DCIT, Central Circle -3, Surat V. DRB Ravani Developers, Surat

ITSSA 4/SRT/2021

AI Insights

The case involves two appeals by the revenue against M/s DRB Ravani Developers concerning the assessment years 2013-14 and 2015-16. The core issue was the addition of Rs. 4.05 crores and Rs. 1.68 crores respectively, made by the Assessing Officer on the basis of incriminating documents seized during a search operation at Param Properties, Surat. These documents allegedly contained entries of unaccounted cash transactions related to the assessee's real estate project, 'Celestial Dreams'. The CIT(A) deleted these additions, finding the documents to be dump documents and noting the absence of signatures or corroborative evidence linking the transactions to the assessee. The Tribunal upheld the CIT(A)'s decision, emphasizing the lack of direct evidence and the failure to provide an opportunity for cross-examination of key witnesses.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 302040 (ITAT-SURAT)
• Duration Of Justice: 2 year(s) 1 month(s) 11 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 16-05-2023
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 20-02-2023
• Assessment Year: 2013-2014
• Appeal Filed On: 04-04-2021
• Other Referred Cases: Chuharmal Vs CIT, Krishna Chand Chela Ram Vs CIT, Andaman Timber Industries Vs Commissioner of Central Excise, PCIT Vs Ajay Sundarbhai Patel, CIT Vs MK Brother, ITO Vs Ramesh Chhadra H Prajapati, Shri Ramalinga Choodambikai Mills Ltd. Vs CIT, ACIT Vs Sri Radheshyam Poddar, CIT Vs Kulwant Rai, CIT Vs Maulikumar K. Shah, ACIT Vs Shri Trilokbhai R. Parikh
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Document seized; Principle of natural justice; Opportunity of cross examination; Block assessment; Capital receipt; Documents seized; TDS; Set aside
• Section: 132; 143(3); 133(6); 69A; 72; 153C

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, SURAT BENCH, SURAT BEFORE SHRI PAWAN SINGH, JUDICIAL MEMBER AND DR. ARJUN LAL SAINI, ACCOUNTANT MEMBER IT(SS)A No. 04 & 05/Srt/2021 (Assessment Years: 2013-14 & 2015-16) (Virtual hearing) D.C.I.T., Central Circle-3, Surat. Vs. M/s DRB Ravani Developers, “Cellestial Dreams”, B/h South Gujarat University, New Airport Road, Surat-395007. PAN No. AAHFD 5840 N Appellant/ assessee Respondent/ revenue Department represented by Shri Ashok B. Koli (CIT-DR) Assessee represented by Shri Saurabh Soparkar, Senior Advocate with Ms. Urvashi Sodhan, Advocate Date of hearing 21/02/2023 Date of pronouncement 17/05/2023 Order under Section 254(1) of Income Tax Act PER: PAWAN SINGH, JUDICIAL MEMBER: 1. These two appeals by the revenue are directed against the separate orders of learned Commissioner of Income Tax (Appeals)- 4, Surat (in short, the ld. CIT(A) both 01/01/2021 for the Assessment years (AY) 2013-14 & 2015-16 respectively. In both these appeals, certain facts are common, the revenue has raised similar grounds of appeal, therefore, with the consent of both the parties these appeals were clubbed, heard together and are decided by this consolidated order to avoid the conflicting decision. For appreciation of facts, the appeal for the A.Y. 2013-14 is treated IT(SS)A No. 04 & 05/Srt/2021 DCIT Vs M/s DRB Ravani Developers 2 as a “lead case”. In this appeal, the revenue has raised following grounds of appeal: “1. On the facts and in the circumstances of the case and in law, the ld. CIT(A) has erred in treating the incriminating documents seized during the search action u/s 132 of the Act in the case of Param Properties as dumb document and deleting the addition made of Rs. 4,05,77,442/- on account of unaccounted on-money receipts. 2. On the facts and in the circumstances of the case and in law, the ld. CIT(A) has erred in ignoring the fact that the additions was made by the A.O. on the basis of incriminating documents found and seized during the course of search and confirmed by the person, from whose possession the same was seized, in the statement recorded. 3. On the facts and in the circumstances of the case and in law, the ld. CIT(A) has erred in ignoring the fact that the A.O. has carried out independent enquiry from the bank and confirmed that the assessee has done transactions with third person and that person has issued a demand draft to the assessee as advance payment, which is also getting correlated with incriminating documents found and seized during the course of search proceedings. 4. On the facts and in the circumstances of the case and in law, the ld. CIT(A) has erred in deleting the additions on the ground that the A.O. has not allowed the cross examination of the person from whom the incriminating documents was found and seized, ignoring the incriminating evidences on record and without affording an opportunity of cross examination in the appellate proceedings. 