ACIT CENT. CIR 7(1) , MUMBAI V. DR. D.Y.PATIL EDUCATION SOCIETY, KOLHAPUR

ITA 2297/MUM/2021

AI Insights

The case involves a series of appeals and cross objections between the Revenue and Dr. D. Y. Patil Education Society concerning the alleged receipt of unaccounted capitation fees for admissions in medical colleges. The AO had reopened the assessments for the relevant assessment years based on incriminating evidence and statements collected during a search operation under section 132 of the Income-tax Act, 1961. The AO made additions to the income of the assessee, which were later deleted by the Ld. CIT(A). The Revenue challenged this deletion, leading to the present appeals. The Tribunal examined the evidences, including the statements of various individuals and the documents seized, and found insufficient basis to uphold the additions made by the AO.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 125729 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 3 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-03-2023
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: D
• Next Hearing Date: 01-02-2023
• Assessment Year: 2015-2016
• Appeal Filed On: 05-12-2021
• Other Referred Cases: Straptex India P Ltd. v Oy. CIT, Prarthana Construction (P) Ltd. Vs. Deputy Commissioner of Income Tax
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Loose papers; Opportunity of cross examination; Third party statement; Retraction; Documents seized
• Section: 131; 132; 142(1); 69A; 192; 153C

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL “D” BENCH, MUMBAI BEFORE SHRI ABY T. VARKEY, JM AND SHRI AMARJIT SINGH, AM आयकर अपील सं/ I.T.A. No.2295/Mum/2021 (निर्धारण वर्ा / Assessment Years: 2013-14) ACIT, CC-7(1) R. No. 676B, 6 th Floor, Aayakar Bhavan, M. K. Road, Mumbai-400020. बिधम/ Vs. Dr. D. Y. Patil Education Society 869, E Ward, Kasaba Vawada, Kolhapur- 416006. Cross Objection No. 60/Mum/2022 Arising out of I.T.A. No.2295/Mum/2021 (निर्धारण वर्ा / Assessment Year: 2013-14) Dr. D. Y. Patil Education Society 869, E Ward, Kasaba Vawada, Kolhapur-416006. बिधम/ Vs. ACIT, CC-7(1) R. No. 676B, 6 th Floor, Aayakar Bhavan, M. K. Road, Mumbai-400020. आयकर अपील सं/ I.T.A. No.2296/Mum/2021 (निर्धारण वर्ा / Assessment Years: 2014-15) ACIT, CC-7(1) R. No. 676B, 6 th Floor, Aayakar Bhavan, M. K. Road, Mumbai-400020. बिधम/ Vs. Dr. D. Y. Patil Education Society 869, E Ward, Kasaba Vawada, Kolhapur- 416006. Cross Objection No. 61/Mum/2021 Arising out of I.T.A. No.2296/Mum/2022 (निर्धारण वर्ा / Assessment Year: 2014-15) Dr. D. Y. Patil Education Society 869, E Ward, Kasaba Vawada, Kolhapur-416006. बिधम/ Vs. ACIT, CC-7(1) R. No. 676B, 6 th Floor, Aayakar Bhavan, M. K. Road, Mumbai-400020. आयकर अपील सं/ I.T.A. No.2297/Mum/2021 (निर्धारण वर्ा / Assessment Years: 2015-16) ITA Nos.2295 to 2297/Mum/2021 CO. Nos. 60 to 62/Mum/2022 A.Y. 2013-14 to AY. 2015-16 Dr. DY. Patil Education Society 2 ACIT, CC-7(1) R. No. 676B, 6 th Floor, Aayakar Bhavan, M. K. Road, Mumbai-400020. बिधम/ Vs. Dr. D. Y. Patil Education Society 869, E Ward, Kasaba Vawada, Kolhapur- 416006. Cross Objection No. 62/Mum/2022 Arising out of I.T.A. No.2297/Mum/2021 (निर्धारण वर्ा / Assessment Year: 2015-16) Dr. D. Y. Patil Education Society 869, E Ward, Kasaba Vawada, Kolhapur-416006. बिधम/ Vs. ACIT, CC-7(1) R. No. 676B, 6 th Floor, Aayakar Bhavan, M. K. Road, Mumbai-400020. स्थधयी लेखध सं./जीआइआर सं./PAN/GIR No. : AAATD8919M (अपीलार्थी /Appellant) .. (प्रत्यर्थी / Respondent) सुनवाई की तारीख / Date of Hearing: 02/02/2023 घोषणा की तारीख /Date of Pronouncement: 29/03/2023 आदेश / O R D E R PER ABY T. VARKEY, JM: These are appeals preferred by the Revenue as well as cross objection (CO) filed by the assessee against the order of the Ld. CIT(A)-49, Mumbai dated 28.09.2021 for the AY. 2013-14 to AY. 2015-16. Since the issues involved are the same, all these appeals & COs were heard together. Both the parties also argued them together raising similar arguments on the common issues involved. Assessee by: Shri Dharmesh Shah/Dhaval Shah Revenue by: Smt. Riddhi Mishra (DR) ITA Nos.2295 to 2297/Mum/2021 CO. Nos. 60 to 62/Mum/2022 A.Y. 2013-14 to AY. 2015-16 Dr. DY. Patil Education Society 3 Accordingly, for the sake of brevity, we dispose of all the appeals by this consolidated order. 2. We first take up the appeals preferred by the Revenue. Briefly stated, the facts of the case are that, a search u/s 132 of the Income-tax Act, 1961 (‘the Act’) was conducted against the DYP-Kolhapur Group on 29-07-2016. The AO of the searched person was of the view that several incriminating statements/evidences regarding capitation fees earned by the assessee in lieu of admission of students in Medical College operated by assessee Trust was found and therefore as per the satisfaction note dated 18-09-2018, the relevant documents/accounts were handed over to the AO of the assessee on 07-07-2017. Based on the statements/documents etc, received from the AO of the searched persons, the AO of the assessee Trust recorded his satisfaction note on 18-09-2018, pursuant to which he reopened the assessments for the relevant AYs 2013-14 to 2015-16 by issue of notices u/s 153C of the Act dated 19-09-2018. 3. Based on the statements recorded and evidences available with him, the AO issued show cause notice u/s 142(1) dated 26-11-2018 wherein the assessee was required to explain as to why addition towards unaccounted capitation fees in cash should not be made in its hands to which the assessee furnished it explanation vide letter dated 05-12-2018 which has been extensively reproduced by the AO at Pages 4 to 9 of the assessment order. The AO however did not find the ITA Nos.2295 to 2297/Mum/2021 CO. Nos. 60 to 62/Mum/2022 A.Y. 2013-14 to AY. 2015-16 Dr. DY. Patil Education Society 4 submissions of the assessee to be acceptable. The AO primarily relied on the statements of Shri Dilip Kashid, Shri Herambh Shelke and Shri Karan Singh Vihol which were recorded in the search action u/s 132 of the Act wherein, according to the AO, they had stated that the assessee received cash from students for admission to medical/dental courses. Before the AO, the assessee had filed notarized retraction affidavits of these persons, which were rejected as after-thought. 4. The AO further noted that the statements of Shri Dilip Kashid & Shri Herambh Shelke were confronted to Shri Sanjay Patil, trustee of the assessee Trust, in the course of search u/s 132 of the Act. The AO also extracted the relevant portions of his statement recorded u/s 132(4) of the Act wherein Shri Patil had denied these allegations. According to AO, however this denial was unacceptable in view of the fact that the statements of these persons stood corroborated by the cash of Rs.1.05 crores seized from the premises of Shri Sanjay Patil. The AO also took note of document seized and marked as Annexure – 1, Page Nos. 1 & 2 which were found from the residence of Shri Dilip Kashid which revealed that a sum of Rs.1.20 lacs had been refunded to the author of the document which was earlier received for admission of his daughter. According to AO, the reliance placed by the assessee on the statements of the dean, professors, employees of the Trust, in which none of them had stated that the assessee Trust would charge capitation fees for admission of students, were not tenable. The AO instead confronted the assessee with the performance of 10 students. ITA Nos.2295 to 2297/Mum/2021 CO. Nos. 60 to 62/Mum/2022 A.Y. 2013-14 to AY. 2015-16 Dr. DY. Patil Education Society 5 According to AO, these students were non-meritorious as they could not qualify any other exam and therefore the AO assumed that these students would have paid capitation fees to obtain admission in the assessee’s medical/Dental college. Based on these findings, the AO estimated that the assessee would have collected sum of