DEPUTY COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE 1, RAJKOT V. JAGJIVAN R SAKHIYA, RJAKOT

ITSSA 8/RJT/2024

AI Insights

The case involves an appeal by the Revenue against Jagjivan Ranchhodbhai Sakhiya, concerning the assessment year 2018-19. The appeal was directed against the order of the CIT(A), which had deleted the additions made by the assessing officer under sections 69C and 69B read with section 115BBE of the Income Tax Act, 1961. These additions were related to unexplained expenses and on-money payments for property transactions. The Tribunal examined the evidence, including seized documents and the findings of the Hon'ble Interim Board, and concluded that the CIT(A)'s decision was correct and the additions were not justified.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 33994 (ITAT-RAJKOT)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 26-02-2025
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2018-2019
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MEHUL RANPURA; LD
• Assessee Lawyers: SHRAMDEEP SINHA; LD.
• Keywords: Unexplained investment; Document seized; Documents seized; Principle of natural justice; Search and seizure; Loose papers
• Section: 142(1); 143(2); 132; 69C; 69B; 13; 153C; 20

Judgement Text

"IT(SS)A.08/RJT/2024/AY.18-19 JagjivanRanchhodbhaiSakhiya Page | 1 IN THE INCOME TAX APPELLATE TRIBUNAL, RAJKOT BENCH, RAJKOT BEFORE DR. ARJUN LAL SAINI, ACCOUNTANT MEMBER AND SHRI DINESH MOHAN SINHA, JUDICIAL MEMBER आयकरअपीलसं./IT(SS)A No.08/RJT/2024 Assessment Year: (2018-19) (Hybrid Hearing) DCIT, Central Circle-1, Rajkot. Vs. Jagjivan Ranchhodbhai Sakhiya. 6-A Nakshatra Appartment, Shree Colony Main Road B/H Panchvati Commu. Hall, Rajkot Gujarat-360001 èथायीलेखासं./जीआइआरसं./PAN/GIR No.: AFLPS5842L (Appellant) (Respondent) Appellant by : Shri Mehul Ranpura, Ld. A.R. Respondent by : Shri Shramdeep Sinha, Ld. CIT. DR Date of Hearing : 23/12/2024 Date of Pronouncement : 26/02/2025 आदेश / O R D E R PER DR. A. L. SAINI, AM: Captioned appeal filed by the Revenue, pertaining to assessment year (A.Y.) 2018-19, is directed against the order passed by the Learned CIT(A), dated 29.04.2024,which in turn arises out of an assessment order passed by assessing officer (assessing officer), u/s 153C of the Income Tax Act, 1961, vide, order dated 27.09.2021. 2.Grounds of appeal raised by the revenue are as follows: (1). \"In the facts and on the circumstances of the case and in law, the Id.CIT(A) has erred in deleting the addition made on account of unexplained expenses u/s.69C of the Act, on interest payment made to M/s.Swastik Finance Corporation amounting to Rs.44,49,765/-. IT(SS)A.08/RJT/2024/AY.18-19 JagjivanRanchhodbhaiSakhiya Page | 2 (2). In the facts and on the circumstances of the case and in law, the ld.CIT(A) has erred in deleting the addition made on account of on-money payment of Rs.3,14,94,810/-, for purchase of 50% of the immovable property u/s 69B r.w.s. 115BBE of the Act. (3). In the facts and on the circumstances of the case and in law, the Id.CIT(A) has erred in deleting the addition made on protective basis of Rs.3,14,94,810/-, in respect of other 50% of the property as the assessee has denied involvement of M/s.Swastik Finance Corporation in purchases of the property. (4). The Revenue craves leave to add/alter/armed and/or substitute any or all of the grounds of appeal.\" 3.The relevant material facts, as culled out from the material on record, are as follows. The assessee before us, is an Individual who earned income from salary and other sources. The return of income for the year has been filed u/s 139(1) of the Act on 10.10.2018, declaring total income of Rs. 54,71,210/-.A Search and seizure action named \"Operation Star Alliance\" was conducted on 26.09.2018. Various builders and financiers were covered under this operation. Inquiries revealed that huge cash transactions in various forms have been carried out by the builders and financiers. Some of the prominent builder and financer groups of and around Rajkot city were covered under the operation. Residential premise of Shri HimanshuRaiyani, Square 9 project of Aryan Arcade, was also covered u/s 132 of the Act. During the search operation, various incriminating documents / digital data pertaining to the project,“Om Decora Square 9” developed by M/s Aryan Arcade, have been found and seized. Some of these documents / digital data contained information related to / pertaining to the assessee. Further, the residential premise of Shri Kaushik Gosai, who is the close confidant of Shri GunvantbhaiBhadani and Shri RameshbhaiVachhani and is