5. It is, therefore, prayed that the order the ld. CIT(A)- 4, Surat may be set aside and that of the AO may be restored to the above extent. IT(SS)A No. 04 & 05/Srt/2021 DCIT Vs M/s DRB Ravani Developers 3 6. The appellant craves leave to add, alter, amend and/or withdraw any ground(s) of appeal either before or during the course of hearing of the appeal.” 2. Brief facts of the case are that the assessee is a builder and developer, filed its return of income for A.Y. 2013-14 declaring total income of Rs. 2,13,75,000/-. The assessment was completed under Section 143(3) of the Income Tax Act, 1961 (in short, the Act) on 09/02/2016 determining total income of Rs. 2.14 crores only by making addition of Rs. 31,314/- on account of disallowance of interest paid on TDS. A search action was carried out by the Investigation Wing on Param Properties, Surat on 04/09/2015. During the course of search action, several incriminating documents and evidences were found and seized, which contains the entries pertaining to information related to units/flats of ‘Celestial Dream’, a project undertaken by the assessee. Consequent upon such search action leading to evidence relating to assessee, notice under Section 153C dated 19/06/2017 was served upon the assessee for filing return of income for various assessment years. In response to such notice, the assessee filed return of income for A.Y. 2013-14 on 22/09/2017 declaring income of Rs. 2.14 crores. During the assessment, the Assessing Officer recorded that various incriminating evidences corresponding to facilitation of unaccounted cash transactions of clients, financiers IT(SS)A No. 04 & 05/Srt/2021 DCIT Vs M/s DRB Ravani Developers 4 and other brokers were found during the search on Param Properties which includes page No. 72 of Annexure-BS-51 and page No. 6 of BS-53 wherein certain details of cash payment received by assessee for booking of flats in Celestial Dream undertaken by assessee are mentioned. Entry at page No. 72 of BS-51 corresponding with page No. 83 of BS-53 and certain entries are corroborates with page No. 6 of Annexure BS-53, page No. 83 of Annexure BS-53 is a copy of original diaries issued by assessee in respect of flat No. E-801 booked by Shri Rajesh Jogani. On page No. 83 of BS-53, cash is written in a coded form ignoring the last two digits, 2000 means Rs. 20.00 lacs or so on, and so forth. The transactions featured in seized documents pertaining to flat No. E- 801 of Celestial Dream Project and these sheets were sent by Dilipbhai Ravani, key person of assessee firm to Param Properties, in respect of unit booked through them. On the basis of such seized document, the Assessing Officer was of the view that besides the amount mentioned in the seized paper, the assessee firm has also received payment of Rs. 25.00 lacs trough demand draft issued by Karnataka bank. In order to verify the nature and transaction, notice under Section 133(6) of the Act issued to Karnataka Bank. The Karnataka Bank replied and confirmed that the said demand draft was issued at the stance of Sangeeta Rajesh IT(SS)A No. 04 & 05/Srt/2021 DCIT Vs M/s DRB Ravani Developers 5 Jogani favouring to assessee firm. The mode of payment for purchasing the demand draft was through cheque from savings bank account of Sangeeta Rajesh Jogani. The Assessing Officer also issued notice to Sangeeta Rajesh Jogani on 01/12/2017 for seeking certain information. In response to such notice, Smt. Sangeeta Rajesh Jogani confirmed of having entered into purchase of flat from assessee and accepted that demand draft dated 31/01/2013 was issued from her savings bank account favouring the assessee of Rs. 25.00 lacs for booking of flat No. E-801 of ‘Celestial Dreams’ project. She further replied that the project did not proceed and cancellation deed dated 10/03/2016 was executed and the amount paid of Rs. 25.00 lacs were returned to her. The Assessing Officer on the basis of noting on page No. 72 and 6 of Annexure-BS-51, prepared a table of unaccounted transaction received by assessee in respect of flat No. E-801 on various dates aggregating of Rs. 4.05 crores. The Assessing Officer was further of the view that such amount was received in cash on account of unaccounted transaction. 