TaxTMI 
TaxTMI 
2025 (3) TMI 1152
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....n the appeal of the assessee filed for AY.2015-16, the assessee is assailing the decision of the Ld.CIT(A) in confirming the additionmade on the basis of whatsapp chat. 3. The facts relating to the case are discussed in brief. The assessee is carrying on monsoon shed hiring business in addition to carrying on agricultural activities. He has been making investments in shares and securities, mutual funds etc. During both the years under consideration, the assessee has sold shares of M/s.Pine Animation Ltd., and earned long term capital gains in both the years. The assessee claimed the same as exempt u/s 10(38) of the Act. The investigation wing of Income Tax Department, Kolkata found out that the prices of shares of certain companies (called as penny stock companies) are being manipulated in order to generate bogus long term capital gains. M/s.Pine Animation Ltd., was identified as one of such companies. The SEBI, being the regulator of the Stock Exchange, started investigation on those activities. In respect of M/s.Pine Animation Ltd., an Ad-interim Order dated 08-05-2015 was passed by SEBI, wherein it initiated enquiries on the promoters and the allottees of shares of M/s.Pine A....
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....UE'S APPEAL):- 6. We shall first take up the appeal filed by the revenue for AY 2014-15. We noticed earlier that the search was conducted in the hands of the assessee on the basis of Ad-interim report given by SEBI, since enquiry was conducted by SEBI on all the purchasers of shares in the preferential allotment made by M/s Pine Animation Ltd (earlier known as 4K Animation Ltd). The assessee had purchased 6,00,000 shares of above said company @ Rs.10/- per share in the shares issued under private placement on preferential basis. The shares were allotted to the assessee on 07-12-2012. Subsequently, the face value of shares was split from Rs.10/- per share to Re1.00 per share. Accordingly, the assessee got 60,00,000 shares. All these shares were sold by the assessee in the month of January 2014 to March, 2014 and earned long term capital gains, which was claimed as exempt u/s 10(38) of the Act. The assessee's sister Smt. Lata Shah also purchased 6,00,000 shares and hence she was also subjected to enquiry by SEBI. 7. During the course of assessment proceedings, the AO issued a notice u/s 142(1) of the Act to the assessee raising various queries. The assessee also duly furnished ....
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....f persons, on whose statements, the AO is placing reliance. But the AO did not afford that opportunity to the assessee. Before the AO, the assessee furnished all the documents in support of purchase and sale of shares. The Ld A.R submitted that the assessee also furnished copy of final SEBI report, wherein he and his sister have been exonerated by SEBI. However, the AO did not accept any of those documents. He concluded as under:- • The financials of M/s. Pine Animation Limited were very poor during the period when the shares were purchased by the beneficiaries. • The business profile shows that the company was not engaged into any substantial activity. • The business profile shows that the company was not having any future plans which could attract investors from all over India to invest in the company. • The whole process of rigging value of the shares on the stock market was a prearranged and a managed process so as to for booking accommodation entry of bogus LTCG in the garb of sale proceeds on sale of shares. • The shares were rigged on the stock exchange through manipulation of the stock market. • V....
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.... (e) the AO did not deal with various case laws relied upon by the assessee, but relied on certain case law which are not applicable to the facts of the present case. 12. Hence, the CIT(A) called for a remand report from the assessing officer. The AO submitted that the modus operandi in generating bogus capital gains have been extensively investigated by the Investigation wing of Kolkata, Mumbai and Delhi. He submitted that the contents of the statement given by certain operators have already been incorporated in the assessment order. The AO did not offer any comment on the issue of not providing opportunity of cross examination. He also did not comment upon the documents furnished by the assessee to prove purchases and sales. 13. The remand report given by the AO was confronted with the assessee, who furnished his comments on it. In effect, the assessee submitted that the AO has not addressed various contentions raised by him. The assessee also placed reliance on the following case law to contend that the additions made by the AO should be deleted:- (a) Shri VijayrattanBalkrishnan Mittal vs. DCIT (2020)(121 taxmann.com 100)(Mum-Trib); (b) DCIT vs. Shr....
