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2023 (8) TMI 909 - AT - Income TaxAdditions u/s 69A - Denial of exemption u/s 11 - Receipt of unaccounted capitation fees in cash - Assessment of trust - AO primarily relied on the statements of third persons as recorded in the search action u/s 132 wherein, according to the AO, they had stated that the assessee received cash from students for admission to medical/dental courses - HELD THAT:- As nothing was brought on record by the Revenue before us, to show that this cash found with Shri Patil represented capitation fees collected from students. The facts placed before us reveal that Shri Patil derived income from several different sources/agriculture etc; and therefore we agree with the findings of the CIT(A) that, the assumption made by the AO that this cash represented capitation fees collected from students was far-fetched and based purely on conjecture & surmise. Particularly when, Shri Patil who had been examined twice by the Department viz., in the course of search and in the post search proceedings, had denied collecting capitation fees from students. It is indeed true that a simple denial is not sufficient but at the same time it is also to be seen as to whether the accusation being levelled is supported by material or corraborative evidence found in the course of search. From the facts on record, it is evident that there was no evidence found in the course of search which would show that the assessee had received capitation fees from students. Much ado has been made by the Revenue before us that since the search operation began first at the other group of DY Patil at Navi Mumbai, the assessee society had received prior information about the search operation and for that reason no corraborative evidence or material was gathered in the course of search. Without going into the veracity of this contention, we find that the Ld. CIT(A) had rightly held that, search operation being leaked cannot be an alibi for making addition in an assessment, as the assessment has to be made based on evidences and not on suspicion and conjectures. No reason to interfere with the impugned order of the Ld. CIT(A) deleting the addition made by way of capitation fees - Decided in favour of assessee.
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