3. The Assessing Officer further noted that the statement of Agam Vadecha of Param Property was recorded under Section 132(4) of the Act on 30/09/2015 and in reply to question No. 20 explained that noting on page No. 72 are related with their client Dilip Ravani IT(SS)A No. 04 & 05/Srt/2021 DCIT Vs M/s DRB Ravani Developers 6 in respect of Celestial Dreams project. The Assessing Officer scanned the question no. 20 and its answer in the assessment order. On the basis of aforesaid observations, the Assessing officer issued show cause notice dated 18/09/2017 to explain the assessee about the transaction and the details of flats mentioned in the seized material. The Assessing Officer recorded that the assessee flatly denied about the transaction with Param properties. The submission of assessee was not accepted by the Assessing Officer, the Assessing Officer vide notice dated 01/12/2017 again asked the assessee to explain the transaction reflected in the seized material and as to why in absence of proper and satisfactory explanation, transaction reflecting in seized material should not be treated as unexplained receipt and added to the income of assessee. The assessee again in its reply denied any transaction with Param properties as featured in seized document. The assessee stated that such document does not bear the signature of assessee and not seized from their premises. 4. The reply of assessee was not accepted by the Assessing Officer. The Assessing officer held that reply of assessee is not tenable. The Assessing Officer held that as per decision of Hon’ble Supreme Court in Chuharmal Vs CIT, 172 ITR 230 (SC) wherein it was held that third party evidence has evidentiary value and can be used if IT(SS)A No. 04 & 05/Srt/2021 DCIT Vs M/s DRB Ravani Developers 7 corroborative or other circumstantial evidence and can be used with corroborative and other circumstantial evidence. In case of assessee, information was collected discreetly during the search action under Section 132 of the Act. Agam Vadecha one of the partner of Param Properties in his statement admitted about the belongingness of the documents with assessee firm. Such fact was confirmed from the information gathered from the bank as well as Sangeeta Rajesh Jogani in respect of demand draft transaction featured in the seized document. On the basis of such fact, it is clearly established the relations between the assessee and Param properties. On the basis of his observation that there is clinching evidence in the seized document, accordingly receipt in respect of flat No. E-801 of Celestial Dreams project reflecting in the seized material aggregating of Rs. 4.05 crore was added under Section 69A of the Act in the hands of assessee in the assessment order passed under Section 143(3) r.w.s. 153C of the Action 27/12/2017. 5. Aggrieved by the additions in the assessment order, the assessee filed appeal before the ld. CIT(A). Before the ld. CIT(A), the assessee filed its detailed written submission. The submission of assessee was recorded in para 4 of order of ld. CIT(A). The assessee in its submission raised various legal and factual objection. The assessee in sum and substance in its submission IT(SS)A No. 04 & 05/Srt/2021 DCIT Vs M/s DRB Ravani Developers 8 submitted that the assessee is a partnership firm engaged in the business of contract of project namely “Cellestial Dreams”. A search action was carried out by the Investigation Wing on 04/09/2015 in case of Param Properties, Surat. During the search, several incriminating documents were found and seized which was inventorised as Annexure-BS-51 consisting of page No. 70, 71 and 72, BS-53 including of page No. 6, 82 and 83, copies of which were filed. The Assessing Officer considering such documents pertaining to assessee, issued notice under Section 153C of the Act. In response to such notice, the assessee filed return of income on 22/09/2017. The Assessing Officer during the assessment issued various show cause notice as to why transaction reflected in the seized document should not be treated as unexplained cash transaction. Show cause notices were replied by the assessee. With regard to page No. BS-53, the assessee explained that it is an excel sheet without any name or signature at one side, narration is written as capital receipt and on other side it is written as capital return. This is a diary in the name of Rajesh Bhai Jogani for flat No. E-801. On one page, some amount written with date and signature totalling 187000=00. On the other page heading is “Return” with date and signature. On page No. 83 repetition of page No. 82. Again on BS-51 at page No. 70 and 72 repetition of IT(SS)A No. 04 & 05/Srt/2021 DCIT Vs M/s DRB Ravani Developers 9 page No. 82 and for page No. 72, it was explained that it is excel sheet with heading “Dilipbhai Ravani E-801 Sellester Dreeam (For R Jogani) totalling 273774.42 out of which 43774.42 due. Further in the seized material at page No. 82 of BS-53 there is reference of one DD (demand draft) payment of Rs. 25.00 lacs dated 31/01/2013 from Karnataka bank. The Assessing Officer issued notice to Karnataka Bank. The Karnataka Bank replied that DD was issued from the account of Sangeeta Jogani and credited to the account of assessee. On the basis of such reply, notice under Section 133(6) of the Act was issued to Sangeeta Jogani for clarification. Sangeeta Jogani vide her reply dated 09/12/2017 accepted that she made booking and paid advance. She also informed the Assessing Officer that deal was cancelled and amount was