GANESHARAM GALBARAM MALI ,MUMBAI vs. DCIT CENTRAL CIRCLE 4(2), MUMBAI
Income Tax Appellate Tribunal, MUMBAI BENCH “G”, MUMBAI
Per Bench :
A bunch of appeal of the same assessee filed against the order of the Ld.
Commissioner of Income Tax appeal 52, 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 2017-18 to 2019-20, date of order 03.09.2025. The impugned order emanated from the order of the Ld. Assistant Commissioner of Income Tax
C.C.-4(2) Mumbai (for brevity the ‘Ld. AO’) order passed under section 153C of the Act date of order 09.03.2024 for A.Y. 2017-18, 10.03.2024 for A.Y. 2018-19 and for A.Y. 2019-20. 2. All the appeals have same nature of fact and since all the appeals pertains to same assessee involving similar issue arising out of similar factual matrix, these appeals were heard together as a matter of convenience and are being decided by way of this consolidated order. With the consent of both the parties ITA
8349/Mum/2025, AY 2017-18 is taken as lead case and the decision rendered therein shall apply mutatis mutandis to other appeals before us.
The brief facts of the case are that a search and seizure action was conducted on 17.03.2021 in “Rubberwala Group” at the premises of “M/s Rubberwala Housing and Infrastructure Ltd”. (RHIL). The promoter and director of “Rubberwala Group” Shri Tabrez Shaikh and key employee of Rubberwala Group Shri Imran Ansari who was handling sale and registration of shops in project ‘Platinum Mall’ are also covered in search. Among other statement, the statements of these persons were recorded oath on various dates and during the course of search and post search proceeding. Relying on the statement, Ld. AO found that the assessee had purchased the shop from the said RHIL at “Platinum Mall”, Girgaon, Mumbai and amount to Rs. 70,69,200/- was paid in cash in different financial years for acquisition of this property. The year wise payment of cash duly noted by the Ld. AO in the assessment order which is reproduced as below: Sr. No. Financial Year Assessment Year Amount of Investment 1 2014-15 2015-16 - 2 2015-16 2016-17 - 3 2016-17 2017-18 4,00,000 4 2017-18 2018-19 41,29,520 5 2018-19 2019-20 25,39,680 6 2019-20 2020-21 - 7 2020-21 2021-22 - Total 70,69,200
Accordingly, this in impugned assessment year the Ld. AO had treated the cash investment amount to Rs.4,00,000/- as investment from undisclosed source and the addition was confirmed u/sec. 69C amounting to Rs.4,00,000/-. The aggrieved assessee filed an appeal before the Ld. CIT(A). The Ld. CIT(A) upheld the impugned assessment order. Being aggrieved the assessee filed an appeal before us.
4. The Ld. Authorised Representative (AR) submitted that a search and seizure action under section 132 of the Act was carried out on 17.03.2021 in the case of the Rubberwala Group and others. During the course of the search proceedings, it was found that the assessee had purchased a shop in Platinum
Mall Building, Girgaon, Mumbai for a consideration of Rs. 70,69,200/-. The Ld. AO presumed that a part of the consideration for acquisition of the said property had been paid in cash. The Ld. AO further concluded that the assessee had allegedly paid cash in different assessment years, namely AY 2017-18, AY 2018-19 and AY
2019-20, amounting to Rs. 4,00,000/-, Rs. 41,29,520/- and Rs. 25,39,680/- respectively. Based on this presumption, the assessment was initiated under section 153C of the Act, and an addition of Rs. 4,00,000/- was made in the Act.
5. The Ld. AR further submitted that statements were recorded under section 132(4) of the Act from Shri Imran Ansari and Shri Tabrez Shaikh on the basis of certain seized materials. In his statement, Shri Imran Ansari, while explaining the details of the transactions noted in an Excel sheet, stated that the sheet contained details of the agreement value of the shops, floor-wise and level-wise, along with the actual price at which the shops were sold. He further stated that the agreement value was lower than the actual sale price, and that the differential amount (commonly referred to as “on-money”) was received in cash from the buyers and handed over to Shri Tabrez Shaikh. On the basis of these statements, the Ld. AO called upon the assessee to explain why the alleged on- money payment of Rs. 4,00,000/- should not be added to the income of the assessee. Although the Ld. AR strongly objected to the proposed addition, categorically stating that the assessee had not paid any on-money over and above the consideration mentioned in the registered agreement, the Ld. AO was not convinced and concluded that the assessee had indeed paid on-money in cash towards the purchase of the shop.
6. The Ld. AR further argued that the entire foundation of the impugned addition rests solely upon:
(i) Excel sheets found in a pen drive seized from Shri Imran Ansari, a third party, containing the name of the buyer, shop number, and alleged cash amounts; and (ii) the statement of Shri Imran Ansari, wherein he admitted that cash received on behalf of the Rubberwala Group was handed over to the Director of the company,
Shri Tabrez Shaikh. It was contended that on the basis of the said material and statements recorded at the premises of the third party, the company belonging to the said group had accepted receipt of on-money in cash and declared 8% of the net profit as undisclosed income. However, no independent evidence has been brought on record by the revenue to demonstrate that the assessee had actually paid any cash. There is no receipt, diary, acknowledgment, contemporaneous document, or corroborative evidence linking the assessee to the alleged cash payment, apart from the third-party record. The Ld. AR further contended that a crucial issue arises as to whether the material found in possession of a third party, the statement of such third party, and the disclosure made by them can bind the assessee and justify an addition without providing the assessee an opportunity to confront such material.
