DEPUTY COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE 8(1), MUMBAI, MUMBAI vs. PLS DEVEOPERS PRIVATE LIMITED, MUMBAI

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH “C”, MUMBAI BEFORE SHRI ANIKESH BANERJEE, JUDICIAL MEMBER AND SHRI MAKARAND VASANT MAHADEOKAR, ACCOUNTANT MEMBER ITA No.2126/Mum/2026 (Assessment year: 2016-17)

Deputy Commissioner of vs PLS Developers Pvt. Ltd. Income Tax, C.C. 8(1), 202, Krishna Kunj, Navyug society, Mumbai V.M. Road, Mumbai-400056 Room No.656, 6th Floor, AayakarBhavan, Mumbai- PAN: AAHCP0296K 400020 APPELLANT RESPONDENT CO No.171/Mum/2026 (Assessment Year: 2016-17) PLS Developers Pvt. Ltd. vs Deputy Commissioner of Income 202, Krishna Kunj, Navyug Tax, C.C. 8(1), Mumbai society, V.M. Road, Mumbai- Room No.656, 6th Floor, Aayakar 400056 Bhavan, Mumbai-400020 PAN: AAHCP0296K APPELLANT RESPONDENT Assessee by : Shri Punit Shah a/w Shri Pankaj Jain Revenue by : Shri V.S. Mahajan (Sr. DR)

Date of hearing : 14/05/2026 Date of pronouncement : 22/05/2026 O R D E R

2 ITA No.2126/Mum/2026 & CO 171/Mum/2026 PLS Developers Pvt. Ltd. Per:Anikesh Banerjee (JM): The instant appeal of the revenue and cross objection of by assessee filed against the order of the Ld. Commissioner of Income Tax (Appeals)-47, Mumbai [for brevity the “Ld. CIT(A)”], order passed under section 250 of the Income Tax Act 1961 (for brevity ‘the Act’) for Assessment Year 2016-17, date of order 29.12.2025. The impugned order emanated from the order of the Ld. Assistant Commissioner of Income Tax C.C. 8(1), Mumbai (for brevity the ‘Ld. AO’) order passed under section 147 of the Act date of order 09.03.2024. 2. The brief facts of the case are that a search and seizure action u/sec. 132/133A of the Act was conducted on Estate Investment Company Pvt. Ltd. and other related entities of Sakseria Group including assessee on 08.10.2021. Accordingly, the assessee’s case was centralized and assessed u/sec. 147 of the Act. During the assessment the Ld. AO observed that assessee had purchased the share of Veda Real Estate Corporation Pvt. Ltd. (Veda) in assessment year 2016- 17. Based on loose sheet of paper dated 18.05.2016 relating to AY 2017-18 from three entities the amount of Rs.5,00,000/- as recorded in the receipt in the diary on 18.01.2017. But the Ld. AO on basis of this record found in the diary and telescoped against the payment made amount to Rs.8,15,00,000/- towards purchase of share of Veda by the assessee related to transactions in cash with the Seksaria Group Entities. The assessee claimed that the assessee only pay Rs.5,00,000/- for purchasing the share of Veda from the Searia Group Entities. So, the addition made by the Ld. AO Rs.8,15,00,000/- is relying on the loose paper and alleged documents which has no basis. The aggrieved assessee filed an appeal before the Ld. CIT(A). The Ld. CIT(A) allowed the appeal of the assessee and

3 ITA No.2126/Mum/2026 & CO 171/Mum/2026 PLS Developers Pvt. Ltd. deleted the addition. Being aggrieved revenue filed the appeal by challenging the merits of the case. And the assessee had challenged the jurisdiction of the Ld. AO for reopening assessment u/sec. 148 of the Act in cross objection. 3. The Ld. DR argued and contended that on basis of the statement recorded of Shri Pawan K. Sharma the Accountant of the Seksaria Group has confirmed that the cash transaction was duly made with the assessee related to purchase of shares. On evidence, the Ld. AO had mentioned in the assessment order related to the excel sheet and other relevant documents found during the search where the assessee had made the transaction of Rs.8.15crore cash with the Seksaria Group for purchasing the share of Veda. So, accordingly, the Ld. DR stands in favor of the order of Ld. AO. 4. The Ld. AR argued and contended that the Ld. AO had made the addition Rs.8.15 crore u/sec. 69A of the Act by placing reliance on loose paper found by the premises / godown of third party without basis of any facts. There were rough noting and no statement has been recorded in respect of the said noting in A1 page 89. Since the assessee had not been found to be an owner of money, jewellery or other valuable articles the provision u/sec. 69A are not applicable to the facts. So the circumstances, the additions should not be added. Further, he contended that the assessee had made the transaction with three parties, Mr. Tarun Seksaria, Mr. Harsh Seksaria and Mr. Siddharth Mehta amount of Rs.2.15 crore, 2.15 crore and 3.30 crore respectively who have sold the share of Veda which aggregate to Rs.7.59 crore and addition was also made in the hands of the purchaser and as well as the seller. So, in any case the Ld. AO erred in addition amount to the 8.15crore instead of Rs. 7.59crore.

