WAANEEP SOLAR PRIVATE LIMITED,DELHI V. CENTRAL CIRCLE 2(4) , MUMBAI

ITA 4032/MUM/2025

AI Insights

Waaneep Solar Private Limited appealed against the orders of the Commissioner of Income-tax (Appeals) which upheld the additions made by the Assessing Officer under Section 69C of the Income-tax Act, 1961, for unexplained expenditures related to land purchases. The case stemmed from a search and seizure operation on the Waaree group, which included Waaneep Solar, leading to the discovery of documents and emails suggesting unaccounted cash transactions for land purchases. The Tribunal considered the legal arguments regarding the jurisdiction and the validity of the satisfaction note under Section 153C, ultimately finding in favor of the revenue. The Tribunal's decision was influenced by the detailed examination of the satisfaction note and the lack of sufficient reconciliation by the appellant for the disputed amounts.

• Counselvise Citation: [2026] 140 COUNSELVISE.COM (IT) 828784 (ITAT-MUMBAI)
• Duration Of Justice: 7 month(s) 6 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-01-2026
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: Mumbai
• Assessment Year: misc
• Appeal Filed On: 05-06-2025
• Other Referred Cases: DCIT vs Sunil Kumar Sharma, Indian National Congress vs DCIT, CIT vs Singhad Technical Education Society, Principal Commissioner of Income Tax, Central-3 vs. Abhisar Buildwell P. Ltd
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: ARUN KANTI DATTA
• Assessee Lawyers: RUSHABH MEHTA
• Keywords: Unexplained expenditure; Retraction; Capital expenditure; Principle of natural justice; Search and seizure; Assessment record
• Section: 143(3); 132; 153A; 131; 69C

Judgement Text

"IN THE INCOME-TAX APPELLATE TRIBUNAL “G” BENCH, MUMBAI BEFORE JUSTICE (RETD.) C. V. BHADANG, PRESIDENT & SHRI PRABHASH SHANKAR, ACCOUNTANT MEMBER ITA No.4031/MUM/2025 (A.Y. 2015-16) & ITA No. 4032/MUM/2025 (A.Y. 2016-17) Waaneep Solar Private Limited Plot No. 201, Ground Floor, Phase III Okhla, Industrial Estate, New Delhi – 110 020, Delhi, New Delhi v/s. बनाम Income Tax Officer, Central Circle – 2(4), 802, 8th Floor, Pratishtha Bhavan, Old CGO Annexe, Maharishi Karve Road, Mumbai – 400 020, Maharashtra स्थायी लेखा सं./जीआइआर सं./PAN/GIR No: AABCW5050A Appellant/अपीलार्थी .. Respondent/प्रतिवादी Appellant by : Shri Rushabh Mehta, AR Respondent by : Shri Arun Kanti Datta, (CIT-DR) Date of Hearing 14.10.2025 Date of Pronouncement 12.01.2026 आदेश / O R D E R PER PRABHASH SHANKAR [A.M.] :- The above captioned appeals have been filed by the assessee against the orders of even date as passed by the Learned Commissioner of Income-tax, Appeal, CIT(A)-48, Mumbai [hereinafter referred to as “CIT(A)”] pertaining to the assessment orders passed u/s. 153C r.w.s. 143(3) of the Income-tax Act, 1961 [hereinafter referred to as “Act”] dated 15.04.2021 for the Assessment Years [A.Ys.] 2015-16 & 2016- Printed from counselvise.com P a g e | 2 ITA No. 4031, 4032/Mum/2025 A.Y. 2015-16, 2016-17 Waaneep Solar Private Limited 17.Since the issues involved are common and also the fact that appeals were heard together, they are being taken up together for adjudication vide this composite order for the sake of brevity. ITA No. 4031/Mum/2025 is taken as the ‘Lead case’. Decision herein would apply mutatis mutandis to the appeal for AY 2016-17. 2. The grounds of appeal are as under:- ITA No. 4031/MUM/2025(A.Y. 2015-16) 1(a) The assessment order passed u/s. 153C of the Act by the Ld. Assessing Officer is without jurisdiction, invalid and bad in law and in violation of the principles of natural justice. (b) The Ld. Assessing Officer erred in law and on facts in initiating proceedings u/s. 153C of the Act without recording proper and valid satisfaction thereby rendering the entire proceedings invalid and void ab initio. (c) The satisfaction recorded by the Ld. Assessing Officer is in the form of a consolidated satisfaction note, which is generic, vague, non-specific, and not in accordance with the mandatory requirement of law. 2)(a) The Ld. CIT(A) erred in facts and in law in upholding the addition to the extent of Rs. 1,86,72,930/-u/s. 69C of the Act as unexplained expenditure towards purchase of land parcels without appreciating the details, documents and explanations placed on record by the appellant. (b) The Ld. CIT(A) failed to appreciate that the addition has been sustained solely on the basis of entries in an excel file allegedly found from the email account of a director, without any corroborative evidence to establish that the appellant was in possession of unaccounted cash purportedly utilized for the purchase of land. (c) The Ld. CIT(A) further erred in placing reliance upon unauthenticated, incomplete, and informal data contained in a draft excel file attached to Printed from counselvise.com P a g e | 3 ITA No. 4031, 4032/Mum/2025 A.Y. 2015-16, 2016-17 Waaneep Solar Private Limited the email received from an employee, which does not bear any signature, approval, or acknowledgment of the appellant, and which cannot be treated as conclusive evidence against the appellant and even the presumption under section 132(4A) or section 292C of the Act arises only in relation to the person subjected to search, and cannot be extended to a third party without independent evidence. 