ITO Vs Vineet Maini (ITAT Delhi)
“On-Money” Needs Evidence: ITAT Rejects ₹23.50 Lakh Addition Based on Builder’s Search Material
Revenue’s Appeal Fails on Tax Effect and Merits
The Delhi Bench of the Income Tax Appellate Tribunal, in ITO v. Vineet Maini, dismissed the Revenue’s appeal concerning an alleged on-money payment of ₹23.50 lakh for a property in an Omaxe group project.
The Tribunal noted that the tax effect of ₹18.33 lakh was below the ₹60 lakh monetary limit referred to in CBDT Circular No. 9/2024 dated 17 September 2024. It also examined the merits and found that the allegation rested on an inference drawn from material seized from the builder, without actual evidence showing that the assessee had paid or acknowledged the alleged amount. The ₹60 lakh ITAT threshold under Circular No. 9/2024 is also reflected in TaxGuru’s discussion of departmental appeals. [TaxGuru](https://taxguru.in/income-tax/appeal-income-tax-appellate-tribunal-itat.html?utm_source=chatgpt.com)
The decision concerned Assessment Year 2020-21, in ITA No. 6696/Del/2026. Pasted text
Builder’s Search Led to Allegation Against the Buyer
The dispute arose from reassessment proceedings under Section 147 of the Income-tax Act, 1961.
The Assessing Officer framed the assessment/reassessment on 7 March 2025, alleging that the assessee had made unexplained investments of ₹23.50 lakh. The amount was described as on-money paid to the Omaxe group in connection with its project, “The Lake Chandigarh”.
The allegation originated from material found during a search at the Omaxe group’s premises. The Assessing Officer drew an inference from that material that the assessee had paid an amount over and above the recorded consideration.
The matter subsequently reached the CIT(A)/NFAC, whose order dated 30 April 2026 was challenged by the Revenue before the Tribunal.
The Tribunal’s brief order does not reproduce the seized documents or provide a detailed account of the CIT(A)’s reasoning. Its findings must therefore be understood within the factual account expressly recorded in the order. Pasted text
Tax Effect Was Below the Stated Monetary Limit
At the hearing, the Tribunal examined the Revenue’s Form 36 and noted that the tax involved in the appeal was ₹18.33 lakh.
It compared this with the ₹60 lakh limit prescribed in CBDT Circular No. 9/2024 and observed that the appeal fell below that threshold.
The distinction between the amount of addition and the tax effect is important. The disputed investment was ₹23.50 lakh, while the tax effect recorded in Form 36 was ₹18.33 lakh. The Tribunal referred to the latter when considering the monetary limit.
The order does not contain a separate discussion of any exception to the circular. It nevertheless proceeded to examine the substantive allegation as well, finding that the Revenue’s case failed even on merits. Pasted text
Inference From Seized Material Was Not Corroborated
The Tribunal’s central factual observation was that, apart from the inference drawn from material seized at the builder’s premises, no actual evidence had emerged showing payment by the assessee.
It specifically referred to the absence of evidence that the assessee had either paid or acknowledged paying the alleged on-money through an agreement, receipt or similar document signed with the vendor.
The Revenue could hardly dispute this position, as recorded by the Tribunal.
Consequently, the allegation remained unsupported by evidence establishing the assessee’s involvement in the alleged payment. The Tribunal found no merit in the Revenue’s case and declined to interfere.
This reasoning should not be expanded into a universal requirement that an on-money addition can survive only where a signed receipt exists. The order refers to agreements and receipts as examples of evidence that could have supported the allegation; its broader factual finding was the absence of actual evidence of payment or acknowledgment. Pasted text
Revenue’s Appeal Dismissed
The Tribunal dismissed the Revenue’s appeal, thereby leaving the CIT(A)’s order undisturbed.
The result rested on the two features expressly discussed: the tax effect below the stated monetary limit and the lack of supporting evidence for the alleged on-money payment.
The order records the hearing and pronouncement as 4 August 2026, while the concluding date is 30 September 2026. Both dates appear in the document. Pasted text
Author’s Comments
The decision highlights the need to connect material found during a builder’s search with the specific transaction and conduct of the buyer. The existence of seized material may prompt investigation, but the allegation against a particular purchaser still requires evidentiary support.
Here, the Tribunal found that the Revenue had moved from third-party search material to an inference of payment without establishing that the assessee actually paid or acknowledged the alleged amount. That missing connection was decisive on merits.
Equally, the ruling should not be read as declaring all third-party documents irrelevant or incapable of supporting an addition. The Tribunal did not undertake a detailed examination of the documents’ contents, authenticity or evidentiary character in its published reasoning. Its conclusion was confined to the absence of actual supporting evidence in this case.
For practitioners handling similar disputes, the useful focus is the precise link between the seized entry, the identified buyer, the property transaction and the alleged payment. A general allegation that a builder received on-money cannot, by itself, resolve whether a particular taxpayer made the disputed payment.
The case also shows that monetary-limit scrutiny and examination of merits can coexist. Although the Tribunal noted the low tax effect, it expressly rejected the Revenue’s factual case as well. Pasted text
FULL TEXT OF THE ORDER OF ITAT DELHI
This Revenue’s appeal for assessment year 2020-21, arises against the Commissioner of Income Tax (Appeals)/National Faceless Appeal Centre [in short, the “CIT(A)/NFAC”], Delhi’s DIN and order no. ITBA/NFAC/S/250/2026-27/1088739195(1), dated 30.04.2026 involving proceedings under section 147 of the Income- tax Act, 1961 (hereinafter referred to as ‘the Act’).
Heard both the parties. Case file perused.
2. It transpires during the course of hearing that the tax involved in the instant appeal is Rs.18.33 lakhs as per its Form 36 attached herein which turns out to be less than the prescribed tax limit of Rs.60 lakhs in CBDT’s landmark Circular No. 9/2024, dated 17th September, 2024.
3. The fact also remains that that the learned Assessing Officer appears to have framed his assessment/reassessment in the assessee’s case on 07.03.2025 alleging unexplained investment(s) of Rs.23.50 lakhs representing his on-money paid to the searched party i.e. M/s. Omaxe group in its project called “The Lake Chandigarh”.
4. It is in this factual backdrop that the Revenue could hardly dispute that apart from drawing same inference based on the corresponding seized material found during the course of search carried out at M/s. Omaxe group premises, there is no actual evidence having seen light of the day till date that the assessee had ever paid or acknowledged to have paid the aforesaid on-money by way of any agreement or receipt etc.; as the case may be, signed with the vendor concerned. I see no merit in the Revenue’s case herein even on merits as well which is hereby declined in very terms.
5. This Revenue’s appeal is dismissed.
Order pronounced in the open court on 4th August, 2026
