ACIT Vs Ashokkumar Babulal Bambharoliya (ITAT Ahmedabad)
Summary: The appeals of the Revenue and cross objections of the assessees arose from separate orders of the CIT(A)-12, Ahmedabad, NFAC, Delhi, all dated 27.03.2025 for A.Y. 2018-19. The common issue arose from assessments framed under Section 153C of the Act on the basis of alleged incriminating material found during a third-party search.
The material was a WhatsApp chat extracted from the phone of Mr. Vijay K. Manghrani, who was subjected to search action u/s. 132 of the Act. The Revenue alleged that the chat showed a much higher prevailing fair market value for land sold by the assessees and co-owners and consequently inferred receipt of cash on-money over and above the documented sale consideration.
In the lead case of Ashokkumar Babulal Bambharoliya, the assessee and five co-owners had sold 9,611 sq. metres of land bearing Survey No. 241/1, TP Scheme No. 241, Nana Chiloda, Gandhinagar, to M/s Shivam Associates for Rs.1,65,00,000/- on 21.09.2017. During a search on 15.10.2019, a WhatsApp chat dated 14.09.2018 was found on Mr. Manghrani’s mobile phone. The chat was read as showing a market rate of Rs.22,500 per sq. yard for land in TP Scheme No.241 during F.Y. 2018-19, whereas the assessee’s documented sale rate was stated to be Rs.1,435.40 per sq. yard. The AO inferred a total consideration of Rs.25,86,37,500/- against the documented Rs.1,65,00,000/-, treated the differential Rs.24,21,37,500/- as cash on-money received by the co-owners, and made an addition of Rs.6,05,84,375/- in the assessee’s hands.