3. Brief facts are that the assessee is in the business of setting up and running solar plants. For the AY 2015-16, it filed Return of Income declaring Nil income. Subsequently, scrutiny assessment under section 143(3) of the Act was made. A search and seizure action under Section 132 of the Act was initiated in the case of M/s. Waaree Energies Ltd., M/s. Cessare Bonetti India Pvt. Ltd., Shri Hitesh Chimanlal Doshi, Shri Kirit Chimanlal Doshi and Shri Viren Chimanlal Doshi on 20.11.2018. The assessee is one of the entities of Waaree group. In the said search, certain document/material relating to the assessee was allegedly found and seized. A notice under section 153C of the Act was issued, in response to which the assessee filed its return claiming a loss of Rs.1,33,70,723/-. 4. Ground no.1-The ld. AR has raised a preliminary ground. It is submitted that the AO had recorded his satisfaction jointly for both the years, which is not permissible. Reliance in this regard is placed on the decision of Supreme Court in DCIT vs Sunil Kumar Sharma, 469 ITR Printed from counselvise.com P a g e | 4 ITA No. 4031, 4032/Mum/2025 A.Y. 2015-16, 2016-17 Waaneep Solar Private Limited 271 (SC). It is submitted that the satisfaction note ought to have been recorded separately for each of the assessment years and the joint satisfaction note would vitiate the entire assessment proceedings. It is submitted that the recording of a proper satisfaction note on the basis of objective circumstances/material is a sine qua non for assumption of jurisdiction. 4.1 In this regard, the ld. DR has submitted that the satisfaction note cannot be questioned as it sets out the necessary particulars which are the basis for the impugned addition for both the years and no prejudice is demonstrated. It is contended that it is only where the additions in respect of different years is based on distinct circumstances/reason that would require separate satisfaction note. It is submitted that the assessee has failed to submit reconciliation in respect of the entire amount and, therefore, the addition made in respect of the balance amount is justified and does not require any interference. The ld. DR has also placed reliance on the decision of hon’ble Delhi High Court in Indian National Congress vs DCIT, 463 ITR 431 (Delhi) wherein it was held that the composite satisfaction note would be sufficient for the purpose of requirements of section 153 of the Act Printed from counselvise.com P a g e | 5 ITA No. 4031, 4032/Mum/2025 A.Y. 2015-16, 2016-17 Waaneep Solar Private Limited provided it embodies details of material gathered in course of search pertaining to assessment years forming part of the block as a whole. 5. We have considered the submissions made. First, we reproduce the preliminary ground as under :-. “1) (a) The assessment order passed u/s. 153C of the Act by the Ld. Assessing Officer is without jurisdiction, invalid and bad in law and in violation of the principles of natural justice. (b) The Ld. Assessing Officer erred in law and on facts in initiating proceedings u/s. 153C of the Act, without recording proper and valid satisfaction thereby rendering the entire proceedings invalid and void ab initio. (c) The satisfaction recorded by the Ld. Assessing Officer is in the form of a consolidated satisfaction note, which is generic, vague, non- specific, and not in accordance with the mandatory requirement of law.” 5.1 We find that the said ground would go to the root of the matter and as the necessary material to decide the said ground is available on record, the same can be allowed to be raised for the first time before this Tribunal. 