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....e me the appellant has furnished his explanation on the above mentioned issues discussed by the A.O in the assessment order. I have gone through the various submissions of the appellant. In a nutshell the appellant's contention is summarised as under- I. The appellant is a regular investor in shares. He has also invested in other shares during the concerned period. II. The shares of Pine Animation Ltd. were purchased on the recommendation of Shri. Bhavesh Shah, who was working as sub broker with First Global stock brokers. III. This fact has also been confirmed by Shri Bhavesh Shaha in his statementrecorded u/s 131 of the IT Act on 13.09.2015. IV. No incriminating evidences were found during the search which demonstrates that the appellant has availed any accommodation entry. No cash as alleged by the AO was found during the search. V. The appellant has carried out genuine transaction and the same are supported by documentary evidence. VI. Shares have been sold online stock exchange through reputed brokers. VII. Purchases have been accepted by the AO as no addition in this regard has been made. VIII. No opp....
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....disproved the documentary evidences filed by the Appellant in support of the exemption claimed under section 10(38) of the Act in respect of long term capital gain earned on sale of shares of PAL." 17. Thereafter, the Ld.CIT(A) referred to the statement taken from the assessee u/s 132(4) of the Act during the course of search operations. Upon examining it, the Ld.CIT(A) concluded that the assessee is a regular trader in the share market. Hence it is not an isolated case of purchase of shares of M/s Pine Animation Ltd. The assessee had stated that he purchased the shares of above said company on the advice of his share broker Shri Bhavesh Shah, who was also examined and he also confirmed that he had advised the assessee herein to buy the shares of M/s Pine Animation Ltd. Accordingly, the ld CIT(A) concluded as under:- "19.6.4 During the assessment and appellate proceedings the appellant has furnished the brokers notes, details of payments made for the purchase, copy of bank statement etc in support of purchase. It is not in dispute that the appellant had made purchase of shares off market through preferential allotment of shares by the concerned company. The appellant ha....
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....iyank Ankit Miglani and others (ITA No.2531/Mum/2021) (e) Gopal Nichaldas Pariani (ITA No.7761 & 7762/Mum/2019) (f) Yogesh Thakkar and others (ITA 1605/Mum/2021 and others) The Ld.CIT(A) noticed that the facts prevailing in the case of Priyanka Ankit Miglani were identical with the case of the assessee. In fact, the concerned Ld CIT(A) in the case of Priyanka Ankit Miglani, had followed the decision rendered by the Tribunal in the case of Vijayrattan Balkrishna Mittal in ITA No.3248/Mum/2019 dated 01-10-2019. The Ld CIT(A) noticed that the decision rendered by Ld CIT(A) in the case of Priyanka Ankit Miglani has been upheld by the Tribunal in ITA No.2531/Mum/2021). The Ld.CIT(A) noticed that the facts prevailing in the present case and in the cases of Anuj Rajinder Miglani** and Vijayrattan Balkrishnan Mittal are identical in nature. In this regard, the Ld CIT(A) has prepared a chart showing parity of facts between the above said cases.(** decided along with Priyanka Ankit Miglani) The said chart is extracted below, for the sake of convenience:- Appellant Anuj Rajinder Miglani Vijayrattan Balkrishnan Mittal ....
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....ordinate Bench of the Tribunal has examined an identical issue in the above case in a detailed manner and accordingly deleted the addition. The operative portion of the decision rendered by the Co-ordinate Bench in the case of Priyanka Ankit Miglani (supra) is extracted below:- "5. We find that the ld. AO had relied on the findings of the investigation wing of Kolkata and an interim order dated 08.05.2015 passed by SEBI wherein assessee and the company Pine Animation Ltd were prevented from accessing the securities market either directly or indirectly in any manner whatsoever, till the completion of final investigation by SEBI. The main grievance of the ld. AO is that rise in share price of Pine Animation Ltd is devoid of commercial principle or market factors ; that transactions are based on mutual connivance on part of assessee and Smt. Prayanka Ankit Miglani and others operators; that assessee resorted to preconceived scheme to procure bogus long term capital gains and hence the transactions are not bonafide; that SEBI also passed an interim order in the case of Pine Animation Ltd holding that share prices were determined artificially by manipulations; that these are cl....
