Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2023 (12) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2023 (12) TMI 625 - AT - Income TaxUnexplained investment - scribbling/notings/jottings on loose papers found during the course of search relied concluding assessee has made expenditure out of books for purchase of land and construction of the factory thereon - HELD THAT:- The Hon'ble Delhi High Court in the case of Praveen Juneja [2017 (7) TMI 1102 - DELHI HIGH COURT] held that addition cannot be made on the basis of a document which is silent as to the payer and payee of the amount in question and does not disclose that the payment was made by cheque or cash nor it is proved that the document is in the handwriting of the assessee or at least bears his signature. Also in Common Cause & Others Vs. UOI [2017 (1) TMI 1164 - SUPREME COURT] has held that loose sheet of papers are wholly irrelevant as such evidence is not admissible u/s 34 of the Act. These transactions mentioned therein have no evidentiary value. If we consider the entire factual matrix relating to the impugned additions apart from the impugned loose sheets, there is no further corroborative evidence suggesting undisclosed investment was available on record. As A.Y 2014-15 is the first year of incorporation. Therefore, by no stretch of imagination it can be said that the assessee company has brought in its own unaccounted funds for making the unaccounted purchases. Since the business has not even commenced in the subsequent A.Y. i.e. 2015-16 also, the assessee company had no funds on its own, whether accounted or unaccounted from revenue operation. There is nothing on record to suggest that the Assessing Officer has taken any action against the promoters/directors of the assessee company. Similar view was taken by the Hon'ble High Court of Allahabad in the case of Lal Mohar [2017 (12) TMI 133 - ALLAHABAD HIGH COURT] wherein as held that since it was the first year of business of the AOP, and no business activity having shown to have been conducted by it that could lead to generation of unaccounted income on the first day of relevant accounting period itself, the Tribunal has not committed any error in deleting the impugned addition. No merit in the additions made by the Assessing Officer. Appeal of assessee allowed.
|