It was further argued that the assessment in the present case has been initiated under section 153C of the Act, and under the provisions of that section, the incriminating material pertaining to the assessee, which forms the basis of recording satisfaction, ought to have been forwarded to the Ld. AO of the assessee. However, despite specific requests made by the assessee, no such material was provided to the assessee. The assessee also sought an opportunity to cross-examine Shri Imran Ansari. However, both the Ld. AO as well as the Ld.
CIT(A) declined the request on the ground that the statement of Shri Imran Ansari was not the sole basis for making the addition. The Ld. AR submitted that, in fact, no other evidence has been brought on record by the revenue authorities to substantiate that the alleged cash on-money was actually paid by the assessee to Shri Imran Ansari, except the confessional statement of Shri Imran Ansari.
7. The Ld. AR contended that the similar issue was examined and adjudicated by the Coordinate Bench of the ITAT Mumbai. The Ld. AR respectfully relied on the order of Coordinate Bench of ITAT Mumbai in the case of Bharat Solanki vs
DCIT in ITA No.6523 to 6365/Mum/2025 date of pronouncement 23.12.2025 the relevant para 8.5 to 8.8 is reproduced as below:
“8.5 The Ld. counsel for the assessee submitted that said Rubberwala Group has credited 100%
amount of the cash in its books of accounts against offering 8% of income on such declaration.
In other words, they have generated huge amount of income in their hands at 33% of tax on the 8% income of the cash declared. For example, if the assessee get credited Rs.100 in its books of accounts against cash received then it has paid taxes @ 33% on the Rs.8 which work out to Rs.2.6. The Ld. counsel for the assessee submitted that this was one of the beneficial declaration and therefore, they have admitted and paid the taxes. The Ld. counsel for the assessee submitted that the assessee has never paid such cash on-money and it might be their own money which they had brought into books in garb of cash on-money for tax benefit.
6 We are of opinion that though the Rubberwala Group has admitted receipt of unaccounted cash and offered a percentage thereof to tax, such admission by the seller cannot, by itself, fasten liability upon the purchaser unless there is cogent evidence establishing that the purchaser actually made such payment. The disclosure by the developer may explain the source of its own funds, but it does not dispense with the burden on the Revenue to prove the assessee's investment or expenditure.8.7 The Ld. counsel for the assessee specifically brought to our attention that Shri Imran Ansari in his answer to question No. 13 of the statement dated 17.03.2021 stated that after receipt of alleged cash from the customers a small diary was being used to provide containing cash details received from the customers. The Ld. counsel for the assessee submitted that no such diary has been recovered from the assessee nor any kind of receipt issued by Rubberwala Group having signature of the assessee has been found from the premises of the Rubberwala group or from the assessee. The Ld. counsel submitted that in the case of one of the customer sh Rajesh Jain search was conducted by the Department but no such document in the form of diary was found which could corroborate statement of Shri Imran Ansari. According to him, Shri Imran Ansari cooked up a story of cash on-money in his statement for benefiting interest of their company.
8 We are of opinion that Shri Imran Ansari himself stated that cash payments were recorded in a diary provided to buyers but no such diary was recovered from the assessee. Even in other despite search action. This materially weakens the evidentiary value of the statement.”
The Ld. AR further relied on the order of Coordinate Bench in the case of Akhraj Pukhraj Chopra & Others vs DCIT 5553 to 5557/Mum/2025 date of pronouncement 12.11.2025. The relevant observations are reproduced as below: “18. From the records we also noticed that no statement was provided to the assessee, and none of the persons, whose statements were relied upon were produced for cross-examination. Even the extract of the statement mentioned in the assessment order does not indicate the name of the assessee.
Apart, the AO during the course of assessment also failed to provide the opportunity to cross examine of the witnesses, whose statements were relied upon by the revenue which resulted in 'breach of principles of natural justice'. In this regard, reliance is being placed upon the decision of Hon'ble Supreme Court in the case of Andaman Timber Industries Vs. CCE reported in (2015)281 CTR 241 (SC) wherein it has been held that 'failure to give the assessee the opportunity to cross examine witness, whose statements are relied upon, results in breach of principles of Natural Justice. It is a serious flaw which renders the order a nullity'.
In the case of CIT Vs. Odeon Builders Pvt. Itd. (418ITR 315), it was held that the 'addition/disallowance made solely on third party information without subjecting it to further scrutiny and denying the opportunity of cross examination of the third party renders the addition/disallowance bad in law'.
In the case of H.R. Mehta v/s Assistant Commissioner of Income-tax, Mumbai 72 taxmann.com110 (Bombay) wherein it was held as under In the light of the fact that the money was advanced, apparently by the account payee cheque and was repaid vide account payee cheque the least that the Assessing Officer should have done was to grant an opportunity to the assessee to meet the case against him by providing the material sought to be used against him in arriving before passing the order of assessment. This not having been done, the denial of such opportunity goes to root of the matter and strikes at the very foundation of the assessment ard, therefore, renders the orders passed by the Commissioner (Appeals) and the Tribunal vulnerable. The assessee was bound to be provided with the material used against him apart from being permitting him to cross examine the deponents whose statements were relied upon by him. Despite assessee with copies of statements and disclose material, these were denied to him. 22. Taking into consideration the entire facts and circumstances and legal prepositions as discussed by us above, we direct the AO to delete the addition, consequently these grounds raised by the assessee are allowed.”
