Home Construction Co. Vs DCIT (ITAT Chandigarh)
ITAT deleted addition of ₹1.17 crore sustained by CIT(A) towards alleged “on-money” received on sale of flats, holding that the entire addition was based solely on digital data and documents seized from a third-party broker (Sh. Ravi Kapoor) and not from the assessee. Tribunal observed that third-party documents, without corroborative material or independent enquiry from buyers, cannot justify addition, especially when no incriminating material was found from the assessee’s premises.
Relying on earlier Chandigarh Bench rulings and the decision in the group concern case of Homelife Buildcon Pvt. Ltd., ITAT held that presumption u/s 132(4) applies only to the person from whom documents are seized. Since the evidence lacked nexus with the assessee and no corroboration existed, the addition was unsustainable and deleted. Appeal allowed.
FULL TEXT OF THE ORDER OF ITAT CHANDIGARH
This is an appeal filed by the Assessee against the order of the Ld. Pr. CIT(A)-5, Ludhiana dt. 26/03/2025 pertaining to Assessment Year 2022-23.
2. In the present appeal Assessee has raised the following grounds:
“1. That the Ld. CIT(A) has erred in confirming the addition of Rs. 1,17,00,000/-against the addition of Rs. 1,50,33,080/-, as made by the Assessing Officer on account of suppression.
2. That the confirmation of above addition as made by the Ld.CIT(A) is not in order and against the facts and circumstances of the case.
3. That the said addition have been confirmed by the CIT(A) without making any enquiries from the parties to whom, the flats have been sold and without bringing any material on record.
4. That the addition has been sustained against the facts and circumstances of the case.
5. That the appellant craves leave to add or amend the grounds of appeal before the appeal is finally heard or disposed off.”
3. Briefly, the facts of the case are that the assessee, M/s Home Construction Co., filed its return of Income for A.Y. 2022-23 declaring an income of Rs. 2,68,240 under Section 139(1) of the Income-tax Act, 1961. The case pertains to the Home Life Buildcon Pvt. Ltd. Group, wherein a search and seizure operation under Section 132 was conducted on 16.11.2021. Incriminating documents were found and seized from various business and residential premises of the group.
