MAMTA PATEL, RAIPUR,RAIPUR V. ACIT, CIRCLE-1(1), RAIPUR, RAIPUR

ITA 684/RPR/2025

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The case revolves around an appeal by Mamta Patel against the order of the Assistant Commissioner of Income Tax, which added Rs.5,07,690 to her income as unexplained investment under Section 69 of the Income Tax Act, 1961. This amount was allegedly paid in cash for the purchase of a flat, as per an excel sheet found during a search operation on the Wallfort Group. The Tribunal examined the evidence, including bank statements and a confirmation from the seller, Chhattisgarh Project (India) Pvt. Ltd., which contradicted the claim of cash payment. The Tribunal concluded that the addition was unjustified as the payments were fully documented and made through bank transactions.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 792646 (ITAT-RAIPUR)
• Duration Of Justice: 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-12-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2020-2021
• Appeal Filed On: 10-11-2025
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: PRIYANKA PATEL
• Assessee Lawyers: DIMPLE WARYLANI
• Keywords: Unexplained investment; Onus to prove; Search and seizure; Assessment record
• Section: 147; 69

Judgement Text

"आयकर अपीलȣय अͬधकरण Ûयायपीठ “एक-सदèय” मामला रायपुर मɅ IN THE INCOME TAX APPELLATE TRIBUNAL RAIPUR BENCH “SMC”, RAIPUR Įी पाथ[ सारथी चौधरȣ, ÛयाǓयक सदèय क े सम¢ BEFORE SHRI PARTHA SARATHI CHAUDHURY, JUDICIAL MEMBER आयकर अपील सं./ITA No.684/RPR/2025 Ǔनधा[रण वष[ /Assessment Year : 2020-21 Mamta Patel E-802, Wallfort Height, Bhatagaon, Raipur-492 015 (C.G.) PAN: AHRPP8532E .......अपीलाथȸ / Appellant बनाम / V/s. The Assistant Commissioner of Income Tax, Circle-1(1), Raipur (C.G.) ……Ĥ×यथȸ / Respondent Assessee by : Mrs. Dimple Warylani, CA Revenue by : Dr. Priyanka Patel, Sr. DR सुनवाई कȧ तारȣख / Date of Hearing : 04.12.2025 घोषणा कȧ तारȣख / Date of Pronouncement : 04.12.2025 Printed from counselvise.com 2 Mamta Patel Vs. ACIT, Circle-1(1), Raipur (C.G.) ITA No.684/RPR/2025 आदेश / ORDER PER PARTHA SARATHI CHAUDHURY, JM The present appeal preferred by the assessee emanates from the order of the Ld.CIT(Appeals)/NFAC, Delhi dated 11.09.2025 for the assessment year 2020-21 as per the following grounds of appeal: “1. On the facts and circumstances of the case, the Learned CIT(A) (NFAC) has erred in upholding the order of the Learned Assessing Officer (‘AO’), wherein the Assessing Officer has erred in making addition of Rs.5,07,690/- under section 69 of the I.T. Act, 1961 on account of unexplained investment by holding that cash amount has been given for purchase of immovable property which is not recorded in the books of accounts. The addition made by the Assessing Officer and sustained by the CIT-Appeal is unjustified, unwarranted and uncalled for. 2. The appellant reserves the right to add, amend or alter any grounds of appeal at any time of hearing.” 2. Brief facts in this case are that the assessee had purchased one unit Flat i.e. E-802 at Wallfort Heights, Bhatagaon, Raipur from Chhattisgarh Project (India) Pvt. Ltd. There was search and seizure action carried out in the case of Wallfort Group and others who are the owners of the said Chhattisgarh Project (India) Pvt. Ltd. on 03.11.2023. During the course of search proceedings various evidences were found which revealed that the group had indulged in tax evasion by carrying out sale of flats/plots in cash to various buyers and the same has not been offered to taxation. One such evidence was an excel sheet named WH 2020 NOT REG.xlsx which Printed from counselvise.com 3 Mamta Patel Vs. ACIT, Circle-1(1), Raipur (C.G.) ITA No.684/RPR/2025 was retrieved from email id of one of the director of the said Wallfort Properties Pvt. Ltd. namely, Shri Pankaj Lahoti who is also a director in Chhattisgarh Project (India) Pvt. Ltd. The A.O writes in the assessment order that analysis of the said excel sheet revealed that the group has received cash in addition to consideration price reported in registry of various units sold in the Wallfort Height project of the group and hence, this cash forms part of the revenue of the group which has not been disclosed to the department for taxation. The A.O observed and held that