also one of the trusted employees of M/s Swastik Finance Corporation, was also covered under search action under section 132 of the Act. During the search proceedings, some incriminating documents containing notings of land dealing situated at Vavdi R S No.149, were found and seized. These loose papers revealed on-money transaction by the assessee. IT(SS)A.08/RJT/2024/AY.18-19 JagjivanRanchhodbhaiSakhiya Page | 3 4. Thereafter, proceedings u/s. 153C was initiated by issuing notice u/s 153C on 29.09.2020, whereby the assessee was requested to file the return of income. The assessee has filed the return of income on 13.10.2020 showing therein income of Rs. 54,71,210/-. The notice u/s 143(2) of the Act was issued on 11.02.2021 and then notices u/s 142(1) have been issued on 11.02.2021, seeking details and explanations from the assessee. In view of the natural justice, copies of the seized documents containing the information related to the assessee, satisfaction note of both assessing officer and relevant part of statements have also been provided to the assessee. During the course of assessment proceedings, on perusal of various submission filed, and various incriminating document / digital found and seized during the search proceedings. It has been observed by the assessing officer that the transactions mentioned in the seized document / digital data were not reflected in the books of account of the assessee. Therefore, a show cause notice dated 01.09.2021, proposing the additions was issued requesting therein to furnish its reply in the matter. The operative part of show- cause notice is reproduced as under: “With respect to above, it is pertinent here to bring to your notice that a search operation named as \"Operation Star Alliance\" was carried out by the Income Tax Department u/s 132 of the Income Tax Act on 26.09.2018 at various premises covering several persons/groups. Moreover, survey actions were also carried out on the same day at few other premises as well.The residential premise of Shri Kaushik Gosai, who is the close confidant of ShriGunvantbhaiBhadani and Shri RameshbhaiVachhani and is also one of the trusted employees of M/s Swastik Finance Corporation, was also covered under search action under section 132 of the Act. During the search proceedings, some incriminating documents containing notings of land dealing situated at Vavdi R S No.49, were found and seized. The page 18 of Annexure A-1 of the seized documents bears the details of transactions including you i.e 'JagubhaiSakhiya'.” 5. The assessing officer noticed that legal owner is Shri Jagjivan R.Sakhiya, however actually Shri Jagjivan R.Sakhiya, has only 50% stakes in the said transaction. The other party, which has 50% stake in the said transaction, is IT(SS)A.08/RJT/2024/AY.18-19 JagjivanRanchhodbhaiSakhiya Page | 4 M/sSwastik Finance Corporation. The assessing officer narrated all these facts on page number 11 and 12 of the assessment order. 6. In response to various notices of the assessing officer, the assessee submitted its reply, along with documentary evidences, before the assessing officer, which are reproduced by the assessing officer, on page number 13 to 26 of the assessment order. In his reply, the assessee submitted before the assessing officer that he has not made any unaccounted investment in the property purchased or paid any uncounted cash interest as alleged in the show -cause notice. The assessee also stated that addition proposed in the show cause notice is solely on the basis of certain piece of papers stated to have been seized from the possession of third party, that is, Shri Kaushik Gosai. The assessee stated that documents recovered from the possession of third-party cannot be binding on him and further assessee submitted that notings on the impugned papers, vide page numbers 16, 17 and 20 of Annexure-1 are not related to him. 7. However, the assessing officer rejected the contention of the assessee and observed that the assessee has objected the addition on the ground that the said loose papers have been seized from the premise of Shri Kaushik Gosai, therefore, the notings made on it may not be binding on the assessee. In this regards, it must be noted that Shri Kaushik Gosai has disposed of his responsibility by explaining the contents of such documents to the satisfaction of assessing officer. Further, reference of assessee's name in the seized document along with sale deed clearly inter relates assessee with the seized document and transactions mentioned therein.The description of sequence of events mentioned in the show cause notice clearly proves