TaxTMI 
TaxTMI 
2025 (6) TMI 1050
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....tisfaction recorded is illegal, bad in law and in violation of the CBDT guidelines and judgment of Hon'ble Supreme Court. 4. That on the facts and circumstances of the case and provisions of the law, approval obtained u/s 153D is illegal, bad in law and is without application of mind. 5. That the Ld. CIT(A) has erred on facts and in law in sustaining the addition of Rs. 32,62,500/- made by the Ld. Assessing Officer on account of unexplained money under section 69A of the Act without appreciating the facts of the case and relying solely upon dumb documents. 6. That the impugned CIT(A) order is arbitrary, illegal bad in law and in violation of rudimentary principles of contemporary jurisprudence. 3. Ground no.1, 2 and 6 are general in nature. No specific arguments have been made in respect of this ground and hence the same are dismissed. 4. Brief facts of the case:- A Search and seizure action u/s 132 of the Income Tax Act, 1961 (hereinafter referred to as 'the Act) was conducted in the case of Navneet Dawar & others Group on 03.01.2018 whereby residences and business premises of various persons including Sh. Navneet Dawar, Sh. Anil Narang, and Sh....
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....kar Mani, which is unaccounted cash in the hands of the assessee for the relevant assessment year. 4.4. In this regard, it was noted that in the show-cause dated 21.12.2022, it was stated that the above seized document was inter-alia confronted to Shri Anil Narang and his statement was recorded, whereas, in the seized document being page no.95, 96 of Annexure A-12 seized from the premises of Shri Guruvinder Singh Duggal at G-9, Greater Kailash III, Masjid Moth, New Delhi, the name of Shri Ravi Narang appears along with Shri Guruvinder Singh Duggal and Shri Upkar Mani showing the receipt of Rs. 1,48,50,000/- including the cash of Rs. 1,30,50,000/- (share of Rs. 32,62,500/- being 25% of total cash receipt pertaining to Shri Upkar Mani) out of Rs. 6,41,00,000/-. Therefore, the case was fixed for clarification to clarify the relationship of Shri Anil Narang and Shri Ravi Narang with the property mentioned in the said seized document A-12, Page no.95 and 96. During the clarification hearing on 11.03.2025, it was submitted by the Ld. AR that Shri Anil Narang and Shri Ravi Narang are own brothers and Shri Ravi Narang was one of the co-owners of the property being B-766, Shushant Lok, P....
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....ly. According to the Assessing Officer that the transactions made were related to the property B-766, Sushant Lok, Phase-1, Gurugram and the incriminating document found cannot be said to be invalid. Further, the Assessing Officer held that the reply filed by the assessee has been perused but not found to be satisfactory. According to the Assessing Officer, in his reply, the assessee has accepted that the assessee and its co-owners had accepted the RTGS payment from Heena Chowksi and Shri Shamit Chowksi but denied of any cash transaction made. The Assessing Officer held that it is clear that the assessee was denying the cash payment intentionally to avoid payment of due taxes on it. 4.9. Further, the Assessing Officer issued notice u/s 133(6) on 17.10.2022 to HDFC Bank and upon receipt of the information, found that the payment of Rs. 18 lakhs through RTGS matched with the seized document as referred above. The Assessing Officer held that it was clear that all the payments made through banking channel are matched with the seized documents and therefore, it is clear that cash transaction mentioned in the document is being denied intentionally by both the parties to avoid the paym....
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....t are correct or not correct but it cannot be partially correct. The appellant cannot selectively choose the entries in the account to be correct or incorrect. If the banking transactions are found to be correct then the rest of the cash entries are also to be considered as correct only. xxxxxxxxxx 4.1.8 As regards the appellant's contention regarding lack of opportunity to cross-examine the evidence relied upon by the Assessing Officer, it is worth mentioning that where the statement supports and corroborates the seized material and is not the primary evidence on the basis of which addition has been made, then there is no mandatory requirement to grant cross-examination of the relevant person/s. In the case of the appellant also, the statement/s recorded during the search proceedings are collateral/corroborative in nature and is not the sole evidence relied upon by the Assessing Officer. The primary evidence in this case is the seized document found during the search of Sh. 'Gurvinder Singh Duggal, Therefore, the Assessing Officer was not under obligation to grant cross-examination of concerned person/s. xxxxxx 4.1.13 This issue has been analysed an....
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....has failed to discharge the onus cast upon him and hence, it is held by the Assessing Officer in the case of Sh. Gurvinder Singh Duggal and also in the case of the appellant that they are in possession of unexplained money u/s 69A of Income Tax Act. The share of above mentioned cash received by Sh. Gurvinder Singh Duggal has already been added in the hands of Sh Gurvinder Singh Duggal us 69A of Income Tax Act and the addition has already been confirmed by the CIT(A) and the Assessing Officer has subsequently levied penalty on this addition. The appellant had received 25% of this cash and same has therefore been correctly added in his hands during the year as unexplained money received us 69A of Income Tax Act. As per the documents available as a result of search, there is sufficient evidence that the appellant was in receipt of undisclosed money in cash amounting to Rs. 32.62,500/- and therefore was the owner of this money which was not recorded in the books of accounts. The case laws mentioned by the appellant in his submissions do not address the issues raised in appeal as their facts are different from the facts of the present case. In view of the above, I am of the considered o....
