Can WhatsApp Chats Alone Justify Tax Additions? Tribunal Says No

Summary: The ITAT Delhi in DCIT vs. Balar Marketing Pvt. Ltd. held that additions in search assessments cannot be sustained solely on unauthenticated electronic evidence such as WhatsApp chats, SMS messages, and screenshots of alleged parallel accounts without strict adherence to evidentiary principles. In this case, the Revenue relied entirely on digital data extracted from seized devices and statements recorded during search, without any corroborative material like stock discrepancies or third-party confirmations. The Tribunal emphasized that even though strict rules of the Indian Evidence A...