated that cheque buyers at the office, which he w unts Department through an off nt was made through bank tran either telephonically or by way payments, Shri Imran Ansari s nt of cash to be accepted from he buyer to Shri Abrar Ahmed,
M/s. Rubberwala Housing & Inf at the company’s office at Rub
Opposite Agripada Police Stat o him, the buyer would hand o who would thereafter orally co further stated that, upon such c tails of the cash payment, inc ary which, according to him, ha
Bharat Solanki
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Nos. 6523 to 6525/MUM/2025
ure followed for hannels. For the e is summarised of booking of a mponents of the que or banking by the buyers in ses of delay, he nd them of the es were handed would thereafter fice assistant. In nsfer, the buyer y of a message.
tated that, after m the buyer, he who was stated frastructure Ltd.
bberwala House, tion, Mumbai –
over the cash to nfirm receipt of confirmation, he cluding the date d been provided to the buyer at the against each such updated the corre
“Consolidated 1 2 3
statement is reprodu
“Q.26 Please and payment channel)?
Ans. At the components o or banking c schedule. In from my mob handover me
Accounts Dep the buyer inti of cash, I verif and then tak
Rubberwala H office of at situated at Ru
Police Station the amount o
Ahmed confir
I make entry booking of sh payment in t update my Ex has been men
6.6 Further, in resp
Imran Ansari stated
Abrar Ahmed, who handling cash transa deposed that, upon ITA N time of booking of the shop, entry. Simultaneously, he cl sponding entries in his Ex
3 Balance”. For ready referenc ced as under:
state how buyers are informed regarding t is collected in cash and in cheque ( time of booking, the buyer is informed of payment to be made in cash and throu channels. Buyers pay the amount as p case of non-payment at due time, I cal bile and remind them for payments. T e the cheques in office which I forw partment through office boy. In case of ban imate me either on call or through messa ify the amount of cash to be accepted from ke the buyer to Mr. Abrar Ahmed (Cash
Housing and Infrastructure Limited) who
Rubberwala Housing and Infrastructu ubberwala House, Dr. A R Nair Road, Opp n, Agripada Mumbai- 400011. Then, the b of cash to Mr. Abrar Ahmed. Thereafter, rms the cash received from buyer to me o in the diary earlier given to the buyer at hop. I mention the amount of cash along w that diary and sign after each entry. P xcel File named "consolidated 1 2 3 bala ntioned above.”
ponse to Question No. 27 of his that he would accompany the was stated to be the person actions on behalf of the Rubber receipt of cash from the buy
Bharat Solanki
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Nos. 6523 to 6525/MUM/2025
and would sign laimed to have xcel file titled ce said part of g payments
(or banking d about the ugh cheque per agreed ll to buyers
The buyers ard to the nk transfer, age. In case m the buyer hier in M/s also sits in ure Limited p. Agripada buyer gives
, Mr. Abrar rally. Then, t the time of with date of Parallelly, I ance" which statement, Shri e buyers to Shri entrusted with rwala Group. He yer, Shri Abrar
Ahmed would orally would update the corresponding Excel further stated that th thereafter handed ove
6.7 On the basis of Imran Ansari, the As booked a shop in the cash payments agg assessment years, na
The Assessing Office action and the sta
Rubberwala Group, unaccounted cash a tax. Relying upon t
Assessing Officer for unexplained cash ex of the said shop. W cross-examine the pe upon, the Assessing recorded by the Asse examination are rep assessment order, wh precedents to hold
ITA N y confirm such receipt to him relevant entries in the di sheets maintained by him. Sh he cash so received by Shri Ab er to Shri Tabrez Shaikh.
f the aforesaid Excel sheets mai ssessing Officer observed that th e Platinum Mall project and had regating to ₹12,87,900/-, spr amely Assessment Years 2017–
er further noted that, pursuan atements recorded from key p the said group had accepted and had offered 8 per cent of s the details reflected in the Ex rmed the view that the assesse xpenditure / investment toward
When the assessee sought an ersons whose statements and d
Officer declined the said reque ssing Officer for rejecting the re produced in paragraph 9.3 of herein reliance was placed upon that the right of cross-exam
Bharat Solanki
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Nos. 6523 to 6525/MUM/2025
, whereafter he iaries and the hri Imran Ansari brar Ahmed was intained by Shri he assessee had d allegedly made read over three
–18 to 2019–20. nt to the search persons of the d the receipt of such amount to xcel sheets, the ee had incurred ds the purchase opportunity to data were relied est. The reasons equest for cross- f the impugned n certain judicial mination is not absolute and depend case. It was furthe according to him, proceedings clearly c relation to the alle contents of the electr person in a statemen this basis, the Asses warranting grant of c on the aforesaid reas an addition of ₹1,00,0
6.8 The relevant fin
“9.3. Further examination i not an absolu
(Del) 295). Th right of hear examination.
the circumsta
(State of J&K
Bait-Al-Tamur
Ashok Chima unaccounted
Tamur Co. d
Further, these
Rajal Narend in his stateme the fact that t
ITA N ds upon the facts and circums er observed by the Assessin the documents seized durin contained the name and PAN of ged unaccounted transaction, ronic data had been admitted by nt recorded under section 131
ssing Officer concluded that no cross-examination were made o soning, the Assessing Officer pro
000/- in the year under conside ding of the ld AO is reproduced r, in respect to the assessee's reques it is submitted that the right of cross exa ute right. (Nath International Sales vs. UO he Hon'ble Supreme Court has also he ring does not necessarily include righ
3) 68 ELT 548, 551(All.) In the present ca s are warranted as in the document earch and survey proceedings in the ca r Co., the name and PAN of the asses anlal Mehta) was clearly mentioned in purchase of Rs. 13,81,350/- from M during the F.Y.2017- 18 relevant to A.
e facts in the pendrive were also confron dra Ashar (proprietor of M/s Bait-Al-Tamu ent recorded on oath u/s.131 of the Act, h the pen drive contained a list of out of boo
Bharat Solanki
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Nos. 6523 to 6525/MUM/2025
stances of each ng Officer that, ng the search f the assessee in , and that the y the concerned of the Act. On o circumstances out. Accordingly, oceeded to make eration.
as under:
t for cross amination is OI, AIR 1992
eld that the ht of cross epend upon e concerned
67 SC 122).
d to cross nds on the ri Merchant ase, no such ts collected ase of M/s ssee (ACM- respect of M/s Bait-Al-
.Y.2018-19. nted to Shri ur Co.) and he admitted oks sales.
The Hon'ble R
In CIT v. Met was held tha likes, behind against the a the requireme that he sho assessment; includes direc
Therefore, in hereinabove, rejected.”
