No addition could be made merely on basis of seized excel sheet which was a mere dumb document

Tarun Kumar Goyal Vs ACIT (ITAT Hyderabad)

Conclusion:  Addition of on-money payment made in both these assessees’ hands on the basis of a mere dumb document and not corroborated by any other evidence was not sustainable as the department had failed to corroborate the impugned seized document indicating assessee’s alleged on money payment over and above the sale price itself.

Held: Department had carried out the impugned search dt.02-11-2016 in twin assessee’s cases namely Sri T and Sri A/vendees as well as the vendor M/s.W and other parties. The same culminated in Section 153A proceedings initiated against them. Coming to the issue of on-money payment to the vendor, M/s.W, it was an admitted fact that the purchase transaction was regarding commercial space admeasuring 38,700 sft. (11th floor) of the Western Pearl Project. AO’s case was that the impugned search had found/seized the incriminating document ‘No.A/GSR/02’ in the nature of an ‘Excel’ sheet. AO stated that the said Excel sheet revealed the assessee’s vendor and Shri Narendra Kumar Goyal’s debit and credit entries followed by registration of the sale deed in former’s name only. AO took note of the former assessee Shri T’s statement u/s.132 allegedly referring to a document recovered from partner of M/s.W during search that the same sufficiently indicated details of the on-money payment in issue. The issue arose was whether the impugned seized material / ‘Excel’ sheet (not mentioning the assessees’ names) formed a dumb document or not. It was held that the department had failed to corroborate the impugned seized document indicating assessee’s alleged on money payment over and above the sale price itself. All it had done was to rely on their father’s name only. It was nowhere clear as to whether it was an alleged document forming part of the books of account maintained in the regular course of business either by the vendor or vendee side. All it contains therefore was rough notings and jottings only. This tribunal co-ordinate bench’s decision Nishan Constructions Vs. ACIT ITA No.1502/Ahd/2015; after considering the hon’ble apex court’s landmark decision in Common Cause, Vs. Union of India (2017) 77 taxmann.com 245 (SC) and CBI Vs. V.C.Shukla (1998) 3 SCC 410 (SC) holds that such loose sheets deserves to be treated as a dumb documents only since not revealing full details about the dates containing lack of further particulars and therefore, ought not to be made basis of an addition. Therefore, the impugned addition of on-money payment made in both these assessees’ hands on the basis of a mere dumb document and not corroborated by any other evidence was not sustainable.

FULL TEXT OF THE ORDER OF ITAT HYDERABAD

The instant three appeals pertain to two assessees, S/Shri Tarun Kumar Goyal and Arun Kumar Goyal for AYs.2014-15 & 2016-17. The former assessee’s appeals ITA Nos.456 & 457/Hyd/2020 arise against the CIT(A)-11, Hyderabad’s separate orders, both dated 31-01-2020 (AYs.2014-15 & 2016-17) passed in case Nos.10252 & 10255/2018-19 followed by a latter assessee’s appeal ITA No.458/Hyd/2020 for AY.2016-17 directed against the very CIT(A)’s order; of even date, passed in case No.10253/2018-19, involving proceedings u/s.143(3) r.w.s.153A of the Income Tax Act, 1961 [in short, ‘the Act’]; (in all cases), respectively.

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