returned back. She also submitted cancellation deed dated 10/03/2016. On the basis of such fact, Sangeeta Jogani explained that she paid demand draft of Rs. 25.00 lacs alongwith Rs. 77,250/- towards service charge for booking of flat No. 801, 8 th Floor, E-Cellestial Dreams, Surat. Project was not proceeded and booking was cancelled, cancellation sheet was executed on 10/03/2016 and amount alongwith service charge was refunded vide cheque dated 10/03/2016. She had not made any transaction in cash except booking advance of Rs. 25.00 lacs. She does not IT(SS)A No. 04 & 05/Srt/2021 DCIT Vs M/s DRB Ravani Developers 10 know Param Properties or Agam Vadecha. She is not aware of alleged diary made for flat either in her name or her husband’s name. Diary does not pertain to them. During the block assessment proceedings, no addition was made by her Assessing Officer for block period of A.Y. 2009-10 to 2015-16 in her case. The assessee further submitted that they categorically denied to have made any transaction with Agam Vadecha or Param Properties and disowned the diary seized from Param properties. The seized document does not bear signature of assessee or person in whose name the material is made. The assessee furnished details of booking in the name of Sangeeta Jogani and cancellation deed alongwith ledger account and confirmation. The assessee further explained that the Assessing Officer accepted part of seized material and not accepted the part of material about the return of money clearly mentioned. The Assessing Officer has not taken any other step except issuing notice under Section 133(6) to Sangeeta Jogani. The assessee asked for cross examination of Agam Vadecha of Param Properties by various submissions but no opportunity was provided. The document found from the possession of third party has no evidentiary value. The assessee also stated that no addition can be made on the basis of dump document. There is no corroborative noting in the loose paper found during the search about the IT(SS)A No. 04 & 05/Srt/2021 DCIT Vs M/s DRB Ravani Developers 11 unconnected third party. To support such submission, the assessee relied on various case laws. The assessee reiterated that no opportunity of cross examination was provided. The statement of persons which was used against the assessee were recorded at the back of assessee. To support such contention, the assessee relied on decision of Hon’ble Apex Court in the case of Krishna Chand Chela Ram Vs CIT 125 ITR 713 (SC) and Andaman Timber Industries Vs Commissioner of Central Excise (2015) 62 taxmann.com 3 (SC). 6. The ld. CIT(A) after considering the contents of assessment order and submission of assessee held that as per Assessing Officer, the transaction featured in the seized document pertains to flat No. E- 801 Celestial Dreams and these paper sheets were sent by Dilipbhai Ravani, the main person of assessee to Param Properties in respect of unit booked through them. The Assessing Officer on the basis of documents noted that the assessee received Rs. 25.00 lacs through demand draft issued by Karnataka Bank. On seeking information under Section 133(6), the Karnataka Bank confirmed that the demand draft was issued at the instance of Smt. Sangeeta Rajesh Jogani in favour of assessee. Sangeeta R. Jogani also responded to the notice issued by the Assessing Officer wherein she confirmed about booking with assessee and accepted the IT(SS)A No. 04 & 05/Srt/2021 DCIT Vs M/s DRB Ravani Developers 12 demand draft was drawn from her savings bank account for booking of flat No. E-801. It was also stated by her that project did not proceed and cancellation deed dated 10/03/2016 was executed. The amount paid by her through demand draft was returned by the developer. The Assessing Officer mentioned the cash transaction other than the amount involved besides demand draft. As per the Assessing Officer, the assessee received Rs. 4.05 crores during the financial year in seven instalments against the said flat. The ld. CIT(A) also noted that during the search, statement of Shri Agam Vadecha, partner of Param properties from whose premises, the document was found, was recorded. In response to question No. 20, explaining page No. 72, he stated that this page shows the transaction made by their clients with Ravani Group in respect of Celestial Dreams and quantum of transaction is Rs. 2.73 crores. On the basis of such fact, the Assessing Officer issued show cause notice to the assessee, however, the assessee denied of having entered into any transaction with Param properties. Such explanation was not accepted by the Assessing Officer. The assessee further stated that document found during the course of search on Param properties which is third party, is not signed by or on behalf of assesse, even the document is not signed by Rajesh Jogani whose name is IT(SS)A No. 04 & 