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2023 (1) TMI 410 - AT - Income TaxUndisclosed investment - documents seized at the time of search - violation Principles of natural justice - contentions raised before the tax authorities by the assessee was that the hand written note and it has been stated therein that Mr. Nuruddin Ajani has taken amount of Rs. 60 lakhs - As argued AO has not allowed the opportunity of cross examining Shri Nuruddin Ajani - HELD THAT:- We notice that the A.R stated that the revenue has not made any addition in the hands of Shri Nuruddin Ajani. The above submissions made by the assessee would show that the impugned rented premise, i.e., the tenancy right was held by M/s Empire Continental Exports P Ltd, a company owned by Shri Ajani. The said company has been acquired by the son and wife of the assessee on 18-09-2003. Accordingly, it was submitted that the tenancy right would form part of the company and hence there was no requirement to make separate payment for it. On a safer course, it was argued that the transaction, if at all is taxable, would be liable to be taxed in AY 2004-05 and not in AY 2005-06. The assessee, in whose hands, it is taxable is also a question at large. In the absence of providing opportunity to cross examine Mr Nuruddin Ajani, there is violation Principles of natural justice. Before us, the revenue has expressed its inability to produce the sworn statement recorded from Mr Nuruddin Ajani or Mr D N Israni. Hence, it is not clear as to whether the above said two parties have implicated the assessee in this deal, if any. Even if it is assumed for a moment that these parties have admitted to have received amount of Rs.60 lakhs from the assessee, it is not shown that the action taken by the revenue in the hands of the above said two persons in respect of the above said amount. Hence AO was not justified in making addition in the hands of the assessee, as other corroborative evidences militate against the impugned addition. Appeal filed by the assessee is allowed.
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