ACIT Vs Jayesh Umakant Manania (ITAT Mumbai)
₹2 Cr Cash Addition Crumbles: Third-Party iPhone Notes, No Corroboration, No 65B—ITAT Mumbai Upholds Deletion
In a reassessment framed u/s 147 r.w.s. 143(3), AO made addition of ₹2,00,00,000/- u/s 69A alleging unexplained cash paid for booking flats in “Vivaria”, solely on the basis of images/loose notings extracted from the iPhone of a third party (Shri Pankaj Goshar) during search/survey in connected cases. Assessee consistently denied any cash payment, stated no flat was booked in AY 2012-13, pointed out that all later transactions were through banking channels, & emphasized that the seized electronic material neither belonged to nor was authored by him. The alleged recipients (Shri Pankaj Goshar & Shri Ajay Vishrani) categorically denied receipt of any cash; cross-examination reinforced the denial.
CIT(A) held reopening valid but deleted the addition on merits, noting absence of primary evidence, lack of corroboration such as cash withdrawals/flow of funds/agreements, denial by alleged payees, non-compliance with s.65B of the Evidence Act for electronic evidence, & parity with coordinate bench decisions where identical material was treated as “dumb documents”. ITAT Mumbai upheld the deletion, observing that third-party loose sheets/electronic images without linkage to Assessee cannot sustain an addition; denial by alleged payees materially weakens the Revenue’s case; duplication of the same alleged cash in the hands of Assessee’s brother further vitiates fairness; & consistency requires following earlier coordinate bench rulings deleting identical additions. Revenue’s appeal was dismissed.
