SUSHMA SACHIN SANKPAL,MUMBAI vs. INCOME TAX OFFICER, NAVI MUMBAI

PER OM PRAKASH KANT, AM

This appeal by the assessee is directed against order dated 30/01/2026 passed by the Ld. Commissioner of Income-tax (Appeals)- National Faceless Appeal Centre, Delhi [in short the Ld. CIT(A)] for assessment year 2011-12, whereby the additions made

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under Section 69 of the Income Tax Act, 1961 aggregating of Rs. 89,00,000/- has been sustained. The assessee has raised following grounds of appeal ;-

1.2 The Ld. CIT(A) failed to appreciate that the said property was purchased by the Appellant's husband and the entire consideration was paid by him through banking channels, and the Appellant had not made any investment in the said property.

1.3 The Ld. CIT(A) erred in not appreciating that the Appellant was merely a joint holder in name and was not involved in any financial transaction relating to the said property.

1.4 The Ld. CIT(A) failed to consider that the addition has been made solely on the basis of third-party seized material and statement, without any independent verification or corroboration linking the Appellant to the alleged payment.

1.5 The Ld. CIT(A) further erred in not appreciating that no material or evidence was found from the Appellant indicating any such payment and that the addition has also been made in the hands of the Appellant's husband in respect of the same transaction.

1.6 The Ld. CIT(A) failed to consider the submissions and evidences placed on record by the Appellant and confirmed the addition in a mechanical manner.

1.7 The Appellant submits that the addition of Rs. 14,00,000/- so confirmed is incorrect and requires to be deleted.

2.1 On the facts and in the circumstances of the case and in law, the Ld. CIT(A) erred in confirming the addition of Rs. 75,00,000/-

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made by the Ld. AO under section 69, being 50% of the value of immovable property, without proper verification of facts. 2.2 The Ld. CIT(A) failed to appreciate that the said property was purchased entirely by the Appellant's husband and the Appellant was only a joint holder in name without any financial contribution. 2.3 The Ld. CIT(A) erred in not appreciating that the entire payment for the property was made by the husband and duly recorded in his books of account. 2.4 The Ld. CIT(A) failed to consider that no enquiry or verification was carried out to determine the actual contribution of the Appellant in the said property. 2.5 The Ld. CIT(A) further erred in confirming the addition without examining the payment details, financial records or bank statements of the Appellant. 2.6 The Ld. CIT(A) failed to appreciate that the addition has been made on presumptive basis without identifying any specific investment made by the Appellant. 2.7 The Appellant submits that the addition of Rs. 75,00,000/- so confirmed is incorrect and requires to be deleted.

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i. Addition of Rs. 14,00,000/- towards alleged cash on-money payment for purchase of Shop No. 4; and ii. Addition of Rs. 75,00,000/- towards alleged unexplained investment in immovable property.

“ 5. Having carefully perused the assessment order passed by the Assessing Officer (AO), the grounds of appeal raised by the assessee, her written and oral submissions, the material available on record including seized documents and statements from search proceedings, as well as the remand report called for from the AO (which corroborates the findings), the following decision is rendered in a structured manner. 6. Section 69 of the Income-tax Act, 1961 empowers the Assessing Officer to treat any investment in any financial year as unexplained income of the assessee where no explanation is offered or the explanation offered is not satisfactory in the opinion of the Assessing Officer. The provision casts a strict onus on the assessee to satisfactorily explain the nature and source of such investments, failing which the amount is deemed to be income accruing to the assessee. This provision is particularly applicable where investments pertain to immovable properties or cash transactions evidenced through third-party records like AIR/ITS or seized material during search operations.

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Shri Sachin Sankpal. AO rightly apportioned 50% (Rs. 75 lakhs) as assessee's unexplained share, given her balance sheet's meager capital (no loans/gifts sourced). Assessee's bald denial of "mistake in ITS" and "no purchase/payment" is self-contradictory-no denial deed, rectification proof, or alternate source furnished despite notices u/s 142(1)/143(2). Best Infrastructure (supra) treats such AIR-backed joint investments as cogent evidence unless rebutted. Proportionate addition for joint ownership is standard practice, affirmed in CBDT vs. Vimal Chand Hirawat 378 ITR 97 (MP). Explanation unsatisfactory; addition confirmed. 12. The assessee's explanations fail the tests of genuineness, verifiability, and consistency. Seized material, statements, and ITS prevail over uncorroborated denials. AO's order is well-reasoned, factually accurate, and legally sound. The additions aggregating Rs. 89,00,000/- u/s 69 stand confirmed. Total assessed income of Rs. 96,03,050/- is upheld.”