Rs.2 crores in each year by way of capitation fees and therefore added the same by way of income u/s 69A of the Act. The AO accordingly also denied benefit of Section 11/12 of the Act holding that it did not exist for charitable purpose and accordingly assessed it in the status of AOP. Being aggrieved by the order of the AO, the assessee preferred an appeal before the Ld. CIT(A) who was pleased to delete the same. Aggrieved, the Revenue is now in appeal before us. 5. Assailing the action of the Ld. CIT(A), the Ld. DR appearing on behalf of the Revenue heavily relied on the findings recorded by the AO. Taking us through the statement of Shri Hemrambh Shelke, which was extracted at Pages 10 & 11 of the assessment order, the Ld. DR showed us that Shri Shelke had admitted on oath that the assessee Trust has received capitation fees for admission of students which was being managed by Shri Dilip Kashid and that any person/student who approached him would be directed to Shri Kashid. Thereafter, the Ld. DR invited our attention to the statement of Shri Dilip Kashid, extracted at Pages 11 & 12 of the assessment order, particularly his answers to Q No. 15 to 20, wherein according to Ld. DR, Shri Kashid had laid bare the modus operandi of collection of capitation fees and ITA Nos.2295 to 2297/Mum/2021 CO. Nos. 60 to 62/Mum/2022 A.Y. 2013-14 to AY. 2015-16 Dr. DY. Patil Education Society 6 had categorically stated that capitation fees of usually Rs.1.5-2 crores is collected each year. The Ld. DR further submitted that, the cash which was found from the premises of Shri Sanjay Patil & document seized and marked as Annexure – 1, Page Nos. 1 & 2, corroborated the version of Shri Kashid. According to Ld. DR, the incriminating statement of Shri Kashid and the aforesaid corroborative evidences was sufficient enough to justify the addition made by the AO. Per contra, the Ld. AR fully supported the order of the Ld. CIT(A). 6. We have heard both the parties and perused the records. It is noted that, the case of the Revenue is that, the assessee was receiving capitation fees in lieu of admission of students. This premise primarily hinges on the statements of Shri Heramb Shelke, Shri Karan Vihol, Shri Vijay Shinde & Shri Dilip Kashid recorded in the course of search. According to Revenue, these statements stand corroborated by the (a) the cash seized from the premises of Shri Sanjay Patil and (b) document Annexure – 1, Page Nos. 1 & 2 found from the premises of Shri Dilip Kashid. Therefore, in order to adjudicate the issue at hand, it is first relevant to examine the statements of the aforesaid four (4) persons which have been relied upon by the AO. 7. Let us first examine the statement of Shri Herambh Shelke relied upon by the AO, which is available at Page no’s. 158 to 162 of PB. Perusal of the statement shows that, he is a qualified Engineer B- Tech, Mechanical working as a guest lecturer with D.Y. Patil ITA Nos.2295 to 2297/Mum/2021 CO. Nos. 60 to 62/Mum/2022 A.Y. 2013-14 to AY. 2015-16 Dr. DY. Patil Education Society 7 Education Federation Pune [please note, he is not working with assessee, but with Pune group]. He is regularly assessed to tax. He also stated that he has various businesses and is a partner, proprietor etc in five (5) different entities. It is noted that he is not directly associated with the assessee Trust in any official capacity. From his statement it is revealed that he had leased a restaurant and McDonald’s outlet in D.Y.P City Mall, which is owned by Shri Sanjay Patil, [trustee of the assessee Trust]. Also, he stated that Shri Dilip Kashid was a business partner in his firm M/s Meghsparsh Infra and Services. When questioned about the assessee Trust, he explained that his partner, Shri Dilip Kashid is the Senior Clerk of assessee trust, who according to him, collected cash component for admission in colleges of the group. To the specific question as to the role of Shri Dilip Kashid in the admission process in that group of colleges, his statement is noted to be as under: - “Ans. Students who are willing to pay cash for admission in DY Patil Group of colleges meet Mr. Dilip Kashid. Then parties have discussion with Dilip Kashid about cash amount to be paid for admission for various courses. Then the final cash amount is collected by Mr. Dilip Kashid either directly or through his agents. After that I do not know exactly what Mr. kashid does with the cash.” 8. It is noted that Shri Shelke had denied being involved in this process or receiving any cash donations, except in one or two ITA Nos.2295 to 2297/Mum/2021 CO. Nos. 60 to 62/Mum/2022 A.Y. 2013-14 to AY. 2015-16 Dr. DY. Patil Education Society 8 instances. Instead, he stated that, if any students approach him for getting admission by paying cash, he directed them to Shri Dilip Kashid. When questioned about those instances at Q No. 17, Shri Shelke is noted to have given a vague and generalised answer without naming on whose behalf or for whose admission did he receive the payment. The only averment made by him was that he received Rs.8 lakhs & Rs. 2 lacs on two different occasions, which amount also he did not pass on to Shri Kashid or the assessee Trust but had deposited in current account in ICICI Bank of his proprietorship entity, M/s. Maharaja Wines. Having perused this statement, we are of the considered view that, apart from levelling general & bald allegations, the statement of Shri Phelke did not contain anything incriminating per-se based on which any prudent person could reasonably infer that the assessee had received capitation fees. It is noted that the Ld. CIT(A) had analyzed the statement of Shri Herambh Shelke and thereafter recorded the following findings: - “8.4.42. It is also evident from the statement of Shri Heramb Shelke that apart from his business income, he is having salary from DY Patil Education society federation Varale, Talegaon, Pune where he works as a guest lecturer. The case of the assessee is that it has no relation with the said institution and that this Institution is not even a part of DY Patil Group of Kolhapur. In the given facts of the case, even if it is believed that Shri Karan Singh Vihol has stated a fact that Shri Heramb Shelke works for DY Patil Institute, that has to be taken as the institution for which Shri Shelke ITA Nos.2295 to 2297/Mum/2021 CO. Nos. 60 to 62/Mum/2022 A.Y. 2013-14 to AY. 2015-16 Dr. DY. Patil Education Society 9 works, which is not DY Patil Medical College. Hence, in absence of any other evidence to corroborate and implicate the assessee as to the same, in my considered view, it cannot be held that the cash referred to by Shri Karan Singh Vihol as having been transferred for Shri Shelke pertain to DY Patil Medical College of Kolhapur. 