that the assessee is just feigning ignorance about the said document and Shri KausikGosai. The assessee has indeed purchased property bearing R.S. no. 149 located at Vavdi. Further, the mention of \"Jagubhai\" in the said document also proves connection IT(SS)A.08/RJT/2024/AY.18-19 JagjivanRanchhodbhaiSakhiya Page | 5 between the assessee and the transaction mentioned in the said document.Theassessee has not provided any specific response to the above produced show cause notice, however, he has simply denied that he has not made suchinvestment.The Show cause notice of assessing officer clearly delineates that assessee has entered into unaccounted transaction with 50% partnership ratio pertaining to itself. Therefore, the same needs to be added.In regards to the interest expense made by the assessee, the Show cause notice has established conclusive correlation with the seized data. Therefore, the same needs to be added. 8. Therefore, assessing officer held that it iscrystal clear that assessee made unexplained expense of Rs. 44,49,765/- within the meaning of 69C r.w.s. 115BBE of the I.T. Act, therefore an addition of Rs. 44,49,765/- was made u/s 69C of the Act. 9. The assessing officer further held that assessee has purchased the impugned immovable property during the concerned year, after paying on-money to the tune of Rs. 3,14,94,810/- (as per his 50% share). Therefore, the same was added in the income of the assessee substantively for the concerned year u/s 69B r.w.s. 115BBE of the Act. 10. The assessing officer also noticed that as the assessee has denied involvement of M/s Swastik Finance Corporation, to the tune of 50% in the said transactions, therefore, Rs.3,14,94,810/-, was added on protective basis in the income of the assessee under section 69B read with section 115 BBE of the Act. 11. Aggrieved, by the order of the assessing officer, the assessee carried the matter in appeal before the ld. CIT(A), who has deleted the addition made by the assessing officer.During the course of appellate proceedings, the assesseehas IT(SS)A.08/RJT/2024/AY.18-19 JagjivanRanchhodbhaiSakhiya Page | 6 referred to issue of Swastik Finance Corporation as was there before Hon’ble Interim Board and its final outcome. The assessee has filed relevant extract of the order of the Hon’ble Interim Board which is also reproduced by ld CITA) in his order. The ld. CIT(A) observed that the Hon'ble Interim Board had held that, on the seized page, there is no mention of any name of M/s. Swastik Finance Corporation or its partners. Hence, it cannot be thrusted upon Swastik Finance Corporation as 50% stake holder in the said property. Further, it has been held by the Hon'ble Interim Board that the property description made on the seized page is not the actual property purchased by the assessee (or Swastik Finance Corporation). Hon'ble Interim Board has given categoric finding that description of the land on the title of page and the actual land owned by Jagjivan differs, therefore it cannot be said that notings in the seized page pertains to the same as has been purchased by Shri JagjivanSakhiya. It is further seen that the seized ledger shows actual figure of Rs.4,53,500/- and the PCIT in the Rule 9 report could not substantiate as to how this is coded figure and extrapolated to Rs.4,53,50,000/-. The Hon'ble Interim Board also held that the PCIT in the Rule-9 report has not objected to the admission of applicant (Swastik Finance Corporation) of this ledger being actual finance given to one Paresh Mehta, whose name is clearly mentioned in the seized ledger itself. Since this has been admitted by Swastik Finance Corporation being loan of Rs.4,53,500/- given to Paresh Mehta and the interest earned therefrom has been included in its working of additional income, and as such admission has not been denied or challenged in the Rule-9 report, therefore, the loan as per ledger is concluded.So far as merit is concerned, the ld CIT(A) noticed that the seized document placed supra are not the ledger of the assessee from the books of Swastik Finance Corporation and the very mention of word haste in the ledger shows that the assessee is only a conduit (recommendation or guarantor) for funding done by Swastik Finance Corporation to one Paresh Mehta, whose name is clearly mentioned in the ledger title. Besides, no such land at survey No 49 has been IT(SS)A.08/RJT/2024/AY.18-19 JagjivanRanchhodbhaiSakhiya Page | 7 purchased by the assessee and the ledger shows date starting from 2015 whereas, another land has been purchased by the assessee in the year 2018, solely. M/s Swastik Finance Corporation