VIMALA JITENDRA JAIN ,MUMBAI vs. ASST, CIT.CENTRALCIRCLE4(2), MUMBAI

Facts

The assessee challenged orders for AY 2019-20 and 2020-21, specifically regarding the validity of assessment under Section 153C, denial of cross-examination, and an addition of Rs. 2,50,000/- (and Rs. 18,64,200/- in another appeal) for unexplained investment. These additions were based on alleged cash payments for shop premises, stemming from third-party statements and seized material (a pendrive) during a search on the Rubberwala group.

Held

The tribunal, relying on its coordinate bench decisions, held that additions based solely on uncorroborated third-party statements or seized material (like a pendrive not found from the assessee) were unsustainable without corroborative evidence. The Assessing Officer's failure to provide an opportunity for cross-examination of the third party whose statements were relied upon was a violation of natural justice, rendering the assessment null. Consequently, the tribunal directed the deletion of the impugned additions.

Key Issues

1. Validity of assessment framed under Section 153C. 2. Denial of opportunity for cross-examination of third parties. 3. Addition for unexplained investments (on-money) based on uncorroborated third-party statements and seized material. 4. Application of tax rates under Section 115BBE.