2026 (6) TMI 483

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....he assessment year 2022-23. 2. The brief facts of the case are that, the assessee is a partner of M/s. National Egg Store, filed his original return of income under Section 139(1) of the Income Tax Act, 1961 for the assessment year 2022-23 and declared a total income of Rs. 14,17,790/-. A search and seizure operation under Section 132 of the Act, was conducted on 15.03.2023 in the case of M/s. Grace Services Society Group and M/s. National Egg Store. During the course of search at the residence of the assessee, an agreement of sale-cum-GPA dated 15.01.2022 was found and as per the seized document, the assessee has agreed to purchase land admeasuring 1454 sq. yards in Plot No. 195, Survey Nos. 245, 309, 310 and 311 at Jeedimetla Village, ....

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....o taking note of the material available on record, observed that, the assessee has paid a sum of Rs. 31,86,000/- in cash for purchase of the property. However, failed to explain the source for the said cash payment. Therefore, made addition of Rs. 31,86,000/- as unexplained investment under Section 69 of the Act, and taxed under Section 115BBE of the Income Tax Act, 1961. 4, Aggrieved by the assessment order, the assessee preferred appeal before the Ld. CIT(A). Before the Ld. CIT(A), the assessee submitted that, he has purchased the property and also paid a sum of Rs. 31,86,000/- as specified in the sale agreement and the source for the said cash payment is out of drawings from the partnership firm, M/s. National Egg Store, where the ass....

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....A.O. towards cash payment of Rs. 31,86,000/-, even though the assessee has explained the cash payment out of drawings from M/s. National Egg Store on different dates. The learned counsel for the assessee, further referring to the cash book of M/s. National Egg Store, submitted that the assessee has drawn Rs. 12,00,000/- on 30.11.2021 and Rs. 11,00,000/- on 11.12.2021 and further, an amount of Rs. 9,00,000/- on 01.01.2022, aggregating to Rs. 32,00,000/-. The above cash drawings were used for making payment to the seller and the same has been recorded in the sale agreement-cum-GPA. These evidences are furnished before the A.O. However, without considering the relevant evidences, the A.O. simply made addition towards cash payment as unexplaine....

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....h proceedings in the statement recorded under Section 132(4) of the Act. The A.O. made addition towards cash payment under Section 69 of the Act, as unexplained investment on the ground that the assessee has failed to explain the source for cash payment for purchase of the property. Although, the Ld. CIT(A) admitted the fact that the assessee claims to have made payment out of cash from M/s. National Egg Store, Hyderabad, but rejected the explanation of the assessee on the ground that, except making a claim and filing copy of ledger account of partnership firm account, the assessee could not file further evidence, including proof of availability of cash in hand of the partnership firm at the relevant point of time. Except this observation, ....