Abhay Vrundavandas Devi Vs ACIT (ITAT Ahmedabad)
Post-Search Flat Booking Can’t Trigger On-Money Addition: Ahmedabad ITAT Deletes ₹7 Lakh u/s 69A
The Ahmedabad “SMC” Bench of the ITAT allowed the appeal of Abhay Vrundavandas Devi vs. ACIT, Circle-2(1)(1), Ahmedabad, ITA No. 1972/Ahd/2025, AY 2013-14, vide order dated 18.12.2025, and deleted the addition of ₹7 lakh made u/s 69A
The addition arose from a search on a real-estate developer (Dev Group), where the builder admitted before the Settlement Commission to having received on-money from customers. Based solely on the Assessee’s name appearing in the builder’s records, the AO reopened the assessment and alleged that the Assessee had paid ₹7 lakh as on-money for booking a flat, which was confirmed by the NFAC-CIT(A).
Before the Tribunal, it was demonstrated that the Assessee booked the flat only on 13.05.2014, i.e., much after the date of search (03.01.2013). The only payment made was ₹20 lakh through banking channels, and even that booking was subsequently cancelled, with the entire amount refunded by cheque in April 2021. There was no evidence of any cash payment or on-money by the Assessee, nor any corroborative material linking him to the amounts admitted by the builder during the search.
The Tribunal held that on-money admitted by the builder for the pre-search period cannot be mechanically fastened on a person who entered into a transaction only after the search. The addition, based merely on assumption, presumption, and third-party statements without cross-examination, was found unsustainable.
Accordingly, the addition of ₹7 lakh u/s 69A was deleted in full, and the Assessee’s appeal was allowed.
FULL TEXT OF THE ORDER OF ITAT AHMEDABAD
The above appeal has been preferred by the assessee against order passed by the Ld.Commissioner of Income-Tax(Appeals), National Faceless Appeal Centre (NFAC), Delhi [hereinafter referred to as “ld.CIT(A)] dated 10.9.2025 under section 250 of the Income Tax Act, 1961 (“the Act” for short) for the assessment year 2013-14.