is not 50% stake holder in the land as held by the assessing officer, as Swastik Finance has charged interest as per the seized ledger and this is not a ledger of the assessee. All these goes to prove that the transaction is not as what has been decoded by the assessing officer and there is no evidence to conclusively prove that the assessee had taken any cash loan from Swastik Finance Corporation. Since no cash loan has been taken, the question of paying interest thereon does not arise. Besides, since the seized ledger nowhere corroborates with the sheet showing unexplained investment in land, and as no such land has been purchased at R Survey No 49 by the assessee, the addition made on account of unexplained investment also fails to survive. Secondly, the matter has been clearly deciphered by the Hon. Interim Board, whose order was based on the Rule-9 report of the Id. PCIT. The Hon. Interim Board, after considering the Rule-9 report has held that, the title of the land description is not the transaction of applicant (Swastik Finance Corporation) and the figure of Rs.4,53,500/- is a wholesome figure and not any coded figure, as is apparent from seized ledger itself, and that this ledger shows the transaction between the applicant (Swastik Finance Corporation) with Shri Paresh Mehta, which has been admitted in the working of the additional income (both principal and interest), which has not been challenged in the Rule-9 report. It is observed that entire loose paper as relied upon by the assessing officer while making present addition has also been dealt with by Hon'ble Interim Board wherein even report of Id PCIT is also considered and relying upon the finding given by such Hon'ble Board, it is observed that assessing officer was not justified in making substantive and protective addition of Rs.3,62,50,000/- in the hands of assessee as well as addition of alleged unaccounted interest payment of Rs.44,49,765/-,in the hands of IT(SS)A.08/RJT/2024/AY.18-19 JagjivanRanchhodbhaiSakhiya Page | 8 assessee.Therefore, based on these facts, the ld CIT(A) deleted the addition. 12. Aggrieved by the order of the ld. CIT( A), the Revenue is in appeal before us. 13. Learned DR for the Revenue argued thatId.CIT(A) has erred in deleting the addition made on account of unexplained expenses u/s.69C of the Act, on interest payment made to M/s.Swastik Finance Corporation amounting to Rs.44,49,765/-.The ld.CIT(A) has erred in deleting the addition made on account of on-money payment of Rs.3,14,94,810/-, for purchase of 50% of the immovable property u/s 69B r.w.s. 115BBE of the Act, and the Id.CIT(A) has also erred in deleting the addition made on protective basis of Rs.3,14,94,810/-, in respect of other 50% of the property as the assessee has denied involvement of M/s.Swastik Finance Corporation in purchases of the property. The ld. DR pointed out that ld. CIT(A) has ignored the cogent evidences.The ld CIT-DR further pointed out that reference of assessee's name in the seized document along with sale deed clearly inter relates assessee with the seized document and transactions mentioned therein.The description of sequence of events mentioned in the show- cause notice of the assessing officer clearly proves that the assessee is just ignoring the documents. The assessee has indeed purchased property bearing R.S. no. 149 located at Vavdi. The assessee has not provided any specific response to assessing officer,however, he has simply denied that he has not made suchinvestment. Therefore, ld DR contended that addition made by the assessing officer should be upheld. 14. On the other hand, ld. Counsel for the assessee argued that the assessee, under consideration, has not entered into any transaction of land jointly with Swastik Finance Corporation.The impugned document referred by the assessing officer, has not been found from Swastik Finance Corporation, that is, from third-party premises. The impugned document on the basis of which the IT(SS)A.08/RJT/2024/AY.18-19 JagjivanRanchhodbhaiSakhiya Page | 9 assessing officer made addition was found from office boy of Swastik Finance Corporation, hance, it should not be relied on. Besides, no land has been purchased, by the assessee, at Vavdi survey No 49, therefore, addition was made by the assessing officer based on the dump document, which has been correctly deleted by the ld. CIT(A). Therefore, ld. Counsel contended that order passed by the ld. CIT(A) is Just and proper hence the same should be upheld. 