4 ITA No.2126/Mum/2026 & CO 171/Mum/2026 PLS Developers Pvt. Ltd. 5. The Ld. AR further contended that in case of Mr. Tarun Seksaria the addition was confirmed Rs.2.15crore related to this transaction for selling of share of Veda. Mr. Tarun Seksaria challenged this addition before the Coordinate Bench of ITAT, Mumbai. The ITAT Mumbai has adjudicated the issue in the case of Tarun Nandkumar Seksaria vs. DCIT, ITA No.3216/3215 and 3229/Mum/2025 for A.Y. 2015-16 to 2017-18 date of pronouncement 28.10.2025 and the Coordinate Bench has deleted the addition made by the Ld. AO. The observation contained in para no.52 of the said order is reproduced as below: “52. We therefore hold that the Assessing Officer, in relying solely upon unverified excel sheet, loose sheet and uncorroborated statements, has traversed beyond the permissible confines of evidentiary inference. The seized excel sheet and loose sheet, as earlier discussed, are incapable of interpretation without contextual evidence, and the statements upon which reliance was placed stand nullified by valid retraction. The confluence of these infirmities absence of corroboration, failure to summon and cross-examine, and the intrinsic vagueness of the documents compels us to conclude that the additions made towards alleged capital gains and unexplained money are devoid of factual and legal foundation. In the result, the additions sustained under the head "Unexplained Investment U/s 69A/69B" and capital gains addition of Rs.2,14,50,000 cannot be upheld and are hereby /deleted.”

5 ITA No.2126/Mum/2026 & CO 171/Mum/2026 PLS Developers Pvt. Ltd. the search. From deep scrutiny of the statements it is discerned that the statement of TNS was contradicted by NKS who is the key person involved with land dealings. Further, NKS pointed out that the said sheet was prepared by PDG which is evident on a plain reading of this statement and the same were estimate of cost and profits and projections. NKS has further stated that TNS was not in good health and to keep him busy he was assigned with the task of land acquisition. No further statement of NKS was recorded on this issue. Further, in the statement of TNS was considered only in part. The AO ignored the statement where TNS has stated that the cash was derived from Estate. The AO has not recorded the statement of TNS in respect of various other entries found in the excel sheet. Thus, this statement per se cannot lead to conclusion that notings in the excel sheet prepared by PDG in his individual capacity can lead to adverse inference in so far as assessee company are concerned that they paid cash towards acquisition of land.

50.1. The common thread in all these additions relating to lands at Dapoli,is that these have been made on the basis excel sheets or loose papers which are not self-explanatory purely based on the statements recorded under section 132[4] by TNS and contradicted by NKS.

50.2. Even after the statements have been retracted no further action has been taken by the AO either on the retraction or any effort has been made to provide any other corroborative evidence by making third party verifications or by rerecording the statements of the concerned persons.

50.3. Further in respect of the addition of capital gains, the AO relied merely on loose sheet titled Veda(B) without recording statements of any of the concerned parties i.e. the sellers

6 ITA No.2126/Mum/2026 & CO 171/Mum/2026 PLS Developers Pvt. Ltd. and buyers of the shares of Veda despite there being contradictory facts evident in the noting in the said loose sheet and that too , despite being pointed out by the assessee during the assessment proceedings , which have been reiterated by the AR during the course of the hearing before us. The CIT[Appeals] has confirmed the addition of capital gains by merely relying on the order of the AO and without rebutting the submissions filed by the assesse.

50.4. The mere discovery of excel sheet and loose sheets which are not even prepared by the assessee and remain uncorroborated by any external evidence, cannot, by itself, form the sole basis for an addition. Particularly so when the authorship and authenticity of such documents are in dispute. The Investigation Wing, which carries out the search, may record statements or seized documents; however, the same are merely inputs for further enquiry. Once the material is transmitted to the jurisdictional Assessing Officer, it becomes incumbent upon him to apply his own independent mind and conduct proper enquiry to determine whether such tatements or seized documents can lawfully lead to any addition.

