ACIT I/C ITO - 22(2)(1), MUMBAI, PIRAMAL CHAMBERS, LALBAUG, MUMBAI V. NARESH MANAKCHAND JAIN , PRABHADEVI, MUMBAI

ITA 1580/MUM/2025

AI Insights

The case involves multiple appeals by the Revenue against Mr. Naresh Manakchand Jain concerning the assessment years 2013-14 to 2017-18. Following a search and survey operation, the AO made additions to the assessee's income on account of alleged bogus long-term capital gains and initiated penalty proceedings. The assessee challenged these additions and penalties, which were upheld by the Commissioner of Income Tax (Appeals). However, the Tribunal, referencing a composite order in related quantum appeals, found no incriminating material to support the additions and penalties, leading to the dismissal of the Revenue's appeals.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 360592 (ITAT-MUMBAI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-05-2025
• Appeal Filed By: Department
• Order Result: Dismissed
• Assessment Year: 2015-2016
• Other Referred Cases: Continental Warehousing Corporation vs. Abhisar Buildwell (P) Ltd., B Kishore Kumar vs. DCIT, CIT vs. Harjeev Aggarwal, DCIT vs. Skyway Infra Projects P ltd, PCIT (Central) vs. Anand Kumar Jain (HUF)
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RAKESH RANJAN; LD.
• Assessee Lawyers: SUCHEK ANCHALIYA; LD
• Keywords: Set aside; Document seized; Documents seized; Capital Gains; Search and seizure; Accommodation entries; Block assessment; Loose papers; Bogus
• Section: 143(3); 271(1)(c); 132; 153A

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL, MUMBAI BENCH “B”, MUMBAI BEFORE SHRI NARENDER KUMAR CHOUDHRY, JUDICIAL MEMBER AND SHRI PRABHASH SHANKAR, ACCOUNTANT MEMBER ITA Nos.1578, 1579, 1580, 1581 & 1604/M/2025 Assessment Years: 2013-14, 2014-15, 2015-16, 2016-17 & 2017-18 ACIT i/c ITO-22(2)(1), Office of the ACIT i/c ITO- 22(2)(1), Room No.312, 3rd Floor, Piramal Chambers, Lalbaug, Mumbai – 400 012 Vs. Mr. Naresh Manakchand Jain, 1201, 12th Floor Sumer Trinity Tower 1, New Prabhadevi Road near Samna Press, Prabhadevi, Mumbai – 400 025 PAN: AACPJ9811A (Appellant) (Respondent) Present for: Assessee by : Shri Suchek Anchaliya, Ld. A.R. Revenue by : Shri Rakesh Ranjan, Ld. D.R. Shri Leyaqat Ali Aafaqui, Ld. Sr. A.R. Date of Hearing : 21.04.2025 Date of Pronouncement : 23.05.2025 O R D E R Per : Bench These appeals have been preferred by the Revenue against the orders even dated 08.01.2025, impugned herein, passed by the Ld. Commissioner of Income Tax (Appeals) (in short Ld. Commissioner) u/s 250 of the Income Tax Act, 1961 (in short ‘the Act’) for the A.Y. 2013-14, 2014-15, 2015-16, 2016-17 & 2017-18. ITA Nos.1578, 1579, 1580, 1581 & 1604/M/2025 Mr. Naresh Manakchand Jain 2 2. In the instant case, a search and survey action was conducted on the Assessee namely Shri Naresh Jain and his associates with the allegations that they were involved in providing accommodation entries in the form of long term capital gain/losses in several scrips to various beneficiaries across the country. The tentacles of this network are spread across the country and inter-alia include various participants such as operator, numerous beneficiaries, intermediaries who would arrange for beneficiaries, exit providers, intermediaries who acted as aggregators of exit providers, share broking firms, hawala operators, kacha companies etc. Premises of the entities in the syndicate were identified across Mumbai, Lucknow and Chennai and therefore search and seizure actions were carried out leading to the discovery of incriminating documents, communications and digital data. In this action, the operations of the syndicate have been unearthed, clearly establishing the modus operandi of providing bogus long term capital gain/loss as also the modus operandi involved in rigging the prices of various scrips on stock exchange, has been uncovered. 