DCIT Vs GSG Abode LLP (ITAT Ahmedabad)
WhatsApp Chats & Cancelled MOU Not Evidence -ITAT Ahmedabad Quashes On-Money Additions
A search was conducted u/s 132 in the case of land broker Suresh Thakkar. On the basis of alleged incriminating material (digital data, loose papers & WhatsApp chats), assessments u/s 153C were initiated in the case of GSG Abode LLP (purchaser) & original land owners (sellers). AO held that there was payment of on-money of Rs.25 crores over & above the registered sale consideration of Rs.49 crores for land purchased at Sarkhej-Vejalpur, Ahmedabad. AO relied on a cancelled MOU dated 20.01.2018, WhatsApp chats & a DVO’s report valuing land at Rs.54.37 crores. Additions were made u/s 69B in the hands of GSG Abode LLP & corresponding additions in the hands of sellers as unexplained LTCG.
Before CIT(A), Assessees argued that no incriminating material pertained to them; WhatsApp chats were between third parties; the MOU was cancelled within 10 days; DVO valuation in 2022 was influenced by subsequent development of “Orchid Sky” project; variation was only 9.88% which was within permissible range; no cash trail was found; & all sellers denied receipt of on-money. Reliance was placed on SC decision in Ambalal Sarabhai Enterprises Ltd. Vs KS Infraspace LLP (2019) that WhatsApp chats have weak evidentiary value unless tested by cross-examination. CIT(A) deleted the additions, holding that estimation alone could not justify addition, & that no corroborative evidence of on-money existed.
