Search-based on-money addition in property purchase required fresh examination after retraction and stamp valuation evidence.
An addition for alleged on-money payment on property purchase was not finally sustained where the assessee retracted the search admission and relied on the stamp authority's valuation, which showed only a marginal difference from the declared consideration. Since the lower authorities did not properly consider the order of the Chief Revenue Officer / Inspector General of Registration, the matter required fresh examination. The ITAT remitted the issue to the Assessing Officer for reconsideration on the existing material, leaving the disputed addition open.
Issues: Whether the addition made towards alleged on-money payment for purchase of property was sustainable, and whether the matter required reconsideration in the light of the order of the stamp authorities and the assessee's retraction.
Analysis: The addition rested on the seized executive diary and the assessee's statement recorded during search, but the assessee had retracted the admission and relied on the valuation determined by the stamp authorities, which showed only a marginal difference from the declared consideration. The authorities below did not consider the order of the Chief Revenue Officer / Inspector General of Registration, although it was specifically relied upon as a material circumstance bearing on the correct value of the property. In the circumstances, the issue required fresh examination by the Assessing Officer with reference to the said order and the other available evidence.
Conclusion: The addition was not finally sustained and the matter was remitted to the Assessing Officer for fresh adjudication.
Final Conclusion: The assessee obtained a partial relief by way of remand, and the disputed addition was kept open for reconsideration on the existing material.
Ratio Decidendi: Where an addition based on search material and a recorded admission is specifically challenged by reference to relevant valuation material from the competent stamp authority, the matter must be re-examined before the addition is sustained.
TaxTMI 
AI Drafter ✕
TaxTMI 