3. Consequent to the search operation, the cases of the Assessee for the assessment years under consideration were reopened by issuing notices u/s 153A of the Act which ultimately resulted into making the additions by the Assessing Officer (AO) on account of bogus long term capital gain/short term capital loss/circular trading as detailed below: Assessment Year Assessment Orders dated Provisions of the act Addition 2013-14 23.04.2021 143(3) r.w.s. 153A of the Act Rs.9,58,14,350/- 2014-15 24.04.2021 143(3) r.w.s. 153A of the Act Rs.16,48,71,668/- 2015-16 24.04.2021 143(3) r.w.s. Rs.7,74,06,800/- ITA Nos.1578, 1579, 1580, 1581 & 1604/M/2025 Mr. Naresh Manakchand Jain 3 4. The AO in the assessment orders, simultaneously initiated penalty proceedings detailed below: Assessment Year Penalty proceedings u/s Reason 2013-14 271(1)(c) of the Act For concealment of income and providing inaccurate particulars in respect thereof 2014-15 271(1)(c) of the Act For concealment of income and providing inaccurate particulars in respect thereof 2015-16 271(1)(c) of the Act For concealment of income and providing inaccurate particulars in respect thereof 2016-17 271(1)(c) of the Act For concealment of income and providing inaccurate particulars in respect thereof 2017-18 270A of the Act Under reporting of income 6. The Assessee challenged the aforesaid additions by the AO, by filing respective appeals before the Ld. Commissioner, however, was of no avail, as the Ld. Commissioner vide order dated 01.12.2022, affirmed the aforesaid additions, by dismissing the quantum appeals of the Assessee. 7. Thereafter, thus the AO vide respective penalty orders, levied the following penalties: 153A of the Act 2016-17 24.04.2021 143(3) r.w.s. 153A of the Act Rs.6,06,40,140/- 2017-18 24.04.2021 143(3) r.w.s. 153A of the Act Rs.17,89,73,516/- ITA Nos.1578, 1579, 1580, 1581 & 1604/M/2025 Mr. Naresh Manakchand Jain 4 Assessment Year Date of order u/s Penalty amount 2013-14 28.11.2023 271(1)(c) of the Act Rs.2,94,31,534/- 2014-15 28.11.2023 271(1)(c) of the Act Rs.5,58,47,269/- 2015-16 28.11.2023 271(1)(c) of the Act Rs.2,61,12,296/- 2016-17 28.11.2023 271(1)(c) of the Act Rs.2,07,84,459/- 2017-18 12.12.2023 270A of the Act Rs.3,17,99,119/- 8. Thereafter, the Hon’ble Co-ordinate Bench of the Tribunal, by composite order dated 27.06.2024 in the respective quantum appeals and by taking into consideration case pertaining to A.Y. 2013-14 in ITA No.240/M/2023 as a lead case, ultimately deleted the aforesaid additions on the legal aspects/additional grounds raised by the Assessee, by observing and holding as under: “18. We have heard the rival submissions of the parties and perused the material on record. As far as the additional ground No. 1 of the appeal is concerned, the moot issue in dispute is whether the addition in dispute of commission income amounting to Rs.9,58,14,350/- has been made based on ‘incriminating material’ found during the course of search dated 20.03.2019. In the case of Continental Warehousing Corporation (supra), the Hon’ble Bombay High Court held that if the assessments of any years is pending as on date of search, the same stands abated due to search action and AO can make any addition in those assessment years based on the facts and circumstances of the case and not limited to the additions based on incriminating material. But in assessment years in relation to which the assessments were already completed as on the date of search action, those are unabated assessments and in those cases no addition could have been made except based on incriminating material found during the course of search action. However, as far as any incriminating material related to the any other person found during the course of search of searched person, action in the case of the other person can be taken in terms of s. 153C of the Act if the said material is either belonging to the assessee or books of account or documents pertaining to him or any information contained thereof is relating the assessee. In the instant case assessments have been completed u/s. 153A of the Act and not u/s. 153C of the Act. Therefore only incriminating material which is found during the course of search action at the ITA Nos.1578, 1579, 1580, 1581 & 1604/M/2025 Mr. Naresh Manakchand Jain 5 premises of assessee could be considered for making addition u/s. 153A of the Act and no addition could have been made based on any incriminating material found during the course of search of another person in the absence of invoking provisions of s. 153C of the Act. Thus, now the question which is left before us is whether any incriminating material has been found during the course of search from the premises of the assessee qua the addition in dispute of commission income of Rs.9,58,14,350/-. 