15. We have given our thoughtful consideration to rival contention. We have perused case file as well as paper books furnished by assessee.Though facts have been discussed in detail in the foregoing paragraphs, however in the succinct manner, the relevant facts and background are reiterated in order to appreciate the controversy and the issue for adjudication.The ground of appeal no. 3 raised by the revenue, relates to addition of Rs.44,49,765/- u/s 69C of the Act, on account of alleged unexplained interest payment. The ground of appeal nos. 2 and 3, raised by the revenue, relate to addition of Rs.3,14,94,810/- by invoking provisions of section 69B r.w.s. 115BBE of the Act, on account of alleged on money payment on purchase of land situated at Revenue Survey No. 149 Paiki 5 Paiki at Village Vavdi Rajkot. As all the grounds of appealrai,sed by the revenue, are interconnected and mix, therefore, we shall adjudicate together. The assessing officer has found that assessee purchased the land along with M/s Swastik Finance Corporation to the tune of 50% in the said transactions hence assessing officer had made substantive addition of Rs.3,14,94,810/-, in the hands of assessee. The assessing officer observed that as the assessee has denied involvement of M/s. Swastik Finance Corporation to the tune of 50% in the said transactions, therefore, Rs.3,14,94,810/- was added protectively in the income of the assessee, in addition to substantive addition, for the concerned year, u/s.69B r.w.s. 115BBE of the Act.The residential premise of Shri Kaushik Gosai, who is the close confidant of Shri GunvantbhaiBhadani and Shri RameshbhaiVachhani and is also one of the IT(SS)A.08/RJT/2024/AY.18-19 JagjivanRanchhodbhaiSakhiya Page | 10 trusted employees of M/s. Swastik Finance Corporation, was also covered under search action under section 132 of the Act. During the search proceedings, some incriminating documents containing notings of land dealing situated at Vavdi RS No.49, were found and seized. The page 18 of Annexure A-1 of the seized documents bears the details of transaction including ‘JagubhaiSakhiya’. The aforementioned seized incriminating document is reproduced by ld CIT(A) on page no. 29 of the appellate order. 16.The assessing officer observed that the total area of land in is 5000 square yard and rate per sq. Yard is Rs. 14,500/-, which works out to Rs 7.25 crore (5000 sq yard x Rs. 14,500/-). The value clearly shows that the values are recorded in coded form. The seized document signifies that the share in the said land is divided between assessee and Swastik Corporation. The assessing officer has observed that Shri Kaushik Gosai, in his statement recorded during search, admitted that this paper was given to him by Shri Ramesh Vachhani and it is related to land transfer transaction of Revenue Suvery/Vavadi No.49. He has also stated that said transactions pertain to M/s Swastik Finance Corporation. Further, the seizure of document from the trusted employee of M/s Swastik Finance Corporation also highlights its links with the impugned land transaction. The assessing officer has also observed that Shri Kaushik Gosai in his statement recorded on 05/11/2018 stated that the data has been maintained by Swastik Finance Group after \"two zero suppression\" i.e. 1/100th of original value. Shri Kaushik Gosai has again admitted on 04.04.2019 that it is general practice of Swastik Finance Group to record the transactions after eliminating the last two digits of actual transactions. Therefore, the coded form of recording of transaction is well established.The assessing officer at page no 6 to 9 of assessment order has reproduced ledger account \"GJR- Vadi-49- ParinFarnichar (jagu Bhai sakhiya) from “Shree Ramchandra\" and contended that such pages were confronted to Shri Kaushik Gosai during post search proceeding. He has IT(SS)A.08/RJT/2024/AY.18-19 JagjivanRanchhodbhaiSakhiya Page | 11 admitted vide his statement dated 04.04.2019 that various accounts under the head of Shri Ramchandra are related to M/s Swastik Finance Corporation. The title \"Shree Ramchandra\" is used as conspicuous title to record unaccounted transaction of M/s. Swastik Finance Corporation, as confirmed by Shri Kaushik Gosai. The assessing officer also observed that final deed of the impugned property has been registered only in name of assessee and at purchase price of Rs.95,10,380/-. Thus, M/s. Swastik Finance Corporation is legally not involved in the impugned land transaction. The copy of deed is reproduced at Page No 9 and 10 of assessment order. 