05/Srt/2021 DCIT Vs M/s DRB Ravani Developers 13 written on such paper. As per their books of account, booking amount of flat No. E-801 is shown in the name of Sangeeta R. Jogani on receipt of demand draft which later on cancelled. Such fact was confirmed by Sangeeta R. Jogani to the Assessing officer. Except payment of Rs. 25.00 lacs. Sangeeta R. Jogani denied payment of other amount on the same page. On the basis of such observation, the ld. CIT(A) was of the view that in such situation, relying upon these documents against the assessee is totally unjustified. The assessee further claimed that seized diary clearly mentioned word “Return” and excel sheet also mentioned the word “capital Return”, however the Assessing Officer ignored these words on the same page. The assessee contended that partial reading of seized material is not permissible as per Section 292 of the Act. The Assessing Officer used the figures and words suited to the revenue and making unnecessary additions in the hands of assessee. The ld. CIT(A) held that contention of assessee is that the document was found at the third party premises, were not in the handwriting of assessee and not signed by assessee, is correct. Relying on these dump documents for making addition in the hand of assessee is not justified. The ld. CIT(A) held that undisputed fact is that the document relied by Assessing Officer were found at the premises of Param Properties and not from the assessee. Such IT(SS)A No. 04 & 05/Srt/2021 DCIT Vs M/s DRB Ravani Developers 14 document is not signed by or on behalf of assessee. Documents is not in the handwriting of person authorised by assessee. Even in the statement of Agam Vadecha recorded by Investigation Team, he stated that transaction involved was of Rs. 2.73 crores. During the course of assessment, notice under Section 133(6) was issued to Agam Vadecha who did not respond to the Assessing Officer. There is no statement or even identification of person Dilipbhai whose name is written in the seized document. In such situation, the documents are nothing but a dump document as far as assessee is concerned. The ld. CIT(A) held that the Hon’ble Jurisdictional High Court in PCIT Vs Ajay Sundarbhai Patel (2016) 69 taxmann.com 309 (Guj), CIT Vs MK Brother 163 ITR 249 (Guj), Ahmedabad Tribunal in ITO Vs Ramesh Chhadra H Prajapati in ITA No. 827/Ahd/1999 dated 22/07/2015 and Madras High Court in Shri Ramalinga Choodambikai Mills Ltd. Vs CIT (1955) 28 ITR 952 held that the addition on the basis of dump documents are not justified. On the basis of such observation, the ld. CIT(A) held that the addition made in the hands of assessee are not sustainable. The ld. CIT(A) specifically noted that inquiry against Sangeeta R. Jogani whose husband’s name is mentioned in the seized document was conducted by Assessing Officer by issuing notice under Section 133(6) of the Act. She admitted that she paid Rs. IT(SS)A No. 04 & 05/Srt/2021 DCIT Vs M/s DRB Ravani Developers 15 25.00 lacs directly to assessee for booking of flat No. E-801 through demand draft issued from her savings bank account and the same was received back on cancellation of booking. For other entries, she denied that she has not made the payment shown on the entries. The assessee asked for cross examination of Agam Vadecha but the same is denied by the Assessing Officer despite specific request. The ld. CIT(A) by referring the decision of Hon’ble Supreme Court in Krishna Chand Chela Ram Vs CIT 125 ITR 713 and Andaman Timber Industries Vs Commissioner of Central Excise (supra) held that non-providing of cross examination of person on whose statement reliance was made for making addition, is against the principles of natural justice and thus the addition in absence of such cross examination is not sustainable. Thus, the ld. CIT(A) deleted the entire addition. Aggrieved by the order of the ld. CIT(A), the revenue has filed present appeal before this Tribunal. 7. We have heard the submission of Sh Ashok B Koli learned Commissioner of Income Tax-departmental representative (Ld CIT- DR) for the revenue and Sh Saurabh Soprakar learned Senior Advocate assisted by Ms Urvashi Shodhan Advocate (ld Senior Counsel) and have gone through the order of the lower authorities carefully. The ld CIT-DR for the revenue submits that a search was carried out on Param Properties, Surat by investigation team, IT(SS)A No. 04 & 05/Srt/2021 DCIT Vs M/s DRB Ravani Developers 16 wherein several incriminating documents and evidences were seized. The document seized from Param Properties also pertains information about booking of flats/units in Celestial Dreams projects undertaken by assessee. On the basis of such evidences, notice under Section 153C was issued to the assessee for filing return of income for various assessment years. During the search action, the documents seized includes page No. 72 of