VIRENDER KUMAR,BAHADURGARH vs. INCOME TAX OFFICER, PANCHKULA

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ITA 64/CHANDI/2026Status: DisposedITAT Chandigarh07 July 2026AY 2019-209 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the addition could not be sustained solely on the basis of an uncorroborated third-party Excel sheet without any independent evidence. It also noted that a Coordinate Bench had deleted similar additions in the hands of the recipient (Omaxe Ltd.).

What were the facts?

The Assessing Officer (AO) made an addition of Rs 19,03,000/- as unexplained investment based on an Excel sheet allegedly recovered during a search of a third party. This Excel sheet suggested an on-money cash payment by the assessee to Omaxe Ltd. The CIT(A) upheld this addition.

What were the issues?

Whether an addition under Section 69 can be made solely on the basis of an uncorroborated third-party document, and whether the assessment proceedings were valid given procedural objections.

Which sections of the Income-tax Act were involved?

Section 69,Section 147,Section 144B,Section 151A

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, BENCH, ‘SMC’ CHANDIGARH

Before: SHRI LALIET KUMAR

For Respondent: Dr. Ranjit Kaur, Addl. CIT, Sr.DR
Hearing: 25.06.2026Pronounced: 07.07.2026

आयकर अपील�य अ�धकरण,च�डीगढ़ �यायपीठ, च�डीगढ़ IN THE INCOME TAX APPELLATE TRIBUNAL BENCH, ‘SMC’ CHANDIGARH BEFORE SHRI LALIET KUMAR, JUDICIAL MEMBER आयकर अपील सं./ ITA No. 64/CHD/2026 �नधा�रण वष� / Assessment Year: 2019-20

Shri Virender Kumar, The ITO, House No.6, Sector 15, Vs Panchkula. Omaxe City, Bahadurgarh, Jhajjar (Haryana). �थायी लेखा सं./PAN NO: ASCPK6783D अपीलाथ�/Appellant ��यथ�/Respondent Assessee by : None Revenue by : Dr. Ranjit Kaur, Addl. CIT, Sr.DR Date of Hearing : 25.06.2026 Date of Pronouncement : 07.07.2026

(VIRTUAL HEARING) O R D E R The assessee is in appeal before the Tribunal against the order of the Commissioner of Income Tax (Appeals) NFAC [in short ‘the CIT (A)’] dated 14.11.2025 passed for assessment year 2023-24.

The assessee has raised the following grounds of appeal : 2.

“1. That on the facts and circumstances of the case, the appellate order passed by the learned Commissioner of Income Tax (Appeals), is bad both in the eyes of law and on facts.

ITA No.64/CHD/2026 A.Y.2019-20 2 2. That on the facts and in the circumstances of the case, the learned Commissioner of Income Tax (Appeals) erred in fact and law by upholding the addition of Rs 19,03,000/- as unexplained investments made by the learned Assessing Officer without appreciating- that the impugned assessment order was passed by the learned Assessing Officer without obtaining mandatory approval as required under section 148B of the Act, rendering the assessment proceedings void ab initio 3. That on facts and in the circumstances of the case, the learned Commissioner of Income Tax (Appeals) erred in fact and law by upholding the addition of Rs. 19,03,000/- as unexplained investments made by the learned Assessing Officer without appreciating that the notices issued u/s 148 and 143(2) of the Act, are invalid and bad in law being issued by the Jurisdictional Assessing Officer (JAO) instead of faceless assessing officer (FAO) which were not in accordance with section l5lA of the Act. Hence, entire assessment proceedings u/s 147 and consequential assessment order passed u/s 147 r.w.s. 144B of the Act is null and void and is liable to be quashed 4. That on the facts and in the circumstances of the case, the learned Commissioner of Income Tax (Appeals) erred in fact and law by upholding the addition of Rs. 19,03,000/- as unexplained investments made by the learned Assessing Officer without considering that the Ld AO has made said addition on the basis of alleged incriminating material found & seized during the course of search & seizure action carried out at the premises of third party, which was neither provided nor brought on record for rebuttal by the appellant, despite repeated requests during the course of assessment proceedings. Hence, additions made aggregating to Rs 19,03,000/-, is bad in law and is liable to be deleted. 5. That on the facts and in the circumstances of the case, the learned Commissioner of Income Tax (Appeals) erred in fact and law by upholding the addition of Rs. 19,03,000/- as unexplained investments made by the learned Assessing Officer without appreciating that Ld. AO has made addition solely relying on third party information received on insight portal without conducting any independent enquiry and corroborating the allegation with cogent material and without rebutting the claim of the appellant established through submission of various details / documents / explanations Hence, additions made aggregating to Rs. 19,03,000/-, is bad in law and is liable to be deleted

