Whether the addition on the basis of such dumb document is sustainable or not?
The addition on the basis of loose sheets, papers, etc obtained during survey or search proceeding is one of the regular features during post survey and search assessment proceeding.
Whether the addition on the basis of such dumb document is sustainable or not?
Here was an issue before Hyderabad ITAT.
Assessee in this objected for such disallowances/additions and it has been broadly submitted that the AO erred in taking cognizance of two unsigned impounded papers which have no evidentiary value under law. It was also contended and explained that the loose sheets were merely a discussion paper prepared for the information of the management and it was merely an inflow and outflow of funds for the periods mentioned there in. It was contended and submitted that the figures mentioned in these papers were not actual figures but rough figures rounded off and wherever certain figures like increase in bank loans etc were available it was taken on the basis of increase in their limits and the headings were conveniently grouped under recognizable heads for easy understating of the management. It was contended by the assessee that the AO disregarded the explanation.
Hon’ble Bench posed a specific query to the learned counsel as to whether all the remaining entries in both sides of the impounded document Annexure-I are correct or not? The reply received from the assessee’s side is in affirmative only.
With this, Hon’ble Bench observed as under”
“All this leads us to an irresistible conclusion that the learned Assessing Officer had rightly made the impugned addition in assessee’s hands taking into consideration the totality of all the corresponding entries in the impounded document rather than adopting a pick and choose method”.
It means if the part of the contents is accepted as true then the balance cannot be denied.
The copy of the order is as under:
