DCIT Vs H.S. Chandramouli (ITAT Bangalore)
The Income Tax Appellate Tribunal (ITAT), Bangalore Bench, recently dismissed an appeal filed by the Deputy Commissioner of Income Tax (DCIT) against H.S. Chandramouli for the assessment year 2004-05. The Tribunal upheld the decision of the Commissioner of Income Tax (Appeals) [CIT(A)] to delete an addition of Rs. 22,75,000/- made by the Assessing Officer (AO) based on a document seized during a search conducted on a third party. The ruling emphasized the limited applicability of statutory presumptions and the necessity of corroborative evidence for additions.
Case Origin: Search on Third Party
The case originated from a search action initiated under Section 132(2) of the Income Tax Act, 1961, on October 9, 2009, in the case of one Shri Sohanraj Mehta, who served as a C&F agent for the M/s. Rasiklal Manikchand Dhariwal group. During this search, a document marked as Annexure A/M/8 was discovered. This document contained an entry showing a sum of Rs. 22,75,000/- against the name of the assessee, H.S. Chandramouli, an Advocate by profession. According to the revenue, this entry indicated that the assessee had received the said amount from Shri Sohanraj Mehta on October 22, 2003.
AO’s Action and Assessee’s Denial