50.5. The Assessing Officer cannot act as a mere forwarding agent of the report or view expressed by the Investigation Wing and mechanically incorporate the same in his assessment order without exercising his own judgment as to whether such information or view can legitimately form the foundation of an addition within the four corners of law. At best, the information and material emanating from the Investigation Wing may serve as a trigger or starting point to issue a showcause notice and seek an explanation from the assessee. But once the assessee has rebutted those materials including any recorded statement with cogent reasons, the Assessing Officer must judiciously evaluate such explanation and undertake at least a prima facie enquiry to test the correctness of the rebuttal and strengthen the evidentiary base of the material relied upon.

50.6. If he fails to do so, sustaining any addition solely on the basis of such material gathered from the search cannot be justified. In the present case, the statements and documents relied upon by the Department have been effectively rebutted and controverted with cogent reasoning, as elaborated in detail above. The Assessing Officer, functioning as a quasi judicial authority, is bound to apply his mind independently and adjudicate the issue in a fair and reasoned manner.

50.7. The presumption under section 132(4A) is, at best, a limited and rebuttable presumption applicable only in the context of seizure and custody, and cannot, by itself, elevate a private employee‘s scribblings into proof of income chargeable to tax. The Assessing Officer‘s reliance on extrapolation— extending the inference drawn from a

7 ITA No.2126/Mum/2026 & CO 171/Mum/2026 PLS Developers Pvt. Ltd. uncorroborated excel sheet and the loose sheet amounts more to conjecture than to judicial reasoning.

51.1. This infirmity is all the more pronounced in the present case because the seized material is neither self-explanatory nor independently corroborated. The Assessing Officer‘s duty extends beyond mere reproduction of search findings; he must verify the surrounding facts and determine whether any such statements or diary notings are supported by independent evidence. Yet, in this case, he did not examine any of the persons purportedly involved in the statements , who were identified by TNS and were the supposed recipients of cash.

51.2. At the very least, there should have been some independent corroborative material such as bank statements, agreements, receipts, or documents evidencing any actual cash transaction or confirmation brought on record. The entire addition has been founded upon untested statements and cryptic notings. Such a method of assessment, built on conjecture and devoid of corroboration, cannot withstand judicial scrutiny. An addition resting purely on suspicion and unsupported inference is antithetical to the settled principles of evidentiary assessment and the doctrine of fair adjudication.

8 ITA No.2126/Mum/2026 & CO 171/Mum/2026 PLS Developers Pvt. Ltd. 19.5 The Hon’ble jurisdictional Tribunal has issued a decision regarding the impounded document, concluding that the Assessing Officer exceeded the permissible scope of evidentiary inference by relying exclusively on unverified excel sheets and unsupported statements. The Tribunal unequivocally determined that the seized excel sheets cannot be interpreted without appropriate contextual evidence; as such, any addition based solely on these documents is not maintainable. In line with the Tribunal’s decision in respect of the impugned document designated as “Veda (B)”—impounded during survey proceedings in the case of the Seksaria group—it is hereby directed that the addition of Rs. 8,15,00,000/- as unexplained money be deleted, since this document constituted the sole basis for the disputed addition in the relevant assessment year. The grounds of appeal are allowed.”

9 ITA No.2126/Mum/2026 & CO 171/Mum/2026 PLS Developers Pvt. Ltd. Coordinate Bench in the case of Shri Tarun Nandkumar Seksaria (supra). We do not find any infirmity in the findings recorded by the Ld. CIT(A). Respectfully following the binding findings of the Coordinate Bench of the ITAT, Mumbai and considering that the issue involved in the present appeal is squarely covered by the aforesaid decision, we uphold the order passed by the Ld. CIT(A) deleting the addition of Rs.8,15,00,000/-. Accordingly, the grounds raised by the Revenue stand dismissed.

10 ITA No.2126/Mum/2026 & CO 171/Mum/2026 PLS Developers Pvt. Ltd. Copy of the Order forwarded to: 1. अपीलाथ�/The Appellant , 2. �ितवादी/ The Respondent. 3. आयकरआयु� CIT 4. िवभागीय�ितिनिध, आय.अपी.अिध., मुंबई/DR, ITAT, Mumbai 5. गाड�फाइल/Guard file. BY ORDER, //True Copy// (Asstt. Registrar), ITAT, MUMBAI