since this Wallfort Heights project is part of Chhattisgarh Project (India) Pvt. Ltd. and the assessee viz. Mamta Patel had purchased one unit flat from the said company, therefore, it is ascertained that the assessee has also indulged in the cash transaction and accordingly, the A.O held as follows: “8. As per discussion made above, it is clear that the assessee has made payments in cash amounting to Rs.5,07,690/- during the year under consideration for purchasing property-E802 in Wallfort Heights. le aforesaid findings of cash payment cannot be denied which have already been accepted by the Wallfort group as a result of search & seizure action. Since the assessee has failed to provide the source of cash payments of Rs.5.07 600/- for purchasing of immovable property, therefore provision of section 69 is attracted in the case of the assessee.” 3. Similarly, the Ld. CIT(Appeals)/NFAC had upheld the said addition by observing as follows: Printed from counselvise.com 4 Mamta Patel Vs. ACIT, Circle-1(1), Raipur (C.G.) ITA No.684/RPR/2025 “4.3 The appellant filed a return of income for the Assessment Year (AY) 2020-21 declaring a total income of Rs.17,32,640/-. Subsequently, information was received from the Investigation Wing of the department concerning a search and seizure action carried out in the case of the Wallfort Group on 03.11.2023. During the search proceedings, an excel sheet titled \"WH 2020 NOT REG.xlsx was seized, which evidenced that the Wallfort Group was engaged in receiving cash consideration for the sale of flats and plots, in addition to the amount reported in the registry documents. This evidence was corroborated by the statement recorded under Section 132(4) of the Income Tax Act, 1961, of Shri Pankaj Lahoti, a Director of the Wallfort Group, on 05.11.2023. In his statement, Shri Lahoti admitted that the group receives 10-15% of the total sale consideration in cash. Based on the seized data, it was ascertained that the appellant had made a cash payment of Rs.5,07,690/- to the Wallfort Group during the relevant financial year for the purchase of immovable property. During the assessment proceedings, the Assessing Officer (AO) provided a full opportunity to the appellant to substantiate the source of this cash payment with corroborative documentary evidence. However, the appellant failed to provide any satisfactory explanation or supporting documentation. Consequently, the AO invoked the provisions of Section 69 of the Income Tax Act, 1961 and added the said amount of Rs.5,07,690/- to the total income of the appellant as an unexplained investment. I have carefully considered the written submissions of the appellant and have perused the assessment records, including the findings of the AO and the seized material. The crux of the matter lies in the appellant's failure to provide a credible explanation for the source of the cash payment of Rs.5,07,690/-. The AO's action was not based on mere suspicion but on concrete evidence seized during a search and seizure operation. The admission made by a key group director, Shri Pankaj Lahoti, under oath in his statement recorded under Section 132(4) provides a strong foundation for the AO's action. This admission, which has not been retracted, directly links the Wallfort Group to a practice of receiving cash payments for property sales. Furthermore, the seized excel sheet specifically points to the appellant's Printed from counselvise.com 5 Mamta Patel Vs. ACIT, Circle-1(1), Raipur (C.G.) ITA No.684/RPR/2025 involvement in such a transaction, detailing the payment of a cash amount of Rs.5,07,690/-. The onus was therefore on the appellant to demonstrate the source of this investment. The appellant's failure to provide any documentary evidence, such as bank statements, withdrawal slips, or a valid explanation for the source of these funds, leaves the investment as unexplained. Section 69 of the Income Tax Act, 1961, clearly provides that where the appellant has made investments that are not recorded in the books of account and the source of which is not explained to the satisfaction of the Assessing Officer, the value of such investments may be deemed to be the income of the appellant. The AO has correctly applied this provision based on the facts and circumstances of the case. The addition is based on tangible evidence and the appellant's inability to discharge the burden of proof. In light of the above discussion, the grounds raised by the appellant are not found to be tenable. The addition of Rs.5,07,690/- made by the Assessing Officer under the provisions of Section 69 of the Income Tax Act, 1961, is held to be fully justified. Consequently, the Ground of appeal related to issue is hereby dismissed. 