The Ld. DR argued and stands in favour of the orders of the revenue authorities. He filed a written submission. The relevant part of the written submission is reproduced as below: “4.2. Revenue's contention on Ground No. 1 to 5:
The assessee filed a ground claiming that the notice u/s. 153C was issued without DIN. In this connection, it is humbly submitted that a new sec. 292BA was introduced in the Finance Act'
2026, on this issue, salient features of which are as under,
The new Section 292BA clarifies that, notwithstanding contrary court rulings, an assessment is not invalid if the order contains a reference to a computer generated DIN, even if there are mistakes, defects, or omissions in quoting it.
Retrospective Application: The amendment applies retrospectively from 1 October 2019, the date of the original CBDT circular mandating DINs.
In view of the introduction of sec. 292BA with retrospective effect, the ground No.1 on DIN issue is liable to rejected.
The Ld. CIT(A) had extensively dealt with above grounds of appeal in Para-6 to 8 (Page 18 to 25
of the appeal order). The salient feature of the Id. CIT(A) observations as communicated in the appellate order on those issues are as under,
That the AO was issued notice u/s 153C after duly following procedural statutory guidelines requirements and relevant provisions of the Act.ii) Provision of section 153C were applicable for assessment where search was conducted u/s 132 or requisition made u/s 132A, and allowed for assessments of "other persons" based on seized materials. In this instant case search was initiated on 17.03.2021 i.e. before 31.03.2021 i.e. before the commencement of New Regime w.e.f. 01.04.2021. Accordingly, proceedings in respect of the search cases initiated before
31.03.2021 would continue to be governed by the old Law. The Ld.CIT(A) further opined that the to be completed under the provisions that were enforced in time of search.
iii) Regarding assessee's objection that the handing over of seized of the juri ictional AO should constitute determining factor for the applicability of new law, The Ld.CIT(A) had contended that "handing over of seized material to the assessing officer is not the determining factor, but the "date of search" is. He further opined that the new search assessment regime was prospective and not retrospective and accordingly search assessment process would be governed by the provisions that were enforced at the time of search. Since the date of search was 17.03.2021, provisions of sec. 153C is applicable in respect to this instant case. The Ld. CIT(A) also relied upon certain decisions in the case of-
Hon'ble Bombay HC in GulshanNagpal (2024) and Mumbai ITAT in Nirmal Promoters (2023): it is held that the validity of section 153C proceedings is determined by the date of search, not the date of receiving the material by juri ictional AO.
b) The Hon'ble Supreme Court in the case of PCIT v. Abhisar Buildwell Pvt. Ltd. (2023): it is held that for searches conducted before 31-Mar-2021, sections 153A/153C continue to apply even if material is received post-1st April 2021. iv) The CIT(A) was also of the opinion that in this instant case the AO has recorded satisfaction and provided copies of the same to the appellant and accordingly there is no irregularity in invoking sec. 153C in the present case. Considering the above facts the Ld. CIT(A) in Para-7.11
(Page-23) dismissed the ground of appeal No. 1 raised by the assessee.
The Revenue respectfully submits that the decision of the C.I.T (Appeal), is based on correct interpretation of the provisions of Act and accordingly grounds No. 1 2 filed by the assessee be dismissed.
3. The assessee raised grounds relates to absence of reference to any incriminating material and lack of opportunity for cross-examination by the assessing officer.4.4. Revenue's contention on Ground No. 3,4 75:
4.1. The Grounds are not supported by facts since the AO has completed the assessment taking into consideration of the excel sheet documenting cash and cheque transactions with customers purchasing shops in Platinum Mall project. The excel sheet was seized at the time of search proceedings and was treated as incriminating evidence in respect of instant assessment assessee to Rubberwala Group.
4.2. The Ld. CIT (Appeal) dealt with the issue of cross examination extensively in para-8 (page- 20) of the appellate order. The relevant part of the appellate order is reproduced as under,8. With regard to Ground No. 1.2. the appellant has raised a contention that copies of the incriminating material, statements relied upon by the Assessing Officer (AO), and an opportunity for cross-examination were not provided during the assessment proceedings under Section 153C of the Income-tax Act, 1961. With regard to Ground No.1.2, the appellant has raised a grievance regarding the alleged denial of an opportunity to cross-examine certain individuals whose statements formed part of the assessment proceedings. It is the appellant's contention that such denial violates the principles of natural justice, thereby rendering the assessment invalid.
1 The AO have mentioned gist of allegation in the satisfaction note. In this regard, I have perused the show cause notice issued by the AO in many cases, where proceedings were initiated on the similar sets of facts. A thorough examination of the said notice reveals that the AO had duly.communicated and forwarded the details of the incriminating material relied upon for the purposes of assessment. The show cause notice clearly refers to and Includes télevant extracts from the statement of Shri Imran Ansari, details regarding the purchase of flats, and data retrieved from pen drives and all of which formed the basis of the proceedings. Hence, the material in question was made available to the appellant and the principles of natural justice were duly adhered to.
