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2023 (3) TMI 972 - AT - Income TaxAddition of cash payments - undisclosed payment - A.O. has relied upon the statement of third person recorded during the course of search u/s 132(4) - HELD THAT:- It is well settled Law that unless the incriminating documents or statement used against the assessee are confronted to assessee and assessee have been allowed to cross-examine such statements, no such material or statement, could be read in evidence against the assessee. A.O. in the assessment order also did not mention, if any, material found during the course of search, was confronted to the assessee. Thus, assessee was justified in denying in making any cash payment at any stage. Tribunal in the case of Shri Manjit Singh Gahlot, Delhi (2022 (10) TMI 399 - ITAT DELHI] and Shri Naresh Pamnani vs. ITO (2019 (3) TMI 1787 - ITAT DELHI] no addition could be made against the assessee of the impugned amount.- Decided in favour of assessee. Penalty u/s 271(1)(c) - non compliance to notices issued by the assessee u/s 142(1) - HELD THAT:- As assessee firstly did not comply with the notices issued by the assessee u/s 142(1) of the Act and, secondly, he placed explanation which was self-contradictory as, on the one hand, the assessee is harping that notices were not served on the assessee and per contra, it has been alleged that the counsel of the assessee appeared before the AO. Therefore, the ld.CIT(A) rightly held that the assessee has failed to explain his non-compliance in response to the notices issued to him u/s 142(1) of the Act. Therefore, the penalty was rightly imposed by the AO and the ld.CIT(A) was also correct in upholding the same. Accordingly, the grounds of the assessee are dismissed and the penalty u/s 271(1)(b) of the Act is hereby confirmed.
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