5. In the result, the appeal stands dismissed.” 4. At the time of hearing, the Ld. Counsel for the assessee vehemently contended that they have purchased a flat unit from the said Chhattisgarh Project (India) Pvt. Ltd. which is part and parcel of the Wallfort Group. However, the assessee had paid entire amount of money of sale consideration through banking channels. In this regard, it was also submitted by Ld. Counsel that they had furnished all the relevant evidences before the A.O and the said evidences were even there on record before the Ld. CIT(Appeals)/NFAC. Demonstrating the same, the Ld. Counsel brought to the notice of the Bench at Page 4 of the paper book, Printed from counselvise.com 6 Mamta Patel Vs. ACIT, Circle-1(1), Raipur (C.G.) ITA No.684/RPR/2025 wherein, they had filed bifurcation of the entire amount and the same is extracted as follows: Date Amount Description 12.06.2019 Rs.1,00,000/- Advance paid by cheque for booking 19.07.2019 Rs.74,14,500/- Rs.59,76,000/- from SBI Home Loan and Rs.14,38,500/- from SBI Saving account 22.07.2019 Rs.5,07,690/- (alleged by the AO to be paid in cash) a) Stamp duty, registration charges and legal:- Rs.4,42,750/- b) Maintenance charges, Society formation and electricity connection (via RTGS) :-Rs.64,940/- Total RTGS made Rs.5,07,748/- dated 22.07.2019 Including RTGS Charges [(Rs.5,07,690/- +58.42 (RTGS Charges)] Copy of registered deed, agreement copy and relevant bank statement is enclosed herewith to evident the same. Kindly refer Annexure-2,3,4 respectively. Total Rs.80,22,190/- It is pertinent to note that the amount allegedly showing as invested in cash of Rs.5,07,690/- in the excel sheet, found during the course of search in Wallfort Group, exactly matches the RTGS transaction of Rs.5,07,690/-, clearly substantiating that no cash payment was involved. Copy of Bank statement highlighting the transaction is enclosed in Amtexure-4. Kindly refer the same. Further in the said excel sheet which is reproduced in page 20 of the assessment order , where the total amount comes to Rs.80,22,190/- exactly match with the total amount paid by the assesse through banking channel and is recorded in registered sale deed as well. It clearly reflects that the said amount of Rs.5,07,690/- has been inadvertently shown in cash column of the excel sheet found from the Wallfort Group. This fact has also been accepted by the seller i.e. Chhattisgarh Project (India) Pvt. Ltd. through their letter dated 02.04.2025, a copy of which is enclosed herewith for your ready reference. Kindly refer Annexure-5. Since the alleged amount of Rs.5,07,690/- has been made through banking Printed from counselvise.com 7 Mamta Patel Vs. ACIT, Circle-1(1), Raipur (C.G.) ITA No.684/RPR/2025 channel and duly recorded in the books of accounts, therefore, the addition made u/s. 69 deserves to be deleted.” 5. The aforesaid document forms part of the submission of the assessee made before the Ld. CIT(Appeals)/NFAC. It is discernable from the afore-stated that the alleged cash payment of Rs.5,07,690/- by the A.O as per excel sheet exactly matches with the RTGS transaction of Rs.5,07,690/-, which therefore, was clear evidence before the Revenue authorities that no cash payment was involved. 