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the entire recorded consideration having been accepted as explained in his hands. It was contended that the Revenue could not, in law, make substantive additions of the same alleged investment in the hands of two separate assessees without a definitive finding as to actual ownership and source. Ld. Counsel referred to the acknowledgement of this factual position by the AO in para 6 of the assessment order. For ready reference, the same is reproduced as under:

“The submission of the Authorised representative of the assessee is carefully considered. It is pertinent to mentioned here that since the assessment proceedings of Shri. Sachin Sankpal is pending for finalisation and facts of the case is not available with this office it would not be correct to pass the order prior to assessment proceeding for substantive addition is either in pending case or facts of the case is not available with this office..." 4.1 Ld. Counsel for the assessee further submitted that the assessee had also submitted that the assessment proceeding in the case of Shri Sachin Sankpal had already been completed and corresponding addition had been made in his hands. Copy of the Assessment order was also furnished before the Ld. CIT(A), but Ld. CIT(A) did not accept the claim of the assessee. It was submitted that the appeal against the husband's assessment order was, at the relevant time, pending before the first appellate authority.

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5.1 The fact in brief qua the issue in dispute are that a search and seizure operation under section 132 of the Act was conducted in the case of ‘Shri Hiren Bharani’ and the entities of the ‘Sabari Group’. During the course of the search, diaries marked as Annexures A-1 to A-15 were seized, allegedly containing details of cash received against sale of various immovable properties developed by the group. In his statement recorded under section 132(4) of the Act on 08.10.2017, Shri Hiren Bharani explained the entries appearing in the seized diaries, including those relating to the purchases made by Shri Sachin Tulsiram Sankpal and the present assessee. The relevant entries relied upon by the Assessing Officer read as under:

Sr. Pg. Flat Name of Total Value Cheque Payment Cash Payment F.Y. No. No. No. the owner Received Received 50 140 Camp Sachin 1,00,00,000 65,00,000 65,00,000 35,00,000 35,00,000 2010- Shop T. 11 No.3 Santaram 51 139 Camp Sachin 1,00,00,000 86,00,000 86,00,000 14,00,000 14,00,000 2010- Shop 11 No.4

5.2 It is thus apparent that the assessee, along with her husband, is stated to have booked two shops — No. 3 and No. 4 — and, on the strength of the statement of Shri Hiren Bharani, to have paid cash on-money of Rs. 35,00,000/- and Rs. 14,00,000/- respectively. The assessee is shown as a joint holder only in respect

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of Shop No. 4, which stands registered for a consideration of Rs. 1,50,00,000/-. It is on this basis that the Assessing Officer concluded that the assessee, being a joint holder of Shop No. 4, had made an unexplained investment within the meaning of section 69 of the Act. Consequently, an addition of ₹14,00,000/- was made towards the alleged cash ("on-money") payment relating to Shop No.4. Further, since the registered sale deed reflected the assessee as a co-owner of the property purchased for ₹1.50 crore, the Assessing Officer treated fifty per cent thereof, i.e., ₹75,00,000/-, as unexplained investment in her hands for want of satisfactory explanation regarding the source thereof.

5.3 Before us, the learned counsel for the assessee has consistently contended that the assessee was merely a nominal or convenience co-holder in the registered document and had not contributed any part of the consideration towards acquisition of the property. It has been submitted that the entire investment, including the alleged cash component, was made by her husband, Shri Sachin Tulsiram Sankpal. This fact has been acknowledged in paragraph 6 of the assessment order itself that the assessment proceedings of the assessee's husband, Shri Sachin Tulsiram Sankpal, were pending at the time the assessee's assessment was framed, and that the addition in his hands, when eventually made, encompassed the aggregate on-money of Rs. 49,00,000/- referable to both Shop No. 3 and Shop No. 4. Further during first appellate

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proceedings, the assessee submitted that corresponding additions relating to the alleged on-money payment aggregating to ₹49,00,000/- (₹35,00,000/- for Shop No. 3 and ₹14,00,000/- for Shop No. 4) have already been made substantively in assessment of her husband. It was pointed out before the ld first appellate authority that the source of the consideration disclosed in the registered sale deed has also been explained in hands of her husband and that his appeal against the assessment order dated 26.12.2018 under Section 143(3) read with 147 is presently pending before the first appellate authority. These factual assertions have not been effectively controverted by the Revenue.

