Divyang Dipakkumar Vyas Vs DCIT (ITAT Ahmedabad)
Loose Papers Without Party/Property Details Not Enough for Taxing Brokerage- Rough Jottings Cannot Justify Addition of Rs. 20.3 Lakh Brokerage Income
Assessee, partner in City Estate Group with Shri Pravin Bavadiya (profit ratio 20:80), had originally declared income of Rs.6.65 lakh. AO, relying on seized loose papers, alleged unaccounted brokerage income of Rs.84 lakh and taxed Rs.20.30 lakh as Assessee’s 20% share for A.Y. 2019-20. Similar additions were made for subsequent years.
CIT(A) upheld additions, holding that brokerage was received on estimated basis from seized documents.
Before Tribunal, Assessee contended that (i) no corroborative evidence such as names of buyers/sellers or property details was found, (ii) addition was based solely on rough jottings, & (iii) in Pravin Bavadiya’s case (ITA No.1896/Ahd/2024, order dated 09.05.2025), on identical facts, Tribunal had deleted similar additions.
Tribunal observed that seized documents were loose papers without details of actual transactions. No independent evidence was brought on record to prove receipt of brokerage. Following its earlier ruling in Pravin Bavadiya (co-partner), Tribunal held that addition could not be sustained.
FULL TEXT OF THE ORDER OF ITAT AHMEDABAD
The captioned four appeals have been filed by the Assessee against the common order dated 20.08.2024 passed by the Learned Commissioner of Income Tax (Appeals)-11, Ahmedabad, (‘Ld. CIT(A)’ in short), under Section 250 of the Income-Tax Act, 1961 (‘the Act’ in short), for the Assessment Years 2019-20 to 2022-23.