6. The Ld. Counsel also had filed the copy of the bank statement of UCO Bank, Telibandha Branch, in which, it is clear that the assessee had made RTGS to the said company i.e. Chhattisgarh Project (India) Pvt. Ltd. amounting to Rs.5,07,748.42 on 22.07.2019. The same is extracted as follows: Printed from counselvise.com 8 Mamta Patel Vs. ACIT, Circle-1(1), Raipur (C.G.) ITA No.684/RPR/2025 Printed from counselvise.com 9 Mamta Patel Vs. ACIT, Circle-1(1), Raipur (C.G.) ITA No.684/RPR/2025 7. The Ld. Counsel for the assessee has also brought on record in the paper book at Page 87, the confirmation from Chhattisgarh Project (India) Pvt. Ltd. which reads as follows: Printed from counselvise.com 10 Mamta Patel Vs. ACIT, Circle-1(1), Raipur (C.G.) ITA No.684/RPR/2025 Printed from counselvise.com 11 Mamta Patel Vs. ACIT, Circle-1(1), Raipur (C.G.) ITA No.684/RPR/2025 8. On perusal of the aforesaid confirmation, it is crystal clear that Vendor Company has received an amount of Rs.5,07,690/- in their bank account from purchaser/assessee and furthermore, in respect of this amount, the confirmation reveals that the vendor has not received any cash from the assessee/purchaser. That in spite of this document being filed before the A.O just on the basis of the excel sheet document which was found during the course of search on third party premises i.e. in the premises of Wallfort Group, the A.O has arbitrarily made the addition in the hands of the assessee contending cash payments. None of the authorities has brought on record any direct evidence of cash payment by the assessee and what is the benefit which the assessee could get through such cash payment while purchasing flat unit, no such findings have been recorded either by the A.O or by the Ld. CIT(Appeals)/NFAC. It was the information that was gathered by the department through search in the third party premises and how that is related to the assessee for making such addition, there is no reasoning or evidence to substantiate the same in the orders of the revenue authorities. 9. On contrary, the assessee had furnished before the A.O confirmation from the vendor company that they have not received any cash from the assessee and that they have got entire money through banking transaction. In fact, the bank statement of the UCO Bank, Telibandha Branch, Raipur of the assessee that clearly shows RTGS of the Printed from counselvise.com 12 Mamta Patel Vs. ACIT, Circle-1(1), Raipur (C.G.) ITA No.684/RPR/2025 said amount which was inadvertently added by the A.O stating it to be a cash payment. The mistake committed by the A.O was further carried on by the Ld. CIT(Appeals)/NFAC without adhering to the provisions of Section 250(4) & (6) of the Act and without any enquiry or verification of the facts, the said authority has summarily and arbitrarily upheld the addition without independent application of mind. This is more strange, when all evidences have been furnished by the assessee demonstrating no cash payment and the assessee had filed bank statements, confirmations, in such case the reasons are best known to the Revenue for making additions in the hands of the assessee alleging cash payments even without any corroborative evidence placed on record, such an order becomes inherently perverse, arbitrary and bad in law. Accordingly, I set- aside the order of the Ld. CIT(Appeals)/NFAC and direct the A.O to delete the additions from the hands of the assessee while providing appeal effect of this order. 10. Before parting, it is also observed that search had taken place in third party premises wherein the informations were collected by the department regarding the assessee, in such scenario, the issue is no more res-integra for applicability of correct provision while framing assessment which should be u/s. 153C of the Act. In this case, the assessment had been completed u/s. 147 of the Act. However, since the matter has been Printed from counselvise.com 13 Mamta Patel Vs. ACIT, Circle-1(1), Raipur (C.G.) ITA No.684/RPR/2025 adjudicated on merits itself, therefore, this Bench does not find any justification to travel further on this legal issue which is hereby rested. 11. As per the above terms, grounds of appeal of the assessee stands allowed. 12. In the result, appeal of the assessee is allowed. Order pronounced in open court on 04th day of December, 2025. Sd/- (PARTHA SARATHI CHAUDHURY) ÛयाǓयक सदèय/JUDICIAL MEMBER रायपुर / Raipur; Ǒदनांक / Dated : 04th December, 2025. SB, Sr. PS आदेश कȧ ĤǓतͧलͪप अĒेͪषत / Copy of the Order forwarded to : 1. अपीलाथȸ / The Appellant. 2. Ĥ×यथȸ / The Respondent. 3. The Pr. CIT-1, Raipur (C.G.) 4. ͪवभागीय ĤǓतǓनͬध, आयकर अपीलȣय अͬधकरण, “एक-सदèय” बɅच, रायपुर / DR, ITAT, “SMC” Bench, Raipur. 5. गाड[ फ़ाइल / Guard File. आदेशानुसार / BY ORDER, // True Copy // Senior Private Secretary आयकर अपीलȣय अͬधकरण, रायपुर / ITAT, Raipur Printed from counselvise.com "