Undisclosed sale consideration cannot be inferred on suspicion alone when registered documents and affidavits support the declared price.

Undisclosed sale consideration cannot be added merely because a seized letter suggests a higher price when registered sale documents, affidavits and bank records support the declared consideration. The assessee explained that the letter related to an earlier cancelled booking, and the Revenue did not record the purchaser's statement or produce comparable evidence to show that on-money was received or that the registered value was false. In the absence of cogent rebuttal material, the inference of higher sale price remained a presumption. The addition was therefore held unsustainable and deleted.

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Issues: Whether the addition of alleged undisclosed sale consideration based on a seized letter and consequential proportionate additions for other flat sales could be sustained when the assessee produced registered sale documents, affidavits and supporting material explaining the discrepancy.

Analysis: The addition rested on the inference that one letter found during search reflected a higher sale price than the registered agreement value. The assessee, however, produced affidavits of the director and purchaser, explained that the letter referred to an earlier cancelled booking, and relied on the registered sale deed and bank records showing payment only of the agreed consideration. No statement of the purchaser was recorded by the Assessing Officer, no comparable evidence from the same or nearby project was brought on record, and no material was produced to show that the registered consideration was false or that any on-money was received. In such circumstances, the assessee's explanation was treated as duly supported, while the Revenue's inference remained a mere presumption unsupported by evidence.

Conclusion: The addition made on a presumptive and arbitrary basis was unsustainable and was deleted in favour of the assessee.

Ratio Decidendi: An addition of undisclosed income cannot rest on suspicion or presumption alone when the assessee's explanation is supported by registered documents and affidavits and the Revenue fails to produce cogent rebuttal evidence.

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