ASST. COMMISSIONER OF INCOME TAX CENTRAL CIRCLE 3, DELHI V. VED PRAKASH CHANANA, DELHI

ITA 4993/DEL/2024

AI Insights

The case involves cross appeals by the assessee, Late Shri Ved Prakash Chanana, and the Revenue against the order of the Commissioner of Income-tax (Appeals)-23, New Delhi, concerning the Assessment Years 2018-19 and 2019-20. The primary issue was the addition of Rs. 51,00,000 as unaccounted income based on entries in a diary allegedly belonging to Smt. Sudesh Dua, without any corroborative material or evidence. The Tribunal examined whether the additions made under section 69A of the Income Tax Act were justified, considering the lack of physical cash and the absence of ownership proof by the assessee.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 781261 (ITAT-DELHI)
• Duration Of Justice: 11 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-10-2025
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2018-2019
• Appeal Filed On: 29-10-2024
• Other Referred Cases: DCIT v Yograj Arora ITA No. 2440/D/2022, CIT v Washesher Chadha ITA 676/2023, ITO v. W.D. Estate (P.) Ltd. [1993] 46 TTJ (Bom.) 143, Shri Neeraj Goel Vs. ACIT in TTA No.5951/Del./2017, ACIT V Layer Exports P. Ltd. [2017] 184 TTJ 469 (MUM), Nishant Construction Pvt. Ltd. V ACIT in ITA No. 1502/AHD/2015, Abhay Kumar Bharamgouda Patil V ACIT [2018] 96 taxmann.com 377 (Panaji - Trib.)
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: JITENDER SINGH
• Assessee Lawyers: NIRBHAY MEHTA
• Keywords: Unexplained expenditure; Unexplained investment; Income from undisclosed sources; Document seized; Documents seized; Search and seizure; Loose papers; Charitable institution
• Section: 143(3); 142(1); 132; 153A

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH ‘A’: NEW DELHI BEFORE SHRI S. RIFAUR RAHMAN, ACCOUNTANT MEMBER and SHRI ANUBHAV SHARMA, JUDICIAL MEMBER ITA No.4643/DEL/2024 (Assessment Year: 2018-19) ITA No.4644/DEL/2024 (Assessment Year: 2019-20) Late Shri Ved Prakash Chanana, vs. ACIT, CC 03, (through legal heir Smt. Neelam Chanana), Delhi. H-6, Masjid Moth, Greater Kailash Part II, New Delhi – 110048. (PAN : AAHPC3020B) ITA No.4993/DEL/2024 (Assessment Year: 2018-19) ACIT, CC 03, vs. Late Shri Ved Prakash Chanana, Delhi. (through legal heir Smt. Neelam Chanana), H-6, Masjid Moth, Greater Kailash Part II, New Delhi – 110048. (PAN : AAHPC3020B) (APPELLANT) (RESPONDENT) ASSESSEE BY : Shri Nirbhay Mehta, Advocate Ms. Vanshika Mehta, Advocate REVENUE BY : Shri Jitender Singh, CIT DR Date of Hearing : 03.09.2025 Date of Order : 24.10.2025 O R D E R PER S. RIFAUR RAHMAN, ACCOUNTANT MEMBER : Printed from counselvise.com 2 ITA No.4643, 4644 & 4993/DEL/2024 1. The assessee and Revenue has filed cross appeals against the order of the ld. Commissioner of Income-tax (Appeals)-23, New Delhi [for short ‘ld. CIT (A)] dated 12.08.2024 for Assessment Year 2018-19. The assessee has also filed appeal against the order of ld. CIT (A)-23, New Delhi dated 12.08.2024 for AY 2019-20. 2. Since the issues are common and the appeals are connected, hence the same are heard together and being disposed off by this common order. 3. First we deal with Ground Nos.1 to 4 of assessee’s appeal for Assessment Year 2018-19 which read as under :- “1. That the order passed by CIT-(A) -23, Delhi (hereinafter referred to as \"CIT-(A)\") is contrary to facts and bad in law. 2. That on the facts and circumstances of tile case and in law the CIT-(A) was not justified in confirming the addition of Rs.51,00,000/- as unaccounted income, merely on the basis of jotting made in the diary allegedly belonging to Smt. Sudesh Dua without any corroborative material or evidence. 2.1 That without prejudice to the above, even if it is assumed that amount of Rs.51,00,000/- was received by the appellant, the same can at highest be treated as loan and cannot be considered as unaccounted income in the absence of any corroborative material. 3. That on the facts and circumstances of the case the AO has erred in invoking section 69A of the - Income Tax Act, 1961 (hereinafter referred to as \"The Act\") and the CIT-(A) has erred in confirming the addition of Rs.51,00,000/- u/s 69A of the Act. 3.1 That on the facts and circumstances of the case the Ld. CIT (A) was not justified in confirming the addition of Rs.51,00,000/- u/s 69A of the Act by not applying the ratio decidendi of DCIT v Yograj Arora ITA No. 2440/D/2022, wherein it was held that to apply the provision of Section 69A \"ownership\" or \"possession\" of money etc. has to be recorded with material in support. That no Printed from counselvise.com 3 ITA No.4643, 4644 & 4993/DEL/2024 cash was found the premises of the appellate and the AO presumed the ownership/possession of the cash. 3.2 That on the facts and circumstances of the case the appellant being a salaried person does not necessarily have to maintain books account. That the CIT-(A) erred in not appreciating the fact that appellate is a salaried person, Reliance is placed on CIT v Washesher Chadha ITA 676/2023, wherein it was held that apply the provision of 69A books of account have to be maintained.” 4. Brief facts of the case are, assessee filed its return of income on 31.08.2018 declaring total income of Rs.39,98,590/- which was processed under section 143(1) of the Income-tax Act, 1961 (for short ‘the Act’). A search and seizure proceedings u/s 132 of the Act was conducted in the case of Super Cassettes Industries Pvt. Ltd. (SCIPL) on 28.11.2018. The assessee’s case was also covered in operation u/s 132 of the Act. The case of the assessee was centralized at PCIT (Central), Delhi-1 vide order u/s 127(1) of the Act. Accordingly, notices u/s 153A was issued and duly served on the assessee. Subsequently, notices u/s 143(2) and 142(1) were issued to the assessee through ITBA Portal. In compliance, ld. AR of the assessee submitted the relevant information as called for. 5. During search proceedings, a diary containing some rough notings were seized as Annexure A-10 was seized from the premises and corporate office belongs to SCIPL. During search on 29.11.2018 related to payments made by Ms. Sudesh Dua to the assessee. The relevant seized Annexure A-10 was reproduced by the AO at page 3 of the assessment Printed from counselvise.com 4 ITA No.4643, 4644 & 4993/DEL/2024 order and as per the information, the AO observed from the seized paper that wherever ‘Chec’ is written, it was considered as a cheque and wherever ‘C’ is written it was considered as cash payment. Accordingly, it was observed that Rs.150 lakhs was paid by cheque on three occasions i.e. 01.05.2017, 24.05.2018 and 21.07.2018 and cash