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....ated that no person who is party in this search as well as whose name is involved has ever accepted anything in their statement. 7.1. The Ld. AR also submitted that the loose sheet found during the search of third person cannot form the basis of addition in the case of the assessee without any corroborative evidence. In this regard, the written submission of the assessee is reproduced as under:- 2. Loose sheet found during the search of third person cannot forms the base of addition without any corroborative evidence: In the impugned case a search operation has happened on Gurvinder singh Duggal and during the course of the search a undated and unsigned loose sheet named as RECEIPT was found from the premises of Gurvinder Singh Duggal wherein it was mentioned that We Gurvinder singh Duggal, Upkar Mani and Ravi Narang have received 1,48,50,000/-from Shamik Chowksi and based on this receipt Ld AO has made the addition assuming that since this sheet contains details of the transaction which have been done through banking channel which matches with the bank statement, hence the other transactions are also genuine. While making the addition, Ld. AO has grossly ignor....
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....nation of undisclosed income of the assessee amounting to Rs. 32,62,500/- for the F.Y. 2017-18 relevant to AY 2018-19. In view of this fact, relying upon the above decision of the Hon'ble Delhi High Court, he submitted that the recording of the combined satisfaction will be legally valid satisfaction in the case of the assessee for F.Y. 2017-18 relevant to AY 2018-19 and the assessment order dated 31.12.2022 in the case of the assessee u/s 153C of the Act was a valid assessment order. The Ld. CIT-DR also submitted that the assessee was not a third party because the search had taken place in the case of Shri Gurvinder Singh Duggal, who was the 50% owner of the property along with the assessee being 25% of the owner along with Mr. Ravi Narang (25%). According to the ld. CIT-DR, the assessee's partner was searched and therefore the document was not seized from a third party but from the partner of the assessee, and thus for this transaction, the assessee i.e. Shri Upkar Mani was the same party against whom the search was conducted and therefore the ld. CIT(A) was correct in invoking the presumption u/s 132(4A) r.w.s 292C of the Act against the assessee. He further submitted that the a....
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....t satisfaction notes for each AY. A composite Satisfaction Note would suffice the requirements of Section 153C of the Act provided it embody details of the material gathered in the course of the search and pertaining to the AYs forming part of the block as a whole. As long as the common Satisfaction Note includes sufficient particulars of the incriminating material relevant to the block of AYs', the same would, in our considered opinion, satisfy the statutory requirement as imposed by the Act. Singhad Technical Education Society as also the decision of the Supreme Court in Principal Commissioner of Income Tax, Central-3 vs. Abhisar Buildwell P. Ltd speak of incriminating material being found and which may impact the estimation of income likely to have escaped assessment for a particular AY. As we read and go through the Satisfaction Note as well as the orders disposing of objections, it is manifest that the respondent has rested its decision on incriminating material found for AYs 2014-15, 2015-16, 2016-17 and stretching up to AY 2020-21. 24. The provision only requires the AO to be satisfied that the material collated and handed over is likely to have an impact on the tot....
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....approval granted u/s 153D of the Act. However, no submission was made in respect of this ground and therefore the same is dismissed. 11. In ground No.5, the assessee has challenged the addition of Rs. 32,62,500/- made by the Assessing Officer on account of unexplained money u/s 69A of the Act without appreciating the facts of the case and relying solely upon the aforesaid seized documents, which according the assessee are dumb documents. In this regard, the Assessing Officer held that property referred in the seized document was a subject matter of sale with the parties as mentioned in the said incriminating document and there is no dispute about that. Further, he held that since the amount of Rs. 18 lakhs received through banking channels was found to be correct and also accepted by Shri Gurvinder Singh Duggal and Shri Anil Narang and therefore the denial of accepting the cash amount of Rs. 1,30,50,000/- as referred in the seized document was only an attempt in not paying the taxes due on the said amount as they had not declared the said amount in their income tax return. The Ld. CIT(A) agreed with the said findings of the Assessing Officer and also held that provisions of sect....
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....ough RTGS has been accepted by the sellers Shri Gurvinder Singh Duggal, Shri Anil Narang and also confirmed by the buyer Shri Shamit Chowksi. It has to be kept in mind that cash received in a transaction along with cheque receipts through banking channels is usually with an intent to conceal it and not to declare the same in its return of income. Therefore, by its very nature, it becomes a secret document, which will not be easily found even during the course of search and even when found, at times, all the entries will not be mentioned in a very clear and explicit manner. However, the entries in the present seized document are very clearly mentioned but the assessee contends that the same is undated and unsigned and the receipt of cash as mentioned in the said seized document has been denied by the seller and the buyer in their respective statement as narrated earlier in this order. 12.1. Therefore, in such a situation, an incriminating document has to be analysed from the evidences/facts available in the said document and its veracity with other verifiable facts. Firstly, it is mentioned in the said seized document before making the entries of cash receipts and payments by RTG....
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....s as contended by the assessee cannot be termed as a dumb document. 12.2. Further, the case laws relied by the assessee with respect to its contention that no addition can be made in respect of loose sheet found during the search of third person without any corroborative evidence will also be not applicable in the present case as it has been held that the seized document was not seized from third party because for this transaction, the assessee is the same party as the searched party and therefore no corroborative evidences are required in this case as contended by the assessee and in this particular case the presumption u/s 132(4A) r.w.s. 292C of the Act will be applicable against the assessee. 12.3. Further, the plea of the assessee that no opportunity has been provided to cross examine is also not acceptable because no reasons or any ground for cross examining any person has been mentioned. Further, in the given facts of the case when there is denial of receipt of the cash by all the parties concerned and there being no dispute with other material details relating to the details mentioned in the seized documents, we are of the considered view that no cross examination is r....