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....th the brokers and entry operators. 5.4. It is not in dispute that the assessee had made purchase of shares in off-market through preferential allotment of shares by the concerned company. Now the next issue that arises for our consideration is as to whether an off market purchase of shares could be taken as a ground to declare the entire transaction as sham. In our considered opinion, the transactions could not be treated as sham merely because they are done in off-market, if the assessee had discharged his onus of proving the fact that shares purchased by him were dematerialized in the Demat account and held by the assessee till the same were sold from the Demat account of the assessee. The transaction of holding the shares are reflected in Demat account and sale of shares are through Demat account. More so, when there is no dispute regarding the purchase price and sale price of shares. Our view is further fortified by the decision of Hon'ble Jurisdictional High Court in the case of CIT vs Jamnadevi Agarwal reported in 328 ITR 656 (Bom) wherein it was held that - "From the documents produced before the Court it was seen that the shares in question were, in f....
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.... were confirmed vide Orders dated June 02,2016, July 05, 2016, August 22, 2016, and June 02,2017 need not be continued. 11. In view of the foregoing, I, in exercise of the powers conferred upon me under Section 19 of the Securities and Exchange Board of India Act, 1992 read with Sections 11, 11(4) and 11B of the SEBI Act, hereby revoke the Confirmatory Orders dated June 02,2016, July 05, 2016, August 22, 2016, and June 02,2017 qua aforesaid 114 entities (paragraph 9 above) with immediate effect. 12. The revocation of the directions issued vide the abovementioned orders (at paragraph 11) is only in respect of the entities mentioned at paragraph 9 of this order in the matter of Pine Animation Limited. As regards remaining entities in the scrip of PAL, violations under SEBI Act, SCRA, PFUTP Regulations, etc., were observed and SEBI shall continue its proceedings against them. Hence, the directions issued vide Orders dated July 05, 2016, August 22, 2016, and June 02,2017 against the remaining 62 entities shall continue. 5.5.1. We find that the name of the assessee is reflected in Serial Number 38 which is part of 114 entities acquitted by SEBI, on whom clean ....
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.... Wing report which are more general in nature and does not implicate the assessee herein in any manner whatsoever. We are unable to persuade ourselves to accept to the contentions of the ld. DR that Kolkata Investigation Wing had conducted a detailed enquiry with regard to the scrip dealt by the assessee herein and hence whomsoever had dealt in this scrip, would only result in bogus claim of long term capital gain exemption or bogus claim of short term capital loss. Merely because a particular scrip is identified as a penny stock by the income tax department, it does not mean all the transactions carried out in that scrip would be bogus. So many investors enter the capital market just to make it a chance by investing their surplus monies. They also end up with making investment in certain scrips (read penny stocks) based on market information and try to exit at an appropriate time the moment they make their profits. In this process, they also burn their fingers by incurring huge losses without knowing the fact that the particular scrip invested is operated by certain interested parties with an ulterior motive and once their motives are achieved, the price falls like pack of cards a....
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....ound to be not violative of provisions of relevant Act and Rules by the SEBI upon necessary investigation and even the initial restraint order was revoked vide interim order dated 06/09/2017, therefore, we find no basis in sustaining the impugned addition made by the AO by treating the said transaction to be a penny stock transaction resulting in bogus long term capital gains. Accordingly, we direct the AO to delete the impugned addition of Rs 84,45,050. Further, since the other addition of Rs 22,712 by AO is also consequent to the aforesaid impugned addition, therefore, the said addition is also directed to be deleted." 5.9. We hold that the entire addition has been made based on mere surmise, suspicion and conjecture and by making baseless allegations against the assessee herein. Now another issue that arises is as to whether the ld. AO merely on the basis of Kolkata investigation wing report could come to a conclusion that the transactions carried out by the assessee as bogus. In our considered opinion, the ld. AO is expected to conduct independent verification of the matter before reaching to the conclusion that the transactions of the assessee are bogus. More importan....