17. On this basis, the assessing officer has observed that the assessee along with Swastik Finance Corporation had jointly purchased one land situated at Vavdi Survey No.49.The assessing officer mainly further observed as under: (a) The land was wholly registered in the name of the assessee, although the seized documents showed that the assessee owned 50% and remaining 50% was owned by Swastik Finance Corporation; (b) The assessee has indeed purchased property bearing R.S. no. 149 located at Vavdi. Further, the mention of \"Jagubhai\" in the said document also proves connection between the assessee and the transaction mentioned in the said document. (c ) Swastik Finance Corporation had charged interest on the loans provided by it and this interest paid by the assessee is not recorded in his regular books of accounts and hence, the interest element is unaccounted in the hands of the assessee. Therefore, on perusal of the assessment order reveals that, the assessing officer had made addition of unexplained investment in land @ 50% of Rs.3,14,94,810/- twice. Once as substantively in the hands of the assessee and secondly, as protectively in the hands of the assessee. Besides, according to the IT(SS)A.08/RJT/2024/AY.18-19 JagjivanRanchhodbhaiSakhiya Page | 12 assessing officer, as per the above ledgers, the assessee had paid interest on cash loan taken, and hence, the assessing officer treated it as unexplained expenditure in the hands of the assessee u/s.69C of the Act. The interest during the year worked out to Rs.44,49,765/-. 18.During the course of appellate proceedings, the assessee has argued before learned CIT( A) thatassessee has not entered into any transaction of land jointly with Swastik Finance Corporation. The above impugned document has not been found from Swastik Finance Corporation. The person from whom it is found, is merely a clerk and office boy of Swastik Finance Corporation. No any land has been purchased at Vavdi survey No 49 and the assessing officer has forcibly connected stray dotted lines to arrive at the conclusion. The assessee also stated that the matter of Swastik Finance Corporation before the Hon`ble Interim Board, wherein the Hon'ble Interim Board, after considering the Rule-9 report of the PCIT had held that the title of the land on the seized paper is not the description of the land actually purchased by the assessee.The Hon'ble Interim Board had also held thatin the seized noting there is neither in the name of the assessee nor of the joint owner (Swastik Finance Corporation or its partners). That the Hon`ble Interim Board also held that the noting on the bottom part of the seized page is totally a different set transaction and the figure mentioned of 4,53,500/- is a whole figure and not a coded figure. This is the advance made to one Paresh Mehta, which is clearly mentioned on the seized page. That Paresh Mehta is actually existing and loan has been given to Paresh Mehta by Swastik Finance Corporation and interest has been charged by Swastik Finance Corporation from Paresh Mehta, and offered by it before the Hon`ble Interim Board, which has not been disputed by the PCIT in the Rule-9 report. Therefore, assessee argued before the learned CIT(A) that assessing officer's finding is contradictory because, on one hand the assessing officer contends that the land has been jointly purchased, whereas, the addition made is for interest charged IT(SS)A.08/RJT/2024/AY.18-19 JagjivanRanchhodbhaiSakhiya Page | 13 by Swastik Finance Corporation. If the land has been jointly purchased, then why would Swastik Finance Corporation charge interest? 19. The learned CIT(A) after going through the above reply of the assessee and on careful consideration of relevant facts on records along with loose papers found during the course of search, observed that noting is for purchase of land at Survey No 49, Vavdi. The fact is that no such land has been purchased by the assessee in revenue survey No 49. It is further seen that no such land has either been purchased by Swastik Finance Corporation. Therefore, the contents in the loose sheet does not match the actual event. On the other hand, the assessing officer has corroborated this evidence with another fact viz., purchase of land by the assessee at survey No 149/5, Vavdi. However, this land has been Solely purchased by the assessee and there is no partnership involved. Merely because loose paper has been found from the premises of Kaushik Gosai, one of the trusted employees of M/s. Swastik Finance Corporation, it does not mean that said party is also party to such transaction. 