Third-party digital data additions fail where concurrent factual findings show no unaccounted transaction and no substantial question of law arises.

Additions for alleged unaccounted sales based on third-party digital data were deleted because the appellate authorities found the software entries had been misread and no unaccounted purchases were established in the third party's hands. The accounts between the assessee and the third party were found to tally, and the High Court accepted these concurrent factual findings. In the absence of any proved unaccounted transaction on facts, the corresponding addition in the assessee's hands could not survive. No substantial question of law was held to arise under section 260A of the Income-tax Act, 1961.

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Issues: Whether the additions made on account of alleged unaccounted sales based on digital data from a third party were sustainable and whether any substantial question of law arose from the concurrent findings deleting those additions.

Analysis: The assessment rested on an interpretation of entries in the EmmEss-Gold software found during survey in the case of V.K. Group. The appellate authorities found that no addition had been made in the hands of V.K. Group for alleged unaccounted purchases, that the software entries had been misread by the Assessing Officer, and that the accounts between the assessee and V.K. Group tallied. The Court accepted these concurrent factual findings and held that, in the absence of any unaccounted purchase in the hands of V.K. Group, the corresponding addition for unaccounted sales in the assessee's hands could not survive.

Conclusion: The deletion of the additions was upheld and no substantial question of law was held to arise.

Ratio Decidendi: Where the appellate authorities record concurrent findings that the third-party material was misinterpreted and no unaccounted transaction is established on facts, the High Court will not treat the matter as giving rise to a substantial question of law under section 260A of the Income-tax Act, 1961.

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