THE ACIT, CENTRAL CIRCLE-1(3), AHMEDABAD vs. ASHISH P PATEL, AHMEDABAD

ITSSA 460/AHD/2019Status: DisposedITAT Ahmedabad01 August 2025AY 2004-0584 pages
AI SummaryDismissed

What were the facts?

The assessee, Ashish Prafulbhai Patel, engaged in real estate and financing, was subject to a search on August 4, 2006. He filed returns for AY 2004-05 and 2006-07 in response to a Section 153A notice. A settlement application for AY 2001-02 to 2007-08 was rejected by the Settlement Commission for non-payment of taxes for AY 2004-05 and 2006-07. The Gujarat High Court stayed assessment proceedings and directed payment of admitted dues. A second search occurred on October 7, 2009, leading to abatement of earlier proceedings. The High Court later set aside the Settlement Commission's order partially, reviving proceedings for certain years. Assessments for AY 2004-05 and 2006-07 were completed on November 3, 2017, under Section 153A(1)(b) r.w.s. 143(3). Aggrieved, the assessee appealed to the CIT(A), who partly allowed the appeals. Both the Revenue and the Assessee are now in appeal before the ITAT.

What did the Tribunal hold?

The Tribunal held that the diary jottings seized from the assessee were merely rough notes and did not conclusively prove any transaction, receipt, payment, or its nature and amount. The Tribunal characterized the diary as a 'dumb' document, lacking evidence of who made the jottings, when, and for what purpose. It could not be conclusively proven that these jottings pertained solely to the assessee. Citing judicial authorities, the Tribunal found no infirmity in the CIT(A)'s deletion of additions amounting to Rs. 1,50,00,000/-, Rs. 1,55,00,000/-, and Rs. 37,00,000/- for AY 2010-11, AY 2011-12, and AY 2012-13, made on account of alleged unaccounted cash payments to Partner Shri K.L. Sharma. Similarly, the Tribunal upheld the CIT(A)'s deletion of additions of Rs. 1,65,00,000/-, Rs. 1,50,00,000/-, and Rs. 1,00,00,000/- for AY 2010-11, AY 2011-12, and AY 2012-13, made on account of alleged unaccounted cash payments to Partners Smt. Sunita Maheshwari and Shri Suresh Kumar Maheshwari. The ratio decidendi is that additions cannot be made solely on the basis of 'dumb' documents like rough jottings without corroborative evidence or independent verification. The Tribunal dismissed the Revenue's grounds of appeal concerning these additions.

What were the issues?

1. Whether the CIT(A) erred in restricting the addition of Rs. 26,86,00,000/- to Rs. 12,00,05,970/- on account of unaccounted income from land transactions of SICCL, as against the addition made by the Assessing Officer (Revenue's contention). The Revenue argued that the CIT(A) erred in deleting the addition of Rs. 26,86,00,000/- on account of bogus payments, even while accepting that the expenditure was not allowable under Section 37, and that disallowing such expenditure was warranted when income was estimated. The Revenue contended that not disallowing the expenditure condones non-allowable transactions. The Assessee's arguments are not explicitly detailed for this issue in the provided text. 2. Whether the CIT(A) erred in deleting additions of Rs. 1,50,00,000/-, Rs. 1,55,00,000/-, and Rs. 37,00,000/- for AY 2010-11, AY 2011-12, and AY 2012-13, respectively, made on account of unaccounted cash payments to Partner Shri K.L. Sharma (Revenue's contention). The Revenue argued that the CIT(A) erred in deleting additions of Rs. 1,65,00,000/-, Rs. 1,50,00,000/-, and Rs. 1,00,00,000/- for AY 2010-11, AY 2011-12, and AY 2012-13, respectively, made on account of unaccounted cash payments to Partners Smt. Sunita Maheshwari and Shri Suresh Kumar Maheshwari. The Revenue's primary argument revolves around the validity of additions made based on diary jottings. The Assessee's arguments are not explicitly detailed for this issue in the provided text.

Which sections of the Income-tax Act were involved?

Section 132,Section 153A,Section 143(3),Section 250,Section 37,Section 69A,Section 292C,Section 69,Section 245HA,Section 245D(2C)

AI-generated summary — verify with the full judgment below

आयकर अपील"य अ"धकरण, अहमदाबाद "यायपीठ ‘A’ अहमदाबाद। IN THE INCOME TAX APPELLATE TRIBUNAL “A” BENCH, AHMEDABAD BEFORE DR. B.R.R. KUMAR, VICE-PRESIDENT Ms. SUCHITRA KAMBLE, JUDICIAL MEMBER SN IT(SS)A/CO No. AY Appellant Respondent 1 IT(SS)A No. 2004-05 Ashish Prafulbhai Patel, 429/Ahd/2019 1 s t Floor, Chinubhai DCIT, Chambers, B/h. City Gold Central Circle-1(3), Cinema, Off Ashram Road, Ahmedabad Ahmedabad [PAN : ACTPP 0045 R] 2 IT(SS)A No. 2004-05 ACIT, Ashish Prafulbhai Patel, 460/Ahd/2019 Central Circle-1(3), Ahmedabad Ahmedabad [PAN : ACTPP 0045 R] 3 CO No. 2004-05 Ashish Prafulbhai Patel, DCIT, 5/Ahd/2020 Ahmedabad Central Circle-1(3), [PAN : ACTPP 0045 R] Ahmedabad 4 IT(SS)A No. 2006-07 Ashish Prafulbhai Patel, DCIT, 431/Ahd/2019 Ahmedabad Central Circle-1(3), [PAN : ACTPP 0045 R] Ahmedabad 5 IT(SS)A No. 2006-07 ACIT, Ashish Prafulbhai Patel, 472/Ahd/2019 Central Circle-1(3), Ahmedabad Ahmedabad [PAN : ACTPP 0045 R] 6 CO No. 2006-07 Ashish Prafulbhai Patel, DCIT, 7/Ahd/2020 Ahmedabad Central Circle-1(3), [PAN : ACTPP 0045 R] Ahmedabad 7 IT(SS)A No. 2003-04 ACIT, Ashish Prafulbhai Patel, 462/Ahd/2019 Central Circle-1(3), Ahmedabad Ahmedabad [PAN : ACTPP 0045 R] 8 CO No. 2003-04

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