20.It was observed by ld CIT(A) that the dates as per the ledger, as relied upon by the assessing officer, shows transactions as early as in the year 2015 whereas, the impugned property at Vavdi Survey No. 149/5 (recorded as 49 in the above seized document) took place in the year 2018. It cannot be said that the cash part of the dealing took place as early as year 2015. This is because, since 2015 there is collection of interest by Swastik Finance Corporation. If the assessee had taken cash loan, then why would he delay the registration by more than 3 years and pay unnecessarily interest on the same? This important aspect has been ignored by assessing officer. The assessing officer on one hand has assumed that assessee has taken loan for purchase of such land and on the other hand is accepting the fact that assessee has got above referred land registered in his name in 2018 when loan is taken in 2015. It is observed that the assessing officer has nowhere referred any statement of partners of Swastik Corporation IT(SS)A.08/RJT/2024/AY.18-19 JagjivanRanchhodbhaiSakhiya Page | 14 wherein they have admitted that they have given loan to assessee in cash for purchase of Land at Survey no. 149/5 and land mentioned as 49 and 149/5 is same land. It is observed that even no statement of assessee was recorded by Authorised officer at the time of search or in assessment proceedings to prove that assessee had made alleged on money payment as alleged by assessing officer. 21.It was further noticed by the ld. CIT(A) that assessing officer in the assessment order states that the assessee had purchased the impugned land in partnership with Swastik Finance Corporation. If that be the case, then it is investment for Swastik Finance Corporation. Then why would it charge interest from the assessee? The assessing officer has failed to establish any live nexus between alleged on money payment by assessee with purchase of land or alleged finance taken by assessee from Swastik Finance and its use for acquisition of land or payment of on money by Swastik Finance to seller of land.The assessee also contended before learned CIT (A) that in the statement of Shri Kaushik Gosai, he has nowhere stated that the seized paper is related to the transaction with the assessee and entries in such papers are in coded form, which is 1/100th of original value. The assessee contended that the assessing officer on the basis of general averments of Shri Kaushik Gosai arrived at the conclusion, which is legally not correct. Therefore, ld. CIT(A) found merits on this contention of the assessee since Shri Kaushik Gosai in his reply to question no. 21 of the statement stated that the questioned seized papers were given to him by Shri RameshbhaiVachhani and entries on such papers are related to Vavdi-49 land. Therefore, it is clear that Shri Kaushik Gosai has not admitted the entries in the seized papers related to the land purchased by the assessee at Survey No. 149 Paiki 5 of Vavdi. 22. During the course of appellate proceedings, the assessee has referred to issue of Swastik Finance Corporation, as was there before Hon’ble Interim IT(SS)A.08/RJT/2024/AY.18-19 JagjivanRanchhodbhaiSakhiya Page | 15 Board and its final outcome. The assessee has filed relevant extract of the order of the Hon’ble Interim Board, before the learned CIT (A), during the appellate proceedings, which is reproduced by learned CIT(A) in his appellate order, vide page number 33 and 34 of his order. The Hon'ble Interim Board had held that, on the seized page, there is no mention of any name of M/s. Swastik Finance Corporation or its partners. Hence, it cannot be thrusted upon Swastik Finance Corporation as 50% stake holder in the said property. Further, it has been held by the Hon'ble Interim Board that the property description made on the seized page is not the actual property purchased by the assessee (or Swastik Finance Corporation). Hon'ble Interim Board has given categoric finding that description of the land on the title of page and the actual land owned by JagjivanSakhiya differs therefore it cannot be said that notings in the seized page pertains to the same as has been purchased by Shri JagjivanSakhiya. It is further seen that the seized ledger shows actual figure of Rs.4,53,500/- and the PCIT in the Rule 9 report could not substantiate as to how this is coded figure and extrapolated to Rs.4,53,50,000/-. The Hon'ble Interim Board also held that the PCIT in the Rule-9 report has not objected to the admission of applicant (Swastik Finance Corporation) of this ledger being actual finance given to one Paresh Mehta, whose name is clearly mentioned in the seized ledger itself. Since this has been admitted by Swastik Finance Corporation being loan of Rs.4,53,500/- given to Paresh Mohta and the interest earned therefrom has been included in its working of additional income, and as much admission has not been denied or challenged in the Rule-9 report, therefore, the loan as per ledger is concluded. 