6.9 On further appe of the assessee for finding of the Ld. CIT
“8.1 The AO h note. In this r by the AO. A the AO had d incriminating assessment. T relevant extra regarding the drives and a Hence, the m appellant and to.
8.2 It is a s provided with relied upon, justice. In thi
Industries v.
Hon'ble Supr would vitiate examined wa provided at ITA N
Rajasthan High Court in the case of Ram
256ITR536(Raj.) has held that "there is n g the cross examination of the perso were recorded during survey."
tal Products of India (1984) 150 ITR 71
at the AO may gather information in any d the back of the assessee and utilize assessee, even if it does not, in all respe ents of the Indian Evidence Act. What is n ould have material upon which to "material" as distinguished from "evide ct and circumstantial evidence.
n view of the facts and circumstance the request of the assessee for cross exa eal, the Ld. CIT(A) also rejected r providing cross-examination
T(A) is reproduced as under:
have mentioned gist of allegation in the s regard, I have perused the show cause no thorough examination of the said notice r duly communicated and forwarded the de material relied upon for the pu
The show cause notice clearly refers to an acts from the statement of Shri Imran Ans e purchase of flats, and data retrieved all of which formed the basis of the p material in question was made availa d the principles of natural justice were du settled position in law that when the a h an adequate opportunity to respond to t there is no violation of the principles is context, reliance is placed on Andam
CCE [2015] 62 taxmann.com 3 (SC), reme Court held that denial of cross-e proceedings only if the evidence sought as the sole basis of the order and no oppo any stage. However, if adequate opp
Bharat Solanki
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Nos. 6523 to 6525/MUM/2025
meshwarlal no provision ons whose
14 (P&H), it manner he e the same ects satisfy necessary is base the ence" which discussed amination is d the contention n. The relevant satisfaction otice issued reveals that etails of the urposes of nd includes sari, details d from pen proceedings.
able to the uly adhered assessee is the material of natural man Timber where the examination to be cross- rtunity was portunity is provided and rendered inva
8.3. In the necessary m
03.03.2024 a submit a resp supply of ma merit and doe
8.4. In the ca
965 SC, the H
Natural justic judicial cure-a man proceede of such essen facts and circ justice can b justice withou factors of a gi law in the ab totality of cir the Court will of natural jus
8.5. Duties a cannot mere discharge the 8.6. In the ca
Hon'ble ITAT
"6.14 It will a of proof on circumstance about the ta answered by plausible expl or complete fa drawing of inevitable. Co of facts, unl capricious.”
8.7. In the ab to 3098 & 3
ITA N d documents are shared, such proceedin alid.
present case, the AO has clearly pr material through the show cause no and granted the appellant sufficient opp ponse. Therefore, the argument that ther aterial or denial of cross-examination is es not hold ground.
ase of Chairman Mining Board v. Ramjee
Hon'ble Supreme Court observed as under ce is no unruly horse, no lurking landm all. If fairness is shown by the decision-m ed against, the form, features and the fun ntial procedural propriety being conditio cumstances of each situation, no breach be complained of. Unnatural expansion ut reference to the administrative realities iven case can be exasperating. Courts can bstract or natural justice as a mere artif rcumstances from denial of reasonable l decline to be punctilious or fanatical as tice were sacred scriptures."
and obligations go hand in hand and th ly harp on technicalities even while e onus laid on him.
ase of Hersh W Chadah V. DDIT, 43 SO has held that:- also be worthwhile to consider the nature the Assessing Officer for proving in the income-tax proceedings. The quest ax liability by the Assessing Officer y the assessee by furnishing reaso lanations. If assessee is not forthcoming acts or his statement or explanation is con suitable inferences and estimation o ourts generally will not interfere with suc less the inferences or estimates are p bove case of Hersh W Chadhavs DDIT, IT 3107/Del/2005, the Hon'ble ITAT held
Bharat Solanki
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Nos. 6523 to 6525/MUM/2025
ngs are not rovided the otice dated portunity to re was non- s devoid of e 1977 AIR r:- mine, nor a maker to the ndamentals oned by the h of natural of natural s and other nnot look at fact... If the opportunity if the rules e appellant failing to OT 544, the e of burden a fact or tions raised are to be nable and with proper ntradictory, of facts is ch estimate perverse or TA No.3088
as follows:
"The tax liabi assessed on surrounding probabilities available with do not gover under the In sense in whi used. The Ass rules about e he is entitled evidence in a 8.8. The Hon
Works Ltd. [1
Officer has, n consist of mat of law.
8.9. In CIT v.
&Har.), it w information i assessee and does not, in Evidence Act.
upon which t from "eviden evidence.
8.10. In ITC
Hon'ble Bomb not appear to 8.11. In State
Hon'ble Supr justice betwee demand tha technicalities justice are no natural justic
They cannot b would be a further held partem [the Tribunal/Auth over-riding ob fair hearing a ITA N ility in the cases of suspicious transactio the basis of the material available circumstances, human conduct, prepon and nature of incriminating information h AO." It was further held as "6.3 Rules rn the income-tax proceedings, as the p ncome-tax Act are not judicial proceedi ich the phrase "judicial proceedings" is sessing Officer is not fettered or bound b evidence contained in the Indian Evidenc d to act on material which may not be a court of law."
n'ble Delhi High Court in Addl. CIT v.
1978] 113 ITR 389 (Delhi) held that the no doubt, to hear "evidence", but such evi terial which would be wholly inadmissibl
Metal Products of India [1984] 150 ITR was held that the Assessing Officer m n any manner he likes, behind the b d utilize the same against the assessee all respects satisfy the requirements of What is necessary is that he should ha to base the assessment; "material" as dis nce" which includes direct and circ
Classic Finance Ltd vs DCIT, 264 ITR bay HC has held that where the transa be overboard, the addition is to be susta e Bank of Patiala v. K Sharma [1996] 3 SC reme Court observed as follows: "Jus en both the parties. The interests of jus at the guilty should be punished and irregularities which do not occasio ot allowed to defeat the ends of justice. P ce are but the means to achieve the ends be perverted to achieve the very opposite counter-productive exercise." The Hon that "(6) While applying the rule of au primary principle of natural justice]
hority must always bear in mind the ul bjective underlying the said rule, viz., t and to ensure that there is no failure of j
Bharat Solanki
17
Nos. 6523 to 6525/MUM/2025
ns, is to be on record, nderance of n/ evidence of evidence proceedings ings in the s ordinarily by technical ce Act, and accepted as Jay Engg.
e Assessing idence may le in a court
R 714 (Punj.
may gather back of the e, even if it f the Indian ave material stinguished cumstantial
R 154, the action does ained.
