Pravin Khetaramm Purohit Vs DCIT (ITAT Mumbai)
This case concerns additions made for alleged “on-money” cash payments towards purchase of a shop in Platinum Mall, a project developed by Rubberwala Group. Assessee purchased Shop No. 43 in October 2019 for ₹17.75 lakh, & paid the entire amount through banking channels. Stamp duty was paid based on the higher market value determined by the Stamp Authority, indicating a fully disclosed transaction.
During a search on Rubberwala Group, the department seized a pendrive containing excel sheets & recorded statements of employees (notably Imran Ansari) & the Group’s promoter. These statements indicated that cash components were collected from some buyers in addition to cheque payments. Based solely on these third-party materials, AO initiated proceedings u/s 153C against Assessee & made an addition of ₹2,00,000/- u/s 69 as “on-money”.
Assessee strongly denied making any cash payment & highlighted multiple fundamental flaws:
- He booked the shop only in FY 2019-20 (AY 2020-21), yet AO made additions even in AYs 2017-18 & 2018-19, which was factually impossible.
- No seized document or statement mentioned Assessee’s name.
- Copies of the excel sheet or statements were never provided.
- No opportunity of cross-examination was granted despite explicit requests.
- The electronic data was seized from a third party, not from Assessee, & no Section 65B Evidence Act certificate was obtained, rendering it legally inadmissible.
- Assessee cited multiple binding judicial precedents, including ITAT Mumbai decision in Rajesh Jain (2024) involving the same builder, same project, & identical facts, where similar additions were deleted.
Tribunal carefully examined the facts & found the case to be identical to Rajesh Jain, where ITAT had held that third-party statements & excel sheets cannot be used to make additions in the absence of corroborative evidence or cross-examination. Tribunal emphasized that while the builder’s employee admitted that cash was collected from some buyers, there was no statement or document showing that THIS assessee paid cash, nor was any diary or receipt found during search from Assessee.