payments to the extent of Rs.300 lakhs. On enquiry, Ms. Dua initially explained that it is nothing but some purchase of ghee for the purpose of donation. However, on verification of the information, it was found that one of the cheque payment of Rs.50 lakhs was matching with the payment made to the assessee. Therefore, the abovesaid seized documents treated as genuine and the cash payment paid to the assessee during two assessment years i.e. 2018-19 and 2019-20 were assessed to tax of Rs.150 lakhs each under section 69A of the Act. 6. Aggrieved with the above order, assessee preferred an appeal before the ld. CIT (A)-23, New Delhi and filed detailed submissions and grounds of appeal :- “1. The relevant facts briefly stated are as under: - (i) A search action u/s 132 of the Income Tax Act was conducted on the appellant on 29.11.2018. Based upon the search action, assessment orders were passed u/s 153A of the Income-tax Act for A.Y. 2018-19 and u/s 143(3) for A.Y. 2019-20. (ii) That for A.Y. 2018-19 the Return of Income was filed on 31.08.2018 declaring total income of Rs. 39,98,590/- which was processed u/s 143(1) of the Income Tax Act on 09.02.2019 at returned income. Copy of computation is enclosed at Page No. 01 to 01 of the P/B. Printed from counselvise.com 5 ITA No.4643, 4644 & 4993/DEL/2024 (iii) A notice u/s 153A of the Act was issued on 15.01.2020 for AY 2018- 19 requiring the assessee to furnish return of income within 15 days of the service of notice. In response to the said notice the appellant has filed a return on 12.02.2020 disclosing total income of Rs. 39,98,590/-. Copy enclosed at Page No. 02 to 02 of P/B. (iv) Thereafter the AO issued notice dated 15.02.2021 u/s 142(1) requiring the assessee to furnish the details/ information required for the purpose of assessment. Copy of notice is enclosed at Page 03 to 10 of P/B. (v) Compliance to the notice u/s 142(1) was made vide reply dated 17.03.2021. Copy of the same is enclosed at Page 11 to 28 of P/B. (vi) Further, a show-cause notice was issued by the AO on 30.05.2021 (copy enclosed at Page 29 to 30 of P/B. The reply to said show-cause notice was filed vide letter dated 25.06.2021 (copy enclosed at Page 31 to 37 of P/B). 2. In the assessment order the AO has held as under: - \"12. The assessee was asked to explain and file the documentary evidence in respect of above fact. However while perusing the detailed submissions in respect of the rough jottings as reproduced above, it has been noticed that there are no documentary evidence regarding the above rough notings was provided by the assessee in support of his claim. Further, the assessee was given ample opportunity to explain the contents of the rough jottings by issuing summons and notices by the assessee was avoiding the notices as well as not producing any satisfactory evidence in support of his claim. Hence, no plausible explanation and valid documentary evidences regarding the transactions as mentioned in the rough jotting annexed as page No. 12 of Annex A- 10 have been provided by the assessee during the assessment proceedings. Accordingly, on the basis of above observations the above cash payments were made to Sh. Ved Prakash Chanana amounting to Rs.150 lakhs during FY 2017-2018 and Rs. 150 lakhs during FY 2018-2019 are treated to be unaccounted income in the hands of assessee which is not recorded in the books of assessee and accordingly additions of Rs.1,50,00,000/- is made to the taxable income of assessee in AY 2018-2019 u/s 69A of IT Act is to be computed u/s 115BBE of the IT Act. 3. Aggrieved by the order of the AO, the assessee is in appeal before the first Appellate Authority. In the present appeal the appellant has raised following grounds of appeal:- 1. That the order passed by DCIT, Central Circle 3, Delhi (hereinafter referred to as AO) is contrary to facts and bad in law. 2. That on the facts and circumstances of the case and in law the A. O. was not justified in making an addition of Rs. 1,50,00,000/-, as unaccounted income, merely on the basis of jottings made in the diary (Anx-A-10) allegedly belonging to Smt. Sudesh Dua without any corroborative material or Printed from counselvise.com 6 ITA No.4643, 4644 & 4993/DEL/2024 evidence. 2.1 That without prejudice to the above, even if it is assumed that amount of Rs.1,50,00,000/- was received by the appellant, the same can at highest be treated as loan and cannot be considered as unaccounted income in the absence of any corroborative material. 3. That the appellant craves leave to add, amend, alter any grounds of appeal at the time of hearing or earlier. GROUND NO. 1 & 3 3. Ground no. 1 and 3 are general in nature and do not require any specific submissions. GROUND NO. 2 4. Under this ground of appeal additions made based on some rough jottings in the diary of Smt Sudesh Dua has been challenged. The addition discussed under this ground is tabulated as under: Addition AY 2018-19 AY 2019-20 Alleged cash payment made to Director Ved Prakash Chanana (Page 12 of Annexure A 10) 1,50,00,000 1,50,00,000 The appellant is aggrieved by the fact that there is no corroborative material available on record based on which the addition is made. Further, the submissions made during the assessment proceedings were also ignored by the AO at the time of framing of assessment order. 5. The relevant facts briefly stated are as under:- i. That the appellant is director in company M/s Super Cassettes Industries Pvt Ltd. (hereinafter referred to as \"Company\"). That a search was conducted on the company on 28.11.2018 vide which the premises and belongings of appellant Shri Ved Prakash Chanana were also searched. ii. That during the course of search proceedings a diary was seized as Annxure- A10 from the office premises of company located in Sector 16A, Film City, Noida ii. At page No. 12 of the diary there were some rough jottings at the top of the page which the AO interpreted as details of payment made to appellant Shri Ved Prakash Chanana. The figures which were denoted by \"C\" were interpreted by AO as payment made in cash and the figures which were denoted by \"Chee\" were interpreted as payment made by Cheque. A detail based on rough jottings was made by the AO for AY 2018-19 and A Y 2019- 20 which is reproduced as under :- S.No. Date Cheque Paid (in lakhs) Cash paid (in lakhs) 1 01.05.2017 50 50 2 26.10.2017 Nil 100 Printed from counselvise.com 7 ITA No.4643, 4644 & 4993/DEL/2024 3 24.05.2018 50 50 4 21.07.2018 50 Nil 5 23.07.2018 Nil 50 6 02.08.2018 Nil 50 Total 150 300 6. During assessment proceedings notices were issued to both Smt. Sudesh Duaand Shri Ved Prakash Chanana