CC 364, the tice means tice equally and that n failure of Principles of s of justice.
e end. That n'ble Court udi alteram the Court/
ltimate and to ensure a justice. It is this objective varying situat
8.12. Right to not absolute i
(i) The Hon'bl
J&K Vs. Baks of Nath Intern right of heari right to cross each case and (ii) In the case
(Bom.Trib) 30
Alteram Parte made advers requirement o do not requ examination i rules of evide and statutory it cannot be l revenue could subjected to c directly incri assessment is eventuality it cross- examin in the order, assessee. Bu evidence used
(iii) In Kanung
February, 19
Hon'ble Apex question of br our opinion, t notice issued
Customs Auth the appellant appellant now alleged to ha produced to e principles of n the persons w the presence
ITA N which should guide them in applying tions that arise before them."
o Cross-examination as held in various d in nature.
ing does not include a right to cross-ex s examine must depend upon the circum d also on the statue concerned.
e of GTC Industries Ltd. V. Asstt. CIT (19
08, it was held that under the dictum em', the right to cross-examine the wi se report is not an invariable attrib of the said dictum. The principles of nat uire formal cross- examination. Form is a part of procedural justice. It is gover ence, and is the creation of Court. It is p y justice, and not a part of natural justice laid down as a general proposition of la d not rely on any evidence which had cross-examination. However, if a witness iminating statement and the additio s based solely or mainly on such statem t is incumbent on the Assessing Office nation. Adverse evidence and material, to reach the finality, should be disclo ut this rule is not applicable where the d is of collateral nature.
go& Company vs Collector of Customs An 972, AIR 1972 SC 2136, a 3 judge be x Court held that "We may first dea reach of natural justice. On the material o there has been no such breach. In the s on August 21, 1961, all the material on horities have relied was set out and it w to give a suitable explanation. The comp w is that all the persons from whom enq ve been made by the authorities should enable it to cross-examine them. In our-o natural justice do not require that in matte who have given information should be e of the appellant or should be allowed t
Bharat Solanki
18
Nos. 6523 to 6525/MUM/2025
the rule to decisions, is of State of in the case
95 that the xamine. The mstances of 998) 60 TTJ m of 'Audi itness who ute of the tural justice mal cross- rned by the part of legal e, therefore, aw that the d not been s has given on in the ment, in that er to allow relied upon osed to the material or nd Ors. on 7
ench of the al with the on record, in show-cause n which the was then for plaint of the quiries were d have been opinion, the ers like this examined in to be cross- examined by Authorities. A third contenti as "What the on the record and then stat inferences ari right in holdi appellant aft appellant of th
(iv) In Surjee
October, 1996
not an absolu
Pradesh High
Manidhari Sta
Petition No. 5
Chhabra v. U with a case a and the Cus
Chhabra was contention tha the violation o
(v) In the cas
Enforcement d
2013(arising
The question, cross examin reversal of th answer to th circumstances
"the refusal examination even on the p rate, the disc opportunity g substantial co being so, ther nor was any the Courts be 8.13. Accordin dismissed.”
ITA N them on the statements made before th
Accordingly, we hold that there is no f ion of the appellant." It was further held impugned order does is that it refers to th which militates against the version of th tes that the appellant had not been able ising there from. In our opinion, the High ing that the burden of proof had shifted fter the Customs Authorities had inf he results of the enquiries and investigati et Singh Chhabravs Union of India &
6, the Hon'ble SC held that cross-exami ute right. This case was cited by Hon'
h Court in its order dated 31.10.201
ainless Wire Private Limited Vs. Union of 5917 of 2017), wherein it held "25. In Su
Union of India, the Supreme Court was arising under the Foreign Exchange Reg stoms Act. Though the decision in Su s a very brief order, the Supreme Court r at the denial of cross-examination tanta of the principles of natural justice.
se of Telestar Travels Pvt. LtdvsSpecial dated 13.02.2013 in Civil Appeal Nos. 13
out of S.L.P. (C) Nos. 15546-15549 of however, is whether failure to permit t ne has resulted in any prejudice so as e orders and a de novo enquiry into the hat question would depend upon the s of each case". It was further held in p of the Adjudicating Authority to pe of the witnesses producing the docume principles of Evidence Act be found fault w closure of the documents to the appellan given to them to rebut and explain the sa ompliance with the principles of natural ju re was and could be no prejudice to the demonstrated by the appellants before u low".
ngly, Grounds No. 2 to 4, raised by appe
Bharat Solanki
19
Nos. 6523 to 6525/MUM/2025
he Customs force in the in para 13
he evidence he appellant to meet the h Court was d on to the formed the ions.".
&Ors on 25
ination was 'ble Andhra
17 in M/s
India, (Writ urjeet Singh s concerned gulation Act rjeet Singh rejected the amounted to Director of 306-1309 of 2008), "18. the party to to call for matter. The facts and para 20 as ermit cross ents cannot with. At any nts and the ame was a ustice. That e appellants us or before ellant stand
10 Further, the Ld assessee that additio without any documen relating to the asse statement of Shri Im Group itself admitted same as additional in not case of unverifi rather one of auth supported by sworn transaction upheld disclosure. The Ld. C Rajesh Jain relied up “10.6 Further Hon'ble Mumb Jain (ITA Nos Y 2021-22). I convenience a "15. The Id A basis of third premises of employee of R which, the de A.R submitted with the as conducted in employee sta simply relied independent provide the op by the assess laws, the Ld A ITA N d. CIT(A) also rejected the co n was made solely on the third ntary evidence or the proof of c ssee. The Ld. CIT(A) referred maran Ansari and concluded th d that having such on-money ncome and paid taxes thereon. ed scribbling or anonymous d henticated and corroborated d statements of persons directly by the developer group by CIT(A) distinguished the decisio pon by the assessee observing as r the Appellant has referred to a decis bai Tribunal decision delivered in the cas . 3842 & 3841/MUM/2023 for the A Y 20 I would like to reproduce relevant para f as under- A.R submitted that the addition was m d party statement and documents foun third party. As per the deposition ma Rubberwala group, the buyers were given etails of cash received were acknowledg d the search officials did not find any ssessee during the course of search his hands. Hence the statement so gi ands disproved. He submitted that th upon third party statement without br material to support the same. The AO a pportunity of cross examination despite b see. Accordingly, by placing reliance on v A.R submitted that this addition should b Bharat Solanki 20 Nos. 6523 to 6525/MUM/2025 ntention of the party statement cash transaction to the detailed hat Rubberwala and offered the Thus, this was documents, but digital evidence, involved in the way of income n in the case of s under: sion of the se of Rajesh 020-21 & A for sake of made on the nd from the ade by the n a diary, in ged. The Ld such diary h operation iven by the he AO has ringing any also did not being asked arious case be deleted.