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....uld not be treated as unaccounted income u/s 68 of the Act. The relevant operative portion of the said judgement is reproduced below:- 5. We have perused the concurrent findings and on which heavy reliance is placed by Mr.Sureshkumar. While it is true that the Commissioner extensively referred to the correspondence and the contents of the report of the Investigation carried out in paras 20, 20.1, 20.2 and 21 of his order, what was important and vital for the purpose of the present case was whether the transactions in shares were genuine or sham and bogus. If the purchase and sale of shares are reflected in the Assessee's DMAT account, yet they are termed as arranged transactions and projected to be real, then, such conclusion which has been reached by the Commissioner and the Assessing Officer required a deeper scrutiny. It was also revealed during the course of inquiry by the Assessing Officer that the Calcutta Stock Exchange records showed that the shares were purchased for code numbers S003 and R121 of Sagar Trade Pvt Ltd. and Rockey Marketing Pvt. Ltd. respectively. Out of these two, only Rockey Marketing Pvt.Ltd. is listed in the appraisal report and it i....
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.... the purposes of faulting the Revenue in failing to discharge the basic onus. If the Tribunal proceeds on this line and concluded that inquiry was not carried forward and with a view to discharge the initial or basic onus, then such conclusion of the Tribunal cannot be termed as perverse. The conclusions as recorded in para 12 of the Tribunal's order are not vitiated by any error of law apparent on the face of the record either. 7. As a result of the above discussion, we do not find any substance in the contention of Mr.Sureshkumar that the Tribunal misdirected itself and in law. We hold that the Appeals do not raise any substantial question of law. They are accordingly dismissed. There would no order as to costs. 8. Even the additional question cannot be said to be substantial question of law, because it arises in the context of same transactions, dealings, same investigation and same charge or allegation of accommodation of unaccounted money being converted into accounted or regular as such. The relevant details pertaining to the shares were already on record. This question is also a fall out of the issue or question dealt with by the Tribunal and pertaining....
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.... financials. On an analysis of the data obtained from the websites, the AO observes that the quantum leap in the share price is not justified; the trade pattern of the aforesaid company did not move along with the sensex; and the financials of the company did not show any reason for the extraordinary performance of its stock. We have nothing adverse to comment on the above analysis, but are concerned with the axiomatic conclusion drawn by the AO that the Respondent had entered into an agreement to convert unaccounted money by claiming fictitious LTCG, which is exempt under section 10(38), in a preplanned manner to evade taxes. The AO extensively relied upon the search and survey operations conducted by the Investigation Wing of the Income-tax Department in Kolkata, Delhi, Mumbai and Ahmedabad on penny stocks, which sets out the modus operandi adopted in the business of providing entries of bogus LTCG. However, the reliance placed on the report, without further corroboration on the basis of cogent material, does not justify his conclusion that the transaction is bogus, sham and nothing other than a racket of accommodation entries. We do notice that the AO made an attempt to delve in....
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.... may be enough to show circumstances that might create suspicion; however the Court has to decide an issue on the basis of evidence and proof, and not on suspicion alone. The theory of human behavior and preponderance of probabilities cannot be cited as a basis to turn a blind eye to the evidence produced by the Respondent. With regard to the claim that observations made by the CIT(A) were in conflict with the Impugned Order, we may only note that the said observations are general in nature and later in the order, the CIT(A) itself notes that the broker did not respond to the notices. Be that as it may, the CIT(A) has only approved the order of the AO, following the same reasoning, and relying upon the report of the Investigation Wing. Lastly, reliance placed by the Revenue on Suman Poddar case (supra) and Sumati Dayal case (supra) is of no assistance. Upon examining the judgment of Suman Poddar case (supra) at length, we find that the decision therein was arrived at in light of the peculiar facts and circumstances demonstrated before the ITAT and the Court, such as, inter alia, lack of evidence produced by the Assessee therein to show actual sale of shares in that case. On such ba....
