HEMANT GOGIA,GURGAON vs. ITO WARD 1(4), GURGAON

1 After examining the records, | am satisfied that there is no delay in filing of the appeal. The objection raised by Registry of the Tribunal order as 20" February, 2023 instead of correct date 23 February, 2026. 3. The learned Counsel for the assessee assailing the addition of %10,66,400/- under Section 69A of the Income-tax Act, 1961 (hereinafter referred to as ‘the Act’) submits that the assessment for assessment year 2015-16 in the case of the assessee was reopened on the basis of information received on the Insight Portal consequent to search and seizure operation on 29" May, 2018 under Section 132 of the Act in the case of Elan Group. Based on documents seized from Elan Group, the Assessing Officer made addition of %10,66,400/- on estimations in hands of the assessee. The learned Counsel for the assessee asserted that no addition can be made on estimations on the basis of search in the case of third party. No incrimination document whatsoever was- available before the Assessing Officer pertaining/relating to the assessee for making such addition. He thus prayed for deleting the addition made by the Assessing Officer under Section 69A of the Act.

Per contra, Shri Manoj Kumar, representing the Department reiterated findings of the Assessing Officer and the CIT(A) and prayed for dismissing appeal of the assessee and upholding the addition.

Both sides heard. Orders of lower authorities examined. A perusal of the assessment order dated 20" February, 2023 passed under Section 147 read with Section 144B of the Act shows that the assessment for assessment year 2015-16 in case of the assessee was reopened on the basis of information received on the Insight Portal of the Department. As per the information, a search and seizure operation under Section 132 of the Act was carried on Elan Group on 29" May, 2018. From the documents impounded during search, it transpires that the assessee had purchased a shop from Elan Ltd. during financial year 2014-15 in its project namely, Elan Mercado at Gurgaon. The fact of purchase of shop is not disputed by the assessee. However, the assessee denied having paid =10,66,400/- in cash. The AO based on the information and alleged seized documents estimates that the assessee made cash payment of %10,66,400/- and made addition of the said amount. From perusal of the assessment order, it emerges that the Assessing Officer has made addition on estimations and not on the basis of seized material pertaining to the assessee. In fact, there is no reference to any incriminating material found and seized pertaining/relating to the assessee in the entire assessment order. No addition can be made on estimations based on documents seized in the case of a search on third party. In absence of any incriminating material, no addition can be made in hands of the assessee and by no extent any addition on estimations. The impugned order is set aside and appeal of the assessee is allowed.

In the result, the appeal of the assessee is allowed.