We heard AO has made premises of th by the employ brought on re mandatory w Further, the examination made by the view that the sustained. In rendered by S Premchang N 08-07-2016), 17. We also cross examin statements t 2020-21 and assessments" abated asses the materials unearthed du assessee, but during the cou the AO was information o Rubberwala necessity to ITA N d Ld D.R and perused the record. We not e the addition on the basis of evidence fo hird party and also on the basis of depos yee of the third party. No corroborative m ecord to support the statement so given when the assessee denies any such AO also did not provide opportunity to the assessee, even after the said re assessee. Under these set of facts, we e impugned addition of Rs. 18,64,200/- this regard, we may take support from t SMC bench of Mumbai Tribunal in the cas Nagda vs. ITO (IT Appeal No.3265/Mum/2 wherein an identical issue was decided a notice that the AO did not provide opp ne the persons from Rubberwala group, the AO had placed reliance upon. Th urt has held in the case of Andam s. Commissioner of Central Excise m 3) (SC) that not providing opportunit serious flaw and it will make the order n iolation of principle of natural justice. We above said decision of Hon'ble Supreme facts of the present case. essee has raised certain legal conten validity of assessment passed u/s 153A o the assessee, the AO should hav u/s 153C of the Act only for making the ce the impugned addition has been ma erial found in the search conducted in th We noticed earlier that the search has the hands of the assessee also and roceedings u/s 153A of the Act have be s of the assessee. Further, the assessm 2021-22 would fall under the category ". The law is well settled now that, in ssments, the AO is entitled to take into s, that is not only those materials uring the course of search in the han t also any other material that may come t urse of assessment proceedings. Hence, i s very much entitled to take into a btained from the search conducted in th group for these two years. Hence, the initiate proceedings u/s 153C of Bharat Solanki 21 Nos. 6523 to 6525/MUM/2025 tice that the found in the sition made material was n, which is h payment. y of cross equest was e are of the - cannot be the decision se of Naren 2015 dated as under:- portunity to , on whose he Hon"ble man Timber (2015) (62 ty to cross nullity, as it e are of the Court shall ntions with A of the Act. ve initiated above said ade on the he hands of s also been consequent en initiated ment of AYs of "abated the case of account all that were nds of the to his notice in our view, account the he hands of ere was no f the Act.
Accordingly, w u/s 153C of materials in a these legal gr discussions,
18,64,200/- m we set aside delete this ad
13. In the ap cash paymen confirmed by 14. We notice the purchase group. During incriminating sale of variou group confirm of shops. Ho
However, the Rubberwala
18,64,200/- same. 15. Th the basis of th premises of employee of R which, the de
A.R submitted with the as conducted in employee sta simply relied independent provide the op by the assess laws, the Ld A 10.7 I have g well known f are binding reiteration.
H distinguishab above mentio covered by th
IT Act. In th
ITA N we are of the view that non-initiation of p the Act will not disentitle the AO tocon an abated assessment years. Accordingly rounds of the assessee. 19. In view of th we are of the view that the addit made by the AO cannot be sustained. A the order passed by Ld CIT(A) and direc ddition."
ppeal filed by the assessee, the addition nt of Rs. 18,64,200/- in respect of purcha
Ld CIT(A) is being assailed.
d earlier that the assessee had purchase e commercial premises developed by R g the course of search conducted in th documents containing details of cash c us shops were found. The employee of R med that the cash has been collected from However, the assessee denied paymen e AO relied upon the materials found in group and accordingly made additi in AY 2020-21. The Ld CIT(A) also con he Id A.R submitted that the addition wa hird party statement and documents foun third party. As per the deposition ma
Rubberwala group, the buyers were given etails of cash received were acknowledg d the search officials did not find any ssessee during the course of search his hands. Hence the statement so gi ands disproved. He submitted that th upon third party statement without br material to support the same. The AO a pportunity of cross examination despite b see. Accordingly, by placing reliance on v
A.R submitted that this addition should b gone through the above Hon'ble ITAT de fact that the decisions of higher judicial on lower authorities and this aspect
However, the above-mentioned case ble on facts compared to the present app ned case the assesseee Shri Rajesh Jai he IT Department by a search action u/s he present case, no such search action
Bharat Solanki
22
Nos. 6523 to 6525/MUM/2025
proceedings nsider those y, we reject he foregoing tion of Rs.
Accordingly, ct the AO to n of alleged ase of shop ed a shop in Rubberwala heir hands, collected on Rubberwala m the buyers nt of cash.
the case of ion of Rs.
nfirmed the as made on nd from the ade by the n a diary, in ged. The Ld such diary h operation iven by the he AO has ringing any also did not being asked arious case be deleted.
ecision. It is authorities t needs no e law is peal. In the in was also s 132 of the n has been carried out i distinguishab
10.8 Further, placed before that Excel she component b
Rubberwala g at his residen
17.03.2021, I responsibilitie
(RHIL). In res
Rubberwala g sale and regi
M/s. Rubberw was handling person statem reinforced by of RHIL, in verified the c
Shri Imran An itself admitt component), o taxes thereon
10.9 Further,
(supra) was establish tha
Department a evidences, the taken as plea upon by the help to him.
10.10 Thus, H does not aid clear linkage transaction, a cited by the a third- party s evidence is no 10.11 It is w are not gover court of law. I
389 (Delhi), it may not be ad
ITA N in the case of the appellant. Thus, th ble on facts.
at the same time, it is seen that full fac the Hon'ble ITAT and it has also not been eet clearly stated the agreement value as both. Imran Ashfaque Ansari was em group and his statement was also record nce. Vide question no. 11 of the said sta
Imran Ansari was questioned about his es in M/s. Rubberwala Housing & Infrast sponse, he stated that he had been wo group of entities since 2010 and inter-al istration of the shops in "Platinum Mall wala Housing & Infrastructure Ltd (RH g said excel sheet. It was not case wher ments were recorded. This statement w
Shri Tabrez Ahmed Shaikh, Director an his post-search deposition dated 19.08
contents of the Excel file and affirmed t nsari's statement. Moreover, the Rubberw ted to having received such on-mo offered the same as additional income n.
