TaxTMI 
TaxTMI 
2026 (6) TMI 778
X X X X Extracts X X X X
X X X X Extracts X X X X
....the Act in the case of Riddhi Siddhi Groups on 01- 02-2019 in which the assessee was also covered. The facts which came to light from the search action on Riddhi Siddhi Group was that the assessee/Dhaval N. Patel was found to be the most trusted person of the Riddhi Siddhi group. At the time of search action, the assessee was present at the corporate office, his wife Smt. Vaishali D. Patel is also one of the director of Riddhi Siddhi Gluco Biols Ltd., flagship company of Riddhi Siddhi Group. From the evidences seized, the assessee was found to be handling the unaccounted cash transactions of Riddhi Siddhi Group. Plethora of such evidences were seized from his mobile phone which proved that these incriminating evidences are related to various entities of the Riddhi Siddhi Group and they have been discussed in respective assessment orders of various entities of Riddhi Siddhi Group. Further, the assessee vide his reply dated 25-07-2019 has categorically submitted that he is just a custodian of unaccounted cash and accounts of Shri Siddharth G. Chowdhary and Riddhi Siddhi Group. 2.1. Apart from the above facts, the importance of the assessee to Riddhi Siddhi Group can also be gauged....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... establish that cash loans have actually been received by the appellant. On perusal of the images found from the mobile of the appellant, it is evident that there is no name mentioned of the lender on any of the promissory notes nor any other details are filled up. Even there is no strike off on cash/cheque. The promissory notes might have been made by the appellant to obtain loans but the AO has not been able to establish whether actual loans were received against these promissory notes or not. The copy of said promissory note is reproduced as under:- 32.4 The provisions of The Negotiable Instruments Act relating to validity of a promissory note require attention and it is clear that the promissory notes found are not validly issued as per these provisions and the promissory notes found are incomplete and inconclusive. 32.5 In view of the above discussion, the addition of Rs. 48,00,000/- made by the AO is hereby deleted. Thus, the grounds of appeal no. 2 to 4 are allowed. 33.1 The AO has made addition of Rs 1,00,00,000/- in the case of the appellant on account of Unexplained Investment in Land based on an image found from the mobile of the appellant. The....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... of brokerage @5% would meet the ends of justice. 33.7 In view of the above discussion, the addition of Rs. 5,00,000/- is confirmed in the case of the appellant towards brokerage and the balance addition of Rs. 95,00,000/- is hereby deleted. Since acting as a broker is the main business activity of the appellant, the income is required to be taxed u/s 28 of the Act and therefore the provisions of section 115BBE will not be applicable to the addition of Rs. 5,00,000/-confirmed in the appellant's case. Thus, the ground of appeal no. 5 to 7 are partly allowed." 4. The next addition of Rs. 3,49,05,858/- (2,72,00,000 + 29,05,858 + 50,00,000) on account of undisclosed income based on two images found from the mobile of the assessee. On appeal Ld CIT[A] deleted the above additions by observing as follows: "... 34.2.5. I have carefully considered the contentions of the AO and the submissions made by the appellant. On perusal of the image, it can be observed that the nature of transaction is not mentioned anywhere. However, dates of repayment and calculation of interest on reducing balance is made in the said image which would indicate that the transactions relate t....
X X X X Extracts X X X X
X X X X Extracts X X X X
....and not paid as contended by the AO. Even in such circumstances, addition cannot be made in the appellant's case since the appellant is the recipient of cash and therefore the source of the same cannot be added in the appellant's case. Considering the totality of the facts, the addition of Rs. 50,00,000/- is hereby deleted." 5. The next addition of an amount of Rs. 50,00,000/- on account of undisclosed income based on WhatsApp chat found from the mobile of the assessee. The AO has made an addition on the basis of an outgoing message found from the mobile of the assessee 1) Direction: Outgoing Deleted: No Type: WhatsApp message Time stamp (Device time +00:00): 11-12-2017 04:35:37 Remote party: 919998612120 Text/Description: "50 lacks given to Manan yesterday" From: 919825822225 To: 919998612120 Details Data source: WhatsApp Google Backup ID: 284485 Remote party: 919998612120 Type: Text Created (Device time +00:00): 11-12-2017 04:35:37 Received by server (Device time +00:00): 11-12-2017 04:35:38 Delivered (Device time +00:00): 11-12-17 5.1. The assessee submitted before the AO that the What....
