DCIT Vs Sigma Institute of Technology & Engineering (ITAT Ahmedabad)
Extrapolation in Search-Based Assessment Upheld: ITAT Allows Partial Estimation of Unaccounted Donations; Recovered Salary from Employees Proved as Regular Practice: ITAT Confirms Full Addition Based on Systematic Modus Operandi; Salary Kickback Scheme Established Through Search Evidence: ITAT Ahmedabad Upholds AO’s Estimation of Unaccounted Income; Partial Relief on Undisclosed Bank Deposits: ITAT Confirms CIT(A)’s Finding Based on Verified Contra Entries; Extrapolation Allowed Only with Evidence of Pattern: ITAT Clarifies Limits of Estimation in Search Assessments; ITAT Ahmedabad Affirms Revenue’s Estimation on Unaccounted Donations but Restricts Scope to 75% of Students; Systematic Modus of Unrecorded Salary Receipts Proved: ITAT Allows Full Estimation Against Trust; Relief on Bank Deposit Addition Where Accounts Belonged to Other Entities: ITAT Rejects Revenue’s Appeal; Unaccounted Donations and Salary Recovery Established by Evidence: ITAT Ahmedabad Upholds Revenue’s Partial Appeal; Search Reveals Organized Cash Collection Scheme: ITAT Backs Revenue’s Findings on Unaccounted Donations and Salaries.
A search u/s 132 on the Sigma Group of Institutes revealed unaccounted donations, salary kickbacks, & undisclosed bank accounts. AO, relying on seized material & extrapolation, made additions aggregating ₹2.31 crore-comprising unaccounted donations, salary received back from staff, & unexplained deposits. CIT(A) restricted additions to the extent proved by seized evidence, rejecting AO’s extrapolation as excessive.
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