Annexure BS- 51 and page No. 6 of BS-53 where certain payments were recorded to have been received by assessee in respect of flat No. E-801 of Calestial Dream project booked by Shri Rajesh Jogani. As per page No. 83 of BS-53, cash is written in a coded form ignoring the last digits whereby 20,000/- which means Rs. 20.00 lacs. It was also revealed that the seized documents contain payment of Rs. 25.00 lacs through demand draft issued by Karnataka Bank. To verify the nature of transaction, notice under Section 133(6) was issued to Karnataka Bank. The Karnataka Bank replied and disclosed that the said demand draft was issued to Sangeeta Rajesh Jogani favouring to DBR Ravani Developers (assessee). The demand draft was issued against the savings bank account of Sangeeta Rajesh Jogani. From the seized documents, coupled with the confirmation of Karnataka Bank it was proved beyond doubt that booking of flat was made through Param Properties. From various entries on page IT(SS)A No. 04 & 05/Srt/2021 DCIT Vs M/s DRB Ravani Developers 17 No. 6 and 72 of BS-51 there is reference of cash payment of Rs. 4.05 crores. Such fact was confronted to the assessee during assessment, however, the assessee flatly refused to accept the transaction recorded in the seized document. The Assessing Officer on the basis of statement of key person of Param Properties and the documents seized during the search action made addition of Rs. 4.05 crores against the assessee. The ld. CIT(A) deleted the addition by accepting the submission of assessee that the documents seized from Param Properties are not signed by the assessee. It was also held that documents are not in the handwriting of any person authorised by assessee. The assessee also raised plea that the documents seized from the premises of Param Properties are dump document and no notice can be taken of such document. The ld. CIT-DR for the revenue submits that Param Properties was involved in facilitating flats booking, making arrangement of cash on commission basis he booking, such fact was admitted by one of the key person namely Agam Vadecha of Param Property. It was also admitted by them that assessee is one of the client of Param Properties. The documents seized from the premises of Param Properties cannot be considered as dump document. The ld CIT-DR for the revenue submits that the order of IT(SS)A No. 04 & 05/Srt/2021 DCIT Vs M/s DRB Ravani Developers 18 ld CIT(A) may be reversed by restoring the additions in the assessment order. 8. On the other hand, the ld. Senior Counsel for the assessee supported the order of ld. CIT(A). The ld. Senior Counsel submits that the documents were seized from the premises of the third party. The document does not contain the name of assessee nor in the handwriting of assessee nor signed on or on behalf of assessee. The ld. Senior Counsel for the assessee invited our attention on page No. 5 of paper book which is part of seized material on which the Assessing officer relied. It was shown that there is certain reference of ‘capital received’ and ‘capital return’ and total capital received /Jama is of Rs. 2.69 crores. Similarly, the ‘capital return’ is also shown certain pending amount and ultimately at the last column (Column F) has shown equal amount which was returned. The ld. Senior Counsel for the assessee submits that before the Assessing Officer, the assessee filed reply to the show cause notice about the seized material which was allegedly related to the assessee wherein they have explained each and every entry in denying that no such cash payment was received except demand draft of Rs. 25.00 lacs, received from Sangeeta Rajesh Jogani against booking of Flat No. E-801, which is duly recorded in books of account. Booking was later on cancelled on 13/03/2016 and the IT(SS)A No. 04 & 05/Srt/2021 DCIT Vs M/s DRB Ravani Developers 19 flat is still lying unsold (till then). The ld. Senior Counsel for the assessee submits that in the reply, the assessee specifically explained that there is no signature of partner of assessee, the assessee also requested for cross examination of the person in whose possession, the noting of their name and such description were found. The Assessing officer has not allowed for cross examination of person from whose possession such document was recovered. During the search action, statement of partner of Param Properties, Agam Vadecha was recorded wherein he stated that certain transactions were made with his client Ravani Group in respect of Calestial Dreams Project and quantum of transaction involved was Rs. 2.73 crores. During the assessment proceedings, Shri Agam Vadecha was issued notice under Section 133(6) but he did not respond. No statement for identification of Dilipbhai whose name is written on the seized document was identified. The ld. Senior Counsel for the assessee reiterated that neither