19. In the preceding paragraphs, we have referred to various statements and observations made by the AO for making the addition of commission income. The AO has referred extensively to the statements of various persons. The question now arises is whether the statement of the assessee or the statements of third persons could constitute an incriminating material found during the course of search of assessee. In this regard, we would like to refer to the decision of the Hon’ble madras High Court in the case of B Kishore Kumar Vs DCIT (2014) 52 taxmann.com 449(madras), wherein the Hon’ble High Court held that when there is a clear and categorical, voluntary admission of the undisclosed income by the assessee himself, there is no necessity for a scrutinizing the documents and that would be good piece of evidence. In the instant case the admission of assessee engaged in providing accommodation entry has been retracted subsequently by the assessee, and therefore, the statement of assessee was voluntary or not is not free from doubts. Further, Hon’ble Delhi High Court in the case of CIT vs Harjeev Aggarwal reported in (2015) 62 taxmann.com 215, held that a statement recorded under section 132(4) of the Act by itself would not be sufficient to assess the income and it could be used for making the assessment but only to the extent it is related to the incriminating evidence/material unearthed or found during such. The relevant finding of the Hon’ble High Court is reproduced as under: “20. In our view, a plain reading of Section 158BB(1) of the Act does not contemplate computing of undisclosed income solely on the basis of a statement recorded during the search. The words \"evidence found as a result of search\" would not take within its sweep statements recorded during search and seizure operations. However, the statements recorded would certainly constitute information and if such information is relatable to the evidence or material found during search, the same could certainly be used in evidence in any proceedings under the Act as expressly mandated by virtue of the explanation to Section 132(4) of the Act. However, such statements on a standalone basis without reference to any other material discovered during search and seizure operations would not empower the AO to make a block assessment merely ITA Nos.1578, 1579, 1580, 1581 & 1604/M/2025 Mr. Naresh Manakchand Jain 6 because any admission was made by the Assessee during search operation. 21. A plain reading of Section 132 (4) of the Act indicates that the authorized officer is empowered to examine on oath any person who is found in possession or control of any books of accounts, documents, money, bullion, jewellery or any other valuable article or thing. The explanation to Section 132 (4), which was inserted by the Direct Tax Laws (Amendment) Act, 1987 w.e.f. 1st April, 1989, further clarifies that a person may be examined not only in respect of the books of accounts or other documents found as a result of search but also in respect of all matters relevant for the purposes of any investigation connected with any proceeding under the Act. However, as stated earlier, a statement on oath can only be recorded of a person who is found in possession of books of accounts, documents, assets, etc. Plainly, the intention of the Parliament is to permit such examination only where the books of accounts, documents and assets possessed by a person are relevant for the purposes of the investigation being undertaken. Now, if the provisions of Section 132(4) of the Act are read in the context of Section 158BB(1) read with Section 158B(b) of the Act, it is at once clear that a statement recorded under Section 132(4) of the Act can be used in evidence for making a block assessment only if the said statement is made in the context of other evidence or material discovered during the search. A statement of a person, which is not relatable to any incriminating document or material found during search and seizure operation cannot, by itself, trigger a block assessment. The undisclosed income of an Assessee has to be computed on the basis of evidence and material found during search. The statement recorded under Section 132(4) of the Act may also be used for making the assessment, but only to the extent it is relatable to the incriminating evidence/material unearthed or found during search. In other words, there must be a nexus between the statement recorded and the evidence/material found during search in order to for an assessment to be based on the statement recorded.” 19.1 Thus, without relating the statements recorded under section 132(4) of the Act with any incriminating material found during the course of search, no addition could have been made on the basis of the statement on the stand-alone basis. 