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2018 (4) TMI 1771 - AT - Income TaxAssessment u/s 153A - Validity of making addition based on the seized paper if it constitutes an incriminating material or otherwise - HELD THAT:- Regarding the Gevrai lands in question, we find in the earlier assessment years, relevant transactions on this land acquisition and sale are found duly accounted in the books of account/financial statements. This finding of ours is confirmed by the entries in the balance sheet Regarding sale transaction, it is also evident that the amounts received by the assessee in response to proposed sale were also equally accounted in the books of account where name of Mr. Ajay Shivajirao Jadhav is found has received the amount of ₹ 2.90 crores against sale of Aurangabad Land (Gevrai Land) Mr. Amit Shivajirao Jadhav also received the equal amount. It is also an undisputed fact that other payments received by the assessee are found accounted in the books of account. It is also not the case of the Revenue that the assessee received on-money payments and there is evidence to support the same. It is an undisputed fact that, in principle, the said agreement to sale seized by the Department during the course of search & seizure action is an accounted transaction and therefore it is not an incriminating document for the AO to rely on for making additions of any kind in the search assessment, like the present one. In our view, it is settled legal proposition of law that the additions if any have to be allowed to be made in the non-abated assessment only based on incriminating material. Addition on account of income from let out properties - HELD THAT:- It is settled legal proposition that so long as Municipal values are available the same becomes bindings and therefore, the decision of the AO in calculating the rental value based on any other method is unsustainable in law. Therefore, the above conclusion drawn by the CIT(A) on this issue is fair and reasonable and it does not call for any interference. Accordingly, the grounds raised by the Revenue are dismissed. Addition on account of adhoc declaration made during search proceedings carried out u/s.132 - HELD THAT:- We find the AO has merely relied on the statement given by the assessee and he did not go into the issues that requires disclosure of additional income of ₹ 54 lakhs. On these facts, we find the issue requires remanding to the file of AO for verification of the seized material. We find the Pune Bench of the Tribunal in the case of Poonawalla Investments and Industries Pvt. Ltd. [2018 (4) TMI 1770 - ITAT PUNE] it is evident that the onus is on the AO to establish the omissions and commissions if any before taxing the buffer disclosure of ₹ 54 lakhs by the AO. As such, AO did not examine this aspect of the issue. Therefore, with similar directions to the AO, we remand the issue to the file of AO (supra). Accordingly, this issue is adjudicated pro tanto. The grounds raised by the assessee are allowed for statistical purposes.
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