8.4.43. I have also gone through statement of Shri Heramb Shelke which has been relied upon heavily in the assessment order. However, it is evident from his statement itself that there is nothing on record to establish his association with the assessee Trust or its constituent Medical College. As mentioned previously. Shri Shelke has his own business and he works as a guest lecturer at DY Patil Education Society Federation, Pune, which is not associated with the assessee Trust Shri Shelke has a business establishment in the name of McDonals Restaurant which is in 'DYP City Mall which is owned by Dr. Sanjay D Patil and Shri Shelke pays rent to him There is nothing on record to prove any association of Shri Shelke with Dr Sanjay D. Patil in respect of any proceedings of the assessee Trust or with assessee Trust in any official or other capacity Shri Heramb Shelke is business partner of Shri Dilip Kashid. In his statement dated 27.07.2016, he has stated that Shri Dilip Kashid collects cash for admission in DY Patil Group of colleges for various courses. He further stated that the students, who were willing to pay cash for admission, meet Shri Kashid and that after having discussion as to this they pay cash amount to Shri Dilip Kashid. As to his role in ITA Nos.2295 to 2297/Mum/2021 CO. Nos. 60 to 62/Mum/2022 A.Y. 2013-14 to AY. 2015-16 Dr. DY. Patil Education Society 10 admission he has stated in his reply to Q. No. 15 that when any willing students ready to pay cash approaches me, I direct him to contact Mr. Dilip Kashid As described above. Mr. Dilip Kashid takes the process forward. He further stated that he did not receive or collect cash from anyone. However, in one or two instances he stated to have received cash directly from the party However, he has also stated in response to Q. No. 17 that he did not remember the name of the parties from whom he has stated to have received cash but about 3 months back he received Rs. 8 lakhs from one party and Rs 2 lakhs from other party and the amount was deposited in the bank account of Maharaja Wines current account it is, therefore apparent that Shri Heramb Shelke has not identified any student or parent who has paid any cash to him or through him or who has taken admission in any course in the institutions run by the assessee Trust by paying capitations fees approaching him for the same. The contention of the assessee in this regard is that Shri Shelke is not in any manner related to the assessee Trust and has no role or function in any matter, including admission, in any of the Institutions run by the assessee Trust and therefore he does not have authority to provide any admission to any one or to ensure any admission to anyone. The assessee also claimed that Shri Heramb Shelke in his statement has not taken name of Dr. Sanjay D. Patil or any of the trustees who could be said to be involved in receipt of any capitation fees and therefore, his statement has no evidentiary value. As mentioned previously, I find that there is nothing on record to establish the Involvement of Shri Heramb Shelke with ITA Nos.2295 to 2297/Mum/2021 CO. Nos. 60 to 62/Mum/2022 A.Y. 2013-14 to AY. 2015-16 Dr. DY. Patil Education Society 11 functioning of the institutions run by the assessee Trust. Furthermore, he has simply said that when any one approached him for admission, he directed them to Mr. Dilip Kashid. He could not identify any student or parent who has approached him for admission or who has taken admission through him. There was no documentary evidences found from his premises to substantiate his involvement with the admission in any of the institutions run by the assessee Trust. 8.4.44. I have also given due consideration to the fact that even if the retraction of the statement made by Shri Shelke is not considered, it is evident that the reference of payment to the assessee in the statement of Shri Shelke is very general and non- specific and it is not in respect of any specific entry of any transaction appearing in any seized documents. Not only that his statement is not corroborated by any evidence found during the course of search, but even in his statement there is no clarification as to who had made payments to him, who had approached him for admissions and whether any candidate has actually taken admission through him by paying any capitation fees. It is obvious that he could not have received payments on his own or as per his discretion. But, he has not even identified the trustee on whose instruction such payments were received. Furthermore, the statement has not even been confirmed by any of the trustees of the trust. Rather, Dr. Sanjay D. Patil, the President of the Trust, in his statement given before the DDIT (Inv), had categorically denied to have any knowledge about any such payments. It is also not the case ITA Nos.2295 to 2297/Mum/2021 CO. Nos. 60 to 62/Mum/2022 A.Y. 2013-14 to AY. 2015-16 Dr. DY. Patil Education Society 12 of the Id.AO that this statement was corroborated by any other evidence by way of any enquiry during the course of search or assessment proceedings. As such, I find merit in the submissions of the assessee that his statement of Shri Heramb Shelke could not be held as sufficient to implicate the assessee for receiving any capitation fees for admissions.” 9. We find ourselves in agreement with the above findings of the Ld. CIT(A) that the statement of Shri Shelke did not contain any tangible incriminating evidence to implicate that the assessee trust had received capitation fees even without considering the retraction made by him. 10. Next, we take up the statement of Shri Karan Singh Vihol, which is found placed at page no. 163 to 181 of PB. It is noted that Shri Vihol had admitted that, he was an angadia/courier who would collect and disburse cash through hawala across different cities in India. He also stated that, Shri Heramb Shelke ran a liquor business and that he was also working for D Y Patil Institute. The relevant portion of his statement regarding Shri Heramb Shelke is noted to be as follows:- “He is working for D. Y. Patil Institute. He also owns liquor business. He receives money through ‘Hawala’ from Delhi, Ludhiana, Ahmedabad, Surat, Mumbai, Malad, Yamunanagar etc. He also receives cash at other ITA Nos.2295 to 2297/Mum/2021 CO. Nos. 60 to 62/Mum/2022 A.Y. 2013-14 to AY. 2015-16 Dr. DY. Patil Education Society 13 Angadias. I also undertake his local cash collection. He undertakes exchange of cash on large scale and hence is one of our good customers.” 11. It is noted that the Investigating authorities had questioned him in relation to a Paper/page which was marked as Annexure-1 and attached to his statement [Page 178 of PB]. Perusal of this document shows that, it contained twenty (20) names with corresponding amounts varying from Rs.1000/- to Rs.37,09,780/-. It also contained another chart which showed that that, money has been distributed to thirteen (13) persons which inter alia included the name of Shri Herambh Shelke to whom amount of Rs.57,19,500/- was paid. The Ld. AR brought to our notice that, Shri Shelke had been questioned regarding this noting and that he had stated under oath that Shri Vihol would handle the cash collections of his wine shop at Pune (Maharaja Wines). According to Ld. AR, Shri Vihol’s statement that Shri Herambh Shelke works for D.Y. Patil is correct because undisputedly he is working as guest lecturer for another group D.Y. Patil, Pune (which has nothing to do with assessee group/Kolhapur). And Shri Vihol’s statement that he transacts/collects cash from Shri Herambh Shelke is for his business of Wine Ship at Pune. The Ld. AR pointed out that, there was nothing contained in this statement which neither incriminated Shri Herambh Shelke not the assessee Trust in any manner or suggested that the assessee received capitation fees from the student. To buttress his contention that the statement of Shri Vihol was ITA Nos.2295 to 2297/Mum/2021 CO. Nos. 60 to 62/Mum/2022 A.Y. 2013-14 to AY. 2015-16 Dr. DY. Patil Education Society 14 of no relevance, the Ld. AR also invited our attention to the statement of Shri Sanjay Patil [Pages 125 to 142 of Paper book] which showed that even the Investigating authorities did not confront him with the statement of Shri Vihol at the time of recording of his statement u/s 132(4) of the Act or post search recording of statement in November 2016. We thus find ourselves in agreement with the following analysis made by the Ld. CIT(A) in respect of the statement of Shri Karan Singh Vihol holding that his statement did not have any relevance to the issue at hand. “8.4.41. Coming to the merit of the evidences and statements recorded during the course of search, on perusal of the statement of Shri Karan Singh Vihol, it is evident that he is working in a firm which transfers cash from one place to another for their clients. In other words, the firm is a Hawala Operator. It is evident from his