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....how strong it may appear to be true, but needs to be corroborated by some evidence to establish a link that the assessee had brought back her unaccounted income in the form of LTCG. Reliance in this regard is placed on the decision of Special Bench of Mumbai Tribunal in the case of GTC Industries Ltd. vs. ACIT reported in 80 taxmann.com 284 (Mumbai-Trib.)(SB) The Tribunal observed as under: "46. ......... Ultimately the entire case of Revenue hinges upon the presumption that assessee is bound to have some large share in so called secret money in the form of premium and its circulation.However, this presumption or suspicion how strong it may appear to be true but needs to be corroborated by some evidence to establish a link that GTC actually had some kind of a share in such secret money. It is quite a trite law that suspicion howsoever strong may be but cannot be the basis of addition except for some material evidence on record. The theory of „preponderance of probability‟ is applied to weigh the evidences of either side and draw a conclusion in favour of a party which has more favourable factors in his side. The conclusions have to be drawn on the basis of cert....
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....ng. (d) The assessee had not provided strong and enough documentary evidences in support of purchase and sale of shares whereas in the case of the assessee herein before us, enough documentary evidences were duly submitted before the ld. AO which stood uncontroverted by the ld. AO. (e) Furthermore, the Hon'ble Bombay High Court in Sanjay Bimalchand Jain has categorically observed that its facts are not similar to the one prevailing in the Hon'ble Bombay High Court decision in CIT vs Jamnadevi Agarwal reported in 328 ITR 656, whereas the facts of the assessee herein before us are similar to the one prevailing in the case of Jamnadevi Agarwal. 5.16.1. Hence we hold that the decision relied upon by the ld. DR vehemently before us on Sanjay Bimalchand Jain, is factually distinguishable and does not advance the case of the revenue. 5.17. We find that the Hon'ble Jurisdictional High Court in the recent case of PCIT vs Ziauddin A Siddique in Income Tax Appeal No. 2012 of 2017 dated 04.03.2022 had held as under:- "2. We have considered the impugned order with the assistance of the learned Counsels and we have no reason to interfere. ....
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.... that the Assessing Officer doubted the transactions since the selling broker was subjected to SEBI's action. However the transactions were as per norms and suffered STT, brokerage, service tax, and cess. There is no iota of evidence over the transactions as it were reflected in demat account. The appeal filed by the revenue was dismissed. We find that the assessee's case before us is in a much stronger footing as no action has been initiated on the Broker by SEBI and even the action initiated on the assessee by SEBI vide Interim order dated 08.05.2015 were finally revoked by SEBI in its final order dated 19.09.2017. 5.20. We find that the Hon'ble Calcutta High Court in the case of CIT vs Bhagwati Prasad Agarwal reported in 2009 (4) TMI 138 - CALCUTTA HIGH COURT (Cal HC) in ITA No. 22 of 2009 dated 29.4.2009, had observed that the Assessee claimed exemption of income from Long Term Capital Gains. However, the ld. AO, based on the information received by him from Calcutta Stock Exchange found that the transactions were not recorded there. He therefore held that the transactions were bogus. The Hon'ble High Court, affirmed the decision of the Tribunal wherein....
