On-money estimation upheld where search admissions and cash findings corroborated undisclosed receipts in regular assessment.

Voluntary admission of on-money, when corroborated by cash found during search, can support an estimation of undisclosed receipts in a regular assessment under section 143(3) of the Income-tax Act, 1961. The Tribunal accepted that the directors had admitted charging on-money on residential and commercial projects and that the surrounding material supported the admission. It further held that the CIT(A) was not justified in excluding the Sarjan project receipts, because the assessee produced no contrary evidence to rebut the estimate. On that basis, the Tribunal upheld estimation of on-money at 10% of total booking receipts and rejected the assessee's challenge.

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Issues: Whether the Tribunal was justified in estimating on-money at 10% of the total booking receipts, including the Sarjan project receipts, on the basis of the director's statement recorded during search and the cash found.

Analysis: The assessee's directors had admitted during search that on-money was being charged on residential and commercial projects, and the statement was supported by the cash found at the premises. The assessment was a regular assessment under section 143(3) of the Income-tax Act, 1961, and not a block assessment under Chapter XIV-B, so the authorities were entitled to make an estimation on the basis of the material available. The Tribunal found the CIT(A)'s exclusion of the Sarjan project unsustainable and held that the assessee had not produced contrary evidence to displace the admission or the estimation.

Conclusion: The Tribunal's estimate of on-money at 10% on the total receipts was upheld and the issue was decided against the assessee.

Ratio Decidendi: Where an assessee's voluntary admission of on-money is corroborated by search material, the revenue authorities may estimate undisclosed receipts on the basis of such admission and supporting circumstances in a regular assessment.

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