, proposition of law laid down discuss not placed before the Hon'ble ITAT, wh at when statements are relied upo as secondary evidence in collaboration en the denial of right to cross-examination a to not make the addition. Therefore, dec assessee, in my considered opinion, is Hon'ble ITAT decision relied upon by th his case. Unlike the present matter, whe e between the documents found, the and the admission of parties involved, appellant pertain to instances where unco tatements were the sole basis of addition ot only specific but also substantiated.
well established in law that income-tax p rned by the strict rules of evidence app
In Addl. CIT v. Jay Engg. Works Ltd. [197
t was held that the AO can rely on mat dmissible in a court of law, as long as it Bharat Solanki
23
Nos. 6523 to 6525/MUM/2025
his case is cts were not n examined s well cash mployee of ded on oath atement dt.
s roles and tructure Ltd orking with ia handling l" Project of HIL, that he re unrelated was further nd Promoter
8.2021. He the truth of wala Group oney (cash e, and paid sed in para hich clearly on by the with other n cannot be cision relied not of any e appellant ere there is assessee's the cases orroborated n. Here, the proceedings licable in a 78] 113 ITR terial which is relevant.
Similarly, the Metal Product
AO can colle provided it is 10.12 The Ho
544] and Her
3107/Del/20
transactions, circumstances and the mate
Indian Eviden reliable.
10.13 In ITC
Hon'ble Bomb lacked transp deficiencies surrounding c
10.14 In the c
Taxman 265,
4. What the B judicata will the Tribunal m its conclusion the assessee operate as r different view closer and mo decisions pla has been pr decisions men to have a fres disclosed by Tribunal in th accept the co operates as r raising the p contention.
10.15 The ap claimed by th entire case is alleged diary
ITA N e Hon'ble Punjab & Haryana High Cour ts of India [1984] 150 ITR 714 (P&H) he ect evidence behind the back of the material and forms the basis of assessm on'ble ITAT in Hersh W. Chadha v. DD rsh W. Chadha v. DDIT, ITA Nos. 3088
005, has further clarified that in cases of tax liability is to be assessed based on s s, preponderance of probabilities, huma rial available on record. The AO is not bo nce Act but must act on material that is re
C Classic Finance Ltd. v. DCIT [264 ITR bay High Court upheld additions where tr sparency, reinforcing the principle tha in evidence must be considered in corroborative circumstances.
case of CIT vs Kalpetta Estates Ltd, 211 I the Hon'ble Kerala HC held as under:
Bench did was to affirm that the princi not apply to income-tax proceedings. Ne may place reliance on an earlier decision n. It could not, therefore, be said that the 's case before us, relating to the prior ye res judicata. The Tribunal is entitled w of the matter, if new materials were pla ore intelligent analysis. It is evident from ced before us that a different aspect of resented for consideration, as laid do ntioned earlier. The Tribunal was theref sh look at the matter based on the line these decisions. That was what was d he instant case. We are not, therefore, ontention that the assessment in the ea res judicata or that it precludes the ass plea as done in the instant case. We o ppellant's argument that the absence of he employee of the Rubberwala Group) di s fallacious. The addition was not bas y alone, but on robust and corrobora
Bharat Solanki
24
Nos. 6523 to 6525/MUM/2025
rt in CIT v.
eld that the e assessee, ment.
DIT [43 SOT to 3098 &
f suspicious surrounding an conduct, ound by the elevant and R 154], the ransactions at apparent n light of ITR 635, 78
iples of res evertheless, n to support decision in ears, would to take a aced or on a the various f the matter own in the fore entitled of thinking done by the inclined to arlier years sessee from overrule the a diary (as isproves the sed on the ated digital evidence, su voluntarily ad
10.16 Accord corroboration group, the ad justified.”
7. Before us, the L containing pages 1 to the lower authoriti reiterated that the a found during the se statement of Shri Imr
no document be was found,
no diary or re cash was recove of the group, an despite specific the complete ma whose statemen
7.1 It was further c
Rubberwala Group a serving declaration, could not, by itself, any cash.
ITA N upported by multiple sworn deposi dmitted by the developer group.
dingly, given the detailed evidentiar by key persons, and admission by ddition made by the AO is legally an Ld. counsel for the assessee file o 58 and relied on the submissio ies. The learned counsel for addition rests entirely on third earch of the Rubberwala Grou ran Ansari. It was submitted tha earing the assessee’s handwriti ceipt allegedly maintained for ered either from the assessee o nd request, the assessee was ne aterial nor allowed to cross-exam nt formed the sole basis of the ad contended that the disclosure o at 8% of the alleged cash rece possibly motivated by tax cons establish that the assessee ha
Bharat Solanki
25
Nos. 6523 to 6525/MUM/2025
itions and ry support, the builder nd factually ed a Paper Book ons made before r the assessee d-party material up and on the at:
ing or signature acknowledging or during search either furnished mine the person ddition.
of income by the ipts was a self- siderations, and ad actually paid
2 The Ld. counse the Tribunal in few o alleged on-money pa of shop in “Platinum 7.3 On the other h supported the orders 8. We have heard relevant material on our consideration is addition of alleged ca “Platinum Mall” can digital records and s effective opportunity 8.1 It is undisputed addition consists of: from Shri Imran An number and amount receipt of cash on b was being handed o Shaikh 8.2 On the basis of person from their pre ITA N el further submitted that Co-ord other cases has also deleted the id in cash to “Rubberwala” grou mall”, Mumbai. and, the learned Departmental of the lower authorities. d rival submission of parties record. The limited controversy whether, on the facts of the pr ash payment in relation to purc be sustained solely on the bas statements, without providing t to confront such material. d that the entire foundation o (i) Excel sheets found in a p nsari, a third party containin t of the cash, and (ii) his state ehalf of the Rubberwala Group over to director of the compa f the said material and the sta emises, the said company has a Bharat Solanki 26 Nos. 6523 to 6525/MUM/2025 dinate Bench of e addition of the up for purchase l Representative s and perused y that arises for resent case, the chase of shop at is of third-party the assessee an of the impugned pen drive seized ng name, shop ement admitting p and that cash any Shri Tabrez atements of key accepted the fact of the on-money rece for undisclosed incom on record to demons There is no rece contemporaneous do the assessee to the party record. 8.3 But the issue a found in possession and the disclosure addition without pro to the assessee. 8.4 In the case asse and under the prov pertaining to the a satisfaction u/s 153 Officer of the assesse no such material wa sought for the oppor both the Assessing O ground that was not that no other eviden authorities to substa ITA N eived in cash and declared 8% me. No independent evidence ha strate actual payment of cash b eipt, no diary, no acknow ocument, and no corroborative e alleged cash payment, apart arises is whether on the basis of the third party, statement of made by them, bind the as oviding opportunity of confronti essment has been initiated u/s visions of section 153C of th assessee which is basis of th C must have been forwarded t ee. But despite specific request as provided to the assessee. Th rtunity to cross-examine Shri Im Officer as well as Ld. CIT(A) has the sole basis for making additi nce has been brought on recor antiate that the cash on-mone Bharat Solanki 27 Nos. 6523 to 6525/MUM/2025 of the net profit as been brought by the assessee. wledgment, no evidence linking from the third- of the material f the third party ssessee for the ing the material 153C of the Act he Act material he recording of to the Assessing by the assessee he assessee also mran Ansari but declined on the ion. But we find rd by the lower ey was actually paid by the assessee Imran Ansari. 