Aarti Sudarshan Soni Vs ITO (ITAT Mumbai)
In the case of Aarti Sudarshan Soni vs. ITO, the Income Tax Appellate Tribunal (ITAT) Mumbai overturned an addition of Rs. 33 lakh made under Section 69 of the Income Tax Act. The case revolved around an alleged unexplained investment linked to the purchase of a flat from M/s Shah Housecon Pvt. Ltd.. The Assessing Officer (AO) relied on statements recorded during a survey conducted at the builder’s premises, where it was claimed that on-money payments were made. The assessee denied these allegations, submitting bank statements and an affidavit stating that no cash consideration was paid beyond the agreement value. The AO, however, made the addition solely based on the builder’s accountant’s statement and the lack of response to summons issued to the builder. On appeal, the CIT(A) upheld the AO’s decision, prompting the assessee to move the ITAT.
The ITAT, citing a Co-ordinate Bench decision in M/s Yash Synthetic Pvt. Ltd., ruled that the AO’s reliance on uncorroborated statements without independent inquiry was legally unsustainable. It emphasized that survey statements under Section 133A lack evidentiary value and that the burden of proving an on-money payment lay with the revenue authorities. Additionally, discrepancies in the builder’s records and the absence of corroborative material further weakened the AO’s claim. Given these factors, the Tribunal concluded that the addition was unjustified and directed its deletion. The appeal was allowed, reinforcing the principle that mere survey findings without independent verification cannot form the basis for additions under Section 69.
