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2012 (9) TMI 97 - HC - Income TaxAddition on unaccounted income - disallowance of expenditure towards commission payments, sundry expenses and green box expenses - Held that:- Once the revenue seeks to draw a presumption, by relying on Section 132 (4A) that presumption has to be given full effect, thus if the correctness of the contents of books and other materials is to be presumed, such a deemed state of affairs would have to be assumed in respect of all entries in the books, and not merely the entries of income (or receipts). If the revenue was of the opinion that the expenses claimed towards “green boxes” was inadmissible or was excessive, or not genuine, in order to reject the entries in the books of account and other documents of the assessee, seized during the search, it ought to have relied on other materials. Having once drawn the presumption that the contents of the documents (of the assessee) taken into possession during the search were true, the revenue could not have, consistently with that presumption, proceeded to require the assessee to produce materials in support of the expenditure entries - as suspicion cannot replace proof, thus in the absence of any materials, in the form of documents, the revenue could not have denied the benefit of any expenses which would otherwise have inured to the assessee, as an allowable deduction under Section 37 (1) - So far as the heads of expenses are concerned, the revenue was unable to show how any of them were prohibited by law, or amounted to offences - in favour of assessee.
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