Block assessment additions need tangible evidence of on-money; estimated higher sale rates alone cannot support undisclosed income.

In block assessment proceedings, an addition towards undisclosed income cannot rest on conjecture or an arbitrary estimate of higher sale rates for flats and shops where the search yielded no incriminating material showing on-money or understatement of consideration. The seized agreements reflected different rates, but the variation was explained by location, payment terms and other commercial factors, and the purchasers confirmed that no amount over the agreement price was paid. On those facts, the estimated addition was held unsustainable and deleted.

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Issues: Whether the addition made in block assessment by estimating higher sale rates for flats and shops, in the absence of evidence of on-money or understatement of sale consideration, was sustainable.

Analysis: The search did not yield any material showing receipt of additional consideration over and above the amounts recorded in the agreements with purchasers. The seized agreements disclosed different rates, but the variation was explained by factors such as location, payment terms, and other commercial considerations. The purchasers also confirmed that no amount beyond the agreement price was paid. In a block assessment under Chapter XIV-B, an addition cannot rest on conjecture or an arbitrary estimate when no incriminating material supports understatement of consideration.

Conclusion: The addition of undisclosed income was not sustainable and was deleted in favour of the assessee.

Final Conclusion: The assessment addition based on estimated sale rates was set aside, and the appeal succeeded on the merits.

Ratio Decidendi: In block assessment proceedings, estimated additions towards undisclosed income cannot be made without tangible evidence of understatement of consideration or on-money receipts.

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