statement that names of various persons have been identified by Shri Karan Singh Vihol as those who have taken their services. Shri Karan Singh Vihol has also identified Shri Heramb Shelke as his client. He has also stated that Shri Shelke is working for DY Patil Institute. However, it is evident that there was no evidences found from the premises of the said Hawala Operator which will have name of DY Patil Medical College or the assessee Trust in respect of any transactions. Even the Annexure-1 of his statement, which although is not a document found and seized during the course of search, has name of Shri Heramb Shelke on it. It is further found that Shri Heramb Shelke in his statement ITA Nos.2295 to 2297/Mum/2021 CO. Nos. 60 to 62/Mum/2022 A.Y. 2013-14 to AY. 2015-16 Dr. DY. Patil Education Society 15 dated 27.07.2016, has clearly stated that Shri Karan Singh Vihol handles cash of his wine shop in Pune. The relevant Q.No. 21 and its answer is reproduced hereunder: Q.No. What are your professional relations/business relations with Shri Karan (Mobile No. 9766314555)? Ans: He handles cash of my wine shop in Pune, and deposits the same in the ICICI Bank, Senapati Bapat Road Branch, Pune. 12. The next statement relied upon by the Revenue is the statement of Shri Vijay Shinde, which has been placed at Page no. 182 to 193 of PB. It is noted that Shri Shinde is a qualified person holding BE Computer and a MBA degree. He is also a visiting lecturer in Dr. D.Y. Patil Engineering College at Old Pune (not the assessee trust or institution). He is noted to be a director of Soft-pro Consultancy Services Pvt. Ltd. which is engaged in customized software development, website designing e-learning software etc. He is a partner in firm M/s. Plentos Ventures along with Shri Herambh Shelke from which he draws salary of Rs.2.5 lacs. With regard to the documents/books found from his possession, he had categorically averred that it related to M/s Maharaja Wines which is owned by his partner, Shri Shelke. In respect of the cash of Rs. 25 Lakhs found from his possession/locker he is noted to have stated that it represented commission earned for arrangement of admission. The question and answer in this regard is reproduced as under: ITA Nos.2295 to 2297/Mum/2021 CO. Nos. 60 to 62/Mum/2022 A.Y. 2013-14 to AY. 2015-16 Dr. DY. Patil Education Society 16 Page 192 of PB. Q. 20. After operating the locker which is in your name, there was cash amount of Rs. 25 Lakhs found ? Kindly explain the source of the same. Ans- Sir, that money is the total amount which I had received as commission till date for arranging the admission. 13. The statement as it can be noted is however conscipously silent as to for whose admission, in which college/course etc. After asking the aforesaid question, no other question was asked to elicit answers which could have cleared the air but unfortunately no other searching questions were asked. Therefore, the Ld. AR has pointed out that, he did not name the assessee Trust or the medical college. Also, referring to his background, it was submitted that he had no relation or link or nexus with the assessee Trust, so as to correlate the cash with the assessee Trust. To buttress that Shri Vijay Shinde’s statement had no relevance, the Ld. AR drew our attention to the statement of Shri Sanjay Patil placed at Page 125 to 142 to show that even the investigation authorities did not confront him with the statement of Shri Vijay Shinde recorded during search & post search proceeding. And in this regard, the Ld. AR further brought to our notice the specific finding of the Ld. CIT(A) that, Shri Shinde had admitted and offered the cash of Rs.25 lacs from his possession by way of income from consultancy provided to students for securing admission in ITA Nos.2295 to 2297/Mum/2021 CO. Nos. 60 to 62/Mum/2022 A.Y. 2013-14 to AY. 2015-16 Dr. DY. Patil Education Society 17 different courses. This according to Ld. CIT(A) all the more corraborated the contention of the assessee that the cash of Rs.25 lacs found from the possession of Shri Vijay Shinde did not have any nexus with the assessee Trust. The relevant analysis of the statement of Shri Vijay Shinde as undertaken by the Ld. CIT(A) is noted to be as follows :- “8.4.45. It is further found that Shri Vijay Shinde, whose statement has been referred in assessment order, is only a business partner of Shri Heramb Shelke and in his statement recorded u/s 132(4) of the Act, he has identified himself as business partner of Shri Heramb Shelke and he is also a visiting lecturer in DY Patil Engineering College at Old Pune-Mumbai Highway, which is not an institution run by the assessee Trust As to the documents found from his possession, he has categorically stated in his answer to Q. No. 12 that those are related to Maharaja Wines, which is a business concern of Shri Heramb Shelke and cheque books, account statement, cash deposit slips found therein was pertaining to the same. Further, it is not even the case of the Ld. AO that any of the documents found and seized from the premises of Shri Shinde was pertaining to or having any reference of any transactions relating to the assessee Trust. As such, there was no documents found from his possession as to receipt of any capitation fees by the assessee Trust. Rs. 25 lakhs in cash was found from his locker which was stated to be commission for arrangement of admission, but he has not identified any institutions wherein such admissions were made. The contention of the assessee is that it is not in any ITA Nos.2295 to 2297/Mum/2021 CO. Nos. 60 to 62/Mum/2022 A.Y. 2013-14 to AY. 2015-16 Dr. DY. Patil Education Society 18 manner related to Mr. Vijay Shinde and he has no role or function in any of the institutions run by the assessee Trust. The assessee has also contended that in his statement. Shri Shinde has not even taken name of the assessee Trust or the Medical College run by the assessee and his statement does not in any manner refer anything relating to the assessee Trust. I find that in the statement of Shri Vijay Shinde, there is no reference of the assessee or any institutions run by the assessee Trust. The documents found from his possession are without any dispute relating to Maharaja Wine Shop, which is the personal business of Shri Heramb Shelke. Furthermore, in the assessment order of Mr. Vijay Shinde in AY 2017-18, Rs. 25 lakhs seized from his possession has been accepted as his income from consultancy for providing guidance to students for securing admission in various courses and therefore, there is nothing to link this cash found with any of the admissions in the institutions run by the assessee Trust.” 