Atchutha Venkata Sreenivasa Rao Vs ACIT (ITAT Hyderabad)
Unsigned Seized Agreement Cannot Prove Cash Receipt: Addition Under Section 69A Deleted
The Hyderabad Bench of the Income Tax Appellate Tribunal (ITAT) deleted the addition of ₹1,83,600 made under section 69A, holding that an unsigned and unacted-upon seized document cannot, by itself, establish receipt of unexplained cash. The addition was based on an alleged “agreement of sale” found during a search in the case of the Spectra Group, from which the Assessing Officer inferred a proportionate cash receipt by the assessee.
The Tribunal noted that the seized agreement did not bear the signature of the assessee or any of the alleged vendors, rendering its execution unsubstantiated. Further, on the date mentioned in the seized document, the assessee was not even the owner of the property, as evidenced by the registered sale deed and encumbrance certificate, which showed ownership was acquired only subsequently.
It was also found that the alleged transaction never materialised and that the property was eventually sold to a third party through a registered sale deed, reinforcing the assessee’s case. Importantly, the Revenue failed to produce any corroborative evidence—such as proof of actual cash receipt—to support the addition. The Tribunal reiterated that mere notings in a seized paper, without signatures or independent corroboration, are insufficient to sustain an addition for unexplained money.
Accordingly, the ITAT directed deletion of the addition on merits, keeping the legal grounds open.
FULL TEXT OF THE ORDER OF ITAT HYDERABAD
This appeal is filed by Atchutha Venkata Sreenivasa Rao (“the assessee”), feeling aggrieved by the order passed by the Learned Commissioner of Income Tax (Appeals)-12, Hyderabad (“Ld. CIT(A)”) dated 18.07.2025 for the A.Y 2020-21.