the document was signed nor found from the premises of assessee nor in the handwriting of assessee or their authorised person. The person, from whose premises, document was found, was not responded to the notice under Section 133(6) of the Act, in such situation, the document cannot be relied and is nothing but a dump IT(SS)A No. 04 & 05/Srt/2021 DCIT Vs M/s DRB Ravani Developers 20 document. To support his submission, the ld. Senior Counsel for the assessee has relied on the following decisions: (a) CIT Vs Gian Gupta (2014) 46 taxmann.com 372 (Delhi), (b) CIT Vs AKEM Projects Ltd. (2014) 42 taxmann.com 379 (Delhi), (c) CIT Vs. Vivek Aggarwal (2015) 56 taxmann.com 7 (Delhi), (d) ACIT Vs Sri Radheshyam Poddar (1992) 41 ITD 449 (Kol Trib), (e) CIT Vs Kulwant Rai (2007) 163 Taxman 585 (Delhi), (f) CIT Vs Maulikumar K. Shah (2008) 307 ITR 137 (Guj), (g) Pr.CIT Vs Ajay Surendrabhai Patel (2016) 69 taxmann.com 309 (Guj), (h) ACIT Vs Shri Trilokbhai R. Parikh IT(SS)A No. 124/Ahd/2014 & ors. Appeals order dated 13/12/2018 and (i) Andaman Timber Industries Vs Commissioner of Central Excise (2015) 62 taxmanm.com 3 (SC) 9. In the short rejoinder, the ld. CIT-DR for the revenue submits that during the recording statement of Agam Vadecha, he has clearly stated about their business transaction and boking in the project of assessee. 10. We have considered the rival submissions of both the parties and have perused the orders of the lower authorities carefully. We have also deliberated about various case laws relied by the lower authorities as well as the ld. Senior Counsel for the assessee. We find that assessing officer made addition of Rs. 4.05 crore by taking view that during the course of search action, on Param Property several incriminating documents and evidences were found and seized, which contains the entries pertaining to IT(SS)A No. 04 & 05/Srt/2021 DCIT Vs M/s DRB Ravani Developers 21 information related to units/flats of ‘Celestial Dream’, a project undertaken by the assessee. It was also held by the assessing officer that on the seized documents cash is written in a coded form ignoring the last two digits, 2000 means Rs. 20.00 lacs or so on, and so forth. The transactions featured in seized documents pertaining to flat No. E-801 of Celestial Dream Project and these sheets were sent by Dilipbhai Ravani, key person of assessee firm to Param Properties, in respect of unit booked through them. The assessee firm has also received payment of Rs. 25.00 lacs trough demand draft issued by Karnataka bank, which was confirmed by Karnataka Bank for booking of flat No. E-801 of ‘Celestial Dreams’ project. The Assessing Officer on the basis of noting on page No. 72 and 6 of Annexure-BS-51, prepared a table of unaccounted transaction received by assessee in respect of flat No. E-801 on various dates aggregating of Rs. 4.05 crores. And that such amount was received in cash on account of unaccounted transaction. The assessing officer also relied on the statement of Agam Vadecha of Param Property, recorded under Section 132(4) on 30/09/2015, wherein he explained that noting on page No. 72 are related with their client Dilip Ravani in respect of Celestial Dreams project. The assessing officer on the basis of statement of Agam Vadecha partner of Param Properties and the information IT(SS)A No. 04 & 05/Srt/2021 DCIT Vs M/s DRB Ravani Developers 22 gathered from the bank as well as Sangeeta Rajesh Jogani in respect of demand draft transaction featured in the seized document held that on the basis of such fact, it is clearly established the relations between the assessee and Param properties and held that there is clinching evidence in the seized document, accordingly receipt in respect of flat No. E-801 of Celestial Dreams project reflecting in the seized material aggregating of Rs. 4.05 crore was added under Section 69A of the Act. 11. We find that ld. CIT(A) after considering the submission noted that undisputed fact is that the document relied by Assessing Officer were found at the premises of Param Properties and not from the assessee. It was noted that such document is not signed by or on behalf of assessee, not in the handwriting of person authorised by assessee. In the statement of Agam Vadecha recorded by Investigation Team, he stated that transaction involved was of Rs. 2.73 crores only. The ld CIT(A) further noted that during the course of assessment, notice under Section 133(6) was issued to Agam Vadecha, whose statement was relied by assessing office but, he did not respond to the Assessing Officer. There is no statement or even identification of person Dilipbhai whose name is written in the seized document. On the basis of such view the ld IT(SS)A No. 04 & 05/Srt/2021 DCIT Vs M/s DRB Ravani Developers 23 CIT(A) held that the documents are nothing but a dump document, as far as assessee is concerned. The ld. CIT(A) while relying on the decision of Jurisdictional High Court in PCIT Vs Ajay Sundarbhai Patel (supra) CIT Vs MK Brother 163 ITR 249 (Guj), and Ahmedabad Tribunal in ITO Vs Ramesh Chhadra (supra) and Madras High Court in Shri Ramalinga Choodambikai Mills Ltd. Vs CIT (supra) held that the addition on the basis of dump documents are not justified. 