23. Therefore, on merit, the ld. CIT(A) observed that the seized document placed supra are not the ledger of the assessee from the books of Swastik Finance Corporation and the very mention of word haste in the ledger shows that the assessee is only a conduit (recommendation or guarantor) for funding done by Swastik Finance Corporation to one Paresh Mehta, whose name is IT(SS)A.08/RJT/2024/AY.18-19 JagjivanRanchhodbhaiSakhiya Page | 16 clearly mentioned in the ledger title. Besides, no such land at survey No 49 has been purchased by the assessee and the ledger shows date starting from 2015 whereas, another land has been purchased by the assessee in the year 2018, solely. M/s Swastik Finance Corporation is not 50% stake holder in the land as held by the assessing officer, as Swastik Finance has charged interest as per the seized ledger and this is not a ledger of the assessee. All these goes to prove that the transaction is not as what has been decoded by the assessing officer and there is no evidence to conclusively prove that the assessee had taken any cash loan from Swastik Finance Corporation. Since no cash loan has been taken, the question of paying interest thereon does not arise. Besides, since the seized ledger nowhere corroborates with the sheet showing unexplained investment in land, and as no such land has been purchased at R Survey No 49 by the assessee, the addition made on account of unexplained investment also fails to survive. Secondly, the matter has been clearly deciphered by the Hon`ble Interim Board, whose order was based on the Rule-9 report of the Id. PCIT. The Hon`ble Interim Board, after considering the Rule-9 report has held that, the title of the land description is not the transaction of applicant (Swastik Finance Corporation) and the figure of Rs.4,53,500/- is a wholesome figure and not any coded figure, as is apparent from seized ledger itself, and that this ledger shows the transaction between the applicant (Swastik Finance Corporation) with Shri Paresh Mehta, which has been admitted in the working of the additional income (both principal and interest), which has not been challenged in the Rule-9 report. It was observed by ld CIT(A) that entire loose paper as relied upon by the assessing officer while making present addition has also been dealt with by Hon'ble Interim Board wherein even report of Id PCIT is also considered and relying upon the finding given by such Hon'ble Board, it was observed that assessing officer was not justified in making substantive and protective addition of Rs.3,14,94,810/- in the hands of assessee as well as addition of alleged unaccounted interest payment of Rs.44,49,765/-,in the hands of assessee. IT(SS)A.08/RJT/2024/AY.18-19 JagjivanRanchhodbhaiSakhiya Page | 17 Therefore, based on these facts and circumstances, the ld. CIT(A) deleted both the additions that is substantive addition ofRs.3,14,94,810/- and protective additionofRs.3,14,94,810/- and also deleted addition on account of interest payment of Rs.44,49,765/-. We have gone through the above findings of the ld. CIT (A) and noticed that the conclusion reached by the ld. CIT (A) is correct.That being so, we decline to interfere with the order of Id. CIT(A) in deleting the aforesaid additions. His order on these additionsare, therefore, upheld and the grounds of appeal of the Revenue are dismissed.Thus, ground Nos.1, 2 and 3 raised by the revenue, are dismissed. 24. In the result, appeal of the revenue is dismissed. Order is pronounced in the open court on 26/02/2025 Sd/- Sd/- (DINESH MOHAN SINHA) JUDICIAL MEMBER (DR. ARJUN LAL SAINI) ACCOUNTANT MEMBER राजकोट/Rajkot िदनांक/ Date:26/02/2025 आदेशकìÿितिलिपअúेिषत/ Copy of the order forwarded to :  अपीलाथê/ The Appellant  ÿÂयथê/ The Respondent  आयकरआयुĉ/ CIT  आयकरआयुĉ(अपील)/ The CIT(A)  िवभागीयÿितिनिध, आयकरअपीलीयआिधकरण, राजकोट/ DR, ITAT, RAJKOT  गाडªफाईल/ Guard File By order/आदेशसे , IT(SS)A.08/RJT/2024/AY.18-19 JagjivanRanchhodbhaiSakhiya Page | 18 Assistant Registrar/Sr. PS/PS ITAT, Rajkot Date 1. Draft dictated on 29.01.2025 2. Draft placed before author 30.01.2025 3. Draft proposed & placed before the second member 4. Draft discussed/approved by Second Member. 5. Approved Draft comes to the Sr.PS/PS 6. Kept for pronouncement on 7. File sent to the Bench Clerk 8. Date on which file goes to the AR 9. Date on which file goes to the Head Clerk. 10. Date of dispatch of Order. 11. Draft dictation sheets are attached "