2 It is a settled position in law that when the assessee is provided with an adequate opportunity to respond to the material relied upon, there is no violation of the principles of natural justice. In this context, reliance is placed on Andaman Timber Industries v. CCE [2015] 62 taxmann.com 3 (SC), where the Hon'ble Supreme Court held that denial of cross-examination would vitiate proceedings only if the evidence sought to be cross-examined was the sole basis of the order and no opportunity was provided at any stage. However, if adequate opportunity is provided and documents are shared, such proceedings are not rendered invalid.
4.3. Vide para-8.3, the Ld. CIT (A) observed that the assessing officer had duly provided available material to the assessee, as a part of the Show Cause Notice and given adequate opportunity to file response. The Ld. CIT(A), has opined (para-8.13) that the statements relied upon by the Department, are of secondary evidence in collaboration with other evidence and accordingly denial of right to cross examine cannot be taken as plea against making the addition. The Ld. CIT(A) in support of his decision has referred several judgments by different Courts including Hon'ble Apex Court as per para-8.4 to para-8.12 of his order. Department. The documents collected by theRevenue in the course of search proceeding clearly demonstrated that actual sale value for the shops exceeded the agreement value of the shops, indicating payment of on-money by the purchasers to the Rubberwalla Group. It is pertinent to refer to the assessment order (para-5.2) where such details were placed on record. 8. In the result, the appeal of the assessee bearing ITA No.6540/Mum/2025 is allowed.
Q.15 Please state the prices of the shops in project of Platinum Mall.
Ans.
Sir, following is the Total Price chart per square feet carpt area for all the shops in Project Platinum Mall: (amount in Rs. Per square feet carpet area)
Floor
Level 1
Level 2
Level 3
Level 4
First floor
71000
62500
59500
54000
Second Floor
63000
57000
53500
48500
Third Floor
58000
53000
48000
43000
Fourth Floor
60000
54000
51000
45500
However the agreement value is lower compared to total price value. The following is Agrrement value Price chart per square feet carpet area for all the shops in Project Platinum
Mall: (amount in Rs. Per square feet carpet area)
Floor
Level 1
Level 2
Level 3
Level 4
First floor
30150
30150
30150
30150
Second Floor
27150
27150
27150
27150
Third Floor
24150
24150
24150
24150
Fourth Floor
24150
24150
24150
24150
The agreement value is accepted in cheque or through banking channel. GST @12% is also charged on above agreement value price which is also accepted in cheque or through banking channel. The difference between total value and agreement value is accepted in cash which is not accounted in books of accounts of M/s Rubberwala Housing infrastructure Limited. The banking channel component and cash component has been decided by CMD of M/s Rubberwala Housing Infrastructure Limited Mr. Tabrez Shaikh. Further. In some cases the rate has been increased due to parking in addition to shop. The rate of parking has also been decided by CMD of M/s Rubberwala Housing Infrastructure Limited Mr. Tabrez Shaikh which varied customer to customer. This parking charges also contain the cash component and banking channel component.
The excel sheet found from the computer maintained at the office Rubberwalla group, also supports the above details. Relevant part of assessment order (para-5.4) is reproduced as under,5.4 It was ascertained that the data is being maintained by Shri Imran Ansari in an excel file namely "consolidated 1 2 3 balance". In the said file sheets with different name viz "Master",
"Payment" and "Cheque" etc. are found to be maintained. It is also found out that in respect of the sale of shops in the said project, comprehensive data is being maintained in these excel sheets, and in this regard, it is important to mention that the sheet "Master" is so elaborate that the data in the sald sheet is spread across 98 columns. Shri Imran Ansari has explained all 98
columns of "Master" sheet and such explanation of each and every column by Shri Imran Ansari further support the fact that the he was maintaining the sold data and therefore could explain all these columns with relevance and purpose. Shi Imran Ansari in response to Question no. 22,
23 and 24, of the statement recorded on 17/03/2021 & 20.03.2021 has explained in detaill the meaning and relevant of each and every column. For ready reference a part of his explanation pertaining to data maintained for cash component received (as given in response to Q:no. 22) is reproduced as under The above details clearly demonstrate that the evidences regarding cash transaction was detected in the excel sheet and other details which were unearthed in the course of search proceeding, and the Imran Ansari only provided necessary clarification regarding the entries.
Thus, the seized documents are to be treated as Primary evidence and the statement of Mr.
Imran Ansari, comes under the category of secondary evidences of corroborating nature. Hence the Ld. C.I.T(A) has correctly concluded that the assessee cannot claim relief for not being allowed for cross examination in respect of clarificatory statement which only constitutes secondary evidence.
It is therefore, respectfully submitted that the Ground No. 3 & 4 filed by the assessee be dismissed.