X X X X Extracts X X X X
X X X X Extracts X X X X
....made on the basis of entries appearing in the seized diaries of Shri Prakash M. Sanghvi has already been dealt with and decided by the undersigned and addition with respect to various sources of income has already been confirmed in the case of Shri Prakash M. Sanghvi. Thus, the addition on account of the source of payments recorded in the said image has already been confirmed by the undersigned while passing appellate orders in the case of Shri Prakash M. Sanghvi. If the addition is also confirmed in the case of the appellant, the same would amount to double taxation of the same income. Following the rule of consistency, the addition for source of funds for payments noted in the image which are also recorded in the seized diaries, as being already confirmed in the hands of Shri Prakash M. Sanghvi, is required to be deleted in the appellant's case. 36.7 Thus, the addition on account of Unexplained transaction is hereby deleted in the case of the appellant. Also, the interest is not recorded by Prakash M. Sanghvi and the addition on account of notional interest is also adjudicated by the undersigned in the case of Shri Prakash M. Sanghvi. Following the rule of consistenc....
X X X X Extracts X X X X
X X X X Extracts X X X X
....s that during the course of search action, statement of the assessee was recorded and while recording the statement of Shri Dhaval N. Patel, he categorically accepted that these are forged documents, created and signed by him with an intention to carry out financial fraud by accepting loans/advances from parties." 2) "In the facts and on the circumstances of the case and in law, the ld. CIT(A) has erred in deleting the addition of Rs. 95,00,000/ on account of unexplained investment in land without appreciating the facts that during the post search inquiry, the assessee failed to give details of the parties involved in the said land deal and considering the assessee as broker in the land deal without mentioning any cogent proof 3) "In the facts and on the circumstances of the case and in law, the ld CIT(A) has erred in deleting the addition of Rs. 3,22,00,000/ on account of unexplained advance without appreciating the facts that during the post search proceedings, the assessee himself accepted that the transactions are unaccounted and he earned interest of Rs. 29,05,858/as well." 4) "In the facts and on the circumstances of the case and in law, the ld. CIT....
X X X X Extracts X X X X
X X X X Extracts X X X X
....d income of the assessee. The Ld. CIT(A) also confirmed the addition primarily on the basis of the wording contained in the message. However, on a careful appreciation of facts, we find that the conclusion drawn by the lower authorities is not supported by any corroborative materials. The WhatsApp message merely mentions that Rs. 50 lakhs were "given" to Manan. The message nowhere states that the amount was paid in cash. In absence of any specific reference to cash payment, the authorities below were not justified in presuming that the transaction represented unaccounted cash outflow. It is a settled proposition that suspicion, however strong, cannot take the place of evidence. 12.1. Further the assessee, from the very beginning, consistently explained that the message pertained to cheque transactions with Shri Manan K. Trivedi. The assessee had also furnished the ledger account, PAN and address details of Shri Manan Trivedi before the Ld AO. Once such primary explanation and identity details were furnished, the burden shifted upon to the AO to conduct further verification or enquiry from Shri Manan Trivedi. However, perusal of assessment order shows that no such independent enq....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ify the persons from whom such loans were allegedly received and therefore the provisions of section 68 of the Act were attracted. Consequently, the AO treated the amount of Rs. 48 Lakhs as unexplained cash credit and added the same to the income of the assessee. On appeal, the Ld. CIT(A) deleted the addition after examining the contents of the promissory notes and observing that there was no corroborative evidence to establish actual receipt of cash loans by the assessee. Aggrieved by the relief granted by the Ld. CIT(A), the Revenue is in appeal before the Tribunal. 14.1. The Ld Sr-DR, Shri Nitin Kulkarni appearing for the Revenue relied upon the assessment order and submitted that the images of promissory notes clearly established that the assessee had entered into loan transactions outside the books of account. It was contended that the assessee failed to explain the nature and source of such transactions and therefore the AO was justified in making addition u/s. 68 of the Act. 15. Per contra, the Ld AR Shri Vijay Mehta appearing for the assessee supported the order of the Ld. CIT(A) and submitted that the entire addition was made merely on the basis of incomplete images ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....hat the AO failed to establish whether any actual loans were received against such documents. The findings recorded by the Ld. CIT(A) remain unrebutted by the Revenue by bringing any contrary material on record. 