TaxTMI 
TaxTMI 
2025 (12) TMI 1835
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....oceedings invoking provisions of section 153C of the Act were initiated and completed. The aforesaid cases being similar on facts and circumstances, thus, as agreed by both parties are taken up together for the hearing and accordingly decided under this common order. 3. To adjudicate the aforesaid identical cases, having similar issues, ground of appeal, facts and circumstances, for the sake of brevity, the appeal in the case of Shri Manish Mali, ITA No. 6571/Mum/2025 for AY 2017-18 has been taken up as the lead matter, wherein our observations, deliberations and adjudication shall apply mutatis mutandis to the remaining appeals. ITA No. 6571/Mum/2025 in the case of Manish Mali for AY 2017-18 Ground of appeal: 1. On the facts and circumstances of the case in law, Ld. CIT(A) erred in confirming the stand of A.O. about that issuing the notice u/s 153C of the Act without DIN. It is blatant contravention of the Circular No. 19/2019, dated 14-8-2019 issued by the CBDT. 2. On the facts and circumstances of the case in law, Ld. CIT(A) erred in confirming addition without referring to any incrementing document. Besides, he has not referred to any incriminating ma....
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....vestments. The assessee denied before the AO to have made such cash payments; however, such submissions of assessee was not found convincing by the ld. AO and accordingly the assessment was completed under section 153C r.w.s. 143(3) of the Act with the additions under section 69 on account of unexplained investment in the hands of assessee for the aforesaid alleged cash payments admitted to be received by the builder from the assessee. 5. Being aggrieved with aforesaid order by Ld. AO, the assessee preferred an appeal before the ld. CIT(A), however with no success, the appeal of the assessee was dismissed. 6. To assail the findings of ld. CIT(A), assessee has preferred an appeal before the ITAT, which is under consideration in the present matters. 7. At the outset, the ld. AR representing the assessee submitted that the AO has erroneously made an addition towards alleged 'on-money' payment for earlier AYs even though the first cheque payment pertaining to the transactions was made only in AY 2019-20. It is further submitted that the documents were recovered from the premises of 3rd party which is not connected to the assessee are devoid of any direct evidentiary value agai....
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....in ITA No. 5553, 5555/M/2025 dated 12.11.2025 and Lilaram v/s DCIT Central Circle 4(2) in ITA No.5554, 5557/Mum/2025 dated 12.11.2025 (4) Heena D Jhanglani v/s ITO 2(5), Mumbai in ITA No. 1665/M/2018 dated 11.01.2019. (5) Mamta S Gupta v/s ITO 2(5), Mumbai in ITA No. 1553/M/2021 dated 16.06.2022. 8. From the aforesaid decisions, the ld. AR drew our attention to a particular judgment in the case of Heena D. Jhanglani (supra) to enlighten that the information seized from the 3rd party would not be conclusive to prove the factum of alleged 'on-money' payment, without corroborative evidence, the relevant findings for the said judgments are extracted as under: "I find substantial merit in the aforesaid submissions of the assessee. In my view, neither the information contained in the pen drive nor the statement recorded under section 132(4) of the Act from Shri Niranjan Hiranandani are enough to conclusively establish the factum of payment of on-money by the assessee. At best, they can raise a doubt or suspicion against the conduct of the assessee triggering further enquiry / investigation to find out and bring on record the relevant fact and material to con....
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....ces as regards payment of "on money" by the assessee for purchase of the property under consideration remain uncorroborated. We further find that what was the source from where the information was received in the pen drive also remains a mystery till date. We find that Sh. Niranjan Hiranandani in the course of his cross-examination had clearly stated that neither he was aware of the person who had made the entry in the pen drive, nor had with him any evidence Heena Dashrath Jhanglani that the assessee had paid any cash towards purchase of flat. We have deliberated on the fact that Sh. Niranjan Hiranandani in his statement recorded on oath in the course of the Search & seizure proceedings had confirmed that the amounts aggregating to Rs. 475.60 crore recorded in the pen drive were the on-money received on sale of flats, which was offered as additional income under Sec. 132(4) and thereafter offered as such for tax in the petition filed before the Settlement commission. We are of the considered view that there is substantial force in the contention of the ld. A.R that mere admission of the amounts recorded in the pen drive as the additional income by Sh. Niranjan Hiranandani....