8.5 The Ld. coun Rubberwala Group h books of accounts declaration. In other income in their hand declared. For examp books of accounts a 33% on the Rs.8 whi assessee submitted t and therefore, they counsel for the asses such cash on-money had brought into boo 8.6 We are of opin admitted receipt of thereof to tax, such a liability upon the establishing that the disclosure by the d funds, but it does no prove the assessee’s i ITA N to Shri Imran Ansari accept co nsel for the assessee submi has credited 100% amount of against offering 8% of inc r words, they have generated h ds at 33% of tax on the 8% inco ple, if the assessee get credited gainst cash received then it ha ich work out to Rs.2.6. The Ld. that this was one of the benefi have admitted and paid the ssee submitted that the assessee y and it might be their own mo oks in garb of cash on-money for nion that though the Rubberw unaccounted cash and offere admission by the seller cannot, purchaser unless there is c e purchaser actually made such developer may explain the sou ot dispense with the burden on investment or expenditure. Bharat Solanki 28 Nos. 6523 to 6525/MUM/2025 onfession of Shri tted that said the cash in its come on such huge amount of ome of the cash d Rs.100 in its as paid taxes @ counsel for the ficial declaration taxes. The Ld. e has never paid oney which they r tax benefit. wala Group has d a percentage by itself, fasten cogent evidence h payment. The urce of its own the Revenue to 8.7 The Ld. counse attention that Shri Im the statement dated cash from the custom containing cash det counsel for the asse recovered from the Rubberwala Group h from the premises of The Ld. counsel sub sh Rajesh Jain sear such document in corroborate statemen Imran Ansari cooked for benefiting interest 8.8 We are of opini cash payments were such diary was reco arising from the sam such diary was fou weakens the evidenti 8.9 Further, althou 153C of the Act, th satisfaction was ad ITA N el for the assessee specifically mran Ansari in his answer to qu 17.03.2021 stated that after re mers a small diary was being tails received from the custo essee submitted that no such assessee nor any kind of rec having signature of the assessee f the Rubberwala group or from mitted that in the case of one rch was conducted by the Dep the form of diary was foun nt of Shri Imran Ansari. Accordi d up a story of cash on-money i t of their company. ion that Shri Imran Ansari him recorded in a diary provided to overed from the assessee. Even e search, including that of Shri und despite search action. ary value of the statement. ugh the assessment was framed e incriminating material formi dmittedly not furnished to th Bharat Solanki 29 Nos. 6523 to 6525/MUM/2025 brought to our uestion No. 13 of eceipt of alleged used to provide omers. The Ld. diary has been ceipt issued by has been found m the assessee. of the customer artment but no nd which could ing to him, Shri in his statement mself stated that o buyers but no n in other cases Rajesh Jain, no This materially d under section ng the basis of he assessee in entirety. The assesse Shri Imran Ansari, w addition. The reque statement was not t careful examination independent evidence sheet maintained by 8.10 It is well settle governed by strict ru cannot be diluted wh collected from third p substantive evidence cross-examine strikes 8.11 In the absen connecting the asses absence of cross-exa relied upon, the addi than proof. 8.12 It is well settled documents does not justice, where such m an assessee and the The learned Comm ITA N ee also specifically sought cross whose statement constitutes the est was declined on the pre the sole basis of the addition. of the record, we find that th e apart from the said statemen the same person. ed that while income-tax proce les of evidence, the principles o here additions are founded on a parties. Where such material is e, denial of effective opportun s at the root of fairness of the pr ce of any corroborative m ssee with the alleged cash paym amination of the person whos tion rests on suspicion and pres that mere furnishing of copies o t, by itself, satisfy the requirem material is sought to be used ad assessee specifically disputes missioner (Appeals) has proc Bharat Solanki 30 Nos. 6523 to 6525/MUM/2025 s-examination of e fulcrum of the emise that the However, on a here is no other nt and the Excel eedings are not f natural justice adverse material s relied upon as nity to rebut or roceedings. material directly ment, and in the se statement is sumption rather of statements or ment of natural dversely against its correctness. ceeded on the assumption that sinc drive contents were principles of natur approach conflates d which are legally di learned Commissione with respect, miscon decision has been necessary only where the addition. This r Excel sheets and evidentiary value d supplied by Shri Im attribution of entrie assessee to such ent digital material doe statement is not co foundation of the add lower authorities on are not governed by t There can be no quar equally settled that abrogation of natura admissible must still when used against ITA N ce extracts of statements, Excel supplied through the show-ca ral justice stood fully compl disclosure of material with test istinct concepts. The reliance er (Appeals) on Andaman Timb nceived and internally contradi cited to suggest that cross- e the third-party statement is th reading is incorrect. In the pr the pen-drive data have n dehors the explanation and mran Ansari. The alleged cash s to specific buyers, and the tries emanate entirely from his es not speak for itself. Con ollateral or incidental evidence dition. Much emphasis has bee n the proposition that income-t the strict provisions of the India rrel with this settled proposition relaxation of evidentiary rules al justice. Even material whic l satisfy the minimum requirem an assessee. The Hon’ble Sup Bharat Solanki 31 Nos. 6523 to 6525/MUM/2025 l data, and pen- ause notice, the lied with. This ting of material, placed by the ber Industries is, ictory. The said -examination is he “sole basis” of resent case, the no independent d interpretation component, the linkage of the statement. The nsequently, the e but the very en placed by the tax proceedings an Evidence Act. n. However, it is does not imply ch is otherwise ment of fairness preme Court in Kishinchand Chellara that any material c proposed to be us opportunity of rebutt includes cross-exami 8.13 Considerable r admission by the Ru offered the same to t the assessee’s liabilit cannot be used as co latter is afforded an The assessee is not applicability of such alleged payment is de 8.14 The learned Com the coordinate Benc ground that the asse the present assessee the core issue of without cross-examin on the alleged admis on-money and offere ITA N am v. CIT (125 ITR 713) has une collected behind the back of t ed against him, must be su tal in a meaningful manner, wh ination where facts are disputed reliance has been placed o ubberwala Group that it received tax. This, however, cannot be d ty. It is trite law that an admissi onclusive evidence against anot opportunity to test and rebut s t estopped from disputing the admission to his case, particu enied and no independent corro mmissioner (Appeals) has sough ch decision in Rajesh Jain pr essee therein was subjected to s was not. This distinction is who evidentiary reliance on third nation. Considerable reliance h ssion by the Rubberwala Group ed the same to tax. This, how Bharat Solanki 32 Nos. 6523 to 6525/MUM/2025 equivocally held the assessee, if ubjected to an hich necessarily d. on the alleged d on-money and determinative of ion by one party ther, unless the such admission. correctness or ularly when the boration exists. ht to distinguish rimarily on the search, whereas olly irrelevant to -party material has been placed that it received ever, cannot be determinative of the rests squarely on two 1. absence of corro 2. denial of cross-e 8.15 Both these featu discipline mandates facts be followed unle case here. 8.16 The ld CIT(A) providing cross exam authorities do not la cross-examination. O requirement depend adjudication, and the the assessee ha payment; no cash, diary, assessee; the alleged diar was never recov ITA N assessee’s liability. The ratio o pillars: oborative material against the as examination despite specific req ures are present in the case bef that a coordinate Bench decis ess shown to be per incuriam, w relied on various decisions t mination of sh Ansai was not ay down a blanket proposition On the contrary, they consistent s on the nature of evidence, e prejudice caused. In the presen as categorically denied having or corroborative document was ry, though repeatedly referred to vered; and Bharat Solanki 33 Nos. 6523 to 6525/MUM/2025 of Rajesh Jain ssessee, and quest. fore us. Judicial ion on identical which is not the o contend that required. These dispensing with tly hold that the its role in the nt case: made any cash found from the o in statements,
the entire edi statements and persons.
