S. 69A : Unexplained money-Alleged on-money paid for purchase of flat-Addition based solely on statements of builder Cosmos Group and unverified Excel sheets seized during search-No incriminating material supplied to assesse-No opportunity of cross-examination-Addition deleted. [S. 132(4), 147, 148, 254(1)]
The assessee, a co-owner of a residential flat purchased from Cosmos Group, was subjected to reassessment on the basis of information received from the Investigation Wing that the purchasers of flats in Cosmos Group projects had allegedly paid “on-money” over and above the agreement value. The Assessing Officer relied upon statements of key persons of Cosmos Group recorded during search proceedings and certain Excel sheets allegedly containing details of cash receipts and made an addition of ₹14.25 lakh under section 69A, being the assessee’s alleged share in the on-money payment. The assessee denied having made any such payment, furnished confirmation from the builder showing receipt of only the recorded consideration of ₹72 lakh, and repeatedly sought copies of the incriminating material and cross-examination of the persons whose statements were relied upon. The requests were not acceded to. The Tribunal held that the addition was made solely on the basis of third-party statements and Excel sheets without bringing any incriminating material on record or supplying the same to the assessee. Mere statements, without corroborative evidence and without affording cross-examination, could not constitute evidence against a third party. Similar additions made in respect of other purchasers of Cosmos Group flats had already been deleted by the Tribunal. Following the co-ordinate bench decisions, in Aakash Developers v ACIT (ITA No. 1767/M/2025 dated 29.09.2025) Bharat Laxman Bhiwapurkar v ITO (ITA No. 3413/M/2023 dated 04.03.2024) Mrs. Mamta Sharad Gupta v . ITO (ITA No. 1553/M/2021 dated 16.06.2022) Monika Anand Gupta v. ITO (ITA No. 5561/M/2018 dated 21.04.2022), the Tribunal held that the Revenue had failed to establish any actual payment of on-money by the assessee and accordingly deleted the addition. Since relief was granted on the merits, the challenge to the validity of reassessment was treated as academic. (AY. 2012-13) (ITA No. 7402/Mum/2025, dated 04-06-2026)
Prakash Bhaguji Katkade v. ITO (Mum.)(Trib.) www.itatonline.org .
[Coram : Hon’ble Shri Pawan Singh, JM and Hon’ble Shri Makarand Vasant Mahadeokar, AM]