Appeal dismissed, assessment upheld under Section 153C. Legal principles on deeming provisions and burden of proof.

The tribunal dismissed the appeal, upholding the validity of the assessment under Section 153C and the addition of Rs. 12,24,000 to the appellant's total income. The tribunal emphasized the legal principles of deeming provisions, the onus of disproving signed documents, and the purpose of Section 153C in assessing income related to persons other than the one searched.

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Issues Involved:
1. Validity of service of notice and assessment.
2. Validity of assessment based on seized material.
3. Merits of the addition of Rs. 12,24,000 to the total income.

Detailed Analysis:

1. Validity of Service of Notice and Assessment:
The appellant initially challenged the validity of the assessment on the grounds of improper service of notice. However, during the proceedings, the appellant's representative stated that this ground was not to be pressed. Consequently, the tribunal dismissed this ground as not pressed.

2. Validity of Assessment Based on Seized Material:
The appellant raised an additional ground questioning whether the seized material found from a third party (Shri Vikas A. Shah) could be used for assessment under Section 153C of the Income Tax Act. The tribunal admitted this additional ground, referencing the case of National Thermal Power Co. Ltd. v. CIT [1998] 229 ITR 383.

The appellant argued that the seized Memorandum of Understanding (MOU) was found in the possession of Shri Vikas A. Shah and not the appellant, invoking Section 132(4A) which presumes that documents found in a person's possession belong to that person. The appellant contended that since the document was found with Shri Vikas A. Shah, the proceedings under Section 153C against the appellant were invalid. The appellant cited the Gujarat High Court decision in Vijaybhai N. Chandrani v. Asstt. CIT [2011] 333 ITR 436 to support this argument.

The tribunal, however, held that Section 132(4A) is a deeming provision and should not be extended to Section 153C. The tribunal emphasized that Section 153C is meant to assess the income of any person other than the one searched, if incriminating material related to them is found. The tribunal also referenced Section 292C, which presumes that documents found in possession of a person during a search belong to them, even when transferred to another assessing officer. Therefore, the tribunal concluded that the proceedings under Section 153C were valid.

3. Merits of the Addition of Rs. 12,24,000 to the Total Income:
The appellant contested the addition of Rs. 12,24,000, arguing that no amount or plot was received from Shri Vikas A. Shah. The tribunal examined the MOU, which indicated that the appellant was to receive Rs. 12,24,000 for a plot in the Chitvan Scheme. The appellant failed to disprove the contents of the MOU or provide any explanation for signing it.

The tribunal noted that the MOU was signed by the appellant and Shri Vikas A. Shah in the presence of witnesses, and the appellant did not deny the signatures. The tribunal held that the onus was on the appellant to disprove the MOU's contents, which the appellant failed to do. The tribunal also referenced the decision in Kamleshbhai Dharamshibhai Patel v. CIT [2013] 31 taxmann.com 50, which supported the view that documents signed by a person belong to them.

The tribunal rejected the appellant's reliance on cases such as Prarthana Construction Pvt. Ltd. v. DCIT and Unique Organisers & Developers (P.) Ltd. v. Dy. CIT, as they were factually distinguishable. The tribunal concluded that the addition of Rs. 12,24,000 was justified based on the MOU and upheld the assessment.

Conclusion:
The tribunal dismissed the appeal, upholding the validity of the assessment under Section 153C and the addition of Rs. 12,24,000 to the appellant's total income. The tribunal emphasized the legal principles of deeming provisions, the onus of disproving signed documents, and the purpose of Section 153C in assessing income related to persons other than the one searched.

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