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....ompany in collusion with others or in the manner of unfair trade practices against the norms of S.E.B.I and Stock Exchange, then merely because of that fact a person who bonafidely entered into share transaction of that company through such broker then only by mere assumption such transactions cannot be held to be a shame transaction. Fact of tinted broker may be relevant for suspicion but it alone necessarily does lead to conclusion of all transaction of that broker as tinted. In such circumstances, further enquiry is needed and that is for individual case. Such further enquiry was not conducted in that case. 11. At this juncture, it would be relevant to mention here that it is not disputed by the Revenue before us that the shares of these assessees were already shown in the earlier Balance Sheet submitted by the assessees, and therefore, in that situation, how the revenue condemned the transaction even on the ground of steep rise in the shares. If within a period of one year, the share price has risen from Rs.5 to 55 and from 9 to 160 and one person was holding the shares much prior to that start of rise of the share, then how it can be inferred that such person entered ....
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....Court has Smt. Prayanka Ankit Miglani and others observed that utmost regard must be had by the adjudicating authorities and the appellate authorities to the requirement of judicial discipline. Hence we deem it fit and appropriate to follow the decisions of Hon'ble Jurisdictional High Court referred supra wherein the impugned issue is decided in favour of the assessee. Moreover, when there are two conflicting decisions of various High Courts, the Hon'ble Supreme Court in the case of Vegetable Products reported in 88 ITR 192 (SC) had held that Construction that is favourable to the assessee should be adopted. Hence by following this principle, the decision of Hon'ble Calcutta High Court and other decisions that are rendered against the assessee, need not be followed by this Court in the peculiar facts and circumstances of the instant case. 5.24. The ld. DR relied on the decision of this tribunal in the case of DCIT vs Leena Power Tech Engineers (P) Ltd reported in 130 taxmann.com 341 (Mumbai Trib) dated 21.09.2021 in support of his contentions. We have gone through the said decision and we find that the said decision was rendered in the context of receipt of sha....
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.... and materials available on record with respect to the facts. Accordingly, the tribunal is bound to pass orders only based on facts and materials available on record. In our considered opinion, this is how the expression 'pass such orders thereon' used in section 254(1) of the Act need to be understood. In any case, we find that in the instant appeal before us, the ld. CIT(A) had sought for a remand report twice from the ld. AO. In both the remand reports, the ld. AO had merely reiterated his findings given in the assessment order. Hence sufficient opportunities were indeed given to the ld. AO to justify his case by the ld.CIT(A). Hence we hold that the reliance placed on this decision of Hon'ble Delhi High Court supra does not advance the case of the revenue. 5.26. In any case, we find that the assessee had duly proved the nature and source of credit representing sale proceeds of shares of Pine Animation Ltd within the meaning of section 68 of the Act. The sale proceeds have been received by the assessee from the stock exchange through the SEBI registered share broker by account payee cheques through regular banking channels. We find that the three ingredients....
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....hat the AO has fully placed reliance on the investigation report given by the investigation wing and also relied upon the statements recorded from certain persons and exit providers. The assessee sought opportunity to cross examine all those persons, but such opportunity was not given. However, in the second remand proceeding, the AO issued notice only to an alleged exit provider named Shri Jagdish Purohit only. Even though Shri Jagdish Purohit did not present himself for cross examination, yet he sent a letter to the AO, wherein he has stated that he was not aware of the assessee and further, he did not have any business relationship with the assessee. This reply of Mr.Jagdish Purohit was not proved to be wrong by the AO. However, in respect of other persons, no step was taken by the AO to afford the opportunity of cross examination either during the course of assessment proceedings or in remand proceedings. Even though the Ld CIT(A) has expressed the view that the AO has not solely placed reliance on those statements and hence affording of opportunity of cross examination is not mandatory, yet the important point here is that it is not the case of the AO that those persons had sp....
