ITO Vs Chirag Jitendra Shah (ITAT Ahmedabad)
Ahmedabad ITAT Deletes On-Money Addition as Revenue Failed to Link Seized Material with Assessee
The Ahmedabad ITAT dismissed the Revenue’s appeal and upheld the deletion of an addition of ₹1.338 crore made under section 69 towards alleged on-money payment for the purchase of a flat. The Assessing Officer had inferred the payment from entries in a seized Excel file (LEGACY.xlsx) and a WhatsApp brokerage sheet recovered during the search on the Shivalik Group, treating the cash brokerage entry as representing 2% of the alleged cash component paid by the assessee.
The Tribunal observed that the assessee’s name did not appear anywhere in the seized Excel file, WhatsApp image, or in any statement recorded during the search. It held that the Revenue’s attempt to correlate the entry relating to Flat No. B-101 with the assessee was based purely on presumption and conjecture, without any corroborative evidence showing that the assessee had actually paid cash to the builder.
Affirming the CIT(A)’s order, the Tribunal held that no addition can be sustained on hypothetical assumptions in the absence of cogent evidence linking the assessee to the alleged cash payment. Since the figure of ₹1.338 crore itself did not appear in the seized material and no independent evidence supported the allegation of on-money, the addition under section 69 was rightly deleted. The Revenue’s appeal was dismissed.
FULL TEXT OF THE ORDER OF ITAT AHMEDABAD
The present appeal has been filed by the Revenue against the order of the Ld. Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (hereinafter referred to as “NFAC”), Delhi (hereinafter referred to as “CIT(A)”), dated 19.11.2025 passed under Section 250 of the Income Tax Act, 1961 (hereinafter referred to as the “Act”) and relates to Assessment Year (A.Y.) 2020-21.