8.17 In such circum manifest prejudice procedural irregularit
8.18 We find that, i alleged cash “on-m
Platinum Mall from t of the Tribunal in Pr
4742 to 4744/Mum learned also placed ordinate Bench of th and Lilaram Vs DCIT order dated 12.11.20
basis of search and s in this regard has bee
Dashrath Jhanglani
: 2007–08) wherein issue in favour of reproduced herein be 10. I have material on r made of 42 la cash towards
ITA N ifice of the addition rests d electronic data interpreted mstances, denial of cross-exam and cannot be brushed asi ty.
in identical factual circumstan money” payments for purchas the Rubberwala Group, the Co- raveen Khetaramm Purohit v.
m/2025) has deleted similar reliance upon another decis e Tribunal in Akhraj Pukhraaj C
T in ITAs No.5553 and 5554/M
025, wherein similar addition w seizure action on Rubberwala G en also placed on the decision in i ITA no.1665/Mum./2018 (As the Coordinate Bench of ITAT h assessee and the relevant p elow:
e considered rival submissions and record. Undisputedly, the genesis of the akh on account of alleged payment of on–
s purchase of a flat lies in a search an Bharat Solanki
34
Nos. 6523 to 6525/MUM/2025
on third-party by those very mination causes ide as a mere nces relating to e of shops in -ordinate Bench
DCIT (ITA Nos.
additions. The sion of the Co-
Mum/2025, vide was made on the Group. Reliance n case of Heena ssessment Year had decided the ortion is being perused e addition
–money in nd seizure operation con persons. Thou has not discu evidence avai cash by the a from the show reproduced by appears that drive found employees of under section Director and P money paid
Group concer recorded und
Shri Niranjan cash towards these two piec evidence on r paid on–mone relevant to o assessee has with all adv recorded und
Hiranandani.
Officer for a Hiranandani upon. Appare accededto by the aforesaid learned Comm had clearly assessee all available with on a perusal o of which is at that the Asses there is no me the adverse m them to the Commissioner patent and o account of on–
the primary a justice. It is w
Officer intend issue against
ITA N nducted in case of Hiranandani Group an ugh, in the assessment order the Assessi ssed in detail the nature of incriminating ilable on record to indicate payment of on–
assessee to M/s. Crescendo Associates, w cause notice dated 4th March 2015, y the Assessing Officer in the assessmen the incriminating materials are in the fo and seized from the residence of on f Hiranandani Group and a statement
132(4) of the Act from Shri Niranjan Hira
Promoter of the Group, wherein, the deta by buyers / prospective buyers to Hir rns are mentioned and further, in the er section 132(4) of the Act on 14th Ma
Hiranandani, has admitted receipt of on–
s sale of flats / shops. Thus, it is clear th ces of evidences the Assessing Officer ha record which demonstrates that the asse ey in cash for purchase of the flat. It observe, from the assessment stage s requested the Assessing Officer to pr verse materials and full text of the der section 132(4) of the Act from Shri
The assessee had also requested the A allowing her to cross–examine Shri and other parties whose statements w ently, this request of the assessee the Assessing Officer. When the assesse d issue before the first appellate auth missioner (Appeals) in letter dated 18th J directed the Assessing Officer to pr adverse materials / documentary h him indicating payment of on–money.
of the remand report dated 23th June 201
t Page–53 of the paper book, it is very m ssing Officer has completely avoided the ention whether the assessee was provide material and if, not so, whether he has assessee as per the directions of th r (Appeals). Thus, from the aforesaid f obvious that the addition of ` 42 lakh
–money payment in cash is without comp and fundamental requirement of rules o well settled proposition of law that if the A ds to utilize any adverse material for de t the assessee he is required to not only
Bharat Solanki
35
Nos. 6523 to 6525/MUM/2025
nd related ing Officer material/
–money in however, which is nt order, it orm of pen ne of the t recorded anandani, ails of on–
ranandani statement arch 2014,
–money in hat except ad no other essee had is further itself the rovide him statement i Niranjan
Assessing
Niranjan were relied was not ee took up hority, the July 2016, rovide the evidences
However,
17, a copy much clear issue and ed with all s provided e learned facts, it is made on plying with of natural
Assessing eciding an y confront such adverse reasonable op adverse mate
Assessing Of recorded from disputed add which prima–
Officer has no and has also examine Shri statements w violation of r principle of la
Tribunal, Mum for the afor sustained.