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....late to the addition of long term capital gains and estimated commission expenses. We noticed earlier that the assessee and his sister Shri Lata Shah had initially purchased shares of M/s Pine Animation Ltd. The assessee's sister had gifted her shares to the assessee and they were sold by him during the year relevant to AY.2015-16. Both the additions were deleted by the Ld.CIT(A) and hence the revenue has filed this appeal. The facts relating to the addition of long term capital gains and estimated commission expenses made in this year are identical with the facts discussed in AY.2014-15. Accordingly, the decision rendered by us in the earlier paragraphs in AY.204-15 in respect of both the additions shall apply mutatis mutandis in this year also. Accordingly, we confirm the relief granted by the Ld.CIT(A) in respect of both these additions in this year also. ASSESSMENT YEAR 2015-16 (ASSESSEE'S APPEAL): - 31. In this appeal, the assessee is assailing the decision of the Ld.CIT(A) in confirming the addition of Rs.2.00 crores made on the basis of whatsapp chat. The facts relating thereto are discussed in brief. The revenue carried out a survey operation in the hands of M/s Kraze....
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....nwards. Besides the above, the assessee's mother named Smt Navalben Dheanji Goshar has given interest free loan of Rs.50,00,000/- to Shri Jayant Chamji Chheda and the same has been repaid by him. It was contended that the assessee has not given any cash as alleged by the AO. It was further contended that the whatsapp chat does not have any evidentiary value. In this regard, the assessee relied upon following decisions:- (a) Lavanya Land (P) Ltd (2017)(83 taxmann.com 161)(Bom); (b) Common Cause (A registered Society) vs. UOI (77 taxmann.com 245)(SC); (c) CIT vs. Saffire Hotels (P) Ltd (2015)(377 ITR 0523)(Bom); (d) DCIT vs. Neelkanth builders P Ltd (2004)(87 TTJ (Mum) 287); (e) CIT vs. DhirajlalDuriabhai Patel-HUF (2010-TIOL-475-HC-AHM-IT) The assessee has also questioned the observation of the AO that the whatsapp chat conversation corresponding to the print out impounded from M/s Krazee Property developers was available in his phone. In this regard, the assessee submitted as under before theLd.CIT(A):- "To prove the authenticity of the said conversation, appellant had requested Ld AO to provide confirmation from Whatsapp Ser....
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....ted that the assessee has only confirmed that the imaging of his phone and two laptops have been taken in external hard discs, but did not confirm any alleged Whatsapp chats. He further submitted the Revenue has not followed the procedure prescribed u/s 65B of the Act Indian Evidence Act for taking the Whatsapp chat as an evidence for making this addition. Accordingly, he submitted that the addition of Rs.2.00 crores cannot be sustained on this legal ground also. 35. The Ld D.R, on the contrary, placed reliance on the order passed by Ld CTI(A). 36. We heard rival contentions and perused the record. We notice that the impugned addition has been made on the basis of whatsapp chat. The contentions of the Ld A.R are summarised below:- (a) The impugned addition of Rs.2.00 crores has been made on the basis of a print out, which appeared to be a copy of whatsapp between assessee and Shri Jayant S Chheda. The said document was found in the premises of M/s Krazee Properties P Ltd. It is scanned as under by Ld CIT(A) Pankaj D. Goshar. Thanks for your support Dear Jayant Bhai I have send you both Account Ledger copy to you which is self-expla....
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....bile phone has been found to be erased/deleted. In the circumstances, the question of taking print out from my mobile data does not arise.... In view of the peculiar facts and circumstances of the case, I request you to provide me the confirmation from the Whatsapp Service Provider/iCloud Service Provider that the conversations as referred with various persons in several paras of your Notice have been extracted from my mobile phone" We notice that the has contended before the AO that the said Whatsapp chat was not available in his phone. Hence, if the Whatsapp chat was really available in the Iphone, then the same should be available in the Hard disk, wherein all the datas were copied by the revenue. We notice that the AO has not brought anything on record, despite the fact that the assessee was disputing the same. We notice that the Ld CIT(A) has also confirmed this addition only for the reason that the data from iphone has been copied in the External Hard disk by the revenue. He also did not bother to call for the same from the AO. (e) Finally, as submitted by Ld A.R, the AO has not followed the procedure prescribed in sec.65B of the Act before placing ....