5. GROUND No. 6 relates to confirmation by the CIT(A) of addition made u/s 69 of the Income Tax Act. The assessee submitted that the addition was based on the uncorroborated third party statement without support of any incriminating material on record. 4.6. Revenue's Contention on Ground No.6: 4.6.1. The Ld. CIT(A) has dealt with the aforementioned grounds extensively in para-9 of the appellate order. The principal contention of the CIT(A) are summarized as under, i) The addition was made on the basis of direct evidence which was identified in the form of excel sheet maintained in the computer system of the RHIL group wherein each component of transaction had been mentioned. The third party statement referred by the assessee was the statement of Mr. Imran Ansari, employee of the RHIL group, and the person in charge of sales & registration of the shops in Platinum Mall and statement of Mr. Tabrez Shaikh, Director and Promoter of the RHIL group, only corroborated the information available in the incriminating material in the form of excel sheetproviding details of such cash transactions seized in the course of search proceedings. ii) The recipient of purchase consideration, RHIL group has admitted receipt of on-money and offered income @8% on such amount, which substantiated the allegation of receipt of on- money. The RHIL admitted such receipt, offered the same as income, and paid taxes. The information as per seized documents thus confirmed as correct by the recipient itself, who was the other party in the transaction regarding sale of shops (para-9.5 of the order). Relevant part of the appellate order is reproduced as under, Vide question no. 11 of the sald statement dt. 17.03.2021, Imran Ansari was questioned about his roles and responsibilities a M/s. Rubberwala Housing & Infrastructure Ltd (RHIL). In response, he stated that he had been working with Rubberwala group of entities since 2010 and inter-alia handling sale and registration of the shops in "Platinum Mall Project of M/s. Rubberwala Housing & Infrastructure Ltd (RHIL, that he was handling said excel sheet. It was not case where unrelated person statements were recorded. This statement was further reinforced by Shri Tabrez Ahmed Shaikh, Director and Promoter of RHIL, in his post-search deposition dated 19.08.2021. He verified the contents of the Excel file and affirmed the truth of Shri Imran Ansari's statement. Moreover, the Rubberwala Group itself admitted to having received such on-money (cash component), offered the same es additional income, and paid taxes thereon.
10 Further, proposition of law laid down discussed in para (supra) was not placed before the Hon'ble ITAT, which clearly establish that when staternents are relied upon by the Department as secondary evidence in collaboration with other evidences, then the denial of right to cross- examination cannot be taken as plea to not make the addition. Therefore, decision relled upon by the assessee, in my considered opinion, is not of any help to him, iii) The Ld. CIT(A) also taken into consideration the ITAT Mumbai's decision in the case of Rajesh Jain and distinguished such decision from the instant case in para-9.7 to 9.11 of the appellate order. 4.6.2. The assessing officer had brought into records all the relevant details in connection with transaction between the assessee and the RHIL group in the assessment order. The Id. CIT(A) has addition made by the assessing officer in an elaborately discussed order.. In this instant case, the First Party of the transaction regarding sale of shop i.e. RHIL group through it's Director, Mr. Tabrez Shaikh, has admitted receipt of the cash component of the sale consideration and offered the same for tax. The documents disclosing such on-money transactions detected at the time of search seizure operation was confirmed and acknowledged by the RHIL group. Relevant part of the assessment order is reproduced as under, 9.2 Further, the promoter and Director of RHIL Group- ShnTabrez Shaikh accepteu Lon cash from individual for sale of Shop in Platinum Mall and also offered 8% of the said cash as unaccounted receipts in his statement recorded u/s. 131 of the Income Tax Act, 1961 on19/08/2021. Q.10. During the course of search proceedings of group companies, the statement u/s 132(4) of the Income Tax Act, 1961 was taken on 17.03.2021 at 1402, Ameena Heights, Dr. A Nair Road, Agripada, Mumbal-400 011and in answer to the Q.47 to 54 you stated that" Ma'am I will have to look into the Books of Accounts and cash flows of my various entitles and only then I will be able to comment on the pen drive in question and the statement of Mr. Imran Ansart". Till today you have not filed any explanation for the questions asked during the course of search proceedings, in these circumstances why amount of Rs. 151,39,11,026/- should not be considered as the unaccounted income of M/s Rubberwala Housing Infrastructure Limited, from the sale of shops at Platinum Project undertaken by the company. Please comments. Ans. Sir, I have already elaborated the circumstances under which I was not been able to file my replies on the questions asked by you during the course of search proceedings. Now I am in receipt of the copy of the statements along with the seized documents and after verification of the documents it is submitted that we have received cash towards the shops and also make various expenditures in the cash towards the project out of the said cash receipts. I am submitting herewith the cash receipts and payments for the following years.
Financial Year
Total Amount Received
2014-15
-
2015-16
-
2016-17
8,01,44,460
2017-18
72,55,56,161
2018-19
33,69,40,975
2019-20
18,56,00,345
2020-21
18,56,69,086
Grand total
1,51,39,11,026
Under this circumstance, mere denial by the assessee, the purchaser of shop, cannot controvert the acknowledgment of receipt of cash by the recipient ( vendor), which was subsequently offered for taxation.
Taking all the facts into consideration, it is prayed that the Ground No. 6 of the assessee may kindly be dismissed.
5.0. In the course of instant appellate proceeding, the assessee filed a case law paper book on 02.03.2026, providing compilation of several decisions of the different benches of Hon'ble ITAT,
Mumbai. Revenue's comment on the content of the paper book is given as under,
Comments on case laws
S. No.
1
Pravin K. Purohit : ITA No.4742-4744/Mum/2025:
ITAT’ Observation:
In this instant case, the ITAT has primarily followed the decision of the coordinate Bench in the case of Rajesh Jain in ITA No. 3842 & 3841
and ITA No. 3954, 3952, 3951 & 3950/Mum/2023 (Para-10, Page-13), wherein the Hon'ble ITAT has decided in favour of the assessee.