19.2 Further, regarding the statement of third parties recorded in the course of the search, the Hon’ble Delhi High Court in the case of PCIT (Central ) vs Anand Kumar jain (HUF) in ITA No. 23/2021, ITA Nos.1578, 1579, 1580, 1581 & 1604/M/2025 Mr. Naresh Manakchand Jain 7 held that without corroborating with the incriminating material, the statement cannot be made basis for addition u/s 153A of the Act. Further the coordinate bench of the Tribunal in the case of DCIT Vs Skyway Infra Projects P ltd in ITA No. 2665/Mum/2022 and others observed that statement of supplier parties (third parties), along with additional facts of lack of evidence in support of transport/delivery of material and nonexistence of the parties during verification, constitute existence of incriminating material. 19.3 In view of decisions discussed above, it is evident that the statement of assessee recorded under section 132(4) except voluntarily, cannot constitute incriminating material on standalone basis without corroboration of any incriminating material found during the course of the search. Similarly statement recorded of third parties under section 132(4) of the Act also cannot constitute an incriminating material unless same is corroborated with any incriminating material seized from the premises of the assessee. Therefore, in the instant case, we hold that the statements of the assessee or the various third-party mentioned by the Assessing Officer in the impugned assessment order could not be made the basis of addition, unless those statements are corroborated with any incriminating material found during the course of search. Thus, the issue now precipitated is whether any incriminating material was found during the course of the search of the assessee qua the addition of commission income computed on value of trade volume on the stock exchange in 12 Scrips, which the Assessing Officer has mentioned in the impugned assessment order. 19.4 As far as existence of incriminating material is concerned, the learned Assessing Officer in impugned assessment order has referred to seized material as under: “2.3 Analysis of seized material and statements: - The analysis of seized material, the findings and extracts from the statements of various persons covered during and after the search action presented in the following manner: - 1. Establishing the role of intermediaries in creating bogus accounts the purpose of rigging various scrips on the stock exchange. 2. Establishing that the persons whose accounts were created by the intermediaries are in fact persons of no- means and had neither understanding nor knowledge of the transactions carried in their accounts. Also, establishing role of Shri Shirish Shah in using his various entities for providing exit to the beneficiaries on stock exchanges. ITA Nos.1578, 1579, 1580, 1581 & 1604/M/2025 Mr. Naresh Manakchand Jain 8 3. The role of Share Brokers in facilitating the transactions of bogus entities on stock exchanges is established. 4. The bank accounts of exit providers have been traced several layers downwards and a cash trail has been established along with the direct link to the trading of scrips. 5. Also, the trading in the scrips and cash movement has been clearly corroborated with the accounts that were maintained by Shri Naresh Jain and his associates. Essentially linking the cash to the bank accounts of bogus entities and in turn linking to the trading done by these bogus entities and eventually matching these transactions the accounts maintained by Shri Naresh Jain and his associates.” 20. On perusal of above finding of Assessing Officer, we do not find reference of any seized material in making the analysis. The AO concluded that the role of Share Brokers in facilitating the transactions of bogus entities on stock exchanges is established, but he has not referred to any seized material for arriving that conclusion. Similarly, he concluded that the bank accounts of exit providers have been traced several layers downwards and a cash trail has been established along with the direct link to the trading of scrips. But, we find that AO has not referred to any seized material which could indicate cash trail between the assessee and alleged beneficiary of LTCG or exit provider except relying on statements of third parties. Further, regarding the email of [e-mail] also the AO has not pointed out the incriminality in correspondence through email. 