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2020 (1) TMI 1107 - AT - Income TaxAssessment u/s 153A - unexplained money - unexplained expenditure u/s 69C - cash found during the search proceedings - additions loose sheets and rough papers - assessee submits that same belongs to Business and kept at residence of assessee - HELD THAT:- AO has alleged that the assessee has incurred an expense in connection with the conversion of land from agriculture to NA with respect to survey numbers. However, the AO without verifying the fact from the parties in whose name the survey number was registered has treated the expenditure as unexplained u/s 69C - AO was under the obligation to carry out the necessary verification before reaching to the conclusion that the assessee has incurred unexplained expenditure. From the list of the expenditures there were mentioned several survey numbers of the land but no enquiry was conducted by the authorities below. In this respect, we would like to discuss the judgment passed by the Hon’ble Delhi High Court in the matter of CIT, C-1-vs-Vatika Landbase Pvt. Ltd. [2016 (2) TMI 835 - DELHI HIGH COURT] . In that matter, the Assessing Officer did not make any enquiry from the employee or from buyers of flats in respect of actual price paid by them. In that circumstances of the case the impugned addition made merely on the basis of unsigned and undated seized document has been held to be unsustainable in the eye of law. Thus, the proposition made by the revenue towards making addition on the basis of the figures mentioned on the said loose dumb document, thus, cannot be considered to be valid evidence in the absence of any enquiry made by the authorities which ought to have done in the manner as already dealt with us hereinabove. No authority acting judicially would have acted on the basis of a loose paper having no evidentiary value had there been minimum application of mind. Information contained in the seized documents are just the information without any support and therefore no credentials can be given to such information until and unless it is based on some materials. As such, seized loose documents found during the search should be read in association with the other materials before reaching to the conclusion that such seized material represent the income of the assessee. We also note that the lose paper found during the course of search did hold evidentiary value unless the same is supported by cogent material in regard we find guidance and support from order of the Hon’ble Supreme Court in the case of Common Cause (A Registered Society) Vs union of India [2007 (9) TMI 25 - SUPREME COURT] Regarding the seizure of cash we note that there was the reconciliation statement furnished by the assessee to justify the availability of cash found at his residence during the search proceedings. As such, there was no defect pointed out by the authorities below in the reconciliation statement furnished by the assessee. Therefore, we are of the view that such cash has been duly explained the assessee. Documents seized during the search proceedings is nothing but representing the dumb documents and therefore no additions based on the same can be made in the hands of the assessee. Accordingly we reverse the order of the authorities below and direct the AO to delete the addition made by him - Decided in favour of assessee.
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