14. Having ourselves perused the statement of Shri Shinde and in the absence of any material to indicate that Shri Vijay Shinde had anything to do with the admission in assessee’s Trust or College, we are of the view that the reliance placed by the AO on his statement to justify addition on account of capitation fees in the hands of the appellant was misplaced and erroneous. ITA Nos.2295 to 2297/Mum/2021 CO. Nos. 60 to 62/Mum/2022 A.Y. 2013-14 to AY. 2015-16 Dr. DY. Patil Education Society 19 15. The last statement relied upon by the Revenue which forms the genesis of the impugned addition of Rs.2 crores was the statement of Shri Dilip Kashid recorded during the search u/s 132 of the Act on 27.07.2016. The Ld. CIT DR showed us that, Shri Kashid in his statement had averred that he was serving as a Head Clerk in the assessee’s Medical College (Kolhapur) for the last twelve (12) years drawing salary of Rs.54,000/- per month. It was brought to our notice that, the Investigating Officer again questioned him about his exact nature of work, and in answering these Question Nos. 14 to 15 (page 149 of PB), he admitted to have received (capitation fee) for admission under the management quota. According to Shri Kashid, some parents contacted him seeking admission for Medical College under the management quota to which he informed them that donation of Rs.25 Lakhs is necessary for admission in MBBS course in cash. And, only if they are ready to pay then he would introduce them to Shri Sanjay Patil. The money received in cash from the parents would be handed over to Shi Sanjay Patil, President of the assessee’s society. Thereafter, he stated that, he would also receive around Rs.1-2 lacs commission per admission and as per his estimate, he collected Rs.1.5 - 2 cr by way of donation in a year, which he would hand over to Shri Sanjay Patil. The Ld. DR also invited our attention to Q No. 33 wherein the Investigating Officer had also confronted Shri Kashid with a document named as Annexure -1, Page Nos. 1 & 2, to which he had explained that it contained noting of cash of Rs.1,20,000/- refunded to Shri Digvijay Singh Yadav, earlier received for admission of his ITA Nos.2295 to 2297/Mum/2021 CO. Nos. 60 to 62/Mum/2022 A.Y. 2013-14 to AY. 2015-16 Dr. DY. Patil Education Society 20 daughter in the Medical College. The Ld. DR also brought to our notice that cash of Rs.8,66,975/- was seized from the possession of Shri Kashid who had admitted that it comprised of commission received for securing admission for students. Although later on Shri Kashid had denied this statement and disclosed the cash by way of his agricultural income, but according to Ld. DR, the fact that the Revenue had ultimately assessed the cash by way of his unaccounted commission income lends credence to their version that the assessee Trust was indeed receiving capitation fees for securing admission of students. 16. The Ld. AR, on the other hand, brought to our notice that Shri Kashid was only a clerk in the college and he did not have any say or authority in the admissions. According to him therefore, this statement should be given any weightage. Moreover, Shri Kashi was doing separate business also (as a partner of Megh Sparsh Infra & Services). The Ld. AR thereafter took us through the statements of the Dean, Registrar & Finance Officer of the college, to show that the persons who are responsible for admissions and have a say in the finances of the college categorically denied to have received capitation fees. Rather the contents of their statements showed that they had explained the admission procedure. The Ld. AR also took us through the statements of the so-called non-meritorious students which according to the Revenue had received admission in the college upon payment of capitation fees. He showed us that, each of these students had also ITA Nos.2295 to 2297/Mum/2021 CO. Nos. 60 to 62/Mum/2022 A.Y. 2013-14 to AY. 2015-16 Dr. DY. Patil Education Society 21 categorically denied payment of capitation fees. According to Ld. AR therefore, when the persons who were actually in charge of the affairs of the assessee society/colleges; and also the students who were admitted in the medical college had denied any wrong-doing, the reliance placed on a stand-alone statement of a clerk, which according to Ld. AR, recorded under duress & coercion, was untenable. To buttress his contention, he laid emphasis on the fact that since the statement was factually wrong, the recorded statement of Shri Kashid could not divulge any specific details viz., name of students, relevant course, date of admission, donation received etc., based on which he made the averment that capitation fees collected each year was Rs.1.5 - 2 crores. The Ld. AR also laid stress on the fact that there was no material or evidence or document which was unearthed in the course of search which would corraborate the version of the assessee. 17. In respect of the document Annexure – 1, Pages 1 & 2, the Ld. AR first pointed out that the document did not contain any reference to the assessee society or the college or the relevant course and therefore according to him, the contents of this document did not pertain to the assessee. The Ld. AR showed us that, the only link between this document and the assessee society was the narrated version of Shri Kashid in his answer to Q No. 33. However, according to Ld. AR, his answer was contradictory as in the first instance he stated that this document represented cash refunded to Shri Yadav which was paid to Shri Prasant Sinha upon cancellation of her admission in the college ITA Nos.2295 to 2297/Mum/2021 CO. Nos. 60 to 62/Mum/2022 A.Y. 2013-14 to AY. 2015-16 Dr. DY. Patil Education Society 22 but in the same breath, Shri Kashid stated that he did not know Shri Prashant Sinha. 18. With regard to the assessment of cash of Rs.8,66,975/- as unaccounted income of Shri Kashid, the Ld. AR submitted that Shri Kashid had retracted his statement and also stood by the retraction by not owning up the cash found from his premises as his unaccounted income and asserted that the statement was taken from him under duress/coercion. He thus contended that the cash of Rs.8,66,975/- found from his possession did not implicate that assessee charged capitation fees from students. 19. We note that the Ld. CIT(A) has examined each of the contentions raised by the Revenue before us in support of the veracity of the statement of Shri Kashid in light of the submissions of the assessee and thereafter he held that, the statement of Shri Kashid was unreliable. The Ld. CIT(A) has also analyzed the contents of the document Annexure – 1, Pages 1 & 2 and has held that, it did not contain anything which implicated the assessee society with receipt of capitation fees. The Ld. CIT(A) is further noted to have held, that the addition of Rs.8,66,975/- in relation to the cash found by way of unaccounted income of Shri Kashid did not have any bearing in the case of the assessee, as there was nothing brought on record to establish the source of the commission income viz., the name of the ITA Nos.2295 to 2297/Mum/2021 CO. Nos. 60 to 62/Mum/2022 A.Y. 2013-14 to AY. 2015-16 Dr. DY. Patil Education Society 23 persons who paid, students whose admissions were secured etc. The relevant findings of the Ld. CIT(A) are as follows: 8.4.48 On perusal of the statement of Shri Dilip Kashid, it is evident that the statement has not been given with reference to any documents found during the course of search or any assets found during the course of search. On perusal of the statement, I find that the documents found from his residence seized by Annexure A I was confronted to him vide Q No 31 and cash of Rs. 8,66,975/ found at his residence was confronted vide Q No. 23, whereas he has explained the modus: operandi of capitation fees previously in response to Q.no 15 which was apparently not with reference to any documents or assets found during the course of search. It is also evident from the statement of Mr. Dilip Kashid that he has not identified even a single student or parent who has paid capitation fees, and has taken admission through him, although he claimed to have collected capitation fees in the tune of 1.5 crores to 2 crores every year. As evident from his answer to Q No. 19 as reproduced previously he has said that he did not remember the exact details of admission done through him although he claimed that usually 4 to 5 such admissions are done through him in this manner in a year. As such, the content of his statement remained unverifiable as there are no one identified by him as someone having actually paid any capitation fees for admissions. 