Search u/s 132 was conducted at Assessees’s residential and business premises. During statement, the MD of the Kalyan Development Corporation admitted to additional income. Other unaccounted receipts were also found. The same was declared on an estimate basis and quantified at 5% of the total receipts. The Tribunal held that, no incriminating material has been unearthed during the course of search for the relevant assessment year, no addition can be made by the AO in the impugned assessment.

For A.Y. 2016-17, the Tribunal observed that the addition has been made and sustained by the authorities below which was solely based on the statement recorded under s. 132(4). The said disclosure was general in nature and without pinpointing to the specific seized documents in respect of which additions have been made in the hands of the Assessee and drawing inferences from his individual case to make an addition in the hands of KDC was uncalled for. Therefore, addition was deleted.

For A.Y. 2014-15, the issue before the Tribunal was that assessment ought to have been framed under s. 153(C) and not under s. 153A, as there was no jurisdiction with the learned AO because the addition made in the case of Assessee was based on the seized documents found in another person’s home, on whom also a search was conducted. The Tribunal held that the Assessment was bad in law as the AO has used the seized material/document found in the course of search conducted in the case of third party. Hence, additional was deleted.  Presumption under S 292C applies only in the case of persons searched—Since the AO was using the excel sheets found and seized from a third person against the assessee, it is was mandatory requirement under s. 65B of the Evidence Act to comply with the procedures given therein. None of these aspects have been discussed by the AO. Therefore, impugned addition made by the AO towards “on-money” alleged to be received by the assessee is deleted.

 (AY. 2016-17 to 2018-19)