ITA No.64/CHD/2026 A.Y.2019-20 3 6. That on the facts and in the circumstances of the case, the learned Commissioner of Income Tax (Appeals) erred in fact and law by upholding the addition of Rs 19,03,000/ as unexplained investments made by the learned Assessing Officer without providing opportunity of cross examination to the appellant. Hence, additions made aggregating to Rs 19,03,000/-, is bad in law and is liable to be deleted. 7. That the grounds of appeal are independent and without prejudice to each other. 8. The appellant craves leave to add, amend or alter any of the grounds of appeal.

1.

The brief facts of the case are that the assessee is an individual who filed his return of income for the assessment year under consideration. Subsequently, on the basis of information received from the Investigation Wing consequent to a search conducted in the case of the Omaxe Group, the assessment was reopened under section 147 of the Income-tax Act, 1961. The allegation against the assessee was that he had allegedly made an on-money cash payment of ₹19,03,000/- to M/s Omaxe Ltd. over and above the recorded consideration for purchase of property. The sole basis for such allegation was an Excel sheet allegedly recovered during the course of search from the premises of Shri Rohtash Goyal, an employee/official connected with the Omaxe Group. Based on the said Excel sheet and the report of the Investigation Wing, the Assessing Officer treated the alleged cash payment as unexplained investment under section 69 of the Act and made the addition. The learned CIT(A) confirmed the action

ITA No.64/CHD/2026 A.Y.2019-20 4 of the Assessing Officer. Aggrieved by the said order, the assessee is in appeal before the Tribunal.

2.

None appeared on behalf of the assessee at the time of hearing. However, the written submissions available on record have been duly considered. It has been submitted that the entire addition has been made merely on the basis of an Excel sheet allegedly recovered during the search in the case of Omaxe Group and not on the basis of any incriminating material belonging to or recovered from the assessee. It has been contended that no document evidencing payment of cash by the assessee was ever found from the premises of the assessee or from the premises of Omaxe Ltd. Further, no receipt, agreement, acknowledgment, diary, loose paper or any document bearing the signature of the assessee was found or seized indicating payment of any unaccounted cash. The assessee has consistently denied having made any cash payment and has submitted that no opportunity of effective cross-examination of the persons whose statements were relied upon was granted. It has further been submitted that on identical facts, the Coordinate Bench of the Tribunal in the case of Omaxe has already held that such additions are unsustainable and has deleted the additions made in the hands of Omaxe itself. Accordingly, it has been prayed that the impugned addition deserves to be deleted.

ITA No.64/CHD/2026 A.Y.2019-20 5 3. The learned Departmental Representative relied upon the findings recorded by the Assessing Officer as well as the learned CIT(A). It was submitted that the information received from the Investigation Wing constituted credible material for initiating reassessment proceedings and making the impugned addition. The learned DR accordingly supported the orders of the authorities below and prayed that the addition be sustained.

4.

We have heard the submissions available on record, considered the arguments advanced by the learned Departmental Representative and perused the material placed before us. We have also carefully gone through the assessment order, the appellate order and the documentary evidence available on record.

5.

The foundation of the impugned addition is not in dispute. A perusal of the assessment order itself clearly reveals that the entire addition has been made solely on the basis of an Excel sheet allegedly recovered during the course of search proceedings conducted in the case of Omaxe Group from Shri Rohtash Goyal. The Assessing Officer has recorded that the said Excel sheet allegedly reflected payment of cash by the assessee to M/s Omaxe Ltd. over and above the recorded consideration. Except for the said Excel sheet, no independent evidence whatsoever has been brought on record by the Revenue to establish that the assessee had actually made any cash payment.