Even o because of th order, the ba information co and seizure op 132(4) of the pen drive, it is drive was not course of sear third party. evidence to e correct and a money in cas the Act. Furt statement rec Hirandani ha therefore, in establish that can be mad submissions information c recorded und Hiranandani payment of on doubt or su triggering furt record the rel payment of o declared sale has failed to ITA N e materials to the assessee but also off pportunity to rebut / contradict the conte rial. Further, the assessment order revea Officer has heavily relied upon the m Shri Niranjan Hiranandani, for ma ition. However, it is the allegation of the –facie appears to be correct, that the A ot provided the full text of such statemen not allowed the assessee an opportunity Niranjan Hiranandani, and other perso were relied upon. This, in my view, is rules of natural justice and against w. In this context, I may refer to the decis mbai Bench, in Nikhil Vinod Agarwal (sup resaid reason, the addition made c otherwise also, the addition made is unsu he following reasons. As discussed earl asis for addition on account of on–mon ontained in the pen drive found during t peration and the statement recorded und Act. As regards the information contain s the contention of the assessee that the t found from the possession of the asses rch and seizure operation conducted in c Therefore, in absence of further cor establish that the contents of the pen authentic to the extent that the assessee sh, no addition can be made under secti ther contention of the assessee is th orded under section 132(4) of the Act, Sh as not made any reference to the absence of any other corroborative ev t assessee has paid on–money in cash, n de. I find substantial merit in the of the assessee. In my view, ne contained in the pen drive nor the der section 132(4) of the Act from Shri are enough to conclusively establish the n–money by the assessee. At best, they c uspicion against the conduct of the ther enquiry / investigation to find out an levant fact and material to conclusively on–money by the assessee over and a e consideration. Apparently, the Assessi bring any such evidence / material on Bharat Solanki 36 Nos. 6523 to 6525/MUM/2025 ffer him a ents of the als that the statement aking the assessee, Assessing t recorded y to cross– ons whose s in gross the basic sion of the pra). Thus, cannot be ustainable lier in the ney is the the search der section ned in the e said pen see but in case of a rroborative drive are e paid on– ion 69B of hat in the hi Niranjan assessee, vidence to no addition aforesaid either the statement i Niranjan factum of an raise a assessee d bring on prove the above the ing Officer n record to prove the pay the assessee payment of o case involvin transaction w Tribunal in ca under:– ……..
19 The consistent f that the additions we Shri Imran Ansari, an during the course o sheet retrieved from incriminating materia from the inception, c and above the docum 8.20 The Co-ordinate facts, has held that records, uncorrobora directly linking the a constitute credible section 69 of the Act requests, the assess adverse material nor Imran Ansari or any upon. ITA N yment of on–money by the assessee. More e from the very beginning has stoutl on–money in cash. Notably, while dealin ng similar nature of dispute concernin with another concern of Hiranandani G ase of Shri Anil Jaggi v/s ACIT (supra) ha factual matrix emerging from ab ere made solely on the basis of n employee of the Rubberwala G of search, and (ii) data contain m a pen drive found from his al was found from the assessee categorically denied having paid mented consideration. e Bench, after an exhaustive exa t such third-party statements ated by any independent evi assessee to the alleged cash p evidence for sustaining an . The Bench further noted that, see was neither confronted wit afforded an opportunity to cros y other person whose stateme Bharat Solanki 37 Nos. 6523 to 6525/MUM/2025 e so, when ly denied ng with a ng similar Group, the as held as bove decisions is (i) statements of Group, recorded ned in an Excel possession. No e. The assessee, d any cash over amination of the and electronic idence and not payment, do not addition under despite specific th the complete ss-examine Shri ents were relied
21 It is well settled not strictly apply nevertheless be foun has a direct nexus cannot be treated as corroborative eviden suspicion, but suspi proof. 8.22 Equally well se Officer proposes to re of the assessee, such and a reasonable contradict the same third-party statemen very root of the mat principles of natura Andaman Timber In that failure to grant s 8.23 In the present c no incriminatin was found from the alleged elect third party; ITA N d that while the rigours of the E to income-tax proceedings, a nded on material which is reliab with the assessee. Third-pa s conclusive unless supported nce. At best, such material m cion, however strong, cannot ta ettled is the principle that if ely upon any adverse material t h material must be confronted opportunity must be grante . Where the addition rests sub nt, denial of cross-examination tter and amounts to a serious al justice. The Hon’ble Supr ndustries v. CCE(supra) has ca such opportunity renders the or case, it is undisputed that: ng document or diary evidencing the assessee; tronic data was found from the Bharat Solanki 38 Nos. 6523 to 6525/MUM/2025 Evidence Act do additions must ble, cogent, and arty statements, by independent may give rise to ake the place of f the Assessing to the detriment to the assessee, d to rebut or bstantially on a n strikes at the s breach of the reme Court in ategorically held rder a nullity. g cash payment possession of a the statements admission by th the assessee statements or permitted. 8.24 In the absence establishing that the the evidentiary thres section 69 or 69C of t 8.25 During the he Representative could fresh material to pe consistently adopted identical matters ar discipline requires th such co-ordinate dec 8.26 On a holistic co the case, we hold tha on the basis of uncor without affording the or rebut the same, justice. Such an addi ITA N relied upon do not specifica he assessee; and was not provided copies of electronic data, nor was cro e of any independent corrobo e assessee had, in fact, paid ca hold required for sustaining an the Act remains unmet. earing before us, the learned d not bring on record any distin ersuade us to take a view diffe by the Co-ordinate Benches of rising from the same search a hat, in the absence of distingu isions be respectfully followed. onsideration of the facts and ci at the impugned addition has b rroborated third-party material a e assessee an effective opportu and in violation of the princi ition cannot be sustained in law Bharat Solanki 39 Nos. 6523 to 6525/MUM/2025 ally record any f the complete oss-examination orative evidence ash “on-money”, n addition under d Departmental nguishing fact or ferent from that f the Tribunal in action. Judicial uishing features, ircumstances of een made solely and statements, nity to confront iples of natural w.
27 Accordingly, the 69C of the Act for deleted. 9. Since, we allowed remaining grounds ar 10. Since the facts a are also identical an also deleted and gro mutandis. 11. In the result, all Order pronoun (SANDEEP SING JUDICIAL M Mumbai; Dated: 23/12/2025 Rahul Sharma, Sr. P.S.
Copy of the Order forward
1. The Appellant
2. The Respondent.
3. CIT
4. DR, ITAT, Mumbai
5. Guard file.
////
ITA N e addition of ₹1,00,000/- made the assessment year under c d the grounds raised on merit re rendered merely academic.
and circumstances in the rema nd therefore addition made in th ounds raised are accordingly d l the three appeals of the assess ced in the open Court on 23/
- GH KARHAIL)
(OM PRAK
MEMBER
ACCOUNTA ded to :
BY ORDER
(Assistant Re
ITAT, Mu
Bharat Solanki
40
Nos. 6523 to 6525/MUM/2025
e under section consideration is t, therefore, the aining two years hose appeal are decided mutasis see are allowed.
12/2025. d/-
KASH KANT)
ANT MEMBER
R, gistrar) umbai