TaxTMI 
TaxTMI 
2026 (5) TMI 477
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....he Act') on 16.05.2017, 01.06.2017 & 07.07.2017. A warrant of authorization for search was issued in the name of the assessee, for his residence premise at C-654, New Friends Colony, New Delhi. During search certain papers/documents relating to certain cash transactions were found and seized. Assessment jurisdiction over the assessee was transferred from Pr. CIT (Central), Gurgaon, vide order u/s 127(1) dated 20.11.2018 with immediate effect. Due to the search conducted u/s 132 in this case, notice u/s 153A of the Act was issued on 23.09.2019,directing the assessee to furnish return of income for the year under consideration being one of the six assessment years preceding to the assessment year in which search was conducted. 4. In response to the notice u/s 153A, the assessee filed return declaring income of Rs. 1,10,18,270/- on 12.12.2019. Notices u/s 143(2) and 142(1) of the Act were issued and served on the assessee. In response, ld. AR of the assessee attended the proceedings from time to time and submitted the requisite details and clarifications as called for. 5. During the year under consideration, the assessee has shown income from salary, income from capital gains an....
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....nt of Rs. 3,50,000/- in cash was made to Mr. Manish Malhotra on behalf of Ms. Jwala Gutta which clearly shows that the assessee has made payment of Rs. 3,50,000/- on behalf of Ms. Jwala Gutta to Mr. Manish Malhotra. 8. Further, AO observed that the assessee has not submitted plausible reply and also failed to submit documentary evidence either during post search proceedings or during assessment proceedings which proves that the cash payments made to Ms. Jwala Gutta has been properly accounted for in the books of assessee and the AO was of the view that it clearly shows the assessee has made payment to Ms. Jwala Gutta in cash from his undisclosed sources and therefore, the same is required to be added to the income of the assessee u/s 69A of the Act. Further, AO observed that the assessee has made payment of Rs. 41,50,000/- during the period F.Y. 2015-16 to 2017-18 and the same are reproduced below: Sl.no. Date of payment (FY) Amount 1 2015-16 20,00,000/- 2 2016-17 3,50,000/- 3 2017-18 18,00,000/- 41,50,000/- 9. AO therefore held that the source of expenditure remained unexplained and therefore, the payment of Rs. 3,50....
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....uced the message in the assessment order. AO observed that it is clear that the assessee has incurred the expenditure for wedding expenses of his brother's daughter amounting to Rs. 53,00,000/- and in absence of any plausible explanation along with documentary evidences, the amount of expenditure Rs. 53,00,000/- is treated as unexplained money u/s 69A of the Act and added to the income of assessee. 12. Aggrieved with the above order, assessee preferred an appeal before the ld. CIT (A) and submitted detailed submissions. Ld. CIT (A) after considering the submissions of the assessee sustained the additions and dismissed the appeal. 13. Aggrieved with the above order, assessee is in appeal before us raising following grounds of appeal :- "1. The order passed by the CIT(A) is erroneous, bad in law, against the facts and circumstances of the case and is liable to be quashed. 2. The CIT(A) erred in law and facts in confirming the addition of Rs. 3,50,000/- made by the AO u/s 69A of the Act alleging cash paid to or on behalf of Ms Jwala Gutta by the appellant without making any independent enquiries from her about the same and ignoring the explanation given. The ad....
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....d. Thus, the addition need to be deleted. 9. The CIT(A) erred in law and facts by committed a gross violation of the principles of natural justice by relying on documents allegedly seized from Shri Anand Mohta and his statement, without providing the assessee an opportunity to cross-examine. Any evidence collected at the back of the assessee cannot be used against him without affording the right of cross-examination. 10. The CIT(A) failed to adjudicate the specific ground raised by the appellant that the assessment order was bad in law as the statutory approval granted u/s 153D by the Addl. CIT was purely mechanical and without any independent application of mind, thus rendering the entire assessment order void ab initio." 14. At the time of hearing, with regard to addition of Rs. 3,50,000/-, ld. AR of the assessee submitted that the assessee was show caused by the Investigation wing and not by the AO to explain the sources of payment of Rs. 82,50,000/- to her by the assessee and the same was duly reflected in his books of account and a copy of the said ledger account in his books of account which was also submitted before the authorities which fact is admitted....
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....y be the same AO. He submitted that nothing can be presumed or assessed as has been alleged or has been done by the AO. He further submitted that merely finding images of those receipts in the mobile of an employee of the assessee cannot at all lead to any presumption that the assessee had made any such cash payment. He accordingly pleaded that no addition could otherwise be made for the said amounts in the hands of the assessee for any of the three assessment years as no evidence is mentioned to support the allegation. 17. With regard to another ground i.e. the addition of Rs. 53,00,000/ - made alleging that the assessee had paid the same in cash outside the regular books of account on the marriage of Ms Radhika Katyal D/o Mr Rajesh Katyal, the elder brother of the assessee, because some details of an event which took place at the time of her marriage, was found in the mobile chat of the assessee and the said WhatsApp chat is reproduced on page 10 of the assessment order. As regards payment of Rs. 42 lakhs in cash to the said company for a marriage event organized by the said company and Rs. 11 lakhs balance was to be paid, he submitted that the assessee did not and actually do....
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.... absence of any evidence of the same or contradictory statements of the event manager or somebody else, no addition can be made in the hands of the assessee on surmises which should be deleted. 19. Further, he relied on the decision of Hon'ble Apex Court Larger Bench while hearing a SLP in the case of A2Z Infraservices vs Quippo Infrastructure Ltd in SLP Civil 8636/2021 wherein it is categorically opined that a WhatsApp chat message cannot be used as evidence in any proceedings. Thus, any reference to and reliance on any WhatsApp chat messages by the revenue cannot incriminate the assessee at all. 20. On the other hand, ld. DR of the Revenue relied on the findings of the lower authorities and further submitted that the assessee himself accepted that the settlement was made partly by cheque and by cash. 21. Considered the rival submissions and material placed on record. We observed that search was conducted at the premises of the assessee and certain details of payments made by the assessee or may be by the group companies to Ms Jwala Gutta and certain payments were made by the assessee in the marriage of his niece Ms. Radhika Katyal. We observed that the AO had heavily....