Mere statement recorded during search cannot be treated as incriminating document for making addition in a search case
Pursuant to search and seizure operation conducted in the premises of the assessee, an individual and trader of bananas, statement of the assessee was recorded admitting purchasing a property at Rs. 36 lakhs against the registered title deed showing an amount of Rs. 10,15,000 paid through banking channel. As some notepads were found indicating the assessee’s source of the money for purchase of the property, the Assessing Officer took them as the cash component of the purchase.
The Commissioner (Appeals) confirmed the addition.
On appeal ITAT Held as under:
(i) that there was no specific incriminating document to prove any payment over and above the cheque payment made by the assessee for the purchase of the immovable property. Notepads indicating the source of money could not be treated as incriminating document to prove the cash payment for the purchase. Other than the assessee’s statement recorded during the search stating payment of Rs. 36 lakhs as total consideration for the purchase, there was no other incriminating document on record to substantiate the Department’s claim of the cash payment.
Therefore, the finding of the Commissioner (Appeals) could not be sustained.
CIT v. MANTRI SHARE BROKERS P. LTD. [2018] 405 ITR (St.) 24 (SC) relied on.
(ii) That during the search operation, a paper was found showing names of four persons and a sum mentioned against each name. The Assessing Officer, treating this dumb document as a noting for the cash transactions without indicating whether it represented receivable or payable, made addition on that basis. Though the Commissioner (Appeals) did not accept the findings of the Assessing Officer, he treated it as a part of cash payment for the property purchase. As this issue had been already held in favour of the assessee, no separate adjudication was necessary with regard to addition made on the basis of a dumb document.
The Copy Of the judgment is as under:
