A division bench of the Delhi High Court in CIT v. Praveen Juneja, has deleted addition made by the Income Tax department on ground that the same was made solely on the basis of a hand written loose paper without any supporting evidence.
An addition cannot be made on the basis of a handwritten loose paper which does not indicate if it pertains to the assessee and if AO has not brought on record any forensic evidence to prove the handwriting of the assessee. An addition cannot be made on the basis of suspicion and guesswork and without bringing corroborative material on record
The department made addition against the assesse on the basis of a piece of paper found during the course of search wherein certain figures were written.
On appeal, the ITAT quashed the order finding that the document was “silent as to the payer and payee of the amount in question nor does it disclose that the payment was made by cheque or cash nor it is proved that the document is in the handwriting of assessee or at least bears his signatures.
Aligning with the findings of the Appellate Tribunal, a bench of Justices S. Muralidhar and Prathibha M Singh deleted the assessment order and held that “the addition of Rs.80,50,000 merely on the basis of a single document without making any further enquiry was not justified. No attempt was made by the AO to find out if in fact it constituted estimates relating the construction of project of Omaxe Ltd.”
Read the full text of the Order below.