16.2. It is a settled principle of law that addition cannot be sustained merely on suspicion, conjectures or surmises. Loose papers, draft documents or incomplete notings, in absence of independent corroboration, do not constitute conclusive evidence for making addition under the Act. Since the Revenue has failed to establish with cogent evidence that the assessee actually received unexplained cash loans of Rs. 48 lakhs the addition made by the AO is unsustainable. Accordingly, we find no infirmity in the order of the Ld. CIT(A) deleting the addition of Rs. 48 lakhs. The same is hereby upheld and the Ground no.2 raised by the Revenue is devoid of merits and hereby dismissed. 17. Regarding Ground No.2 namely deletion of Unexplained investment in land at Ambali of Rs. 1 Crore and Ground No.3 of the assessee namely confirmation of addition of Rs. 5 lakhs being brokerage earned @ 5%. Since both the issues are interconnected the same are dealt herein together. The brief fa....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... of token amount in relation to a proposed land transaction. On careful perusal of the assessment order as well as the findings recorded by the Ld. CIT(A), it emerges as an undisputed fact that the assessee was neither the Purchaser nor the Seller of the impugned property. In fact, the Ld AO himself verified from Government records and reproduced data downloaded from the AnyROR [Gujarat government portal] that the property continued to remain in the name of the original owners and was under litigation. Therefore, the material available on record clearly demonstrates that the proposed land transaction never culminated into an actual transfer. Further, except for the impugned image, no corroborative evidence has been brought on record by the Revenue to establish that the assessee had actually invested an amount of Rs. 1 crore in the said property transaction. No evidence regarding source of funds, payment trail, bank transaction, cash movement, confirmation from parties or execution of sale transaction has been brought on record. The addition has thus been made merely on assumptions drawn from a solitary image recovered from the mobile phone of the assessee is unsustainable in law. ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....eved by the deletion of additions whereas the assessee is aggrieved by the addition of Rs. 29,05,858/- towards interest. 20. The Ld. CIT-DR Mr. Alpesh Parmar appearing for the Revenue relied upon the findings of the AO and submitted that the seized images clearly reflected undisclosed transactions undertaken by the assessee. It was contended that the assessee failed to properly explain the nature and source of the entries contained in the images and therefore the AO was justified in making the additions. 21. Per contra, the Ld. AR for the assessee supported the order of the Ld. CIT(A) deleting the additions and submitted that the entries merely represented loan transactions and interest calculations. It was argued that no corroborative evidence was found by the Revenue to establish that the amounts represented undisclosed income of the assessee for the year under consideration. 22. We have heard the rival submissions and perused the material available on record. The additions in the present case have been made solely on the basis of certain images found from the mobile phone of the assessee. On perusal of the seized images, it is noticed that the nature of the transactions....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ges by themselves do not constitute conclusive evidence unless corroborated by independent material. Suspicion, however strong, cannot substitute legal proof. Since the Revenue has failed to establish through cogent evidence that the amount of Rs. 50,00,000/- represented undisclosed income of the assessee, the deletion made by the Ld. CIT(A) is justified. Accordingly, we uphold the order of the Ld. CIT(A) deleting the additions of Rs. 2,72,00,000/- and Rs. 50,00,000/- and the Ground No.3 raised by the Revenue is devoid of merits and liable to dismissed. 23. Ground No.4 raised by the Revenue is ld. CIT(A) erred in deleting the addition of Rs. 6,01,60,800/- on account of unaccounted income as per whatsapp chats extracted from the mobile phone of Dhaval N. Patel simply relying upon the submission of the assessee and without any verification of the said transaction from the seized diary in the case of Prakash M Sanghvi. 24. We have heard rival submissions and perused the materials available on record and including the Paper Books filed by the assessee and seized materials. We have discussed the facts of the case and reproduced the findings of Ld CIT[A] at paragraph 6 and 6.1 abov....