5.2 It is not disputed that the satisfaction note forms the basis of assumption of jurisdiction under section 153C of the Act and the consequent assessment. Before going further in the matter, it would be Printed from counselvise.com P a g e | 6 ITA No. 4031, 4032/Mum/2025 A.Y. 2015-16, 2016-17 Waaneep Solar Private Limited relevant to peruse the contents of the said satisfaction note,a scanned copy of which has been incorporated as below: 5.3 From the above satisfaction note, it appears that the only incriminating material found/seized during the search and seizure Printed from counselvise.com P a g e | 7 ITA No. 4031, 4032/Mum/2025 A.Y. 2015-16, 2016-17 Waaneep Solar Private Limited operation was certain e-mail communication alongwith its attached excel file showing correspondence between the two important employees of the company. No other material is referred therein. Cash transactions worth Rs 8.20 cr. were mentioned therein and the MD of the company had during the search admitted the transaction as undisclosed income of the appellant company. Although the satisfaction note refers to AY 2013- 14 to 2018-19,the additions impugned before us on the basis of such recording in the incriminating material have been made in AYs 2015-16 and 2016-17 only as admitted in the remand report dated 09.07.2024 submitted by the AO before the ld.CIT(A).We do not find any infirmity or deficiency in the satisfaction note which although is a common satisfaction, the only common incriminating material pertained to email communication and annexed ‘Land ledger’ as also the statement of the key persons of the assessee company. These incriminating materials formed the basis of additions in assessment of AYs 2015-16 and 2016-17 as the entries recorded therein pertained to these two assessment years which are before us for adjudication. Therefore, in our considered view there is no ambiguity in the satisfaction note qua incriminating materials. A composite satisfaction on the facts and the circumstances of the case, in no manner cause any prejudice to the assessee. Printed from counselvise.com P a g e | 8 ITA No. 4031, 4032/Mum/2025 A.Y. 2015-16, 2016-17 Waaneep Solar Private Limited 5.4 It may be stated there the hon’ble Delhi ITAT in its recent decision in the case of Upkar Mani, Delhi vs ACIT CC-8, Jhandewalan on 6 June, 2025 in ITA 3022/DEL/2023 has dismissed similar ground of appeal after duly taking into consideration the provisions of the section 153C of the Act qua facts of the case and also the cited decision of Sunil Kumar Sharma (supra).Relevant parts of the order are extracted as under: “2. The grounds of appeal are as under:- 1. “That on the facts and circumstances of the case, the order passed by the learned CIT(A) under section 250 of the Act is bad both in the eyes of law and on facts. 2. That the Ld. CIT(A) has erred on facts and in law in sustaining the order of the Ld. Assessing Officer passed under Section 153C of the Act which is illegal, bad in law, time barred and without jurisdiction. 3. That on the fact and circumstances of the case and provisions of law, the satisfaction recorded is illegal, bad in law and in violation of the CBDT guidelines and judgment of Hon’ble Supreme Court. ....................... ...................... 7.2. The ld. AR also challenged the satisfaction recorded u/s 153C of the Act and submitted that the Assessing Officer recorded a single/combined satisfaction for the assessment years 2012-13 to 2018-19 without indicating the year-wise undisclosed income which has any bearing on the total income of the assessee. In this regard, the assessee relied upon the following case laws:- i. DCIT vs Sunil Sharma [2024] 168 taxmann.com 77(SC) ii. CIT vs Singhad Technical Education Society (84 taxmann.com290) iii. DCIT vs Sunil Sharma [2024] 159 taxmann.com 179 (Karnataka) iv. Gopi Apartment (365 ITR 411) 7.3. In view of the above submissions, the Ld. AR submitted that since the satisfaction was not recorded properly, the assessment Printed from counselvise.com P a g e | 9 ITA No. 4031, 4032/Mum/2025 A.Y. 2015-16, 2016-17 Waaneep Solar Private Limited order for AY 2018-19 should be quashed and even on merits in view of the above submissions, the addition should be deleted. 8. The Ld. CIT-DR supported the orders of the authorities below. He relied upon the decision of the Hon’ble Delhi High Court in the case of Indian National Congress vs DCIT [2024] 160 taxmann.com 606 (Del.) and submitted that a single satisfaction was valid in the case of the assessee. 9. We have considered the rival submissions and perused the material available on record. The assessee in ground no.3 of the appeal has challenged the single/combined satisfaction and submitted that the satisfaction should have been recorded assessment year wise and in absence of the same, the said satisfaction was illegal and the consequent assessment order was a nullity and should be quashed. The same has been carefully considered by us but not found to be acceptable. The Hon’ble Delhi High Court in the case of Indian National Congress vs DCIT (Supra) held that a composite satisfaction note would suffice requirements of section 153C of the Act provided it embodies the details of materials gathered in course of search and pertaining to assessment years forming