12. We find that the ld. CIT(A) also specifically noted assessing officer conducted inquiry against Sangeeta R. Jogani whose husband’s name is mentioned in the seized document by issuing notice under Section 133(6) of the Act. In response she replied that she paid Rs. 25.00 lacs directly to assessee for booking of flat No. E-801 through demand draft issued from her savings bank account and the same was received back on cancellation of booking. For other entries, she denied that she has not made the payment shown on the entries. The assessee asked for cross examination of Agam Vadecha but the same is denied by the Assessing Officer despite specific request. The ld. CIT(A) by referring the decision of Hon’ble Supreme Court in Krishna Chand Chela Ram Vs CIT 125 ITR 713 and Andaman Timber Industries Vs Commissioner of Central Excise (supra) held that non-providing of cross examination of IT(SS)A No. 04 & 05/Srt/2021 DCIT Vs M/s DRB Ravani Developers 24 person on whose statement reliance was made for making addition, is against the principles of natural justice and thus the addition in absence of such cross examination is not sustainable. We find that the ld CIT(A) on appreciation of facts and evidences held that there were no sufficient evidences against the assessee for making such addition. No contrary facts or evidence or law is brought to our notice to take contrary view, therefore, we do not find any reason to interfere with the finding of ld CIT(A). In the result, the grounds of appeal raised by the assessee are allowed. 13. In the result, the appeal of the revenue is dismissed. 14. Now we take IT(SS) A No. 05/Srt/2021 for the A.Y. 2015-16. As noted above, certain facts for A.Y. 2015-16 is common as facts of A.Y. 2013-14, the Assessing Officer made addition on account of unexplained payment of Rs. 1.68 crores on the basis of certain noting on page No. 72 of BS-56 by taking a view that as per transaction on the seized documents and human probabilities is evident that transaction pertain to the assessee otherwise there is no reason to keep recording of financial transaction in the possession of person wherein entries related to business were recorded. The assessing officer also held that there is clinching evidence on the basis of which inference is drawn that the assessee made unexplained payment of Rs. 1.68 crores. IT(SS)A No. 04 & 05/Srt/2021 DCIT Vs M/s DRB Ravani Developers 25 15. The ld. CIT(A) deleted the addition by taking a view that as per books of account of assessee, the booking of flat No. E-801 is in the name of Sangeeta Rajesh Jogani through demand draft of Rs. 25.00 lacs, which later on, was cancelled. Such fact was confirmed by Sangeeta Rajesh Jogani before the Assessing Officer. Sangeeta Rajesh Jogani denied any other payment written on the same page. Making addition on the basis of such document is totally unjustified. The assessee asked for cross examination of Agam Vadecha, which was not provided. The addition in absence of cross examination on the statement of a person relied, is in violation of principles of natural justice as has been held in Krishna Chand Chela Ram Vs CIT 125 ITR 713 (SC) and Andaman Timber Industries Vs Commissioner of Central Excise (2015) 62 taxmann.com 3 (SC). Thus, the addition made by the Assessing Officer is factually and legally not sustainable. 16. Before us, the ld. CIT-DR for the revenue except supporting the order of Assessing Officer, failed to bring any evidence to connect the assessee with the alleged payment or expenditure of Rs. 1.68 crores with the assessee, particularly when the transaction of booking by Sangeeta Rajesh Jogani was cancelled, who has admitted to have to received his money back and denied of having receipt of any other amount. There is no other evidence of IT(SS)A No. 04 & 05/Srt/2021 DCIT Vs M/s DRB Ravani Developers 26 expenditure recorded in the books of assessee. the alleged evidence of expenditure was found at the premises of third person. Therefore, we do not find any reason to interfere with the order of ld. CIT(A) and we uphold the same. Accordingly, the grounds raised by the revenue in this appeal are dismissed. 17. In the result, both these appeals of the revenue are dismissed. Order pronounced in the open court on, 17 th May, 2023. Sd/- Sd/- (Dr. ARJUN LAL SAINI) (PAWAN SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER Surat, Dated: 17/05/2023 *Ranjan Copy to: 1. Assessee 2. Revenue 3. CIT(A) 4. CIT 5. DRs 6. Guard File By order Sr.Private Secretary, ITAT, Surat