21. The ld CIT(A) also concluded that Cash was deposited in various Dummy bank accounts and then layered through several pass-through bank accounts and then would reach the bank accounts linked to dummy trading accounts. He further concluded that said cash was the unaccounted cash of the beneficiaries that was routed through various bank accounts to reach the bank accounts that were linked to the dummy trading accounts controlled, operated and managed by Shri Naresh Jain. But, the ld CIT(A) has not referred to any seized material for this conclusion except relying on investigation in the case of Kolkata entry providers. The ld CIT(A) further concluded that Once the pre-arranged transaction between beneficiary and dummy trading account is executed on the stock exchange, the beneficiary receives his cash into his bank account and books of account. The ld CIT(A) further observed that the accounting of the above explained pre-arranged transactions were maintained meticulously and the same was explained in detail in the ITA Nos.1578, 1579, 1580, 1581 & 1604/M/2025 Mr. Naresh Manakchand Jain 9 statements of appellant and his associates. But, the ld CIT(A) has not referred to any seized material to substantiate that accounting of such transaction was maintained meticulously. Further the ld CIT(A) observed that in this whole process Shri Naresh jain played a very crucial role by interlinking the beneficiaries, brokers, intermediaries and exit providers for which he charged a specific commission. The ld CIT(A) has not referred to any single incriminating material interlinking the beneficiaries, brokers, intermediaries and exit providers except statement of assessee. 22. Thus, we are of the opinion that either in the assessment order or in the order of ld CIT(A), there is no express reference of any seized material much less incriminating material found from the premises of the assessee in support of allegation of assessee being involved in business of accommodation entry of LTCG . 23. As far as the ‘digital data’ found from the premises of persons other than Shri Naresh Jain is concerned, same cannot be taken into consideration in the present proceedings u/s. 153A of the Act without invoking s. 153C of the Act. 24. During the course of hearing before us, the ld. D.R. referred to ‘loose’ papers marked as Annexure-A, which were seized from the premises of the assessee located at 602, Raheja Chambers, 213, Nariman Point, Mumbai. The ld. D.R. referred to the written submission of the Assessing officer dated 9/3/2024 and submitted that pages 172 to 145 of the said Annexure refer to shareholder agreement as entered among three parties namely, 52 Weeks Entertainment Ltd., Four Lions Films Private Limited and Mrs Gule Nagma Khan. He further submitted that Ms Karisma Jain (daughter of the assessee) is a Director of 52 Weeks Entertainment Limited, therefore, the assessee and his family are hand in glove in manipulation of shares of 52 Weeks Entertainment ltd. He further referred to the statement of the assessee dated 19.03.2019 recorded u/s. 132(4) of the Act and submitted that the assessee had admitted that 52 Weeks Entertainment Ltd. is one of the shares rigged by him and, therefore, this is one of the incriminating material. The ld Counsel for the assessee however responded that the said agreement was in respect of acquisition of the shares of Four Lions Pvt. Ltd. by M/s 52 Weeks Entertainment Ltd. The daughter of the assessee being director of 52 Weeks Entertainment Ltd. from 23.08.2014 and who subsequent became director of Four Lions P. Ltd. on 01.07.2015 , therefore, same was maintained as part of routine business practice, devoid of any incriminating content regarding share manipulation. Further, page Nos. 144-120 are in relation to pledge of shares of M/s Four Lions Films Pvt. Ltd. in lieu of convertible loan of 500 lacs given by M/s 52 Week Ltd. to Four Lions Ltd. Those documents were part of chain of documents in ITA Nos.1578, 1579, 1580, 1581 & 1604/M/2025 Mr. Naresh Manakchand Jain 10 continuation to share of agreement available on page No. 72-145 of the said annexure. Regarding pages 119 to 112, which is a list of share allotment made on 18.09.2014 along with full address PAN etc. The Ld. Counsel for the assessee submitted that same is a public document downloaded from the Ministry of Company Affairs (MCA) Site. Regarding the loose