part of block as a whole. The relevant discussion in para no.23 and 24 of the said order of the Hon’ble Delhi High Court is reproduced as under:- “23. For the purposes of invoking Section 153C of the Act it is incumbent upon the AO to be satisfied that the material gathered in the course of the search and pertaining to the non- searched person would have a bearing on the determination of the total income of such other person either for six AYs’ or for the relevant AY or AYs’. Since the provision itself requires and enables the AO to undertake an assessment for a block period of ten years, it would clearly not be incumbent upon it to draw separate or independent satisfaction notes for each AY. A composite Satisfaction Note would suffice the requirements of Section 153C of the Act provided it embody details of the material gathered in the course of the search and pertaining to the AYs forming part of the block as a whole. As long as the common Satisfaction Note includes sufficient particulars of the incriminating material relevant to the block of AYs’, the same would, in our considered opinion, satisfy the statutory requirement as imposed by the Act. Singhad Technical Education Society as also the decision of the Supreme Court in Principal Commissioner of Income Tax, Central-3 vs. Abhisar Buildwell P. Ltd speak of incriminating material being found and which may impact the estimation of income likely to have escaped assessment for a particular AY. As we read and go through the Satisfaction Note as well as the orders disposing of objections, it is manifest that the respondent has rested its decision on incriminating material found for AYs 2014-15, 2015-16, 2016-17 and stretching up to AY 2020-21. Printed from counselvise.com P a g e | 10 ITA No. 4031, 4032/Mum/2025 A.Y. 2015-16, 2016-17 Waaneep Solar Private Limited 24. The provision only requires the AO to be satisfied that the material collated and handed over is likely to have an impact on the total income for the relevant AY or AYs’. While an assessment would necessarily have to be made in respect of each of the relevant AY or AYs’, we find ourselves unable to read Section 153A or 153C as mandating separate Satisfaction Notes being drawn for each assessment year. Our conclusion in this respect stands fortified from the language of Section 153A(1)(a) which contemplates a notice being issued calling upon the person to furnish a return of income for each of the six AYs’ or the relevant AY or AYs’. This too appears to suggest that while the notice could be composite and based on a common satisfaction note which encapsulates the incriminating material pertaining to the AYs’ in question, it is only returns which must and mandatorily be filed separately.” 9.1. In this case in the satisfaction note dated 13.05.2021 as reproduced on page no.3 of this order, it seen that the Assessing Officer has mentioned inter alia the following details..................... 9.2. Thus, the Assessing Officer has correctly recorded the satisfaction note for the year by recording the fact that the amount of Rs.32,62,500/- received in cash from Sh. Shamik Choksi for purchase of 1st and 2nd Floor + Terrace of B- 766, Sushant Lok, Phase-1, Gurgaon, has a bearing on determination of the total income of the assessee for AY 2018- 19 as in the above seized document, the transactions relate to FY 2017-18 relevant to AY 2018-19 in the case of the assessee. Therefore, relying upon the decision of the Hon’ble Delhi High Court in the above case, no fault can be found in the single/combined satisfaction note recorded by the Assessing Officer in the case if the assessee as the entries of the undisclosed transaction referred in the seized document relate to FY 2017- 18 relevant to AY 2018-19. Therefore, the said satisfaction note is held to be validly recorded and consequently, it is also held that the assessment order u/s 153C dated 31.12.2022 in the case of the assessee is also a valid assessment order. Hence ground no. 3 of the appeal is dismissed.” 5.5 In view of the above discussion and respectfully following the cited decision in the case of Upkar Mani, Delhi(supra),we hold that there is infirmity in the action taken by the AO u/s 153C of the Act. The ground no.1 in this regard is therefore, dismissed. 