on 15.02.2021 for explaining the contents of these pages. A reply was filed by Smt Sudesh Dua on 07.04.2021 vide which it was stated that the rough jottings on page 12 is with regard to arrangement of Ghee in the quantity of 50KGs on various dates which was meant for making Desi Ghee Halwa for feeding it to poor people on certain occasions in Haridwar 7. A show cause notice was issued to the company on 05.05.2021 (enclosed at Page No. 38 to 74 of P/B Vol. I) in which the AO asked the company to furnish the details of the rough jottings on Page 12 of the Diary. In response to the same reply dated 19.06.2021 (enclosed at Page No. 75 to 167 of P/B Vol. I) was filed by the company which is reproduced as under: \"84. With regard to the above it is submitted that the jottings written by Mrs. Sudesh Dua were for charitable purposes to feed poor persons and religious sages stationed in Haridwar during auspicious occasions, as Haridwar is one of the prominent destinations of religious gatherings and celebrations. These instructions were given to Sh. Ved Prakash Chanana to make necessary arrangements and to procure Pure ghee to make Pure ghee halwa. 85. It is further submitted that the rough jottings made in a diary cannot be considered as evidence u/s 34 of the Indian Evidence Act. Such documents are to be treated as \"dumb documents\". It is pertinent to mention that a charge of tax can be levied based on such a document only if such document is a speaking one in itself or becomes a speaking one if read in conjunction to some other corroborative evidence found during the course of search or post search investigation. 86. To elucidate, if it is to be assumed on the basis of jottings on page 12 of Anx-10 that payment in cash aggregating Rs. 150 lacs was made to Sh. Ved Chanana, then there is a need for some corroborative evidence in support of the alleged jottings. It may be noted that a simultaneous search action also took place on the residential premises of Sh. Ved Chanana on 28.11.2018 who is a director of M/s Super Cassettes Industries Pvt. Ltd. (SCIPL). The search action on the premises of Sh. Ved Chanana did not reveal any incidence of him receiving any cash from Smt. Sudesh Dua or SCIPL. Neither any cash was found at his premises nor any corresponding record of him having received such cash amount was found. Thus, it cannot be said that the jottings referred above represent cash payment to Sh. Ved Chanana. Further, the jottings on Page 12 do not reflect in any manner, that the figures mentioned are in lacs. Against the name \"Mir\" figure of 32/50 and 40 are mentioned which does not suggest that these amounts are in lacs. There is no evidence of Printed from counselvise.com 8 ITA No.4643, 4644 & 4993/DEL/2024 having paid any amount of Rs. 40 lacs to \"Mir\", as incorrectly alleged in the SCN. This can be appreciated from the below reproduced snapshot of page 12. ……………. Continuing further as regards contents of Page 15, against the jotting \"Bombay Furniture\" (at the right hand bottom) certain figures viz. 35.98, 40, 50,22 are mentioned, total of which comes to 147.98. On this solitary jotting it cannot be presumed that Rs. 147.98 lacs has been paid in cash for acquiring furniture for Bombay Office. There is no mention or indication that the figures mentioned are in \"lacs\". Further there is no mention of any cash payment. Also, the search action did not reveal any undisclosed furniture items in Bombay Office of SCIPL. As regards amount of Rs. 65 lacs mentioned in the SCN, it is submitted that even the SCN admits the fact that certain figures are loosely mentioned on Page 15 in \"Kgs\" & \"Pkts. Apart from the same there is no intelligible description mentioned on the seized page. Even no date mentioned is against these numbers in Kgs and Pkts. Therefore, it is fallacious to presume that these amounts are in \"lacs\", have been paid in cash outside books of accounts and pertain to A.Y. 2018-19. A snapshot of Page 15 is reproduced below ……………. 87. Therefore, the well settled legal position is that a non-speaking document without any corroborative material, evidence on record and finding that such document has materialized into transactions giving rise to income of the assessee which had not been disclosed in regular books of account by such assessee, has to disregarded for the purposes of assessments to be framed pursuant to search and seizure action. From the search and seizure perspective, such non speaking seized documents are referred to as \"Dumb Documents\". 88. Having said so, the predominant judicial view is that no arbitrary addition to the income can be made by the Assessing Officer based on the dumb documents, loose papers containing scribbling, rough/vague notings in the absence of any corroborative material, evidence on record and finding that such dumb documents had materialized into transactions giving rise to income of the assessee which had not been disclosed in regular books of account by the assessee. 89. In ITO v. W.D. Estate (P.) Ltd. [1993] 46 TTJ (Bom.) 143, the Assessing Officer made addition on the basis of a file, a table diary belonging to a disgruntled employee found during search at his premises. This showed sales and sale amounts allegedly received as \"on\" money by the assessee. However, there was absolutely no evidence to show that the assessee in fact received \"on\" money payments. The assessee contended that such additions were based on hearsay evidence. 90. Recently the Delhi ITAT in case of Shri Neeraj Goel Vs. ACIT in TTA No.5951/Del./2017 vide order dated 21/03/2018 held that addition on account Printed from counselvise.com 9 ITA No.4643, 4644 & 4993/DEL/2024 of alleged interest income is not sustainable in the eyes of law, because the document does not mention the name of the assessee, does not bear the signature of the assessee, not in the handwriting of the assessee, documents has imply jottings of certain figures and does not indicate whether it is an investment or deposit or loan, hence, the said seized document is dumb/bald and even otherwise, the same was never found either in the possession or control of the assessee. 