BALWANT SIINGH,BATHINDA vs. DCITACIT(CEN)-2, CHANDIGARH

The CIT(A) erred in confirming the addition of Rs. 1300000/- made by the AO under the head Income from other sources on account of unexplained investment in plot No 3, Divine Enclave, Near Model Town, Phase 3, Part 2 Bhatinda. The order passed by the CIT(A) is contrary to the facts and circumstances of the case.

That the CIT(A) has erred in confirming the addition of Rs. 1300000/- made by the AO ignoring the fact that the assessment framed u/s 153Aa(1)(b) r.w.s 143(3) is bad in law since the same is without mentioning DIN which is a mandatory requirement.

That the Ld. CIT(A) erred in confirming the addition made by the AO on the basis of seized agreement to sell which was neither signed by the appellant nor signed by the witnesses.

That the CIT(A) erred in confirming addition made by the AO based on unexecuted agreement to sell. That the CIT(A) has erred in not appreciating the fact that the property in question till date stands in the name of seller Sh. Manish Kumar.

That the Ld. CIT(A) erred in confirming the addition by presuming that the seized agreement to sell was registered and notarized. That the assumptions made by the CIT(A) are contrary to the facts and circumstances of the case.

That the Ld. CIT(A) erred in confirming the addition made by the AO rejecting the explanation of the assessee that the agreement to sell was merely a proposal which was never executed.

That the Ld. CIT(A) erred in confirming the addition made by the AO without bringing on record any material to prove that the assessee was owner of the property in question and also the agreement was ever executed.

That the CIT(A) erred in confirming the addition made by the AO without appreciating that the assessee was not provided with the opportunity of cross examination in spite of specific request made by the assessee.

That the CIT(A) erred in confirming the addition made by the AO without making any enquiries from the owner Sh. Manish Kumar and without recording any statement of seller in respect of the seized document.

The appellant requests permission to add or amend the grounds of appeal before the appeal is heard and disposed off.

The brief facts of the case, as recorded in the order of the learned CIT(A) for Assessment Year 2017-18, are as follows. The assessee was subjected to a search under Section 132 on 28.01.2021 at both his residential as well as business premises. Pursuant to the notice issued under Section 153A on 22.09.2021, the assessee filed his return of income on 12.11.2021. The case framed by the Assessing Officer is primarily based on an unsigned agreement to sell, which was unearthed during the course of the search. In this regard, it becomes imperative to critically examine the contents of the seized document, particularly to ascertain whether any sale deed was actually executed on the basis of the 3

08.2016 Chiman Lal S/o Nathu Ram Manish Kumar S/O Jagdish 1600000 Not related to appellant Unsigned Agreement to Sell plot No 3, Divine Enclave, Near Model Town, Phase 3, Part 2 Bhatinda 19.09.2016 Manish Kumar S/O Jagdish Balwant Singh S/O Dalip Singh 1300000 Related to the appellant but the same was not executed.

1 The AO on the basis of the said seized unsigned agreement to sell made an addition of Rs. 13,00,000/- to the returned income.

Against the order of the AO the assessee went in appeal before the Ld. CIT(A) challenging the authenticity and evidentiary value of the unsigned and unexecuted agreement to sell.

Against the order of the Ld. CIT(A) the assessee raised several grounds challenging the erroneous addition sustained by the Ld. CIT(A). The summary of the submissions is as under:

The Ld. AR also submitted that no addition can be made merely on the basis of an unsigned and unexecuted agreement, in the absence of any corroborative evidence of actual payment, the addition made in the hands of the assessee is wholly unwarranted and liable to be deleted and relied upon the following case laws:-  Deputy Commissioner of Income-tax (Central-2) vs. Sanjay Agrawal [2025] 174 taxmann.com 108 (Raipur - Trib.)[16-08-2024]

Per contra, the Ld. CIT DR relied upon the order of CIT(A) and argued that the addition made by the AO should be confirmed.

We have heard the rival contention of both the parties and the material available on the record. We have carefully considered the arguments advanced by the Ld. Counsel for the assessee, the paper book filed, the judicial precedents relied upon, as well as the brief synopsis submitted. We have also taken into account the submissions of the Ld. CIT–DR, the assessment order, and the order of the Ld. CIT(A). On perusal of the record, we find merit in the submissions advanced by the Ld. Counsel. The alleged agreement relied upon by the Ld. AO is admittedly unsigned and unregistered and, therefore, cannot be regarded as a legally enforceable document in view of the settled position of law. No registry was ever executed pursuant thereto, nor was any corroborative evidence brought on record to establish transfer of ownership or actual flow of consideration. The property, as evidenced from the electricity bills and purchase invoices, including the latest bill dated 07.05.2024, continued to remain in the name of Shri Manish Kumar. Further, the Ld. AO neither conducted any independent inquiry from the said owner nor afforded any opportunity of cross-examination to the appellant. Order pronounced in the open Court on 10/09/2025. राजपाल यादव

अपीलाथŎ/ The Appellant 2. ŮȑथŎ/ The Respondent 3. आयकर आयुƅ/ CIT 4. आयकर आयुƅ (अपील)/ The CIT(A) 5. िवभागीय Ůितिनिध, आयकर अपीलीय आिधकरण, चǷीगढ़/ DR, ITAT, CHANDIGARH 6. गाडŊ फाईल/ Guard File