8.4.49 I have also taken note of the fact that Mr. Dilip Kashid in his statement, when asked about how the remaining seats in the management quota are filled, has stated that remaining seats are being directly handled by Dr. Sanjay D. Patil, but even though residence of Dr. Sanjay D. Patil and also the campus of DY Patil Medical college was covered by the search operation but there was ITA Nos.2295 to 2297/Mum/2021 CO. Nos. 60 to 62/Mum/2022 A.Y. 2013-14 to AY. 2015-16 Dr. DY. Patil Education Society 24 no evidence at all found during the course of search to give even any indication that Dr. Sanjay D. Patil was involved in receipt of any capitation fees for admissions. In the given facts of the case, there is reason to believe that the statement of Shri Dilip Kashid was not found to be correct as to any admissions handled by Dr. Sanjay D. Patil in the manner as stated by Shri Dilip Kashid. There are absolutely no evidence found during the course of search to corroborate his statement. In this regard, the assessee placed heavy reliance on the statements of the Senior functionaries of the Medical College being Dr. Rakesh Kumar Sharma, Dean, Mr. Shyam Piraji Kole, Finance Officer and Dr. VishwanathV. Bhosale, Registrar as to the admission process. On perusal of their statements, it is evident that none of them has stated that Shri Dilip Kashid had any role in the admissions. Dr. Sharma has clearly stated that the admissions were supervised by him and being looked upon by the Registrar of DY Patil Education Society Kolhapur. Mr. Shyam Piraji Kole, Finance Officer has also stated that the Registrar of the Deemed university is responsible for the admissions, whereas the Registrar has clearly explained the admission process The relevant part of the their statements relied upon by the assessee are extracted below for ready reference: 1. The relevant part of statement of Dean (Dr Rakesh Kumar Sharma) is as under:- Q No. 6 Whether the admission process is supervised conducted by you? if not who does the same? Ans- Admission are supervised by me. This work is being looked after by the Registrar of DY Patil Education Society (Deemed University). Kolhapur. The students who qualify, joins the college, the list is provided to the college by the Deemed University. ITA Nos.2295 to 2297/Mum/2021 CO. Nos. 60 to 62/Mum/2022 A.Y. 2013-14 to AY. 2015-16 Dr. DY. Patil Education Society 25 Q. No 7 What is the process of admission to this college? Who finalizes the final list of candidates? Ans :- This is overseen by the Registrar of the University. Q.No.9 Is there any instances of donation accepted by the college in lieu of the seat? Ans- Not to my knowledge 1. The Relevant part of the statement of Finance officer (Mr. Sham Piraji Kole) dtd 27/07/2016 with regard to admission process and tuition fees is as under- Q. No 14. Who is the person responsible for admission of students of DY. Patil Education Society (Deemed University)? Ans. The Registrar of the Deemed University, who is the competent Authority as per Law, is responsible for the purposes of admission of students and other related matters. Dr. Vishwanath Bhosale is the Registrar of DY Patil Education Society (Deemed University) Kolhapur. Q No 19. Please explain the process of admission to various courses being conducted by DY Patil Education Society (Deemed University) Kolhapur. Ans. It is general practice that ours being Deemed University, conducts entrance test at different centers spread all over India, which is generally carried out in the month of Apr/May every year, which is preceded by news publication in different newspapers published all over India The results of such entrance test examination are declared generally in the month May/June every year. Accordingly, a merit list is published in the official website of the DY Patil Education Society (Deemed University). Kolhapur The admission process commences on the basis of merit list so published and the admission is given to the students on first come ITA Nos.2295 to 2297/Mum/2021 CO. Nos. 60 to 62/Mum/2022 A.Y. 2013-14 to AY. 2015-16 Dr. DY. Patil Education Society 26 first serve basis, but purely based on the merit list This admission is provisional, which is subject to the payment of the prescribed fees and also subject to approval of the students names by the Medical Council of India (MCI) Al the time of giving provisional admission Le before receiving the prescribed fees from the students, we collect their original educational certificates along with the admission form in the prescribed format duly signed by the students as well as their parents/guardians After this procedure, the registrar verifies the eligibility of the candidates and accordingly issue the letter to the students, on the basis of which the students, who desire to obtain admission, make the payment at the counter of the college or through RTGS of directly depositing the toes in our bank accounts or some times by way of DD/Pay Orders However, I would like to clarity is that the process of admission as explained above, has not been followed in the instant year in view of the NEET Exams being conducted by the Central Government in all the States as well as the State Government in some of the States, including the state of Maharashtra Q. No. 41, Whether all the cash received on account of fees from the students is accounted for in the books of account of D.Y Patil Education Society (Deemed University)? Ans. Yes, we account for all the cash received on account of fees from the students in books of account of D.Y. Patil Education Society (Deemed University) 1. The relevant part of the statement of Registrar (Dr. Vishwanath V. Bhosale) dated 27/07/2016 is as under:- Q. No. 14. Who is the person responsible for admission of students of DY Patil Education Society (Deemed University)? ITA Nos.2295 to 2297/Mum/2021 CO. Nos. 60 to 62/Mum/2022 A.Y. 2013-14 to AY. 2015-16 Dr. DY. Patil Education Society 27 Ans. The Board of Management, consisting of 3 nominees of Chancellor, 2 Professors/ Deans, appoints Competent Authority. The Registrar of the Deemed University is generally the Competent Authority for the purposes of admission of students and other related matters. So, I look after the process of admission to this Deemed University and being assisted by my team members. Q.No. 15. Please provide lists of all the students of all education branches being run and managed by DY Patil Education Society (Deemed University), indicating the names of students, category le. General or Management, number of seats & its allocation, etc.? Ans. I am providing lists of all the students of all education branches being run and managed by DY Patil Education Society (Deemed University) for the period from FY 2009-10 to 2015-16. [List of all the students of all education branches being run and managed by D.Y. Patil Education Society (Deemed University) as submitted by the deponent, are annexed hereto and as a part of this statement and marked as Annexure "B"] Q. No 16 Please state the entire process of admission to medical education provided by the College / Institutions being run and managed by Deemed University of D.Y.Patil Education Society? Ans. The entire admission process for the year 2014 is explained on page Nos 98, 99 & 100 of the Annual Report for the year 2015, which I have already provided. However, a copy of the relevant pages is provided herewith. (copy of pages Nos. 98, 99 & 100 of the Annual Report for the year 2015, explaining the admission process for the year 2014, as submitted by the deponent, is annexed hereto and made as a part of this Statement and marked as Annexure "C"] ITA Nos.2295 to 2297/Mum/2021 CO. Nos. 60 to 62/Mum/2022 A.Y. 2013-14 to AY. 2015-16 Dr. DY. Patil Education Society 28 I am also providing a copy of the Note on Admission process for the year 2 Admission process of MBBS & MD/MS/PG Diploma for the year 2015, as submitted by [Note on the deponent, is annexed hereto and made as a part of this Statement and marked as Annexure "D"] Q.No. 17. What is the difference between the admission process involved in the year 2014 and 2015? Ans. The entire admission process takes place in accordance with the provisions of the UGC Act, 1956 till the year 2014, 15% seats for MBBS were reserved for management quota and 50% seats for MD/MS/PG Diploma were reserved for management quota. Tal that time, there was a difference in fees charged by the college in general quota versus management quota, which was also in accordance with the provisions of law Thereafter, since the year 2015, we have cancelled the management quota. Now, we charge same amount of fees to all the candidates 8.4.50. It is also found from the above statement that there is no reference of capitation fees received by the assessee Trust in the aforesaid statement and it is also not the case of the Ld. AO. Rather Shri Sharma, Dean, has categorically denied of having knowledge of any capitation fees received for admissions. It is, therefore, evident that there are statements of Senior functionaries of the College which contradicts the statement of Shr Dilip Kashid. 