papers seized at Serial No. 111 to 93 the Ld. DR submitted that those empty stamp papers in the name of M/s 52 Weeks Entertainment Ltd. are clinching evidences in support of the statement of the assessee that he was involved in front running and manipulation of scrip to accommodate bogus LTCG. The Ld. Counsel for the assessee however responded that those stamp papers were related to a film project that was to be produced by Shri Abbas Mastan and financed by M/s 52 Weeks Entertainment Ltd. and those papers were brought for execution of a specific contract for film production among the parties in whose name the stamp paper belonged. According to the Ld. Counsel there was nothing incriminating in respect of those stamp papers. The Ld. DR could not controvert his submissions. Similarly, the page No. 90 to 91 of the annexure is a resolution copy of the shareholder agreement which has been already referred in page No. 172 to 145 of the annexure. Regarding the page No. 89 to 86 the Ld. DR submitted that those documents indicate involvement in the shares of M/s 52 Weeks Entertainment Ltd. however, the Ld. Counsel responded that the documents relate to agreement for purchase of the property by Mono Type India Ltd. from Cosmos Infrastructure Ltd. and thus is was not even remotely connected with the allegation of bogus LTCG. Regarding pages 85 to 41 the Ld. Counsel for the assessee responded that same were official documents for allotment of the shares by M/s 52 Weeks Entertainment Ltd. and those documents had nothing to do with the allegation of rigging and front running of shares. Regarding the pages 40- 26 the Ld. DR submitted that those blank cheques were used for rigging the stock market. However, the LD. Counsel for the assessee given details submission in respect of the each black cheque. According to him, black cheque available on page 40-39 is a blanck cheque of Pranjali Pvt. Ltd. in which assessee is a director and in respect of that company no share trading activity had taken place nor a demat account had been opened and therefore, allegation of manipulation in shares was only presumption of ld DR. The page 38 to 35 was personal guarantee given to Nova Logistics Pvt. Ltd. and those cheques were taken as a counter guarantee to protect the assessee against the default by the borrower. Other pages are also similar guarantee and not in relation to any allegation of accommodation entry of LTCG. The other documents from 25 to 1 were also not found to be related to any of the allegation of providing accommodation entry of the LTCG. ITA Nos.1578, 1579, 1580, 1581 & 1604/M/2025 Mr. Naresh Manakchand Jain 11 25. The documents referred above, mainly pertain to 52 Weeks Entertainment Limited, a company where Ms. Karishma Jain, the daughter of the Assessee, was serving as a director. But none of, those seized materials qualify as incriminating in nature by collating with those 12 scrips. In view of detailed rebuttal by the ld Counsel for the assessee, it is evident that the documents seized alleged by the ld DR as incriminating material are general documents and nowhere suggest any kind of link with the allegation of accommodation entry business or commission income earned there on. The documents in any manner does not lead to the allegation of the lower authorities that cash was received from accommodation entry seeker by the assessee and after deposit into some personal accounts it was routed to the accounts of buyers of such scrip i.e. exit provider, and the assessee earned commission on such accommodation entry transactions. The above documents do not corroborate the statement recorded of the assessee as well as of the third parties under section 132(4) of the Act. 26. Ultimately, after meticulous consideration and rebuttal of each document by the counsel for the assessee, we find that none of the materials seized from Annexure-A substantiate the allegations of accommodation entries or commission income from such transactions, as posited by the lower authorities. The documents reviewed do not support the assertion that the assessee facilitated cash transactions from accommodation seekers, subsequently depositing funds into personal accounts and then redirecting them to buyers of the securities for a commission. 