Amit Katyal Vs DCIT (ITAT Delhi)
No Addition Under Section 69A Without Independent Inquiry Into Alleged Cash Transactions; ITAT Quashes Cash Payment Addition as Revenue Relied Only on Presumptions and Digital Messages; Wedding Expense Addition Deleted as Revenue Failed to Prove Assessee Paid Cash Amounts; ITAT Rules Third-Party Search Documents Cannot Automatically Justify Addition Against Assessee.
Summary: In Amit Katyal Vs DCIT, the Delhi ITAT deleted additions made under Section 69A relating to alleged cash payments to a sportsperson and wedding-related expenses, holding that the additions were based merely on presumptions and uncorroborated digital messages. The Revenue relied on WhatsApp chats, statements recorded during post-search proceedings, and documents found from a third party’s premises to allege unexplained cash payments. However, the Tribunal found that no independent inquiry was conducted with the alleged recipients, event managers, or related parties to verify the transactions. The assessee had explained that payments recorded through banking channels were genuine and that wedding cash expenses could have been met from customary “Shagun” collections received during the marriage. ITAT held that mere digital chats, assumptions, and third-party documents without corroborative evidence cannot justify additions under Section 69A. Since the Assessing Officer failed to bring concrete evidence on record, all additions were deleted.