91. The Mumbai ITAT in case of ACIT V Layer Exports P. Ltd. [2017] 184 TTJ 469 (MUM) held that additions are to be made on basis of tangible evidence and not solely on basis of estimations and extrapolation theory. Additions could not be sustained merely on the basis of rough notings made on a few loose sheets of papers unless the AO brought on record some independent and corroborative materials to prove irrefutably that the notings revealed either unaccounted income or unaccounted investment or unaccounted expenditure of the assessee. Additions could not be made simply on the basis of rough scribblings made by some unidentified person on a few loose sheets of paper. Since the seized papers were undated, had no acceptable narration and did not bear the signature of the assessee or any other party, they were in the nature of dumb documents having no evidentiary value and could not be taken as the sole basis for determination of undisclosed income of the assessee, thus, no addition can be made by AO on grossly inadequate material or rather no material at all and as such deserved to be deleted. 92. Relying on the judgment of the apex court in case of Common Cause v. UOI(supra), the Hon'ble Bench of ITAT, Ahmedabad in case of Nishant Construction Pvt. Ltd. V ACIT in ITA No. 1502/AHD/2015, held that in the absence of any corroborative evidence , loose sheet can at the most be termed as \"dumb document\" which did not contain full details about the dates, and its contents were not corroborated by any material and could not relied upon and made the basis of addition. Reliance can be also placed on the judgment of the Panaji Bench of ITAT in case of Abhay Kumar Bharamgouda Patil V ACIT [2018] 96 taxmann.com 377 (Panaji - Trib.) wherein the judgement of the apex court was relied upon. 93. Therefore the well settled legal position is that a non speaking document referred to as a \"Dumb Document\" without any corroborative material, evidence on record and finding that such document has materialized into transactions giving rise to income of the assessee which had not been disclosed in regular books of account by such assessee, has to disregarded for the purposes of assessments to be framed u/s 153A and 153C of the Act. 94. In view of the above discussion the contentions of the assessee are summarised as under (A) An explanation on merits was submitted during the post search proceedings describing the contents of the seized material. (B) The jottings made on the seized pages are in the nature of dumb documents and in the absence of any further evidence or corroborating Printed from counselvise.com 10 ITA No.4643, 4644 & 4993/DEL/2024 material found during search or post search investigation, no addition is warranted keeping in view the settled legal position.\" 8. The A.O. did not find the aforesaid reply of the company as being acceptable and made the additions on substantive basis in the hands of company and on protective basis in the hands of appellant. The findings and observations made in the assessment order rejecting the reply of the assessee are summarised as under :- 8.1 The assessee was given ample opportunity to explain the contents of rough jottings but the assessee avoided the notice and failed to furnish satisfactory evidence in support of the claim made. 8.2 Notices issued to appellant remain non-complied and the reply received from Smt Sudesh Dua were not supported by any evidence such as invoices etc. Further, it was submitted by Smt Sudesh Dua that the same may be considered in SCIPL case instead of her personal case. 9. It is the submission of assessee that rough jottings written by Mrs. Sudesh Dua at Page No. 12 were for charitable purposes to feed poor persons and religious sages stationed in Haridwar during auspicious occasions, as Haridwar is one of the prominent destinations of religious gatherings and celebrations. These instructions were given to Sh. Ved Prakash Chanana to make necessary arrangements and to procure Pure ghee to make Pure ghee halwa. 10. It may be highlighted that on Page 12 at once place the term mentioned is \"[lc\" dated 26.10.2017 which has been interpreted by the AO as 1 crore or 100 lacs whereas as per the AO the numbers mentioned on the Page 12 are in lacs, therefore the AO has contradicted its own stand by treating this amount as 1 crore instead of 1 lac. 11. Further the base for treating the rough jottings mentioned on the top of Page 12 of Annexure A 10 was corroborating bank statement of the appellant where it was alleged that certain transactions were matched with the bank statement of the appellant. A comparative table of entries as alleged to be matched with bank statement of Ved Chanana is as under: Date of transaction Alleged figure as per Page 12 of Annexure A10 Amount on the same date in the bank statement 01.05.2017 50 Nil 24.05.2018 50 Nil 21.07.2018 50 50,00,000 The payment of Rs. 50,00,000/- on 21.07.2018 was made by SCIPL to Sh. Ved Chanana on behalf of Sh. Bhushan Dua and the same was in nature of loan given by Mr. Bhushan Dua to Sh. Ved Chanana. In this regard the copy of ledger account of Sh. Ved Chanana in the books of SH. Bhushan Dua and copy of ledger account of Sh. Bhushan Dua in the books of Sh. Ved Chanana is being attached at Page No. 168 to 169 of P/B Vol 1. Further the Statement of affairs of Sh. Bhushan Dua and Sh. Ved Chanana as on 31.03.2018 and 31.03.2019 are being attached at Page No. 170 to 172 of P/B Vol 1 wherein the respective loans are being reflected. 12. The AO in the order has alleged that certain entries are reconciled with Printed from counselvise.com 11 ITA No.4643, 4644 & 4993/DEL/2024 corresponding credit entries in bank account of Sh. Ved Prakash Chanana which corroborates that the other entries made in cash are also true and actually has been made. In this regard it is the prime submission of appellant that if the amounts denoted by \"Chee\" are cheque payments than all the transactions must be matched with the bank statement of Shri Ved Chanana. However, the same are not matching and therefore the allegation of AO does not have any basis of existence. In this regard copy of Dank Statement of Sh. Ved Prakash Chanana is being attached at Page No. 173 of P/B Vol 1. Matching of one amount out of many rough jottings on Page 12 of Annexure A10 is nothing but a coincidence and the same should not be considered as a base for making addition in the assessment order. As explained above only one date and amount are matching which can be only a coincidence. Even the nature payment of the amount which is matching is loan and not expenditure. When the nature of one matching amount is loan given by Mr. Bhushan Dua to Sh. Ved Chanana then the argument of the AO that the cash payment is unexplained expenditure will not hold. The whole argument of the AO is based upon matching the cheque payment and considering the other corresponding amounts as cash payments in the nature of unexplained expenditure. When the nature of one matching cheque payment is loan and not salary paid to Sh. Ved Prakash Chanana then why would the company pay cash of similar amount against the alleged cheque payment. 