Gian Sagar Educational & Charitable Trust Vs DCIT (ITAT Delhi)
Delhi ITAT: ₹2 Crore Addition Based Solely on CBI Chargesheet Unsustainable; No Evidence of Undisclosed Income
The Delhi ITAT deleted the addition of ₹2 crore made as undisclosed income, holding that the Assessing Officer had relied solely on the CBI chargesheet and intercepted conversations without conducting any independent enquiry or bringing any evidence on record to establish that the assessee-trust had paid the alleged bribe.
The Tribunal noted that the very foundation of the addition had collapsed. Subsequent developments showed that the Delhi High Court had quashed the proceedings against Dr. Ketan Desai, the alleged recipient of the bribe, and had also quashed the charges against the alleged middleman J.P. Singh, holding that there was no admissible evidence linking him to the alleged conspiracy and that the ₹2 crore recovered from him stood independently explained as sale proceeds of agricultural land.
The Tribunal further observed that repeated inspections by the CBI, the Ministry of Health’s fact-finding committee, and the Board of Governors of the Medical Council of India found the medical college to possess the requisite infrastructure and justified the grant of permission for admissions. Thus, the allegation that the assessee had paid a bribe to secure approval without adequate infrastructure was unsupported.
Holding that the Revenue had failed to establish any nexus between the assessee and the alleged cash payment or any source of undisclosed income, the Tribunal deleted the entire addition of ₹2 crore and allowed the assessee’s appeal.
FULL TEXT OF THE ORDER OF ITAT DELHI
