TaxTMI 
TaxTMI 
2026 (7) TMI 1078
X X X X Extracts X X X X
X X X X Extracts X X X X
.... CIT(A)-12, Hyderabad has erred in upholding the assessment made by the Ld. AO u/s. 153C of the Income Tax Act, even though the Ld. AO wrongly presumed that the contents in the loose sheets found during a search operation at the premises of M/s. MSR India Ltd. (a third party) "pertains" to the assessee. 3. The Hon. CIT(A)-12, Hyderabad has erred in upholding the addition made by the AO as unexplained investment under sec. 69 of the Income Tax Act without considering the fact that the details like name, extent, payment details, TDS etc. mentioned in the dumb document do not match with the actual transaction (as per the sale deed) that was happened between the appellant and the land lord. 4. The Hon. CIT(A)-12, Hyderabad has failed to appreciate the fact that the addition of Rs. 1,20,06,000/- made by the Assessing officer as unexplained investment is wholly unjustified and based only on presumptions drawn from loose sheet that was seized from the premises of third party. M/s. MSR India Ltd. and the said document (A/MSR/OFF/1, page 125) is a dumb document, containing no signature or authentication and the figures mentioned therein do not match with the actual transac....
X X X X Extracts X X X X
X X X X Extracts X X X X
....foresaid loose sheet, the AO of the searched person recorded his satisfaction under section 153C of the Act and handed over the incriminating material to the AO having jurisdiction over the assessee. Consequently, the AO of the assessee issued a notice under section 153C of the Act and initiated assessment proceedings. 5. During the assessment proceedings, the AO observed that the assessee had purchased plots bearing Nos. 6, 7, 40 and 41 situated at Dommarapochampally Village, Dundigal-Gandimaisamma Mandal, Medchal-Malkajgiri District through registered Sale Deed No. 7932/2018 dated 22.06.2018. It was further observed that the seized loose sheet, viz. Annexure A/MSR/OFF/1- Page No. 125 reflected total consideration of Rs. 2,20,17,000/-, whereas the registered document disclosed consideration of Rs. 75,11,000/-. The AO further observed that the assessee had admittedly paid Rs. 25,00,000/- to M/s Mirchi Developers Private Limited and Rs. 75,11,000/- towards acquisition of the property and therefore concluded that the total payment made by the assessee was Rs. 1,00,11,000/-. Accordingly, the AO treating the amount of Rs. 2,20,17,000/- appearing in the loose sheet as the actual cons....
X X X X Extracts X X X X
X X X X Extracts X X X X
....0/- appearing in the registered sale deed is not reflected anywhere in the seized document. The Ld. AR submitted that the assessee had paid Rs. 25,00,000/- on 23.05.2018 through cheque No. 536341 to M/s Mirchi Developers Private Limited and Rs. 74,35,890/- through cheque No. 536342 on 22.06.2018 after deduction of TDS of Rs. 75,110/- to Shri Anil Kumar Verma, and the said payments are fully supported by bank statements, sale deed and TDS records. Carrying his contention further, the Ld. AR submitted that the AO has merely presumed that the amount of Rs. 75,11,000/- forms part of the figure of Rs. 1,30,17,000/- appearing in the seized "loose sheet", viz. Annexure A/MSR/OFF/1- Page No. 125, without referring to or placing on record any supporting evidence. It was submitted that the AO had also failed to conduct any enquiry either from Shri Anil Kumar Verma or from M/s Mirchi Developers Private Limited to ascertain whether any amount over and above the consideration disclosed in the registered sale deed had actually been received by them. The Ld. AR further submitted that no statement of the vendors was recorded, alleging receipt of any on-money. Also, the Ld. AR submitted that neithe....
X X X X Extracts X X X X
X X X X Extracts X X X X
....(i) the document does not bear the signature of either the assessee, i.e., the purchase or the sellers; (ii) there is nothing available on record which would irrefutably establish as to who is the author of the subject seized document and no evidence has been brought on record to establish when and by whom it was prepared; and (iii) the seized document is not part of any regularly maintained books of account. Also, we find that the contents of the seized document suffer from material inconsistencies, viz. (i) the registered sale deed records sale consideration of Rs. 75,11,000/-, but the same does not find place anywhere in the seized document; (ii) the cheque numbers appearing in the seized document do not tally with the actual cheque numbers reflected in the banking records of the assessee; and (iii) the seized document also contains figures which are admittedly not reconcilable with the actual transactions. 15. We find that the AO has proceeded on the assumption that the amount of Rs. 75,11,000/- paid by the assessee forms part of the figure of Rs. 1,30,17,000/- appearing in the seized "loose sheet", viz. Page No. 125 of Annexure A/MSR/OFF/1. However, we find absolutely no ma....
X X X X Extracts X X X X
X X X X Extracts X X X X
....s of a dumb document without confronting the concerned parties and without gathering corroborative evidence. 18. We find that the present case before us stands on an even stronger footing because the seized document, viz. Page No. 125 of Annexure A/MSR/OFF/1 was not found with the assessee or the vendors, but was found with an entirely different entity, viz. M/s MSR India Limited. Apart from that, the Revenue has failed to establish any direct nexus between the alleged entries and the vendors' actual receipt of money. In our view, the burden to prove understatement of consideration was squarely upon the Revenue, which we find it had miserably failed to discharge. We say so, for the reason that, except for the impugned loose sheet, viz. Page No. 125 of Annexure A/MSR/OFF/1 there is no evidence whatsoever demonstrating that the assessee paid any amount over and above the consideration reflected in the registered documents. At this stage, we are reminded of the judgment of the Hon'ble High Court of Punjab & Haryana in the case of Paramjit Singh vs. ITO [2010] 195 Taxman 273 (Punjab & Haryana), wherein it has been held that the contents of a registered sale deed cannot be dislod....