X X X X Extracts X X X X
X X X X Extracts X X X X
....d investment 1,83,81,000 Unexplained credits in bank account 46,68,168 Unexplained transactions 58,00,000 Unexplained transactions 10,00,000 Unaccounted cash found in locker 1,04,000 Unaccounted cash found in residence 7,92,750 Unaccounted Foreign currency found in residence 22,72,470 Unaccounted Jewellery found in locker 6,89,078 Unaccounted loan 8,75,000 Unaccounted Interest paid 40,157 Unaccounted transaction 30,00,000 Unaccounted cash receipt 3,16,14,625 Unaccounted brokerage income 9,27,000 Unaccounted income 2,31,192 26.1. Aggrieved against the assessment order the assessee filed appeal before Ld CIT[A], who by common order dated 19-07-2024 confirmed few additions/disallowances and deleted few additions. 27. Now let us deal with each [Modified] Grounds of Appeal raised by the Assessee in ITA No.1582/Ahd/2024: 1. The learned CIT(A) has erred in not holding that the notice issued u/s 143(2) of the Act is bad in law, illegal and void-ab-initio. The learned CIT (A) has erred in not holding that the assessment order passed by AO u/s. 143(3) of the Act is bad in law, illegal and null and....
X X X X Extracts X X X X
X X X X Extracts X X X X
....cted with the Ground Nos.1, 2 & 3 raised by the Revenue. Hence the same are dealt together in Revenue appeal. 30. Regarding Ground No. 6 namely unaccounted income of Rs. 58,00,000 as per WhatsApp chat (Page no 32 of assessment order). During the course of search, following WhatsApp chats were seized from assessee's mobile. "a. Original rtgs of 59.00 and 8.00 from Dhaval Patel so totaling to 67.00, last week given 8.00 cash so 75.00 and not doing rtgs of 32.00 so 108.00 and 8.00 refunding so net 100.00. b. Have you pick up cash 50 Saturday from angadiya" 30.1. As regards the WhatsApp message of Rs. 8,00,000 the AO held that the contents of the WhatsApp message clearly indicate that cash transaction of Rs. 8,00,000 has been carried out and that the other contents of the message are accounted for and transactions have happened so there is no reason to assume that unaccounted transaction did not occur. 30.2. As regards WhatsApp message of Rs. 50,00,000 the AO held that the transaction of Rs. 50,00,000 was accepted by the assessee as unaccounted transaction as the same was incorporated in the cash book submitted during post search proceedings. 31. On ap....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... carried out. The assessee has specifically contended that the RTGS transaction of Rs. 8,00,000/- referred to in the same message never materialized and the same is verifiable from the bank statement. It is also submitted that the reference to "8.00 refunding" equally did not materialize. Thus, according to the assessee, the WhatsApp message merely records proposed or contemplated transactions and not concluded transactions. 35.1. It is a settled proposition that loose notings, dumb documents, WhatsApp chats or uncorroborated electronic material, by themselves, cannot form the sole basis for making addition unless supported by independent evidence establishing that the transaction actually took place. In the present case, no cash was found during search relatable to the impugned entry, no corresponding entry was found in any books or diaries, no statement of the counter-party was recorded, and no trail of movement of funds has been brought on record. The AO has merely proceeded on presumption that since some transactions mentioned in the chat had happened, the alleged cash transaction must also have happened. Such inference, in absence of supporting evidence, cannot take the pla....
X X X X Extracts X X X X
X X X X Extracts X X X X
....the impugned amounts of Rs. 8,00,000/- and Rs. 50,00,000/- represented undisclosed income of the assessee. Accordingly, the addition of Rs. 58,00,000/- sustained by the ld. CIT(A) is directed to be deleted. Thus, Ground No.6 of the assessee is allowed. 37. Regarding Ground No.10, the ld. AR submitted that during the course of assessment, various additions were made by the AO both on account of alleged unexplained receipts/source of funds as well as on account of alleged unexplained expenditure, investments, assets and cash applications. A chart demonstrating the nexus between the additions representing source and application of funds was also filed before the lower authorities. It was contended that once certain receipts are treated as undisclosed income of the assessee, corresponding application or utilization thereof cannot again be separately taxed, as the same would amount to double addition of the very same income. Accordingly, it was prayed that suitable benefit of telescoping/set-off be granted in respect of additions sustained, if any. 38. We have considered the rival submissions and perused the materials available on record. The principle of telescoping is a well-rec....
X X X X Extracts X X X X
X X X X Extracts X X X X
....tion of Rs. 4,99,58,125/- out of total addition of Rs. 5,25,87,500/- on account of unexplained cash receipt without appreciating the facts that during the course of assessment proceedings, the assessee failed to explain source of such cash receipt." 2) "In the facts and on the circumstances of the case and in law, the ld. CITIA) has erred in deleting the addition of Rs 1,65,92,000/- out of total addition of Rs. 1,67,57,000/-on account of unexplained cash receipt & unaccounted brokerage in land without appreciating the facts that during the post search inquiry, the assessee failed to give details of the parties involved in the said land deal and considering the assessee as broker in the land deal without mentioning any cogent proof. 3) "In the facts and on the circumstances of the case and in law, the ld.CIT(A) has erred in deleting the addition of Rs. 44,89,200/- out of total addition of Rs. 54,29,200/- on account of unexplained cash receipt without appreciating the facts that during the post search inquiry, the assessee failed in establishing the source of funds regarding the transactions." 4) "In the facts and on the circumstances of the case and in law....