The principal contention of the ITAT was that the facts of the aforementioned case was similar to the facts pertaining to the case of Rajesh Jain. The ITAT made following observations, i) The assessee denied having paid any amount of cash over and above agreement value. The AO has neither confronted the assessee with any of the material found during the search of Rubberwala Group or mentioned any evidence or seized document has been explicitly mentioned on account of payment of any on money.
ii) The assessee was not confronted with any statement of key person.
iii) Information found in the pen drive cannot considered as "credible evidence" since the same was not corroborated with any evidence.
The Hon'ble ITAT accordingly (Para-14) considered that since the contents of pen drive was not authenticated no addition on account of on money is sustainable.
Distinguishing factors from present case
The facts of the case have certain distinguishing factors which are as under, i) The Hon'ble ITAT has primarily relied upon the decision in the case of Rajesh Jain. As per Para-9, Page-10 of the ITAT's order the basic facts in the case of Rajesh Jain was mentioned wherein it was categorically search action u/s 132 on 17.03.2021 at the time of search in the premises of Rubberwala Group entities. In the case of Ganeshram G.
Mali, the assessee was not covered by search action u/s 132. In fact the assessee's case was assessed u/s 153C on the basis of information received from the Investigation Wing as a result of search in Rubberwala Group.
ii) In this instant case the CIT(A) has categorically dealt with the ITAT's decision in the case of Rajesh Jain and highlighted the distinguished factors in Para-9.7,9.8 & 9.9 (Page-30 to 32) of the appellate order.
The distinguishing factors as stated by the CIT(A) is reproduced as under,
"9.8. I have gone thought the above Hon'ble ITAT decision. It is well known fact that the decisions of higher judicial authorities are binding on lower authorities and this aspect needs no reiteration. However, the above-mentioned case law i istinguishable on facts compared to the present appeal. In the above mentioned case the assesseee Shri
Rajesh Jain was also covered by the IT Department by a search action u/s 132 of the IT Act. In the present case, no such search action has been carried out in the case of the appellant. Thus, this case is distinguishable on facts.
9. Further, at the same time, it is seen that full facts were not placed before the Hon'ble ITAT and it has also not been examined that Excel sheet clearly stated the agreement value as well cash component both. Imran Ashfaque Ansari was employee of Rubberwala group and his statement was also recorded on oath at his residence. Vide question no. 11 of the said statement dt. 17.03.2021, Imran Ansari was questioned about his roles and responsibilities in M/s. Rubberwala Housing & Infrastructure Ltd (RHIL). In response, he stated that he had been working with Rubberwala group of entities since 2010 and inter-alia handling sale and registration of the shops in "Platinum Mall Project of M/s. Rubberwala Housing & Infrastructure Ltd (RHIL,, that he was handling said excel sheet. It was not case where unrelated person statements were recorded. This statement was further reinforced by Shri Tabrez Ahmed Shaikh, Director and Promoter of RHIL, in his post-search deposition dated 19.08.2021. He verified the contents of the Excel file and affirmed the truth of Shri Imran Ansari's statement. Moreover, the Rubberwala Group itself admitted to having received such on-money (cash component), offered the same as additional income, and paid taxes thereon.
10. Further, proposition of law laid down discussed in para (supra) was not placed before the Hon'ble ITAT, which clearly establish that when statements are relied upon by the Department as secondary evidence in collaboration with other evidences, then the denial of right to cross-examination cannot be taken as plea to not make the addition. Therefore, decision relied upon by the assessee, in my considered opinion, is not of any help to him.
11. Thus, Hon'ble ITAT decision relied upon by the appellant does not aid his case. Unlike the present matter, where there is clear linkage between the documents found, the assessee's transaction, and the admission of parties involved, the cases cited by the appellant pertain to instances where uncorroborated third-party statements were the sole basis of addition. Here, the evidence is not only specific but also substantiated.
The Ld. CIT(A) also relied upon certain judgments in support of his contention that the Income Tax Department is notbound by strict rules of evidence. Relevant part of the order is reproduced as under,
"9.12. It is well established in law that income-tax proceedings are not governed by the strict rules of evidence applicable in a court of law. In Addl. CIT v. Jay Engg. Works Ltd. [1978] 113 ITR 389 (Delhi), it was held that the AO can rely on material which may not be admissible in a court of law, as long as it is relevant. Similarly, the Hon'ble Punjab &
Haryana High Court in CIT v. Metal Products of India (1984) 150 ITR
714 (P&H) held that the AO can collect evidence behind the back of the assessee, provided it is material and forms the basis of assessment.
13. The Hon'ble ITAT in Hersh W. Chadha v. DDIT (43 SOT 544) and Hersh W. Chadha v. DDIT, ITA Nos. 3088 to 3098 & 3107/Del/2005, has further clarified that in cases of suspicious transactions, tax available on record. The AO is not bound by the Indian Evidence Act but must act on material that is relevant and reliable.
