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2007 (4) TMI 298 - ITAT DELHI-CAssessment u/s 158BD r/w s. 158BC - Search And Seizure - Document found marked as Annex. AD-46 - undisclosed income - Addition made on basis of the entries found in the books of accounts of the party under searched - HELD THAT:- The combined reading of the provisions of ss. 158BA and 158BB shows that the AO has to prove on the basis of evidence found as a result of search and such other material or information as are available with him and relatable to such evidence that the assessee had the undisclosed income chargeable to tax in the block assessment. In block assessments, additions can be made on the basis of concrete material and not on suspicion or surmises. Suspicion, however strong, cannot take place of proof. No corroborative material of any nature whatsoever was brought on record by the AO to indicate that noting on the seized paper was related to the assessee. This document was seized from the office of Dr. M.C. Gupta, but neither during the course of search nor even thereafter the Department has tried to record his statement to substantiate their stand that document was belonging to any of the companies in whose hands the addition was made. This document indicated transaction in respect of 3 big has of land, alleged to be purchased from three persons, but in the books of none of the assessees there was any such transaction for 3 bighas, so as to corroborate the same with seized document. Furthermore, the Department itself has carried out the valuation of the land shown by the assessee in their regular returns, by its own valuation cell, which has also valued the same near to the price at which these were shown by the assessee in their books of account. The registering authorities have also registered the land purchased by the assessee at the price shown in the sale deed. Thus, neither the State Government being the registering authorities supports the value taken by the AO on the basis of dumb document, nor the valuation cell of the IT Department itself supports the rate of land shown in the document so found. Applying the propositions laid down by the various authorities as referred by the ld AR during the course of hearing, to the facts and circumstances of the present case where addition has been made on the basis of dumb document, the AO could not corroborate the document or its contents with any other information or evidence, whereas on the contrary the documents/information so gathered by the AO goes against the Department, we do not find any merit in the additions so made by the AO and confirmed by the CIT(A), in case of all the assessees. We therefore direct for deletion of all these additions. Ground taken with regard to initiation of penalty proceedings u/s 158BFA(2), being premature is dismissed in limine - In the result, all the three appeals of the assessee are allowed in terms indicated hereinabove.
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