8.4.51. It is found that a document vide Annexure A1 was seized from the residence of Shri Dilip Kashid, which is a receipt dated 02.03.2013 which says that one Shri Vijay Singh Yadav has paid Rs 1,20,000/- to one Shri Prashant Sinha for admission of his daughter in MBSS course in Management Quota, which was received back by him and now he has nothing to collect from Shri ITA Nos.2295 to 2297/Mum/2021 CO. Nos. 60 to 62/Mum/2022 A.Y. 2013-14 to AY. 2015-16 Dr. DY. Patil Education Society 29 Prashant Sinha or MCD Sanstha in this regard. Shri Dilip Kashid in his statement dated 27.07.2016, has stated that Dr. Sanjay D. Patil has told him to keep this document with him. He, however, stated in his answer to Q.no.33, that he did not know who is this Prashant Sinha. On perusal of this document it is evident that it has no reference of the Medical College run by the assessee Trust or any of the officer/Trustee associated with the Trust or the Medical College. The assesses submitted that the id AO did not call Shri Vijay Singh Yadav by issuing summons u/s 131 of the Act despite of having been asked for the same. I find that identity of Shri Prashant Sinha, whose name is appearing in the document, is not known as Shri Dilip Kashid said he did not know him. As such, the content of the document was not verifiable with the said Shri Prashant Sinha, who as per this document had received the money Furthermore, the document says that the payment was for admission in MBBS and that Shri Yadav had nothing to receive from Shri Sinha or the MCD Sanstha' but, there is nothing on record to believe that the said 'MCD Sanstha' was DY Patil Medical College, Kolhapur. Furthermore, it is also not the case of the AO that the candidate, Ms. Meena Yadav, whose name is appearing in the said document has taken admission in DY Patil Medical College Kolhapur. As such, in my considered view, this document has nothing to implicate the assessee Trust with receipt of any capitation fees. 8.4.52. During the course of search at the residence of Shri Dilip Kashid, cash amounting to Rs. 8,66,975/- was found which he stated to be representing commission for getting candidates admissions in DY Patil Medical College, Kolhapur. It is however, found that he has not identified anyone who has paid any such ITA Nos.2295 to 2297/Mum/2021 CO. Nos. 60 to 62/Mum/2022 A.Y. 2013-14 to AY. 2015-16 Dr. DY. Patil Education Society 30 commission to him. In his return of income he claimed the sum partly representing his agricultural income and partly savings of his family. This cash has been taxed in his hands as unaccounted income but there is no evidence on record to confirm the fact that the cash represented commission received by him for admission in the Medical College. He himself has offered this cash as agricultural income and partly as his personal savings denying the content of his original statement and nothing further was brought on record during his assessment establish that the said cash could be commission received on account of admissions to by taking any capitation fees, It is also found that Shri Dilip Kashid does not only have income as salary from the Medical College, but has also his own business and therefore, the cash found in his possession which has been taxed in his hands could not be held as representing any commission on account of admissions when there is nothing on record to establish as to who are the persons who have paid him such commissions or who have paid any capitation fees for admissions as claimed by him in his statement.” 20. The above findings of the Ld. CIT(A) and his analysis of the statement of Shri Kashid remain uncontroverted before us. We therefore do not see any reason to interfere with the same. 21. On overall consideration of the above facts, we also find ourselves in agreement with the Ld. CIT(A) that none of these four (4) persons, whose statements were relied upon by the AO, were persons holding any important post or having any authority in the college or ITA Nos.2295 to 2297/Mum/2021 CO. Nos. 60 to 62/Mum/2022 A.Y. 2013-14 to AY. 2015-16 Dr. DY. Patil Education Society 31 Trust and therefore their statements cannot be the sole basis of addition, particularly when no evidence was gathered either from the premises of the assessee Trust or the premises of these four persons which would otherwise justify the addition impugned before us. It is noted that, the AO did not have in his possession any material or evidence to come to a conclusion that the assessee had received Rs.2 crores by way of capitation fees. Instead, the impugned addition solely hinged on the bald statement of Shri Kashid that assessee received Rs.1.5 crores – Rs.2 crores each year, which as noted by us above, was an empty averment, as he did not identify any person or student who had paid the same, and more so the students (so called less meritorious students) who were called for examination and had also denied making payment of capitation fees. 22. Before us, the Ld. DR also relied on the AO’s findings wherein, according to him, the AO had corraborated the impugned addition with reference to the cash of Rs.1.05 crores which was found from the possession of Shri Patil. According to AO, this cash represented capitation fees of assessee society. The Ld. AR of the assessee, however, brought to our notice that, part cash was ultimately found to be explained and hence no adverse inference was drawn. We also note that nowhere Shri Patil in his statement/s had averred that this cash represented capitation fees received on behalf of assessee Trust. Instead, in his statement recorded u/s 131 of the Act in the post-search proceedings, it is noted that he had explained the source of the ITA Nos.2295 to 2297/Mum/2021 CO. Nos. 60 to 62/Mum/2022 A.Y. 2013-14 to AY. 2015-16 Dr. DY. Patil Education Society 32 remaining sum as income derived from his agricultural holdings. Although the Revenue did not accept this contention and added the remaining sum of Rs.53,51,615/- in the hands of Shri Patil as his undisclosed income. However, nothing was brought on record by the Revenue before us, to show that this cash found with Shri Patil represented capitation fees collected from students. The facts placed before us reveal that Shri Patil derived income from several different sources/agriculture etc; and therefore we agree with the findings of the Ld. CIT(A) that, the assumption made by the AO that this cash represented capitation fees collected from students was far-fetched and based purely on conjecture & surmise. Particularly when, Shri Patil who had been examined twice by the Department viz., in the course of search and in the post search proceedings, had denied collecting capitation fees from students. 