ITAT Deletes ₹2.70 Crore Income Tax Addition on Alleged Cash Receipts from Property Sale, Cites Lack of Supportive Evidence [Read Order]

The Delhi Bench of the Income Tax AppellateTribunal (ITAT) has upheld the deletion of additions made on account of alleged cash and on-money transactions related to property deals, holding that the additions were unsupported by corroborative material. In this light, the Tribunal proceeded to dismiss Revenue’s appeal.

The reassessment proceedings for the assessment year 2012-13 were initiated against the appellant, Sunita Gadde. The Assessing Officer had made additions on account of alleged cash received on sale of property situated at Dera Mandi, Mehrauli, and cash payments made for purchase of another property at Chhatarpur. These additions were deleted by the Commissioner of Income Tax (Appeals). This led the Revenue to approach the Tribunal.

The Revenue contended that the appellateauthority erred in deleting the additions by ignoring statements and documents, which allegedly indicated exchange of cash in the course of property transactions. It was argued that the assessee had received on-money against sale of property and made unexplained cash payments towards purchase of another property.

While dealing with the alleged cash payment for purchase of property, the Tribunal took note of the cancellation deeds placed on record, which demonstrated that the transaction had been legally rescinded. It was held that the Assessing Officer’s observations were untenable.

The Tribunal further held that the Revenue had failed to rebut the detailed findings recorded by the appellate authority. Due to the absence of any sustainable evidence and keeping in mind the finality attained by earlier judicial pronouncements, the additions could not be sustained either on facts or in law.

As a result, the Tribunal dismissed the Revenue’s appeal.

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