Uncorroborated WhatsApp chats cannot sustain unexplained investment addition when seized records support the assessee's explanation.

In a search assessment, uncorroborated WhatsApp chats could not by themselves justify an addition for unexplained investment where the seized draft agreement, cost estimate sheet, board resolution, sale deed and recorded statements, read as a whole, supported the assessee's explanation that the property was negotiated with proposed refurbishment costs and ultimately purchased on an as-is basis for the registered consideration. The statutory presumption under sections 132(4A) and 292C attached to the seized material, and the Revenue failed to rebut it or show fabrication or falsity. On that evidence, the alleged cash component was not proved, and the addition under section 69 read with section 115BBE was deleted.

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Issues: Whether the addition made as unexplained investment on the basis of WhatsApp chats and alleged cash payment for purchase of immovable property was sustainable, and whether the seized documents and statements, read together, established that the amount in dispute represented refurbishment cost rather than unaccounted consideration.

Analysis: The seized draft agreement, cost estimate sheet, board resolution, sale deed and the statements recorded during search and post-search proceedings were found to support the assessee's explanation that the property was initially negotiated with proposed refurbishment cost and later purchased on an as-is basis for the registered consideration only. The statutory presumption under sections 132(4A) and 292C attached to the seized documents required them to be treated as true unless rebutted, and the Revenue did not disprove their contents or show that the documents were fabricated or false. WhatsApp chats, by themselves, were held insufficient to conclude that cash was actually paid, particularly when the surrounding material and statements did not corroborate the inference drawn by the Assessing Officer. A search assessment must rest on the totality of the seized material and not on isolated chat extracts or suspicion.

Conclusion: The addition under section 69 read with section 115BBE was not sustainable and was rightly deleted.

Final Conclusion: The Revenue's challenge failed because the alleged cash component was not established by corroborative evidence and the assessee's explanation, supported by seized records and statements, prevailed.

Ratio Decidendi: In a search assessment, uncorroborated electronic chats cannot, by themselves, justify an addition for unexplained investment when the seized documents and recorded statements, read as a whole, support the assessee's explanation and the Revenue fails to rebut the statutory presumption attached to the seized material.

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