6. In the ground no.2 the assesse has contested the addition of Rs 1.86 cr. made u/s 69C of the Act on the basis of certain email Printed from counselvise.com P a g e | 11 ITA No. 4031, 4032/Mum/2025 A.Y. 2015-16, 2016-17 Waaneep Solar Private Limited communication alongwith certain annexures showing cash transactions not recorded in the books of account. It is stated that the ld. CIT(A) failed to appreciate that the addition has been sustained solely on the basis of entries in an excel file allegedly found from the email account of a director, without any corroborative evidence to establish that the appellant was in possession of unaccounted cash purportedly utilized for the purchase of land. The ld.CIT(A) further erred in placing reliance upon unauthenticated, incomplete, and informal data contained in a draft excel file attached to the email received from an employee, which does not bear any signature, approval, or acknowledgment of the appellant, and which cannot be treated as conclusive evidence against the appellant and even the presumption under section 132(4A) or section 292C of the Act arises only in relation to the person subjected to search, and cannot be extended to a third party without independent evidence. 7. According to the assessment order, the AO found that during the search an email was received by Shri Mayank Shah who earlier worked as Director (Finance) in group company, Waaree Energies Ltd. The said email was received from one Shri Kamal Marwah, an employee working in the group, in January, 2016. There was an excel document Printed from counselvise.com P a g e | 12 ITA No. 4031, 4032/Mum/2025 A.Y. 2015-16, 2016-17 Waaneep Solar Private Limited captioned “land ledger” which was attached to the email comprising several worksheets. One of the worksheets captioned “final summary land expenses” (in 14 pages) was also recovered. The statement of Shri Mayank Shah was recorded on oath under Section 132(4) of the Act in relation to the “final summary land expenses” in which he claimed that cash was sent and received by Shri Kamal Marwah, an intermediary for land purchase for Icchawar project of the assessee, Waaneep Solar Pvt. Ltd. in Madhya Pradesh. During the assessment proceedings, the statement of Shri Hitesh Doshi was also recorded in which he offered an amount of Rs.8,20,40,460/- as undisclosed investment generated out of cash sales/scrap sales/land transactions. Shri Hitesh Doshi subsequently filed an Affidavit dated 06.12.2018 withdrawing the said offer. During the assessment proceedings, the statement of Shri Hitesh Doshi was recorded under Section 131 of the Act on 23.02.2021. It was claimed by the assessee that it had entered into registered agreements with the farmers for purchase of land to the tune of approximately Rs. 6.20 cr. and the cash payment was made to the intermediary in connection with the said transaction. 7.1 The AO observed that M/s Waaree Energies Limited entered into EPC agreement with M/s Waaneep Solar Pvt. Ltd for its Icchawar Solar Project. In the process of land procurement, assessee Company has Printed from counselvise.com P a g e | 13 ITA No. 4031, 4032/Mum/2025 A.Y. 2015-16, 2016-17 Waaneep Solar Private Limited incurred amount totalling to Rs. 8,20,40,360/- in cash (Shri Mayank J. Shah had accepted this fact in his statement recorded on oath under section 132(4) of the Income Tax Act, 1961 on 21.11.2018). Moreover, during the search proceedings, Shri Hitesh Chimanlal Doshi, Managing Director of M/s Waaree Energies Limited had also accepted the facts and offered the amount of Rs. 8,20,40,360/- for taxation purpose considering the same as his undisclosed investments out of his undisclosed income generated through cash sale/scrap sale/land transactions etc. His retraction through affidavit was devoid of any merit and did not indicate any one to one flow of funds from the Bank account to the farmers from whom the land was purchased. In view of the above, it was evident that a total of Rs.8,06,32,460/- was incurred in cash by the assessee company out of its undisclosed income. 7.2 Accordingly, a show cause notice was issued by him asking why the amount of Rs. 8,06,32,460/- should not be treated as unexplained cash income and added to the total income for the AY 2015- 16.In response to the show-cause notice, the assessee filed its submission vide letter dated 15.03.2021. The relevant portion of the submission were reproduced below: a) “M/s. Waaneep Solar Pvt. Ltd. had won a 50MW tender floated by M/s. Solar Energy Corporation of India in respect of which a Solar Plant was to be set up Printed from counselvise.com P a g e | 14 ITA No. 4031, 4032/Mum/2025 A.Y. 2015-16, 2016-17 Waaneep Solar Private Limited at Ichhawar, Madhya Pradesh. Shri Kamal Marwah used to work for M/s. Waaneep Solar Pvt. Ltd. as project in charge of the said project and he was entrusted with the responsibility to execute the project, obtaining necessary permissions, procure land and registration of land. He used to report to Shri Mayank Shah who was the CFO of M/s. Waaneep Solar Pvt. Ltd. and was managing day to day operations including fund planning of the said Project. b) For the purpose of installing the solar project, the assessee company used