27. In conclusion, based on the comprehensive arguments presented before us, we are of the opinion that the documents contained in Annexure-A do not establish any nexus with the alleged modus operandi of generating bogus Long Term Capital Gains or Short Term Capital Losses. The contentions raised by the Departmental Representative regarding the incriminating nature of the seized materials have not been substantiated, thereby failing to uphold the additions made by the Assessing Officer concerning commission income. 28. The learned DR further submitted that the loose papers folder marked as Annexure A-1 seized from the premises of the assessee located 602, Raheja Chambers, Nariman Point, Mumbai comprises of phone call records of beneficiaries in excel format. However, on verification, same is found to be a list of phone numbers only, which does not lead to any link with the allegations by the Assessing Officer. 29. The learned DR further submitted that from the office of the assessee, emails have been retrieved from the email account ITA Nos.1578, 1579, 1580, 1581 & 1604/M/2025 Mr. Naresh Manakchand Jain 12 [e-mail], in which assessee was communicating with his associates regarding scrips under reference. According to the learned DR the email correspondence indicates his active involvement/anchoring in the modus operandi of providing bogus LTCG/STCL. Before us learned DR filed a copy of letter dated 26/02/2024 addressed by the Assessing Officer to the Bench, which is placed on record. The said letter contains print out of the email correspondence as Annexure U-1 and Annexure U-2. On perusal of Annexure U-1, we find that same contain a table with heading as ‘steel Exchange India Limited’ and subheading as ‘buyers list 24/11/2017 INE503B01013’. The various columns of the table contain SNO. Folio, Name, holding as on 31/10/2017, shares bought, holding as on 24/11/2017. There are three more tables having similar columns i.e. details of the names and No. of shares. We do not understand as how above list indicate or give lead to support the allegation that assessee was engaged in providing accommodation entries in the shares of steel exchange of India Ltd. The first page of annexure U-2 refers to email related to annul report of Divine Multimedia (India) Ltd., second page refers to some name of shares and their numbers, third page refers to notice for annual general meeting of Nyssa Corporation Ltd. , other pages refers to annual general meeting or ledger account etc. These mails are on behalf of Monotype India Ltd. We find that no efforts have been made by the lower authorities that those email correspondence corroborate to statement of assessee of having engaged in providing accommodation entries. It seems that lower authorities have first concluded that assessee was engaged in providing accommodation entries and thereafter they have referred to certain pages claiming to be incriminating material, without actually analyzing those documents. 30. Similarly, the image of logo of Monotype India Ltd. or other images which have been referred by the ld. D.R. as part of data seized, does not establish that those documents are incriminating in nature. 31. Further, the ld DR submitted that cash of Rs. 1,11,790/- found from the premises of the assessee was incriminating material. We find the Assessing Officer in the impugned order has nowhere mentioned that the cash found was incriminating in nature. We also find that no addition has been made by the AO for unexplained cash found. Any way such small amount found can’t support the huge addition of more than Rs. 9 crores made in hands of the assessee as commission income for the year under consideration. The Ld DR further referred to the material seized from premises of other persons, but same can’t be taken into consideration under present proceedings u/s 153A of the Act ITA Nos.1578, 1579, 1580, 1581 & 1604/M/2025 Mr. Naresh Manakchand Jain 13 because same could have been only considered u/s 153C proceedings of the Act. 32. We have perused the entire assessment order and submissions of the ld. D.R., but we find that the documents seized in Annexure A-1 from Raheja Chambers including e-mail correspondence etc. does not show any kind of incriminality in itself. Those documents could not be considered as incriminating material corroborating to the statement of the assessee. The ld CIT(A) held that besides confessional statement of assessee, a large number of incriminating material /digital data have been found during the course of search, which conclusively prove that the group concern of assessee were used as conduit for providing accommodation