23. It is indeed true that a simple denial is not sufficient but at the same time it is also to be seen as to whether the accusation being levelled is supported by material or corraborative evidence found in the course of search. From the facts on record, it is evident that there was no evidence found in the course of search which would show that the assessee had received capitation fees from students. Much ado has been made by the Revenue before us that since the search operation began first at the other group of DY Patil at Navi Mumbai, the assessee society had received prior information about the search operation and for that reason no corraborative evidence or material was gathered in the course of search. Without going into the veracity ITA Nos.2295 to 2297/Mum/2021 CO. Nos. 60 to 62/Mum/2022 A.Y. 2013-14 to AY. 2015-16 Dr. DY. Patil Education Society 33 of this contention, we find that the Ld. CIT(A) had rightly held that, search operation being leaked cannot be an alibi for making addition in an assessment, as the assessment has to be made based on evidences and not on suspicion and conjectures. 24. We also gainfully refer to the following findings ultimately recorded by the Ld. CIT(A) while deleting the additions impugned before us. 8.4.80. In this case, I am of the considered view that the very basis set out in the order of the Ld. AO for coming to the conclusion that the assessee Trust has received Rs 2.00 crore as capitation fees is not based on any evidence as no documents having any such details were found and seized from any place during the course of search. The addition completely hinges on evidence gathered through third-party statements, being statement of a Clerk of the college run by the Trust, that is Shri Dilip Kashid and other individuals who are found to be having no relation with the affairs of the Medical College or Trust. In the given facts of the case, in my considered view, in order to have a presumption against the assessee Trust in respect of a statement given by an employee, there has to be some corroborative evidence. It is, however, found that Shri Dilip Kashid has not even identified any student who actually had paid any capitation fees for admissions. Hence, the fact is that but from the general claim of receipt of capitation fees, there is no evidence on record to believe that any capitation fees were actually received for admissions, more so when all the students called during the course of assessment proceedings have denied the same. 8.4.81. In the case of Straptex India P Ltd. v Oy. CIT [2003] 84 ITO 320 (Mum), it was held that presumption under section ITA Nos.2295 to 2297/Mum/2021 CO. Nos. 60 to 62/Mum/2022 A.Y. 2013-14 to AY. 2015-16 Dr. DY. Patil Education Society 34 132(4A) is only against the person in whose possession the search material is found and not against any other person. It is further held that the presumption is rebuttable and not conclusive and it cannot be applied in the absence of corroborative evidence. Further, it was held in the case of Prarthana Construction (P) Ltd. Vs. Deputy Commissioner of Income Tax (2001) 118 Taxman 112 (IT AT- Ahmedabad) (Mag) that loose papers and documents seized from premises of third parties and statement recorded at back of assessee without it being afforded opportunity to interrogate said documents and without bringing on record any supporting evidence, could not be made basis for adding undisclosed income in the hands of assessee. 8.4.82. In this regard, I have also taken note of the fact that the Search operation was not conducted in the case of the assessee. Although, DY Patil Medical College, Kolhapur, which is a constituent of the assessee was covered in the search operation but there is absolutely no evidences found there from in respect of receipt of any capitation fee. Neither, any such evidences were found from the residence of Dr. Sanjay D. Patil, who was also covered in the said search operation. The evidences in the form of statements are from third-persons contents of which are not supported by any documents found during the course of search and which have been denied by the President of the Society Shri Sanjay D. Patil. The assessment in the case of the assessee was made u/s 153C of the Act, on the basis of material found during the course of search conducted in the case of such other persons. As such, even the presumption, as expressly provided in Section 132(4A)/292C of the Act, does not hold ITA Nos.2295 to 2297/Mum/2021 CO. Nos. 60 to 62/Mum/2022 A.Y. 2013-14 to AY. 2015-16 Dr. DY. Patil Education Society 35 good in the case of the assessee as the search was not conducted in the case of the assessee. 8.4.83. Hence, in consideration of the facts in its entirety and also in view of the judicial pronouncements relied upon by the assessee and referred to earlier, I am of the considered view that the evidence which was collected during the course of search in the form of statement of Shri Dilip Kashid and Shri Heramb Shelke as to receipts of capitation fees was not with reference to any transactions pertaining to the assessee appearing in any of the documents seized during the course of search. Even these individuals have not identified anyone having paid capitation fees for admissions and there was no evidence found from the Medical College or the residence of Dr. Sanjay D. Patil or even from the said third parties, whose statements have been relied upon in the assessment order, which could be said to be having even a reference of any capitation fees received by the assessee Trust. It is further found that these third party statements were not corroborated by any statement/acceptance by any of the Trustees of the Trust. Furthermore, there are no other evidences on record gathered during the course of Search or assessment to implicate the assessee Trust with the said receipts, which was held as taxable in its hands as unaccounted capitation fees received on the basis of statement of Shri Kashid. Hence, I am of the considered view that the addition cannot be sustained in the hands of the assessee when it has been made merely on the basis of third-party statements which had been denied by the President of the Trust, and when the same is not even corroborated by any evidence found during the course of search or assessment proceedings. 8.4.84 Hence, The addition of Rs. 2.00 crore made on account of receipt of capitation fees on, estimate basis as income to be assessed in the hands of the appellant for Assessment Year 2017-18 deserves to be deleted. I direct accordingly. Ground No. 2 of the Appeal for Assessment Year 2017-18 is accordingly ALLOWED.” ITA Nos.2295 to 2297/Mum/2021 CO. Nos. 60 to 62/Mum/2022 A.Y. 2013-14 to AY. 2015-16 Dr. DY. Patil Education Society 36 25. In view of our above findings & discussions, we do not see any reason to interfere with the impugned order of the Ld. CIT(A) deleting the addition made by way of capitation fees of Rs.2,00,00,000/- in all the AYs 2013-14 to 2015-16. Accordingly, the grounds raised by the Revenue in all the three (3) appeals are dismissed. 26. Since the appeal of the Revenue has been dismissed, the Cross- Objections of the assessee have been rendered academic in nature and is therefore dismissed as infructuous. 27. In the result, the appeal of the revenue and the cross objections of the assessee stands dismissed. Order pronounced in the open court on this 29/03/2023. Sd/- Sd/- (AMARJIT SINGH) (ABY T. VARKEY) ACCOUNTANT MEMBER JUDICIAL MEMBER मुंबई Mumbai; दिनांक Dated : 29/03/2023. Vijay Pal Singh, (Sr. PS) आदेश की प्रनिनलनि अग्रेनर्ि/Copy of the Order forwarded to : 1. अपीलार्थी / The Appellant 2. प्रत्यर्थी / The Respondent. 3. आयकर आयुक्त / CIT 4. दवभागीय प्रदतदनदि, आयकर अपीलीय अदिकरण, मुंबई / DR, ITAT, Mumbai 5. गार्ड फाईल / Guard file. ITA Nos.2295 to 2297/Mum/2021 CO. Nos. 60 to 62/Mum/2022 A.Y. 2013-14 to AY. 2015-16 Dr. DY. Patil Education Society 37 आदेशधिुसधर/ BY ORDER, सत्यादपत प्रदत //True Copy// उि/सहधयक िंजीकधर /(Dy./Asstt. Registrar) आयकर अिीलीय अनर्करण, मुंबई / ITAT, Mumbai