13. Further, it is submitted that the rough jottings made in a diary cannot be considered as evidence u/s 34 of the Indian Evidence Act. Such documents are to be treated as \"dumb documents\". It is pertinent to mention that a charge of tax can be levied based on such a document only if such document is a speaking one in itself or becomes a speaking one if read in conjunction to some other corroborative evidence found during the course of search or post search investigation. 14. To elucidate, if it is to be assumed on the basis of jottings on page 12 ofAnx-10 that payment in cash aggregating to Rs. 150 lacs was made to Sh. Ved Chanana, then there is a need for some corroborative evidence in support of the alleged jottings. 14.1 It may be noted that a simultaneous search action also took place on the residential premises of the appellant Sh. Ved Chanana on 28.11.2018, who is a director of M/s Super Cassettes Industries Pvt. Ltd. (SCIPL). The search action on the premises of Sh. Ved Chanana did not reveal any incidence of him receiving any cash from Smt. Sudesh Dua or SCIPL. Neither any cash was found at his premises nor any corresponding record of him having received such cash amount was found. Thus, it cannot be said that the jottings referred above represent cash payment to Sh. Ved Chanana. Further, the jottings on Page 12 do not reflect in any manner, that the figures mentioned are in lacs. This can be appreciated from the below reproduced snapshot of page 12. ...................... Printed from counselvise.com 12 ITA No.4643, 4644 & 4993/DEL/2024 Therefore, the well settled legal position is that a non-speaking document without any corroborative material, evidence on record and finding that such document has materialized into transactions giving rise to income of the assessee which had not been disclosed in regular books of account by such assessee, has to disregarded for the purposes of assessments to be framed pursuant to search and seizure action. From the search and seizure perspective, such non speaking seized documents are referred to as \"Dumb Documents\". 15. Having said so, the predominant judicial view is that no arbitrary addition to the income can be made by the Assessing Officer based on the dumb documents, loose papers containing scribbling, rough/vague noting in the absence of any corroborative material, evidence on record and finding that such dumb documents had materialized into transactions giving rise to income of the assessee which had not been disclosed in regular books of account by the assessee. 16. In ITO v. W.D. Estate (P.) Ltd. [1993] 46 TTJ (Bom.) 143, the Assessing Officer made addition on the basis of a file, a table diary belonging to a disgruntled employee found during search at his premises. This showed sales and sale amounts allegedly received as \"on\" money by the assessee. However, there was absolutely no evidence to show that the assessee in fact received \"on\"money payments. The assessee contended that such additions were based on hearsay evidence. 17. Recently the Delhi ITAT in case of Shri Neeraj Goel /s. ACIT in ITA No. 5951/Del,/2017 vide order dated 21/03/2018 held that addition on account of alleged interest income is not sustainable in the eyes of law, because the document does not mention the name of the assessee, does not bear the signature of the assessee, not in the handwriting of the assessee, documents has imply jottings of certain figures and does not indicate whether it is an investment or deposit or loan, hence, the said seized document is dumb/bald and even otherwise, the same was never found either in the possession or control of the assessee. 18. The Mumbai TTAT in case of ACIT V Layer Exports P. Ltd. [2017] 184 TTJ 469 (MUM) held that additions are to be made on basis of tangible evidence and not solely on basis of estimations and extrapolation theory. Additions could not be sustained merely on the basis of rough notings made on a few loose sheets of papers unless the AO brought on record some independent and corroborative materials to prove irrefutably that the notings revealed either unaccounted income or unaccounted investment or unaccounted expenditure of the assessee. Additions could not be made simply on the basis of rough scribblings made by some unidentified person on a few loose sheets of paper. Since the seized papers were undated, had no acceptable narration and did not bear the signature of the assessee or any other party, they were in the nature of dumb documents having no evidentiary value and could not be taken as the sole basis for determination of undisclosed income of the assessee, thus, no addition can be made by AO on grossly inadequate material or rather no material at all and as such deserved to be deleted. Printed from counselvise.com 13 ITA No.4643, 4644 & 4993/DEL/2024 19. Relying on the judgment of the apex court in case of Common Cause v. UOI(supra), the Hon'ble Bench of ITAT, Ahmedabad in case of Nishant Construction Pvt. Ltd. V ACIT in ITA No. 1502/AHD/2015, held that in the absence of any corroborative evidence , loose sheet can at the most be termed as \"dumb document\" which did not contain full details about the dates, and its contents were not corroborated by any material and could not relied upon and made the basis of addition. Reliance can be also placed on the judgment of the Panaji Bench of ITAT in case of Abhay Kumar Bharamgouda Patil V ACIT [2018] 96 taxmann.com 377 (Panaji - Trib.) wherein the judgement of the apex court was relied upon. 20. Therefore the well settled legal position is that a non-speaking document referred to as a \"Dumb Document\" without any corroborative material, evidence on record and finding that such document has materialized into transactions giving rise to income of the assessee which had not been disclosed in regular books of account by such assessee, has to disregarded for the purposes of assessments to be framed u/s 153A and 153C of the Act. 21. It is submitted that the AO erred in invoking a wrong section and confirmed the addition under a wrong section. The AO confirmed the addition under section 69A of the IT Act. Section 69A of the act is a deeming provision which titles as “Unexplained money\". For the sake of convenience section 69A of the act is reproduced below :- “Unexplained money, etc. [69A. Where in any financial year the assessee is found to be the owner of any money, bullion, jewellery or other valuable article and such money, bullion, jewellery or valuable article is not recorded in the books of account, if any, maintained by him for any source of income, and the assessee offers no explanation about the nature and source of acquisition of the money, bullion, jewellery or other valuable article, or the explanation offered by him is not, in the opinion of the Income-tax Officer, satisfactory, the money and the value of the bullion, jewellery or other valuable article may be deemed to be the income of the assessee for such financial year.]” 22. It is submitted that during the course of search of SCIPL, no unexplained money was found from the premises of the assessee. In order to invoke section 69A the basic requirement is that unaccounted money ought to be seized from the premises of the assessee and the assessee further fails explain the ownership of the money found from the premises. 