CHETAN GULABRAO PATIL,CHALISGAON vs. INCOME TAX OFFICER WARD 2 (1), NASHIK

This appeal at the instance of assessee pertaining to the assessment year 2023-24 is directed against the order dated 15.03.2025 of National Faceless Appeal Centre, Delhi passed u/s.250 of the Income-tax Act, 1961 (hereinafter also called ‘the Act’) arising out of the Assessment Order dated 24.01.2025 passed u/s.144 r.w.s.144B of the Act.

Though the assessee has raised various grounds of appeal but they all revolve around the issue regarding addition of Rs.3.50 lakh made u/s.69A of the Act for the alleged on- money given by the assessee for purchase of immovable property from M/s.Viraj Estate Pvt. Ltd..

Brief facts of the case are that the assessee is an individual. Search and seizure action u/s.132 of the Act conducted in the case of Viraj Group and its key employees and associated concerns on 20.04.2023. Viraj Group is also engaged in the business of Land Development and Real Estate. The documents seized by the department shows that assessee has purchased one Shop bearing No. –B-170 from Viraj group and has paid on-money of Rs.3.50 lakh (Rs.2,50,000 + 1,00,000). Based on this information, case of the assessee selected for scrutiny. Assessee has declared income of Rs.4,80,180/-. After validly serving the statutory notices, ld. AO carried out the proceedings and finally made addition of Rs.3.50 lakh for the alleged on-money paid by the assessee for purchase of immovable property in the form of a shop. During the course of assessment proceedings, assessee failed to make proper submissions and assessment was framed as best judgment assessment u/s.144 of the Act. Aggrieved assessee preferred appeal before ld.CIT(A) but failed to succeed.

Now the assessee is in appeal before this Tribunal.

Ld. Counsel for the assessee referring to the paper book running into 127 pages mainly drew my attention to the Affidavit given by Viraj Estates Pvt. Ltd. to the department on 14.02.2025 and 20.01.2025 stating that no such on-money has been received from the assessee. It is further stated that assessee had not given any such on-money and therefore the impugned addition is uncalled for.

On the other hand, ld. Departmental Representative supported the orders of the lower authorities.

I have heard the rival contentions and perused the record placed before me. Impugned addition of Rs.3.50 lakh for the alleged on-money given by the assessee for purchase of the shop bearing No.B-170 admeasuring 82.56 sq.ft. in the project of Ms. Viraj Estates. As per the sale deed, assessee has paid Rs.10.00 lakh. However, during the search, certain incriminating material were found based on which it was noticed that assessee had paid on-money of Rs.3.50 lakh. Before me, Ld. Counsel for the assessee has referred to the Affidavit given by Viraj Estates Pvt. Ltd. dated 14.02.2025 which is almost two years after the date of search. It is also not made clear by both the sides that whether any such addition has been made in the hands of Viraj Estates Pvt. Ltd. also for receiving the on-money. Under these given facts and circumstances and in the interest of justice, I deem it appropriate to remit back the issue to the file of Learned Jurisdictional Assessing Officer who shall carry out necessary examination and investigation and also call for the details of assessment order in the case of M/s.Viraj Estates Pvt. Ltd. framed for the year under consideration and then shall examine as to whether any such addition has been made in the hands of M/s.Viraj Estates Pvt. Ltd. also. Ld. JAO shall further grant an opportunity to the assessee for cross examination as the assessee is not admitting to have given any on-money. After adhering to the principles of natural justice and also providing proper cross examination and also examining the status of additions made in the hands of M/s.Viraj Estates Pvt. Ltd. for receiving the alleged on-money, ld. JAO shall decide the issue in accordance with law after giving due opportunity of hearing to the assessee. Impugned order is set-aside and the grounds of appeal raised on merits are allowed for statistical purposes.

In the result, appeal of the assessee is allowed for statistical purposes.