14. In ITC Classic Finance Ltd. v. DCIT [264 ITR 154), the Hon'ble Bombay High Court upheld additions where transactions lacked transparency, reinforcing the principle that apparent deficiencies in evidence must be considered in light of surrounding corroborative circumstances."
Now it is to be submitted that the statement of Imran Asfaque Ansari only corroborated the excel sheet and relevant details unearthed in the course of search proceeding by the Department. The documents collected by the Revenue in the course of search proceeding clearly demonstrated that actual sale value for the shops exceeded the agreement value of the shops, indicating payment of on-money by the purchasers to the Rubberwalla Group. It is pertinent to refer to the assessment order (para-5.2) where such details were placed on record.
Q.15 Please state the prices of the shops in project of Platinum Mall.
Ans.
Sir, following is the Total Price chart per square feet carpt area for all the shops in Project Platinum Mall: (amount in Rs.
Per square feet carpet area)
Floor
Level 1
Level 2
Level 3
Level 4
First floor
71000
62500
59500
54000
Second Floor
63000
57000
53500
48500
Third Floor
58000
53000
48000
43000
Fourth Floor
60000
54000
51000
45500
However the agreement value is lower compared to total price value.
The following is Agreement value Price chart per square feet carpet area for all the shops in Project Platinum Mall: (amount in Rs. Per square feet carpet area)
Floor
Level 1
Level 2
Level 3
Level 4
First floor
30150
30150
30150
30150
Second Floor
27150
27150
27150
27150
Third Floor
24150
24150
24150
24150
Fourth Floor
24150
24150
24150
24150
channel. GST @12% is also charged on above agreement value price which is also accepted in cheque or through banking channel. The difference between total value and agreement value is accepted in cash which is not accounted in books of accounts of M/s Rubberwala
Housing infrastructure Limited. The banking channel component and cash component has been decided by CMD of M/s Rubberwala Housing Infrastructure Limited Mr. Tabrez Shaikh.
Further. In some cases the rate has been increased due to parking in addition to shop. The rate of parking has also been decided by CMD of M/s Rubberwala Housing Infrastructure Limited Mr. Tabrez Shaikh which varied customer to customer. This parking charges also contain the cash component and banking channel component.The excel sheet found from the computer maintained at the office of Rubberwallagroup, also supports the above details. Relevant part of the assessment order (para-5.4) is reproduced as under,
4 It was ascertained that the data is being maintained by Shri Imran An excel file namely "consolidated 1 2 3 balance". In the said file sheets wit name viz "Master", "Payment" and "Cheque" etc. are found to be mainta also found out that in respect of the sale of shops in the said project, comp data is being maintained in these excel sheets, and in this regard, it is im mention that the sheet "Master" is so elaborate that the data in the sal spread across 98 columns. Shri Imran Ansari has explained all 98 co "Master" sheet and such explanation of each and every column by Shri Imi further support the fact that the he was maintaining the sald data and there explain all these columns with relevance and purpose. Shri Imran Ansari in to Question no. 22, 23 and 24, of the statement recorded on 17/0 20.03.2021 has explained in detail the meaning and relevant of teach column. For ready reference a part of his explanation pertaining to data t for cash component received (as given in response to Q: no. 22) is repre under.The above details clearly demonstrate that the evidences regarding cash transaction was detected in the excel sheet and other details which were unearthed in the course of search proceeding, and the Imran Ansari only provided necessary clarification regarding the entries. Thus, the seized documents are to be treated as Primary evidence and the statement of Mr. Imran Ansari, comes under the category of secondary evidences of corroborating nature. Thus in this instant case, that the information available in the computer system and pen drive was duly corroborated by Imran Ansari the person who is in charge of sale and registration of the shops, which was further confirmed by the promoter director of the Rubberwala Group and their action in offering income for taxation. Further, name of the assessee as a payer of on money was duly mentioned in Page-9 (Para-7) of the assessment order. Thus contrary to the case of PravinPurohit the name of the assessee was clearly appear in the seized document (the contents of the document was corroborated and authenticated by the sales person and the promoter director of Rubberwala Group.
It is also submitted that there cannot be any motive for such offer for additional income by the Rubberwala Group other than admission of receipt of cash at the time of sale of shops in Platinum mall. It is also to be stated that the source of such cash which was offered as additional revenue by Rubberwalla Group cannot be attributed to any other source other than "on money receipt" from the purchasers, since the principal business of the Rubberwala group is real estate development. The disclosure of additional revenue by Rubberwala
Group only followed the identification and seizure of the excel sheet documenting receipt of "on money" from the purchasers of shops. The Hon'ble ITAT had not examined all the aspects and thus the decision of PravinPurohit is to be distinguished from the instant case on the basis of above details.
2. AkhrajPukhraj Chopra, ITA No. 5553-5555/MUM/2025
In this instant case the ITAT followed the decision in the case of Rajesh
Jain (Page-7) which was distinguished in the above note.