5.4 Having considered overall facts and circumstances of the case, we find considerable force in the grievance raised by the assessee. It is well settled that while the Revenue may, in an appropriate case, make protective and substantive assessments where there exists genuine uncertainty regarding the person in whose hands a particular income or investment is assessable, the same unexplained investment or alleged cash payment cannot ultimately be brought to tax substantively in the hands of two different persons. The Revenue is required to determine, on the basis of proper appreciation of evidence, the real person who made the investment or incurred the expenditure.

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5.5 In the present case, the assessee has specifically asserted that the entire investment stood made by her husband and that substantive additions on the very same allegations have already been made in his assessment. If that assertion is factually correct, the sustainability of corresponding additions in the hands of the present assessee necessarily requires examination in the light of the findings recorded in the husband's case. Likewise, the addition of ₹75,00,000/- representing fifty per cent of the recorded consideration cannot be sustained merely because the assessee is reflected as a joint purchaser in the registered instrument, if, upon verification, it is established that the entire consideration was in fact provided by her husband. Such an issue can be decided only after a comprehensive examination of the evidence and by maintaining consistency in the treatment accorded to both assessees in respect of the same transaction.

5.6 In these circumstances, we are of the considered view that the identical sum of Rs. 14,00,000/-, representing the alleged cash component for Shop No. 4, cannot, consistent with settled principles governing protective and substantive assessments, be brought to tax simultaneously and on a substantive footing in the hands of both joint holders of the property, absent a clear finding as to the person who has, in fact, made the payment. Similarly, the addition of 50% of the registered sale consideration in the hands of the assessee cannot be sustained in isolation where the assessee's

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specific case that the entire consideration stands explained in the hands of, and paid by, her husband has not been tested against the assessment record of the husband by the first appellate authority.

5.7 In our considered opinion, the interests of justice would be best served by restoring the matter to the file of the learned Commissioner of Income-tax (Appeals) so that an uniform and consistent could be taken in respect of the very same transaction as between the two joint holders, so that the ultimate tax liability, if any, comes to rest upon the person who is, on facts, found to have made the investment.

5.8 For the reasons aforestated, we deem it appropriate not to finally adjudicate the additions on merits at this stage. The order of the Ld. CIT(A) is set aside, and the matter is restored to his file with a direction to decide the assessee's appeal afresh, in conjunction with the appeal of her husband, Shri Sachin Tulsiram Sankpal (PAN: AQTPS3746G), so as to ensure a consistent and uniform determination of the question of cash on-money and the source of investment reflected in the registered sale deed. The concerned authorities of the Revenue shall ensure that both appeals stand consolidated before the same first appellate authority. In the event the appeal of the husband has already been disposed of, the Ld. CIT(A) shall decide the assessee's appeal having due regard to the findings recorded therein. The Ld. CIT(A) shall afford adequate

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opportunity of hearing to the assessee in accordance with law before passing a fresh order.

5.9 We clarify that we have not expressed any opinion on the merits of the additions and all issues are left open to be adjudicated independently by the learned CIT(A) on the basis of the material available on record and any further evidence that may be admitted in accordance with law. Accordingly, the grounds raised by the assessee are allowed for statistical purposes.

Order pronounced in the open Court on 27/07/2026.

Sd/- Sd/- (PAWAN SINGH) (OM PRAKASH KANT) JUDICIAL MEMBER ACCOUNTANT MEMBER Mumbai; Dated: 27/07/2026 Z.U., P.S.

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Copy of the Order forwarded to :

BY ORDER,

//True Copy// (Assistant Registrar) ITAT, Mumbai