The Income Tax Appellate Tribunal (ITAT), Mumbai Bench deleted income tax disallowance as reliance was made by Assessing Officer (AO) on bald statement and dumb document extracted from laptop.
The assessee, Kalpesh C. Shah isan individual having proprietary concern M/s Aatash Investments, was engaged in the business of trading in equity and derivatives and advisory services with respect to capital market and investment. For the year under consideration, the assessee filed regular return of income. The assessment under section 143(3) of the Income Tax Act, 1961 was completed.
Subsequently, the assessment has been reopened by way of issue of notice under section 148 of the Income Tax Act. The AO in the assessment order has mentioned information received from two sources for reopening of the assessment.
The AO added the cash loan that was received from Bhoomi Group and the interest was paid thereon to the total income of the appellant. It is noted that the main premise of theaddition is the statement given by Akshay Doshi under Section 131 of the Income Tax Actin relation to theexcel sheetextracted from the laptop of another person,Vasumati Modi.
In the statement of Akshay Doshi, he has not mentioned the name of the appellant. Even in the questions posed to him, the Investigating Officer never queried about the identity of the persons named in the excel-sheet. Moreover, Akshay Doshi stated that the noting in these excel sheet as his own undisclosed income.
The First Appellate Authority (FAA) relied on the statements made by the assessee and noted that the findings of AO relying on such statement in light of the excel-sheet was based on pure suspicion and surmise and there was neither anything tangible nor was there any evidence brought on record, which would prove that the notings found in the excel-sheet were that of the appellant.
The CIT(A) also upheld the decision of the FAA, hence the Revenue is in appeal before the Tribunal.
A Coram consisting of Om Prakash Kant, Accountant Member and Kavitha Rajagopal, Judicial Member confirmed the observations of FAA wherein it was held that “It is noted that inspite of the glaring infirmities and defects pointed out by the appellant in the excel-sheet as well as thestatements provided by the AO, the AO himself never examined Akshay Doshi on this aspect nor opportunity of cross examination the appellant. Onthese facts therefore, the AO’s relianceon the bald statement of Doshi and the dumb document extracted from laptop of Vasumati Modi to justify the impugned addition is held to be erroneous and unjustified.”
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