ITA No.64/CHD/2026 A.Y.2019-20 6 6. Admittedly, no incriminating material whatsoever was recovered from the premises of the assessee. Equally, no receipt, voucher, agreement, acknowledgment, diary, loose paper, cash book, ledger or any other document bearing the signature of the assessee or evidencing payment of cash by the assessee was recovered either from the premises of Omaxe Ltd. or from the residence or business premises of the assessee. There is also no material to show withdrawal of corresponding cash by the assessee or any independent evidence connecting the assessee with the alleged transaction.

7.

It is a settled proposition of law that an addition cannot be sustained merely on the basis of suspicion, conjectures or surmises. Suspicion, however strong, cannot take the place of legal evidence. Before an addition under section 69 of the Act is made, the Revenue is required to establish by cogent and reliable evidence that the assessee has actually made an unexplained investment. Such burden cannot be discharged merely by relying upon an unsigned third-party document recovered from the premises of another person, particularly when the contents thereof remain wholly uncorroborated by any independent evidence.

8.

In the present case, the Excel sheet neither belongs to the assessee nor has the Revenue established that the entries

ITA No.64/CHD/2026 A.Y.2019-20 7 contained therein were authored, acknowledged or accepted by the assessee. The assessee has throughout denied the alleged cash payment. In the absence of any corroborative evidence, such an Excel sheet by itself cannot constitute substantive evidence so as to fasten tax liability upon the assessee.

9.

We also find considerable force in the submission of the assessee that the very basis of the present addition has ceased to exist. It is an admitted position that the Coordinate Bench of the Tribunal, while deciding the appeals relating to Omaxe Group, has already examined the very same seized material, including the alleged Excel sheets, and has held that the additions made in the hands of Omaxe on the basis thereof were unsustainable and consequently deleted the same. Once the Tribunal has held that the alleged on-money transactions themselves have not been established in the hands of the recipient, namely Omaxe Ltd., the corresponding addition representing the very same alleged payment cannot simultaneously survive in the hands of the alleged payer.

10.

The Revenue has not brought to our notice any distinguishing feature in the present appeal nor has it demonstrated that the decision rendered by the Coordinate Bench in the case of Omaxe has either been reversed or stayed by any superior judicial forum. Judicial discipline requires that a Coordinate Bench should follow

ITA No.64/CHD/2026 A.Y.2019-20 8 an earlier decision rendered on identical facts unless there exist compelling reasons to differ, which are conspicuously absent in the present case.

11.

Viewed from another angle also, the Revenue seeks to tax the same alleged transaction in the hands of two different assessees without there being any legally admissible evidence to establish the existence of such transaction. Once the alleged receipt itself has not been accepted as proved in the hands of Omaxe, the alleged payment corresponding thereto cannot independently be presumed against the assessee merely on the basis of an uncorroborated third-party Excel sheet. Such an approach is contrary to the settled principles governing assessment proceedings and cannot be sustained.

12.

Considering the entirety of the facts and circumstances, we are of the considered opinion that the Assessing Officer has proceeded merely on assumptions arising out of third-party material without bringing any legally admissible and independent evidence on record to prove that the assessee had in fact paid any unaccounted cash. The addition, therefore, rests entirely on conjectures and surmises and not on legally sustainable evidence.

13.

Accordingly, respectfully following the decision of the Coordinate Bench of the Tribunal in the case of Omaxe, and in the

ITA No.64/CHD/2026 A.Y.2019-20 9 absence of any independent incriminating material against the assessee, we hold that the addition of ₹19,03,000/- made under section 69 of the Act is wholly unsustainable. The same is directed to be deleted.

14.

The grounds of appeal raised by the assessee are, accordingly, allowed.

In the result, appeal of the assessee is allowed.

Order pronounced on 07 t h July,2026.

Sd/-

(LALIET KUMAR) JUDICIAL MEMBER

“Poonam” आदेश क� �ितिलिप अ�ेिषत/ Copy of the order forwarded to : 1. अपीलाथ�/ The Appellant 2. ��यथ�/ The Respondent 3. आयकर आयु�/ CIT 4. िवभागीय �ितिनिध, आयकर अपीलीय आिधकरण, च�डीगढ़/ DR, ITAT, CHANDIGARH 5. गाड� फाईल/ Guard File

सहायक पंजीकार/ Assistant Registrar

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