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2017 (12) TMI 1713 - AT - Income TaxUnaccounted Investment - AO has made the addition only on the basis of unsigned document found in search - non reference to the DVO report - HELD THAT:- As unsigned agreement to sell was found as a result of search but it is also a matter of fact, as submitted by the assessee and not denied by the DR, that no question was asked by the search team on this document during the course of search. The contention of the learned DR that the document seized is sufficient to make addition of unaccounted investment is contrary to the provisions of law as the document found during the course of search is not required to be proved or disproved by both, assessee as well as the department as only presumption can be made u/s 132(4A) of the Act with regard to a seized document. This presumption is a rebuttable presumption. However, the first onus to disprove such document is on the assessee. In the present case we note that the AO in order to verify the veracity of the document, referred the valuation of the property in question to the DVO with specific remarks that a document showing consideration of ₹ 21.96 crore has been found during the course of search. The DVO after having the knowledge of the seized document showing value of ₹ 21.96 Crore valued the property at ₹ 7.11 Crore with supporting evidence. Strangely, the AO after carrying out this exercise of valuation during the assessment proceedings did not refer the same in assessment order while making the addition of ₹ 698 lakhs. Also gone through the document like DVO report, sale deed of adjacent property, HSIIDC rate of allotment document and other documents and find that the land prices of the property, excluding construction were in the vicinity of the amount paid by the appellant to Bluebird Software Private Limited and its shareholders. It is also a matter of fact and record the sale price on the basis of signed documents is accepted by the department in the hands of sellers of the property or shareholders of Blue Bird Software Private Limited. Those assessment orders are also passed after search in their cases by the central circle. The assessee has also placed on record the assessment order of Blue Bird Software Pvt Ltd who has purchased this property for 6.80 cr just few months before the date of unsigned document. This value is also accepted by the Income tax authorities. The assessee has been able to produce enough evidence on record to rebut the presumption. In the case of M.M. Financers (P) Ltd vs DCIT [2006 (12) TMI 189 - ITAT MADRAS-B] it is held that the expression used in section 132(4A) is ‘may be presumed’ and it does not mean that other factors are not to be taken into consideration. The mandate does not mean that it has to be presumed irrespective of all other factors. The decision of Delhi High Court in the case of CIT vs Ved Prakash Choudhary [2008 (2) TMI 14 - DELHI HIGH COURT] also support the case of the assessee. Thus addition made by the AO is contrary to the DVO report obtained by him and the CIT(A) has ignored the vital and material documents and evidences on record before upholding the order of the AO. Consequently, the addition upheld by the CIT(A) is deleted - decided in favour of assessee.
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