Extrapolation of income in survey evidence limited to seized incriminating entries; uncorroborated extrapolation disallowed, specific amount taxed accordingly.

Extrapolation of income from a list seized during a survey must be confined to the incriminating material found; additions based on uncorroborated extrapolation across other months are impermissible. The decision clarifies that absent corroborative evidence by the assessing officer, no presumption of similar payments in other periods can be drawn, rendering broad extrapolative additions unsustainable. Consequently, the impugned addition was restricted to the specific amount recorded in the seized document, which was treated as unexplained income and taxed accordingly under the applicable unexplained income provisions.

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Issues: Whether the addition made by extrapolating a one-month salary list found during survey to the entire year is sustainable.

Analysis: An incriminating excel sheet was found during survey showing payment to certain employees for a single month. There is no admission or evidence that identical payments continued for other months. Extrapolation of a one-month figure to the whole year requires corroboration or supporting material to justify assuming recurrence across the year. Prior decisions have held that additions based on extrapolation without corroboration are unsustainable. On the facts, the document found during survey is the basis for any addition, and absent independent proof that similar payments were made in other months, the impugned extrapolation cannot be sustained.

Conclusion: The extrapolated addition for the entire year is not sustainable; the addition is restricted to the amount shown in the incriminating document (Rs. 2,54,115), in favour of the assessee.

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