X X X X Extracts X X X X
X X X X Extracts X X X X
....the contentions of the AO. The AO has while giving background of the appellant, emphasized in the assessment order that the appellant is handling the real estate deals of Riddhi Siddhi Group. The AO has admitted the fact that appellant has acted as a broker and a custodian for the deals of Riddhi Siddhi Group and made addition on account of brokerage in the appellant's case. It is also stated by the AO that the appellant is found to be the most trusted person of Riddhi Siddhi group and the appellant is handling the unaccounted cash transactions of Riddhi Siddhi Group. 43.6 Thus, it is an admitted fact by the AO that the appellant acted as a broker for Riddhi Siddhi Group and handled various sale and purchase deals of the group. Thus, the image found from the appellant represents amounts handled by the appellant on behalf of his client. The appellant has also provided intermediary services including negotiations, finalisation of terms and process to be followed, handling payment transactions, etc. The appellant has not provided detalls of brokerage income earned on account of real estate transactions of Riddhi Siddhi group and has not shown the same in his return of Inc....
X X X X Extracts X X X X
X X X X Extracts X X X X
....at these are his unaccounted transactions. The assessee has consistently stated that he has acted as a broker and the image represents amounts received and given on behalf of his clients. In fact the AO has admitted that the assessee was most trusted person of Riddhi Siddhi group. The AO has held that from the evidences found, the assessee is found to be handling unaccounted cash transactions of Riddhi Siddhi group. The AO has stated that the cash of Rs. 4,44,96,000 seized from the corporate office of Riddhi Siddhi group was also found in the possession of the assessee and thus confirmed that the assessee was key person of Riddhi Siddhi group. Thus, the AO has admitted that the assessee was acting on behalf of Riddhi Siddhi group. Further, Riddhi Siddhi group had sold real estate to Rajanbhai and the cash of Rs. 1,00,00,000 shown as received from Rajanbhai in the image, was towards the said sale and addition for the said sale transaction with Rajanbhai is already made in the case of Riddhi Siddhi group. As regards, the addition of brokerage @5% it is submitted that in the assessee's line of business, normal brokerage is 1% to 2% which fact has also been stated by the AO at vari....
X X X X Extracts X X X X
X X X X Extracts X X X X
....actual position, we are in complete agreement with the finding of the ld. CIT(A) that the entire transaction value of Rs. 5,25,87,500/- could not have been assessed as undisclosed income in the hands of the assessee. Once the substantive transactions are accepted as pertaining to Riddhi Siddhi Group and corresponding additions have already been examined in the hands of such group concerns, taxing the entire amount again in the hands of the assessee merely because he acted as an intermediary would clearly amount to double addition. Thus, the Ground No.1 raised by the Revenue is devoid of merits and liable to be dismissed. 45. The next issue for consideration is regarding estimation of brokerage income. The ld. CIT(A) sustained addition by estimating brokerage/commission income at 5% of the transaction value considering the nature of services rendered by the assessee. The assessee has contended that in the line of real estate brokerage business, normal brokerage ranges between 1% to 2%, which fact has also been acknowledged by the AO in the assessment order, and therefore estimation at 5% is excessive and arbitrary. 46. We find merit in the contention of the assessee. Though th....
X X X X Extracts X X X X
X X X X Extracts X X X X
....er. However, the appellant has failed to provide details of the other broker and therefore addition in respect of entire brokerage of Rs. 1,65,000/- is considered to be the income of the appellant. Since acting as a broker is the main business activity of the appellant, the income is required to be taxed u/s 28 of the Act and therefore the provisions of section 115BBE will not be applicable to the addition of Rs. 1,65,000/- confirmed in the appellant's case. Thus, the grounds of appeal no. 5 to 7 are partly allowed." 48. Ld AR appearing for the assessee submitted that on perusal of the image it cannot be ascertained that the deal has actually taken place. Similarly, the year in which the deal is carried out is also not written on the image. Ld AO has presumed that the transaction pertains to the year under consideration. Since no details as to the land, buyer, seller, etc. were mentioned on the image, appellant could not provide any information. The AO has not brought any material on record to evidence that any such land was sold by the assessee and that the agreement value was credited in the assessee's bank account or that the assessee had executed any registe....
