AO made certain addition u/s 69 in respect of undisclosed investment, in the hands of the assessee firm based on certain handwritten documents seized from the premises of another person. Such note was alleged to be written by one of the partners of the assessee firm. The High Court held that presumption u/s 292C essentially applies in case of the person from whose premises the material was unearthed and for using such material against a third party, some other corroborative material is required. Further, the AO in the case neither proved that the handwriting was of one of the partners of the firm nor inquired into the fair market value of the property. The High Court accordingly, deleted the additions. (ITA Nos. 211,226, 336 of 2010 dt. 31.01.2019)
CIT v. Cordial Company (2019) 308 CTR 159/176 DTR 185 (Ker.)(HC)
S. 153C : Assessment-Income of any other person-Search and seizure–Addition made based on document seized at the premises of third party–Held, presumption u/s. 292C would apply in case of person from whose premise the document was seized–Held, addition burden on the AO in such case–Held, no proper enquiry by the AO – Held addition deleted. [S. 69, 292C]