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....with the assessee or to confront the assessee with any person allegedly connected to the said documents. The proceedings were conducted in a one-sided manner without affording the reasonable opportunities to the assessee to explain and rebut, this constitutes violation of the principle of natural justice. 10. In backdrop of the aforesaid submissions, it was the prayer by ld. AR that the additions made are arbitrary, with no evidence/material on record to prove the payment of 'on-money' by the assessee, which the assessee from very beginning has denied to have made such cash payments, therefore such additions are unsustainable in terms of the decisions of ITAT, Mumbai in identical cases emerged from the same search conducted in the Rubberwala Group, the appeal of assessee, therefore deserves to be allowed and the addition made is liable to struck down. 11. Per contra, the ld. CIT-DR representing the revenue submitted that during the search on Rubberwala Group certain touchable documents in the form of Excel sheet were found which were confronted to the Director and employee of Rubberwala Group who were involved in process of sale of shops in Platinum Mall, wherein the assessee....
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.... payment of cash. 13. It is brought to our notice that identical issues involving cash payments for acquisition of Shops in Platinum Mall constructed by RHIL, cases of certain more assessee were also picked-up and assessed under section 153 of the Act. In such cases ITAT, Mumbai had adopted a view that, if the statements used against the assessee are not provided, neither the cross examination of persons, whose statements were relied upon was provided, the assessee was kept deprived of reasonable opportunity to rebut in contradiction of the evidence and facts used against him, no addition can be made. The observations of Tribunal in various cases are reproduced hereunder for the sake of interpretation in the present matter: (1) Pravin K Purohit in ITA No. 4742 to 4744/M/2025 dated 15.10.2025. "18. From the records we also noticed that no statement was provided to the assessee, and none of the persons, whose statements were relied upon were produced for cross-examination. Even the extract of the statement mentioned in the assessment order does not indicate the name of the assessee. 19. Apart, the AO during the course of assessment also failed to provide....
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....ered by the Co-ordinate Bench in similar circumstances also placed reliance upon another decision of the Co-ordinate Bench of the Tribunal in Akhraj Pukhraaj Chopra vs DCIT and Lilaram Vs DCIT in ITAs No.5553 and 5554/Mum/2025, vide order dated 12.11.2025, wherein similar addition was made on the basis of search and seizure action on Rubberwala Group. Apart from relying upon the orders passed by the lower authorities, the learned DR could not bring any material on record to deviate from the findings of the Co-ordinate Bench rendered in the aforenoted decisions in similar factual circumstances. Therefore, respectfully following the decisions of the Co-ordinate Bench cited supra, we do not find any merits even in the additions made under section 69 of the Act in the assessment year 2019-20, and the same is also deleted. Accordingly, the impugned additions made under section 69 of the Act in the assessment years 2017-18 to 2019-20 are deleted." (3) Akhraj Chopra in ITA No. 5553, 5555/M/2025 dated 12.11.2025. "18. From the records we also noticed that no statement was provided to the assessee, and none of the persons, whose statements were relied upon were produced fo....
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....n, consequently these grounds raised by the assessee are allowed. ITA No. 4743 & 4744/Mum/2025, FY 2018-19 & 2020-21 23. As the facts and circumstances in these appeals are identical to ITA No. 4742/Mum/2025 for the A.Y 2017-18 (except variance in figures) and the decision rendered in above paragraph would apply mutatis mutandis for these appeals also. Accordingly, the grounds of appeal of the present appeals also stands allowed. In the result, all the appeals filed by the assessee stands allowed." 14. In light of the facts and circumstances involved in the present matter, identical to the facts of cases decided by the ITAT Mumbai in various matters, relied upon by the assessee, in absence of any contradictory material, fact or decision submitted by the revenue to rebut in defence., respectfully following the observation and legal prepositions by the Co-ordinate Bench of ITAT, we find substance in the contention raised by ld. AR. Accordingly, Ground Nos. 2 to 8 raised by the assessee, assailing the sole issue qua the addition under section 69 are allowed, the ld. AO is, thus, directed to vacate the addition made u/s 69 of the Act. 15. Regarding Ground No.1 t....