entries, but he has nowhere mentioned any single such incriminating material. In paragraph 8.4 of the impugned order, which has been reproduced above, the Ld. CIT(A) observed that main motive of the assessee was to bring unaccounted cash of various beneficiaries to the mainstream of books of accounts by claiming the same as long-term capital gain and in this whole process the assessee played a very crucial role by interlinking beneficiaries, brokers, intermediaries and exit provider for which he charged a specific commission. But the analysis of the seized document submitted by the learned departmental representative before us do not indicate any such lead regarding the role of the assessee in interlinking of beneficiaries, brokers, intermediaries and exit provider. In the entire seized documents there is no reference of any commission charged by the assessee. This entire addition made by the Assessing Officer is merely based on the confessional statement of the assessee, statement recorded in earlier search and addition proposed in earlier assessment years. The said statements cannot be held to be incriminating material in view of the decisions of the various Hon’ble High Courts discussed above. 33. In view of the above, the addition of commission income made by the AO merely relying on the statement of the assessee as well as the statements of other parties, cannot be sustained in absence of an incriminating material corroborating those statements, in view of the decision of the Hon’ble Bombay High Court in the case of Continental Warehousing Corporation (supra) which has been upheld by the Hon’ble Supreme Court Abhisar Buildwell (P) Ltd. (supra). The additional ground No. 1 of the appeal of the assessee is accordingly allowed. ITA Nos.1578, 1579, 1580, 1581 & 1604/M/2025 Mr. Naresh Manakchand Jain 14 34. Before us the learned counsel for the assessee has raised another additional ground challenging that the Assessing Officer had not followed direction of the CBDT issued by way of circular for citing document identification Number (DIN) on the assessment orders. The learned counsel for the assessee extensively argued in support of this additional ground. Since, we have already allowed the first additional ground in favour of the assessee, therefore adjudication of the additional ground on the issue of the DIN is merely rendered academic and thus, we are not adjudicating upon the same. The other grounds raised by the assessee also rendered academic in view of our finding on the additional ground No. one of the appeal. Accordingly, we are not adjudicating upon those remaining grounds of the assessee challenging merit of addition etc. 35. Similar additional ground have been raised by the assessee in other appeals from assessment year 2014-15 to 2017-18. In view of discussion in AY 2013-14, the additional grounds raised in AYs 2014-15 to 2017-18 are admitted for adjudication. Following our finding in assessment year 2013-14, the additional ground challenging validity of the addition in absence of an incriminating material, is allowed in favour of the assessee. The other grounds and additional rounds raised in those appeals are rendered academic and therefore same not adjudicated upon. 36. In the result, the appeals of the assessee are partly allowed.” 9. Thus, in view of the above decision of the Hon’ble Co-ordinate Bench of the Tribunal in the quantum appeals mentioned above, wherein additions on the basis of which the penalties were levied have already been deleted, the penalties levied by the AO, are un- sustainable and therefore in our considered view, have rightly been deleted by the Ld. Commissioner vide impugned orders even dated 08.01.202. Admittedly, it is also not the case of the Revenue Department that the composite order dated 27-06-2024 in the quantum appeal by the co-ordinate Bench of the Tribunal, has either been stayed or set aside by the Hon’ble High Court. Thus, the appeals filed by the Revenue are liable to be dismissed. ITA Nos.1578, 1579, 1580, 1581 & 1604/M/2025 Mr. Naresh Manakchand Jain 15 10. In the result, the appeals filed by the Revenue Department stand dismissed. Order pronounced in the open court on 23.05.2025. Sd/- Sd/- (PRABHASH SHANKAR) (NARENDER KUMAR CHOUDHRY) ACCOUNTANT MEMBER JUDICIAL MEMBER * Kishore, Sr. P.S. Copy to: The Appellant The Respondent The CIT, Concerned, Mumbai The DR Concerned Bench //True Copy// By Order Dy/Asstt. Registrar, ITAT, Mumbai. "