to purchase barren land i.e. agricultural land but not fertile in nature after getting necessary approvals. The land required for the above project was procured from the local farmers at Ichhawar. Since lands were located in remote location having no streamlined banking facility and also farmers were not having easy access to the banks, the farmers also asked for payment/part payment in cash and accordingly the assessee company was required to disburse certain portions payments through cash. Hence, to meet the commercial requirements of setting up the project and for business exigency, cash was withdrawn from the bank account of the assessee company and the said duly accounted cash was in turn utilized for disbursing the payments to the farmers as per the land purchase agreements. Further, certain cash amounts were also remitted to Shri Kamal Marwah by M/s. Waaree Energies Ltd. from the cash available in its books on behalf of the assessee company. In other words, the said cash was duly accounted and recorded in the books of accounts and its utilization is also as per the land purchase agreement entered with the sellers. All such withdrawals and payments are duly recorded in the books of accounts. Even the land purchase agreements reflects the payment made in cash for purchase of land. c)For control purpose, Shri Kamal Marwah was maintaining status of amounts received and payment made by him for procurement of land which were to be verified by Shri Mayank Shah. In this regard, he had sent an email having subject line “land ledger as on 28-01-2016.xlsx” to Shri Mayank Shah on 28-01- 2016 which had a worksheet attached to it narnely “Final summary land expense” giving details of amount received and amount spent from time to time. d) The worksheet “Final Summary Land Expenses from the email attachment has the following columns & each column has below meaning: - Sr.No. Column Explanation 1 Date Date of transaction 2 Activity Narration of the payment 3 Cash received Cash received by Shri Kamal Marwah from the head office 4 Land Payment for the land 5 Associated to land Payment for the associated costs like stamp duty, registration in relation to the land Printed from counselvise.com P a g e | 15 ITA No. 4031, 4032/Mum/2025 A.Y. 2015-16, 2016-17 Waaneep Solar Private Limited 6 Balance Daily Balance available with Shri Kamal Marwah after incurring expenses out of cash received 7 Bills/Voucher provided Column showing whether supporting bill/voucher provided 8 Remarks Column representing certain specific remarks made by Shri Kamal Marwah e)In this connection, we have already furnished the below details and documents vide our letter dt. 18-12-2020: -  Statement showing reconciliation of the details filled in the above columns of the worksheet - “Final summary land expense” with the details as per books of accounts  Copy of cash book reflecting cash balance available in the books and payments made for purchase of land  Copy of agreements for purchase of lands reflecting cash payment made for purchase of land  Copy of land ledger in the books of assessee  Copy of the above letter dt. 18-12-2020 along with its annexures is enclosed herewith, marked as Annexure “A”. f) In the above reconciliation statement, we have carried out the following reconciliations: -  Mapped the column of ‘cash received’ as per email sheet with cash remitted from Waaneep Solar Pvt. Ltd. & Waaree Energies Ltd. to Shri Kamal Marwah as per books thereby substantiating the source of cash.  Mapped the column of ‘Land’&‘Associated to land’ as per email sheet with various parcel of land debited in the books of which payment has been done in cash being duly accounted in books (References of respective land parcels given in Annexure 1 to 25).  A separate chart is attached, forming part of the reconciliation statement, giving details of various lands purchased by assessee company and details of payments made by banking channel and cash for respective land parcels during FY 2014-15 & FY 2015-16. The cash component of the payment will tally with the details of cash paid as per the above reconciliation statement. g) We wish to reiterate that the details received from Shri Kamal Marwah were merely draft details which were to be reviewed by Shri Mayank Shah to check the factual accuracy and ultimately was to be approved by Shri Hitesh Doshi. Due to voluminous transactions, there were certain inaccuracies in the details prepared by Shri Kamal Marwah. Thereafter, Printed from counselvise.com P a g e | 16 ITA No. 4031, 4032/Mum/2025 A.Y. 2015-16, 2016-17 Waaneep Solar Private Limited Shri Mayank Shah corrected the inaccuracies after communication with Shri Kamal Marwahand after seeking approval of Shri Hitesh Doshi and only after due correction