X X X X Extracts X X X X
X X X X Extracts X X X X
....emains unsubstantiated. However the ld. CIT(A) sustained brokerage addition primarily on the basis that the assessee admitted offering Rs. 82,500/- as his share of brokerage income. However, merely because the assessee, during the course of proceedings, attempted to explain the seized material by assuming that it may relate to a brokerage transaction, the same cannot by itself establish conclusively that the underlying property transaction had actually materialized. In the absence of any corroborative material evidencing completion of the deal, no income can be brought to tax merely on the basis of conjectural notings. 50.3. In the present case, except for the isolated image containing incomplete notings, no material has been brought on record to establish that the alleged land deal was finalized or that the assessee actually earned brokerage income therefrom. The Revenue has failed to discharge the primary burden cast upon it. Therefore, even the addition sustained by the ld. CIT(A) towards brokerage income cannot be upheld. In view of the aforesaid facts and circumstances, the addition of Rs. 1,65,000/- sustained by the ld. CIT(A) is directed to be deleted. Consequently, the G....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... On perusal of the image, it cannot be concluded that the deal had actually taken place. Similarly, the year in which such deal has taken place can also not be ascertained from the image. The AO has merely presumed that the deal has taken place and that the same has taken place in the year under consideration. 53. Per contra Ld CIT DR requested to sustain the addition made by the Ld AO. 54. We have considered the rival submissions and perused the materials available on record. The issue involved in the present ground relates to the addition of Rs. 9,40,000/- sustained by the ld. CIT(A) as alleged unaccounted profit arising from a property transaction based on an image found during the course of search. The Ld AO originally made addition of Rs. 44,89,200/- treating the entire transaction reflected in the seized image as undisclosed sale consideration. The Ld. CIT(A), after examining the seized material, held that only the profit component could be brought to tax and accordingly sustained addition of Rs. 9,40,000/- being the alleged profit mentioned in the image, while deleting the balance addition. The case of the Revenue rests entirely upon certain rough notings contained in ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ly, the addition of Rs. 9,40,000/- confirmed by the ld. CIT(A) is directed to be deleted. Thus, the ground no. 5 raised by the assessee is allowed. 55. Ground No.4 namely addition of Rs. 1,83,81,000/-on account of investment in flat no. E-201. The AO has made addition on account of Unexplained Investment u/s. 69 of the Act of Rs. 1,83,81,000/- on the basis of image found and seized from the assessee's mobile phone. On appeal Ld CIT[A] deleted the addition by observing as follows: "... 46.3 I have gone through the submissions filed by the appellant and the contentions of the AO. On perusal of the image, it can be seen that the buyer was trying to purchase the property at the rate of 4650/1500 which he subsequently revised to 4800/1500. Also, the appellant while conversing with the buyer has quoted the best possible price of 4950/1600. The copy of the relevant page of WhatsApp conversation is reproduced for better clarity, which is as under:- On plain reading of the chat, it is seen that the appellant has conclusively written 'sorry not possible' implying that the rate quoted by the buyer was not acceptable to the seller. Thus, it is clear from the WhatsA....
