Babita Verma Vs ITO (ITAT Agra)
Summary: ITAT Agra allowed the assessee’s appeal and deleted an addition of Rs 9,75,000 made as unexplained investment under section 69 of the Income-tax Act, 1961. The assessee had filed her return for assessment year 2019-20 declaring total income of Rs 4,37,970. Her case was subsequently reopened under section 147 on the basis of information arising from a search conducted under section 132 on Omaxe group on 14.03.2022. The Revenue alleged that an Excel file described as the “MAIN REPORT” showed an unaccounted cash payment of Rs 9,75,000 by the assessee for purchase of property in Omaxe Residency II, Lucknow. The assessee consistently denied having made the alleged cash payment.
The Assessing Officer relied upon the Excel sheet and statements allegedly recorded under section 132(4) from Shri Vikas Goel, AGM Finance, Lucknow Project, and Shri Manish Kumar, President of Omaxe group. However, despite the assessee specifically seeking certified copies of the seized documents and statements, the material was not furnished either during assessment proceedings or before the CIT(A). The Tribunal observed that the Excel sheet reproduced in the assessment order did not even contain the assessee’s name and did not state that she had paid Rs 9,75,000 in cash to Omaxe group. It further held that statements recorded behind the assessee’s back could not be used adversely without first furnishing them for rebuttal and, where requested, providing an opportunity of cross-examination. The Tribunal also noted that since the Excel sheet had admittedly been seized from Omaxe Limited, the statutory presumption under section 292C operated in relation to Omaxe group. The Revenue had not brought cogent evidence on record establishing that the assessee had actually made the alleged cash payment. The addition was therefore held to suffer from factual and legal infirmities and was deleted. The assessee’s appeal was allowed.
FULL TEXT OF THE ORDER OF ITAT AGRA
1. The appeal in ITA No. 74/AGR/2026 for AY 2019-20, arises out of the order of the ld National Faceless Appeal Centre, Delhi [hereinafter referred to as ‘ld. CIT(A)’, in short] dated 11.11.2025 against the order of assessment passed u/s 147 of the Income-tax Act, 1961 (hereinafter referred to as ‘the Act’) dated 28.03.2024 by the Assessing Officer, ITO, Ward-2(1)(1), Agra (hereinafter referred to as ‘ld. AO’).
2. Though the assessee has raised several grounds of appeal, the only issue to be decided in this appeal is as to whether a sum of Rs 9,75,000 could be treated as unexplained investment under section 69 of the Act in the facts and circumstances of the instant case.
3. I have heard the rival submissions and perused the materials available on record. The return of income for the assessment year 2019-20 was furnished by the assessee on 29-08-2019 declaring total income of Rs 4,37,970. As per the information available with the income tax department, it was found that assessee had made cash payment of Rs 9,75,000 to Omaxe group from unaccounted sources for purchase of property. Accordingly, the case of the assessee was reopened under section 147 of the Act and the notice u/s 148 of the Act stood issued to the assessee on 31-03-2023. In response, the assessee filed her return on 28- 04-2023 declaring the same total income of Rs 4,37,970 as was originally filed. The Learned AO noted in the reassessment order that a search and seizure operation was conducted under section 132 of the Act on Omaxe group on 14-03-2022. In the said search, certain documents in the form of MAIN REPORT excel files were found wherein it revealed that assessee herein had made unaccounted payment of Rs 9,75,000 to Omaxe group during the year under consideration. During the course of reassessment proceedings, the payments made to Omaxe group was sought to be examined by the Learned AO. The learned AO noted that the assessee had paid Rs 9,75,000 in cash to Omaxe group for purchase of property in Omaxe Residency II, Lucknow. The assessee categorically denied having made any cash payment of Rs 9,75,000 to Omaxe group for purchase of property in Omaxe Residency II, Lucknow as alleged in the notice of the Learned AO.