22.1 Reliance is placed on the case of DCIT v Yograj Arora ITA No. 2440/D/2022 for AY 2017-2018 copy of the order is enclosed herewith at page 174 to 181 relevant part of the order is reproduced herewith: - \"9. Admittedly, it is not a case in which the assessee was found to be in possession of the cash of Rs. 1.45 crore in search operation. Therefore, it Printed from counselvise.com 14 ITA No.4643, 4644 & 4993/DEL/2024 cannot be presumed that the assessee was the owner of the said cash. To attract the provisions of section 69A sine qua non is \"ownership\" of money etc. which has not been recorded in the books of account. The Id. AO has made only presumption that the said cash was 'available with the assessee' without bringing in record any material in support thereof. Not only that he went a step further and presumed that the assessee paid the said cash to his brother HK Arora only on the basis of conjecture and surmises. The assessee offered explanation for the noting made on page 30 of Annexure A-8 duly supported by the documentary evidence which has been rejected by the Ld. AO in total disregard of all the facts, circumstances and the evidence in the case as ordained by the CBDT in its Circular (supra). To apply the provisions of section 69A by the Ld. AO without satisfying the conditions precedent is not sustainable. 10. On the facts and in the circumstances of the assessee's case, we have no hesitation in holding that the Ld. CIT(A) was perfectly justified in deleting the impugned addition. In no way his order can be branded as perverse, erroneous and not tenable on facts and in law. 23. It is submitted that the assessee was in no possession or ownership of the said cash that was mentioned in the seized material. /4s contended above the seized material is mere dumb document and does not convey any meaning. 24. Reliance is placed on the case of CIT v. Hersh Washesher Chadha ITA 676/2023 copy of the order is enclosed herewith at page 182 to 193 in which Hon'ble High Court of Delhi has held that in order to confirm an addition under section 69A of the Act, books of accounts are incumbent. It would not be possible to invoke this provision if books of accounts are not there. Relevant portion of the order is reproduced herewith : - \"7. Admittedly, in the present case, the respondent/assessee is non-resident Indian and his source of income in India being from interest on bank accounts and interest on income tax refund, he is not obliged to maintain any books of account in India. It appears to us prima facie that the expression \"if any\" specifically used in section 69A of the Act amplies that where books of account are not maintained, it would not be possible to invoke this provision. But as mentioned above, learned counsel for appellant/revenue requested to keep this question open to be agitated in some better case. We accede to this request\" 25. It is submitted that the assessee is a salaried person and in the case of salaried persons it is not necessary to maintain books of accounts. It is submitted that the AO erred in considering the fact that the assessee is a salaried person and the provisions of 69A do not apply to areas where maintainability of books of accounts is a necessity. 26. It is humbly requested that the submissions of the assessee may be considered and the addition may be deleted.” Printed from counselvise.com 15 ITA No.4643, 4644 & 4993/DEL/2024 7. After considering the detailed submissions of the assessee, ld. CIT (A) analyzed the factual matrix on record and sustained only Rs.51 lakhs out of Rs.150 lakhs for AY 2018-19 by observing as under :- “20. The issue involved is mirror image of the addition made in the case of M/s SCIPL for the A.Y 2018-19. In the case of SCIPL, it has been held that an amount of Rs.51,00,000/- in cash was paid by SCIPL to the appellant. It was also held that such amount of cash is not reflected in the accounts of the SCIPL. 21. The appellant has not been able to furnish any evidence to show that the amount of Rs.51,00,000/- received in cash was shown by him in his account or return of income. 22. The Assessing Officer has taken the amount received in cash at Rs.1,50,00,000/-. However, on analysis of the impugned document, it is seen that the amount was only Rs.51,00,000/-. The issue has been dealt in detail in the case of SCIPL and the same has been reproduced in the forgoing paragraphs. 23. From the facts, it is evident that the appellant was owner of unaccounted cash of Rs.51,00,000/- which was not disclosed by him. Therefore, it is held that the Assessing Officer was justified in invoking the provision of section 69A of the Act. 24. In view of the above discussion, the addition u/s 69A to the tune of Rs.51,00,000/- is sustained and addition of Rs.99,00,000/- is deleted.” 8. Aggrieved with the above order, both assessee and Revenue are in appeal before us. 9. At the time of hearing, ld. AR of the assessee submitted that during the course of first appellate proceedings, the assessee, Late Shri Ved Prakash Chanana died on 13th July 2024 and a copy of Death Certificate was placed on record and the wife of the assessee, Smt. Neelam Chanana is the Legal heir, who has signed Form 36 and Power of Attorney. Ld. AR of the assessee brought to our notice detailed submissions and the facts of Printed from counselvise.com 16 ITA No.4643, 4644 & 4993/DEL/2024 the case and he pressed basically ground nos.2 to 4 raised by the assessee in grounds of appeal. In this regard, he submitted that ld. CIT (A) sustained the addition of Rs.51 lakhs out of Rs.150 lakhs made by the AO and ld. CIT (A) has observed that the issue involved is mirror image of the addition confirmed in the case of SCIPL and hence held that the amount of Rs.150 lakhs is cash amount which is not reflected in the books of SCIPL, therefore, the assessee received in cash and was the owner of the amount. Hence, ld. CIT (A) confirmed the addition u/s 69A of the Act. In this regard, ld. AR submitted that the addition for both the year(s) under consideration is confirmed u/s 69A of the Act. He brought to our notice section 69A of the Act. For the sake of convenience Section 69A of the Act is reproduced below :- [Unexplained money, etc. 69A. Where in any financial year the assessee is found to be the owner of any money, bullion, jewellery or other valuable article and such money, bullion, jewellery or valuable article is not recorded in the books of account, if any, maintained by him for any source of income, and the assessee offers no explanation about the nature and source of acquisition of the money, bullion, jewellery or other valuable article, or the explanation offered by him is not, in the opinion of the [Assessing] Officer, satisfactory, the money and the value of the bullion, jewellery or other valuable article may be deemed to be the income of the assessee for such financial year.] 10. Ld. AR further submitted that the essential ingredients to invoke S-69A are as follows: - Printed from counselvise.com 17 ITA No.4643, 4644 & 4993/DEL/2024 i. Assessee found to be the owner of money, jewellery, bullion etc. ii. Not recorded in the books of account (if any). iii. Explanation offered not satisfactory in the opinion of the AO. 11. It is submitted that, during the search and seizure operation, no cash of any amount was found from the premises of the assessee. Furthermore, the only basis of addition relied by the ld. AO is the seized document A-10, which was found from third person’s premises. He further submitted that no corroborated evidence was produced by the AO for confirming that the amount mentioned in the seized document belongs to the assessee and is unaccounted, therefore, addition made u/s 69A is bad in law. In this regard, he relied on the decision of DCIT vs Yograj Arora ITA No. 2440/D/2022 wherein relevant facts are :-  Search was conducted u/s 132 (1) of the Act on 05.10.2017 at the residential premises of the assessee.  During the search and seizure operation a diary was found and seized which contained details of various transactions. The jotting amounting to Rs 1.45Cr were recorded, for which various statutory notices were issued and were compiled to by the assessee. Printed from counselvise.com 18 ITA No.4643, 4644 & 4993/DEL/2024  The explanation offered by the assessee was not found tenable and the ld. AO and therefore made addition of Rs 1.45cr u/s 69A.  Aggrieved by the decision of ld. AO, assessee appealed before CIT (A) wherein the CIT (A) held that AO erred in making addition by placing reliance on rough noting.  Dissatisfied by the decision Revenue appealed before the Hon’ble ITAT. 12. Ld. AR of the assessee submitted that the ITAT took view of that to invoke the provisions of section 69A an essential condition is that “ownership” of money etc. which is not recorded in the books of account has to be shown, mere presumption that the said cash was available to the assessee without bringing any material fact on record in support cannot be said to satisfy the conditions for applying provisions of section 69A. Thus, emphasis was to prove that the money, etc is in “ownership” of the assessee and is not recorded in the books of account. Since no “ownership” of money was found from the assessee the Hon’ble ITAT upheld the reasoning by CIT(A) and dismissed the appeal of the revenue. 13. Thus, it is submitted that in the instant case no ownership of money was found from the premises of the assessee during search and seizure Printed from counselvise.com 19 ITA No.4643, 4644 & 4993/DEL/2024 operation, furthermore, the AO did not bring any material fact on record to satisfy the applying of Section 69A. 14. Moreover, ld. AR submitted that according to Black’s Law Dictionary, the word “ownership” has been defined as “the complete dominion, title, or proprietary right in a thing or claim”, meaning it represents the legal right to own, possess and use something, including to convey it too other. Since, there was no cash found and the ld. AO made a mere presumption that the cash was available to the assessee to either use it or convey it too others. Furthermore, the ld. AO relied on seized material found at third person’s premises showcases that no other material fact by the ld. AO was presented and the addition was confirmed on mere presumption. 15. Ld. AR further submitted that addition made u/s 69A for both the year(s) under consideration is bad in law. He placed reliance on M/s Rucha Consultancy LLP v DCIT ITA 4996/Mum/2024 wherein the relevant facts are as follows :-  Search and seizure operation u/s 132 of the Act was conducted assessee and group concerns on 23.09.2021.  During search operation certain incriminating documents were found and seized and statements were recorded which were later retracted. Printed from counselvise.com 20 ITA No.4643, 4644 & 4993/DEL/2024  During search proceedings, from photo gallery an image containing certain entries was found on the basis of which addition was made by ld. AO.  Aggrieved by the decision of AO, assessee appealed before CIT(A) wherein the addition was confirmed.  Addition of Rs. 2.10cr made u/s 69A of the Act was challenged. And he submitted that the ITAT has held that :-  The ITAT opined that the provision of 69A could only be invoked only if the assessee is “found to be the owner” of any money, bullion, jewellery or other valuable article. Moreover, it was opined that it is required to be shown that the assets were physically available and hence the assessee was found to be the owner for invoking the provisions of 69A. It is essential that the assessee should be found with money, etc. if the assessee is not found then the provisions of 69A cannot be invoked.  Since no ownership of money from the premises of the assessee was found, and the addition was made on the basis of image found in the phone of an employee, addition of Rs 2.10Cr stands deleted. Printed from counselvise.com 21 ITA No.4643, 4644 & 4993/DEL/2024 16. Therefore, it is submitted that in the instant case during the search and seizure operation no money from the premises of the assessee was found. Furthermore, he submitted that the AO relying on seized material found at third person’s premises showcases that no material evidence by the AO was presented for invoking provisions of section 69A. 17. Ld. AR in conclusion submitted that since no cash was found from the premises of the assessee invoking provisions of section 69A stands bad in law, hence it is requested based on above contentions by the assessee the appeal of the assessee may be allowed. 