Mere entry in a pen drive of a third party cannot ipso facto fasten the liability of on money transaction upon the assessee without further corroborative material brought on record

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Mere entry in a pen drive of a third party cannot ipso facto fasten the liability of on money transaction upon the assessee without further corroborative material brought on record

 

ITAT MUMBAI

 

JCIT (OSD) -8 (1) (1) , MUMBAI VERSUS M/S SANJAY V. PARMAR AND (VICE-VERSA)

 

ITA No.3534/Mum/2019, C.O. No.61/Mum/2020

 

 

Short Overview of the case:

 

Addition u/s 69B

 

Cash transactions in the seized documents during a search operation – cash against sale of flat

 

When no material has been found that assessee has made any booking for the flat, a mere entry in a pen drive of a third party cannot ipso facto fasten the liability of on money transaction upon the assessee without further corroborative material brought on record.

 

As a matter of fact as noted by the learned CIT(A) the other materials further support the view that the addition in the hands of the assessee is not sustainable in as much as there was a booking of flat by the assessee’s wife with the same developer which was duly cancelled and booking was refunded prior to the entry of on money cash transaction. –

 

 

ITAT observed & held as under:

 

We find that addition in the hands of the assessee is based upon search & seizure operation at the premises of Nish Developers Private Limited.

 

source is a pen drive entry recovered from an employee of the said developer.

 

The said pen drive purported to have an entry that cash against sale of flat was received from the assessee who is having’s office at Kalbadevi.

 

After detailed submission ld. CIT(A) has found that actually the wife of the assessee had booked a flat in the property of the said developer.

 

That the said booking was done by making cheque payments.

 

That the booking was cancelled and the amount of booking was duly refunded by the developer to the wife of the assessee.

 

CIT(A) has found that this shows that the entry, that on money was paid for sale of flat to the assessee is not at all correct and is a result of a mistaken identity.

 

He found that the said entries for on money cash payments are all dated after the cancellation of booking by the wife of the assessee and refund of money to her by the developer.

 

Hence, he was of the opinion that there is no reason why after the cancellation of booking anybody would pay on money cash amounts.

 

CIT(A) has also noted that AO has not disputed the details about the booking of flat by the wife of the assessee, the cancellation thereof and the refund of booking amount to her by the developer. Learned CIT(A) also noted that the assessee’s address is also not the same as mentioned in the said pen drive.

 

The above reasoning of the ld. CIT(A) in deleting the addition in the hands of the assessee are cogent.

 

When no material has been found that assessee has made any booking for the flat, a mere entry in a pen drive of a third party cannot ipso facto fasten the liability of on money transaction upon the assessee without further corroborative material brought on record.

 

As a matter of fact as noted by the learned CIT(A) the other materials further support the view that the addition in the hands of the assessee is not sustainable in as much as there was a booking of flat by the assessee’s wife with the same developer which was duly cancelled and booking was refunded prior to the entry of on money cash transaction.

 

Decided against revenue.

 

 

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