3
Bhavna Jain, ITA No. 6363-6364/M/2025:
The Hon'ble ITAT has deleted the addition on the basis of reasoning given in Para-8.1 & 8.2 (running Page-77 & 78). It is again reiterated that contrary to the observation of the Hon'ble ITAT the possibility of generating cash receipt doesn't arise in case of on-money transactions in the real estatebusiness. The on-money principally means money paid out of books to avoid taxation. Hence, question of issue of receipt by the recipient doesn't arise. Further, it was the contention of the Hon'ble ITAT in Para-8.2 that there was no diary, no receipt, no acknowledgment or the corroborative documents supporting cash payments. However, it is reiterated that in this instant case, digital evidence in the form of excel sheet providing names of the purchasers, agreement value and actual value with on-money amount was seized by the Investigation Wing. The digital evidence substitutes requirement of maintenance of records of the cash transaction in physical form, which the Hon'ble ITAT had not taken into consideration.
The Hon'ble ITAT also relied upon the judgments passed by the co- ordinate benches in the case of Praveen Purohit and Akhraj Chopra
(para-8.17, running page-85), which can be distinguished from the instant case, as per note prepared in respect of Praveen Purohit case as above.
The other cases as per Case law book, principally worked on similar logic and followed judgments in Rajesh jain, Praveen Purohit and Bhavna Jain cases and accordingly are not being addressed separately.
0. On consideration of above facts and circumstances it is humbly prayed that the all the grounds of appeal filed by the assessee in respect of appeal filed for the A.Y. 2018-19 and 2019- 20 involving identical issues may kindly be dismissed and orders passed by the Ld. CIT(A) may kindly be upheld.
We have heard the rival submissions, perused the material available on record, and carefully considered the judicial precedents relied upon by both the parties. It is an undisputed fact that the impugned addition of Rs. 4,00,000/- has been made on the basis of (i) certain Excel sheets found in a pen drive seized from the premises of a third party, namely Shri Imran Ansari, and (ii) the statement recorded from Shri Imran Ansari and Shri Tabrez Shaikh during the course of search proceedings in the case of the Rubberwala Group. However, upon careful actually paid any cash on-money over and above the consideration recorded in the registered agreement. Except for the entries found in the Excel sheet maintained by a third party and the statement recorded from such third party, no corroborative evidence such as receipt, diary, acknowledgment, contemporaneous document, or any other material has been produced linking the assessee with the alleged cash payment. It is also evident from the record that the assessee had specifically requested for copies of the incriminating material and an opportunity to cross-examine Shri Imran Ansari, whose statement was relied upon by the revenue. However, such opportunity was not provided to the assessee. The denial of an opportunity to cross-examine the person whose statement forms the basis of the addition constitutes a serious breach of the principles of natural justice.Further, we find that the issue involved in the present case is squarely covered by the decisions of the Coordinate Benches of the Tribunal, including the decisions in Bharat Solanki (supra) and Akhraj Pukhraj Chopra & Others (supra), wherein under similar facts arising out of the search in the Rubberwala Group, the Tribunal held that mere reliance on third-party statements and documents, without independent corroboration and without providing an opportunity of cross-examination, cannot justify an addition in the hands of the purchaser. We have also carefully considered the submissions advanced by the Ld. DR and the written submissions placed on record. The Ld. DR contended that the addition was justified on the basis of the Excel sheet seized during the course of search proceedings, which allegedly contained details of cash and cheque components of transactions relating to the sale of shops in the Platinum Mall project. It was further submitted that the said Excel sheet constituted incriminating material, and the statement of Shri Imran Ansari, who was handling the sale and registration of the shops, only corroborated the contents of the seized document. The Ld. DR also emphasized that the Rubberwala Group had admitted receipt of cash on-money and offered the same to tax, thereby lending credibility to the entries found in the seized material. However, we are unable to accept the contention of the Ld. DR in the present case. The mere existence of entries in a third-party document or digital record, without any independent corroborative evidence demonstrating actual payment of cash by the assessee, cannot be treated as conclusive evidence against the assessee. Furthermore, although reliance has been placed upon the statement of Shri Imran Ansari and the admission made by the developer group, the assessee was not provided an effective opportunity to confront such material or to cross-examine the person whose statement was relied upon, despite specific requests made during the course of proceedings. In the absence of such opportunity and in the absence of direct evidence linking the assessee to the alleged cash payment, the submissions of the Ld. DR do not sufficiently establish that the assessee had in fact made the alleged on-money payment. In the present case also, the revenue has failed to establish with cogent evidence that the assessee had actually paid the alleged on-money in cash. The disclosure made by the developer group regarding receipt of cash may explain their own financial position; however, such admission by the seller cannot automatically fasten liability upon the purchaser unless there is independent material demonstrating that the purchaser had actually made such payment. that the addition of Rs. 4,00,000/- made under section 69 of the Act is not sustainable in law. Accordingly, the addition is directed to be deleted, and the grounds raised by the assessee are allowed. The appeal of the assessee is allowed.
In the result the appeals of the assessee bearing ITA No.8347 to 8349/Mum/2025 are allowed.
Order pronounced in the open court on 12th day of March 2026. (JAGADISH)
JUDICIAL MEMBER
Mumbai,िदनांक/Dated:
12/03/2026
SAUMYASr.PS
Copy of the Order forwarded to:
अपीलाथŎ/The Appellant , 2. Ůितवादी/ The Respondent. 3. आयकरआयुƅ CIT 4. िवभागीयŮितिनिध, आय.अपी.अिध., मुंबई/DR, ITAT, Mumbai 5. गाडŊफाइल/Guard file.
BY ORDER,
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(Asstt.