18. On the other hand, ld. DR of the Revenue submitted that the diary is evidence of possession of cash and ownership in the present case, therefore, the assessee is the owner of the cash received by him. He submitted that corresponding bank transactions were matched with the books of the assessee, therefore, he relied on the findings of the lower authorities. With regard to Department’s appeal, he brought to our notice page 14 of the ld. CIT (A)’s order wherein the cheque received by the assessee on 03.08.2017 was proved to be genuine, therefore, the information found during search is genuine. Further he brought to our notice para 17 of the appellate order and he objected to the treatment of one ‘C’ as lakhs instead of crores. He submitted that ‘C’ denotes crores and not lakhs. He objected to the observation of the ld. CIT (A) that the Printed from counselvise.com 22 ITA No.4643, 4644 & 4993/DEL/2024 information found in the diary was interpreted as lakhs, the same should be treated for one which was written in the diary. He subtitled that one ‘C’ denotes for crores, therefore, he relied on the findings of the AO in this regard. 19. Considered the rival submissions and material available on record. We observe that the diary was found at the corporate office of the SCIPL and the diary belongs to one Smt. Sudesh Dua and she has confirmed that this transaction belongs to SCIPL and if any action has to be taken, it should be taken in the hands of the company. We observe that as per the diary, assessee was given Rs.450 lakhs during the period and Rs.150 lakhs by cheque and Rs.300 lakhs by cash. Out of the cheque payment in three transactions, one transaction of Rs.50 lakhs was matching with books of account maintained by the assessee. Other payments were not matching. It is also fact on record that the information was found at the premises of the company and not at the place of residence of the assessee and no cash was found at the premises of the assessee nor at the premises of the company. The addition was made in the hands of the assessee on the basis of noting in the diary. In this regard, the lower authorities have proceeded to make addition u/s 69A of the Act. On the issue of addition made u/s 69A of the Act for the information found from their party place, Printed from counselvise.com 23 ITA No.4643, 4644 & 4993/DEL/2024 in the similar facts on record, we observe that coordinate Bench in ITA No.2440/Del/2022 dated 07.11.2023 held as under :- “9. Admittedly, it is not a case in which the assessee was found to be in possession of the cash of Rs. 1.45 crore in search operation. Therefore, it cannot be presumed that the assessee was the owner of the said cash. To attract the provisions of section 69A sine qua non is “ownership” of money etc. which has not been recorded in the books of account. The Ld. AO has made only presumption that the said cash was ‘available with the assessee’ without bringing on record any material in support thereof. Not only that he went a step further and presumed that the assessee paid the said cash to his brother H.K. Arora only on the basis of conjecture and surmises. The assessee offered explanation for the noting made on page 30 of Annexure A-8 duly supported by the documentary evidence which has been rejected by the Ld. AO in total disregard of all the facts, circumstances and the evidence in the case as ordained by the CBDT in its Circular (supra). To apply the provisions of section 69A by the Ld. AO without satisfying the conditions precedent is not sustainable. 10. On the facts and in the circumstances of the assessee’s case, we have no hesitation in holding that the Ld. CIT(A) was perfectly justified in deleting the impugned addition. In no way his order can be branded as perverse, erroneous and not tenable on facts and in law.” 20. Respectfully following the above decision, we are of the view that no cash was found at the possession of the assessee and the ownership of the same was presumed to be the assessee by the lower authorities. Therefore, without proving the possession and ownership of the same, the addition u/s 69A of the Act cannot be invoked as per the facts available on record. Printed from counselvise.com 24 ITA No.4643, 4644 & 4993/DEL/2024 21. Further we observe that the diary was found with the employee of the company and at the premises of the company. The payments were received by the assessee from the company, in fact one cheque payment was matching with the diary found during the search, other payments were not matching neither recorded in the books of the assessee nor in the books of the company. Therefore, from the notings of the diary, all these transactions are relating to the company. If at all, any addition has to be proposed, it should be in the hands of the company not in the hands of the assessee. By relying on the findings of the coordinate Bench and factual matrix on record, we are inclined to allow ground nos.1 to 4 raised by the assessee and direct the Assessing Officer to delete the additions made in the hands of the assessee. 22. Therefore, the assessee’s appeal for AY 2018-19, we have considered the submissions of the assessee and held that the document found during the search at the premises of the company and no cash was found in possession of the assessee nor the ownership of the cash was established with the assessee, therefore, addition cannot be made u/s 69A of the Act. Accordingly, we allow the grounds raised by the assessee. 23. In the result, the appeal of the assessee for AY 2018-19 is allowed. 24. Since the whole addition cannot be made u/s 69A of the Act, the Revenue is in appeal on the basis of deletion of Rs.99 lakhs made by the ld. CIT Printed from counselvise.com 25 ITA No.4643, 4644 & 4993/DEL/2024 (A) which was relating to the same transactions which AO has invoked section 69A of the Act, therefore, the grounds raised by the Revenue is dismissed. 25. In the result, the appeal filed by the Revenue for AY 2018-19 is dismissed. 26. Since the facts are exactly similar to AY 2019-20 our above findings in AY 2018-19 are applicable mutatis mutandis in AY 2019-20. Accordingly, the appeal filed by the assessee for AY 2019-20 is allowed. 27. To sum up : both the appeals filed by the assessee are allowed and the appeal filed by the Revenue is dismissed. Order pronounced in the open court on this 24th day of October, 2025 Sd/- sd/- (ANUBHAV SHARMA) (S.RIFAUR RAHMAN) JUDICIAL MEMBER ACCOUNTANT MEMBER Dated: 24.10.2025 TS Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals). 5. DR: ITAT ASSISTANT REGISTRAR ITAT, NEW DELHI Printed from counselvise.com "