Veena Hiralal Mehta Vs DCIT (ITAT Mumbai)
Addition u/s 69 for Alleged Cash Component in Property Purchase Deleted – Third-Party Pen Drive & Statements Without Cross-Examination Held Insufficient
The ITAT Mumbai allowed the assessee’s appeals and deleted addition of ₹10 lakh made u/s 69 on alleged cash payment for purchase of shop in “Platinum Mall”. The AO had relied on search findings in Rubberwala Group, including a pen drive containing excel sheets and statements of an employee and promoter alleging cash components in shop sales. However, no incriminating material directly linked to the assessee such as receipts, vouchers or signed documents was found.
The Tribunal held that additions based solely on third-party statements and digital records without independent corroboration or opportunity for cross-examination violate principles of natural justice. It noted that the assessee had denied any cash payment, purchased property at value higher than stamp duty valuation and the AO failed to bring comparable instances or independent evidence. Reliance was placed on earlier coordinate bench rulings involving identical search material, where similar additions were deleted.
Accordingly, ITAT held that suspicion arising from pen drive data or statements cannot substitute proof, and since Revenue failed to establish actual unaccounted investment, the addition u/s 69 was unsustainable. Both appeals of the assessee were allowed.
FULL TEXT OF THE ORDER OF ITAT MUMBAI