X X X X Extracts X X X X
X X X X Extracts X X X X
....appellant has tried to prove that only the RTGS transactions have taken place. The chat reads as under: Original rtgs of 59.00 and 8.00 from Dhaval Patel so totaling to 67.00, last week given 8.00 cash so 75.00 and not doing rigs of 32.00 so 108.00 and 8.00 refunding so net 100.00. On a plain reading of the above chat, it is clear that cash of Rs. 8 lacs was given in the earlier week. There is no ambiguity whatsoever in the chat message. Thus, the addition of Rs. 8,00,000/- made in the case of the appellant is hereby confirmed. 47.2 With regards to the addition of Rs. 50,00,000/-, The AO has stated that the WhatsApp chat is regarding transaction through Angadiya in which it has been requested to pick cash of Rs. 50,00,000/-. The AO has stated that as regards the above chat, the appellant has filed a reply and on verification of the same, it is noticed that the appellant has accepted that the transaction 'mentioned in the above chat is an unaccounted transaction. 47.2.1 The appellant has submitted that no such amount was given by the said party in Angadiya and hence no such amount was collected. The appellant has submitted that back-up of all ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....e appellant. Further, no other corroborative material or evidence is brought on record by the AO to establish that the amount of Rs. 10 lacs was sent by the appellant through Angadia. The language of the WhatsApp chat is also not clear like all the other chats where additions have been confirmed by the undersigned. Thus, the addition made by the AO on a presumption that 10 kg means 10 lakhs cannot be sustained. In view of the same, the addition of Rs. 10 lacs made by the AO is deleted. Thus, the grounds of appeal no. 19 & 20 are allowed. 59. Ld AR appearing for the assessee submitted that the outgoing message speaks about 10 Kgs. of Chilbhuja Dry fruit to be sent to assessee's friend and it nowhere speaks of money transfer. Also, the place of delivery is also mentioned in the said chat as Masala Market in Navi Mumbai. As regards AO's contention regarding bill of dry fruits, it was submitted that it is highly improbable that one would maintain copy of bill for purchase of dry fruits. The details of the party including mobile no. and PAN were available in the chat. The AO made the addition without confirming with the other party merely based on presumption. Various other a....
X X X X Extracts X X X X
X X X X Extracts X X X X
....not exceeding prescribed limit of the CBDT Instruction. Thus, the deletion made by the Ld CIT[A] does not require any interference and Ground No.6 raised by the Revenue is hereby dismissed. 64. Ground No. 7 namely unaccounted Advance taken of Rs. 8,75,000/-. During the course of search, Image Nos. 20180920_155348.jpg and IMG-20170221-WA0007.jpg were seized from the assessee's mobile. On the basis of the said image, unaccounted loan and interest was added. (Para 15.5 of Assessment Order). The AO held that the assessee was duty bound to furnish documentary evidence to establish that the transaction did not pertain to him. Since the loans were not recorded in the books of account of the assessee, AO made addition for unaccounted loans taken by the assessee. On appeal ld CIT(A) deleted the additions as AO has considered it as Loan received by the assessee and hence, the same cannot be treated as income of the assessee, since the assessee is the recipient of loan. 65. Ld AR appearing for the assessee submitted that the AO has presumed that the assessee has obtained loan in cash and made addition. It is submitted that no name of is written in the WhatsApp images which can evide....
X X X X Extracts X X X X
X X X X Extracts X X X X
....n the basis of the said image, AO presumed that the assessee had taken unaccounted loan from Nirav Jain. (Para 16 of Assessment Order). The AO further held that the assessee was duty bound to furnish documentary evidence to establish that the transaction did not pertain to him. The transaction was not recorded in the books of the assessee and hence added to the income of the assessee. 67.1. On appeal Ld CIT(A) held that from the image no conclusion can be drawn as to the nature of the image. The CIT(A) also held that there is no mention of appellant's name on the image to establish loan transaction between the assessee and Nirav Jain. The CIT (A) deleted the additions on the ground that the AO has considered it as Loan received by the assessee and hence, the same cannot be added as income of the assessee. 68. Ld AR appearing for the assessee submitted that the AO has presumed that the assessee has obtained loan in cash. Name of the assessee is not written in the image neither whether the it represents amount given or received is written in the image. Similarly, no year is mentioned in the image and therefore addition cannot be made in the year under consideration. Without....
X X X X Extracts X X X X
X X X X Extracts X X X X
...., no addition on account on money can be made. 73. We have considered the rival submissions and perused the materials available on record. It is an undisputed fact that the land bearing Survey Nos. 42/2 and 42/3 situated at Chandkheda was jointly owned by the assessee along with other co-owners. The specific explanation of the assessee has been that though negotiations for sale had taken place, the transaction ultimately failed since one of the co-owners refused to proceed with the sale. In support of the aforesaid contention, the assessee furnished revenue records demonstrating that the ownership of the property continued to remain in the names of the original co-owners even up to 31.03.2020. The Revenue has not disputed the authenticity of such land records. No registered sale deed, agreement to sell, transfer document, possession letter or any other evidence evidencing transfer of the property has been brought on record by the AO. 73.1. The addition made by the AO is based solely on certain notings contained in the seized images allegedly reflecting proposed consideration and on-money component. However, no independent corroborative evidence has been brought on record to e....