DCIT Vs Shravan Kumar Harkaram Choudhary (ITAT Mumbai Bench)
An Excel Sheet Is Not A Money-Lending Licence & A Screenshot Cannot Grow 100 Times By AO’s Imagination-Additions U/s 69/69A/69C Need Corroboration
Background
The assessee carried on the business of trading in mobile accessories through his proprietorship concern, Patel Mobile. A search u/s 132 was conducted on 17 March 2021 in the Rubberwala/Bhajwad Group cases, covering the assessee’s business & residential premises. During the search, Excel files, loose papers & WeChat data from the mobile phone of an employee were recovered. Based substantially on this electronic material, the AO made huge additions u/s 69, 69A & 69C for alleged unaccounted loans, interest, purchases, sales, debtors, cash rent & stock difference. The CIT(A) granted substantial relief but retained certain additions, including estimated gross profit at 8% on alleged unaccounted turnover. Both the Revenue & the assessee filed appeals. The assessment proceedings arose from orders passed u/s 153A. [TaxGuru: Section 153A — No Additions Without Incriminating Material for Completed Assessments](https://taxguru.in/income-tax/section-153a-additions-incriminating-material-completed-assessments.html)
Deleted Excel Files & Alleged Loans
Two files bearing the name “NH.xlsx” were recovered from the assessee’s laptop, including one from deleted data. They contained worksheets titled “KK”, “Pankaj Bhai”, “after diwali”, “interest KK A/c”, “JRC”, “DP”, “G Power” & “Harshan”, with columns for opening balance, receipts, payments, closing balance & formula-based calculations.