4. The Learned AO however noted that excel sheet was found in the search of Omaxe group wherein figure mentioned thereon need to be multiplied by 100 and accordingly the assessee had made payment of Rs 9,75,000 in cash for purchase of property from Omaxe group. The ld AO also placed reliance on the statement recorded from Shri Vikas Goel, AGM Finance, Lucknow Project who admitted in his statement under section 132(4) of the Act to this effect. The Learned AO also noted that the President of Omaxe group Shri Manish Kumar had also confirmed in his statement under section 132(4) of the Act that the excel sheet date represent cash transactions carried out by the group. In compliance to the show cause notice dated 11.03.2024, the assessee furnished her reply on 13.03.2024 denying having made any cash payment of Rs 9,75,000 to Omaxe group for purchase of property. The Learned AO however completed the reassessment under section 147 of the Act on 28-03-2024 after making an addition of Rs 9,75,000 on account of unexplained investment made in cash.
5. During the course of assessment proceedings, the assessee asked for certified copy of the seized documents from the premises of Omaxe Limited and the relevant statement recorded during the that search operation, wherein adverse information was given against the assessee. This was not provided to the assessee by the Learned AO. The same pleadings were made before the Learned CIT(A) by the assessee. It was pleaded that the Main Report excel sheet is reproduced by the Learned AO in Page 7 of the assessment order. From the said excel sheet, there is absolutely no mention at all that assessee had paid cash of Rs. 9,75,000 to Omaxe Group. Infact even the name of the assessee is nowhere mentioned thereon. The Learned CIT(A), however, did not heed to these contentions and reiterated the observations made in the assessment order and confirmed the addition.
6. It is pertinent to note that assessee was made aware of the Main Report excel sheet only in the assessment order vide Page 7 thereon. In the said excel sheet, we find that the name of the assessee is not even mentioned. Further there is no mention in the said excel sheet that there was some cash payment of Rs 9,75,000 by the assessee to Omaxe group. Hence the explanation offered by the assessee that no cash was paid by her deserves to be accepted. Further some statements were stated to be recorded from the employee and President of Omaxe Group on oath, wherein it was alleged that the assessee had made cash payment to Omaxe Limited. But that such statements were sought by the assessee both before the ld AO as well as before the Learned CIT(A) and the same were never produced to the assessee. Hence statements taken behind the back of the assessee were sought to be used against the assessee herein by drawing adverse inference and conclusion that there was cash payment of Rs 9,75,000 made by the assessee to Omaxe Group, without even providing those statements to the assessee. It is trite law that any statement that is sought to be used against the assessee need to be first furnished to the assessee for her rebuttal. Thereafter if the assessee so desires, the said party who had originally given the statement should be made available for cross examination by the assessee and it would be the department’s duty to produce that person as the said party becomes department’s witness. Further the excel sheet was admittedly seized from the premises of Omaxe Limited. Hence the presumption in terms of section 292C of the Act would be on Omaxe Group that the said document belongs to them. Merely because some employee and President of Omaxe Limited allegedly stated that the entries mentioned in the excel sheet pertains to assessee herein, proceedings cannot be directly initiated on the assessee without making preliminary enquiry both from Omaxe Limited as well as from the assessee herein. I find that the revenue had never brought on record with cogent evidence that assessee herein had indeed made cash payment of Rs 9,75,000/- to Omaxe Limited. It is only an inference drawn by the revenue based on the excel sheet found in the search of Omaxe Limited and supplemented by statements on oath by employee and President of Omaxe Limited, which statements were not even put to assessee for her rebuttal. Hence it could be safely concluded that the assessment framed on the assessee herein by making an addition of Rs 9,75,000/- as unexplained investment under section 69 of the Act suffers from various factual and legal infirmities. Hence we have no hesitation to delete the said addition of Rs 9,75,000 made in the hands of the assessee herein. Accordingly, the grounds raised by the assessee are allowed.
7. In the result, the appeal of the assessee is allowed.
Order pronounced in the open court on 22/05/2026.
