TaxTMI 
TaxTMI 
2026 (6) TMI 1129
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....ssment Order dated 19.03.2024 passed u/s. 143(3) r.w.s.144B of the Act. 2. The sole grievance of the assessee is that ld.CIT(A) erred in confirming the action of the Assessing Officer levying penalty u/s. 271D of the Act. 3. Brief facts of the case are that the assessee is an individual and filed the return of income for A.Y. 2022-23 on 28.12.2022 declaring total income of Rs. 4,33,620/- and agricultural income of Rs. 90,551/-. Case selected for scrutiny through CASS for the reason "Verification report uploaded through VRU". As per the credible information, search u/s. 132 of the Act was carried out by Investigation Wing, Surat on 13.12.2021 at the business premises of M/s.Sumangal Safe Deposit Vault LLP. As per the record, it has bee....
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....ted to have taken any cash loan from Mr. Mahendrakumar C. Mehta. Ld. Assessing Officer has levied the penalty based on the statement given by Manohar Singh Mehta but neither provided the statement of Mr. Mahendrakumar C. Mehta nor provided any opportunity of cross examination. He submitted that the alleged transaction of cash loan by the assessse from Mr. Mahendrakumar C. Mehta is unilateral action against the assessee without establishing the evidence that the assessee was infact involved in the alleged cash loan also. The statement of Mr. Mahendrakumar C. Mehta cannot be considered as evidence as it is a third party statement and that ld. Assessing Officer has merely acted on presumption and guess work because the documents on the basis o....
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....e has repeatedly asked the Assessing Officer to provide copy of incriminating material, copy of statement of Mr. Mahendrakumar C. Mehta related to the assessee, as well as relevant portion of the assessment order reflecting as to how the transaction of Rs. 50,00,000/- was considered in the assessment of Mr. Mahendrakumar C. Mehta still ld. Assessing Officer neither provided any opportunity or cross examination to the assessee nor given any reply as to how the alleged cash loan was considered in the assessment of Mr. Mahendrakumar C. Mehta. 9. We find force in the contention of ld. Counsel for the assessee that if the alleged sum of Rs. 50,00,000/- is not added in the hands of Mr. Mahendrakumar C. Mehta, such cash available with Mr. Mahen....
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.... random entries". Further, there is no allegation on the assessee for escapement of income or undisclosed transaction based on the third party statement then in absence of providing opportunity to the assessee to cross examine such third person, proceedings carried out have been held to be illegal in plethora of judgments. 11. Under these given facts and circumstances where the assessee has denied to have taken any cash loan from Mr. Mahendrakumar C. Mehta, no evidence has been put forth by the Revenue to prove that the assessee has entered into any such transaction and in absence of having any transaction with Mr. Mahendrakumar C. Mehta, no cogent evidence to prove that the assessee has accepted to have received cash loan from Mr. Mahen....
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....erefore, the charge of the Assessing Officer that loans were rightly taken and repaid in cash has not been established. The ld.CIT(A) has given this clear-cut findings in quantum appeal in the case of assessee against which the appeal is also dismissed at the level of ITAT. Hence, ld.CIT(A)'s order has attained finality in the quantum proceedings. Therefore, just because the assessee has business relations with a persons (not even the person from whom the documents were recovered) nor it is proved that unsubstantiated entry found recorded in the similar name is true and belongs to the assessee. We are therefore inclined to agree with the findings recorded by the ld.CIT(A) in penalty proceedings that no corroborative or substantive evidence ....