Unexplained investment additions fail where mobile phone evidence is uncorroborated and Section 65B certification is absent.

Additions for unexplained investment based on alleged cash payments reflected in a mobile phone were held unsustainable because the electronic material was uncorroborated by any independent evidence and no person involved admitted off-book cash payment. The device contents were also treated as inadmissible for want of compliance with Section 65B(4) of the Indian Evidence Act, as no certificate was produced. On that basis, the additions under Section 69 were deleted in favour of the assessee.

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Issues: Whether the additions made as unexplained investment on the basis of alleged cash payments recorded in an electronic device and other third-party material were sustainable, and whether the absence of compliance with the requirement for admissibility of electronic evidence affected the additions.

Analysis: The additions rested on entries and images found in a mobile phone said to relate to alleged cash payments for purchase of flats. None of the persons connected with the transaction admitted receipt or payment of any cash outside the books, and the material was not corroborated by independent evidence. The electronic material was treated as insufficient on its own to support the additions. The requirement for admissibility of electronic evidence was also not shown to have been complied with, as no certificate under Section 65B(4) of the Indian Evidence Act, 1872 was brought on record. In these circumstances, the material was held incapable of sustaining the additions.

Conclusion: The additions under Section 69 were not sustainable and were deleted in favour of the assessee.

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