of inaccuracies and reconciliation of differences, the details were further sent to the accounts team for accounting entry in the books of accounts. We wish to state that the details received from Shri Karnal Marwah vide email dt. 28-01-2016 were informal and draft details and not the final & approved details as the same were subject to further verification and approval of Shri Mayank Shah. Also, Mr. Kamal Marwah is just an employee and not any key person viz. CFO /Managing director/director of the company. h) As per the above reconciliation sheet, we have completely reconciled the land purchase transactions with the books of accounts of M/s. Waaneep Solar Pvt. Ltd. & M/s. Waaree Energies Ltd. which is to the tune of Rs. 6,19,59,530/-. The said amount is also duly reflecting in the land purchase agreements. It is clearly evident from the above reconciliation that cash withdrawals and other available cash in books have been utilized for the purchase of land and both entries i.e. cash withdrawals from bank and utilization for the purpose of land are duly recorded in books of accounts. We wish to state that the remaining amount is in respect of incorrect/non existing items mistakenly filled in the above sheet by Shri Kamal Marwah. Therefore, in respect of the incorrect/non existing items appearing in the above sheet, there cannot be accounting entry of the same in the books of accounts and hence not reconcilable items. As mentioned above, Shri Hitesh Doshi, in his statement on oath recorded u/s. 131 of the Act on 23- 02-2021 has also confirmed the above facts. i) As regards Your Honour’s point that Shri Hitesh Doshi has not provided any cogent evidence with regard to the complete money trail and accounting treatment of the purchase of land to the tune of Rs. 6.2 crores to substantiate his statement on oath recorded u/s. 131 of the Act, we would like to state that we have already furnished all the necessary documents in support of the above reconciliation such as Cash book, ledger accounts, all purchase agreements, etc. vide letter dt. 18-12-2020 and the said fact is also stated by him in the above statement. Hence, no adverse inference can be drawn in this regard. In case, Your Honour requires any further details / documents in this regard, we shall gladly furnish the same on hearing from you. j) Further, Your Honour has merely relied on the statement of Shri Hitesh Doshi recorded on oath under section 132(4) of the Income Tax Act, 1961 on 22-11-2018 wherein he has offeredRs. 8,20,40,360/- as undisclosed investment in M/s. Waaneep Solar Pvt. Ltd. In this regard, we wish to state thatShri Hitesh Doshi, in his affidavit dt. 06-12-2018 has already Printed from counselvise.com P a g e | 17 ITA No. 4031, 4032/Mum/2025 A.Y. 2015-16, 2016-17 Waaneep Solar Private Limited withdrawn his statement dt. 22-11-2018 offering undisclosed investment of Rs. 8,20,40,360/-by stating that the search party did not allow him the time, as requested, to reconcile the above details of cash amount of Rs. 8,20,40,360/- and he was put under tremendous pressure as no proper and reasonable time was allowed to reconcile the above amount. Further, Shri Hitesh Doshi was given to understand that search action will not be concluded till the time he gives a statement offering the aforesaid cash of Rs. 8,20,40,360/- as undisclosed investment in M/s. Waaneep Solar Pvt. Ltd. Hence, he was left with no option but to offer the above amount of Rs. 8,20,40,360/- as undisclosed investment just for buying peace of mind. In the above affidavit, Shri Hitesh Doshi has further stated that the search party should have taken cognizance of the fact that there was sufficient amount of cash balance available in the books of M/s. Waaneep Solar Pvt. Ltd. and M/s. Waaree Energies Ltd. and the same was utilized towards purchase of land and associated expenses for Icchawar project which was also during recorded in the books of accounts of the assessee company. The same is evident from the accounts data in Tally & SAP backup taken by the search party during the course of search. On perusal of the backup data, it is clearly evident that cash withdrawals and other available cash in books have been utilized for the purchase of land and both entries l.e. cash withdrawals from bank and utilization for the purpose of land are duly recorded in books of accounts. Hence, the earlier statement which has been later withdrawn cannot be held as any evidence against the assessee company. k) Further, as regards Your Honour remarks that the retraction of Shri Hitesh Doshi through affidavit is devoid of any merit and does not indicate any one to one flow of funds from the Bank account to the farmers from whom land was purchased, we wish to state that it is an undisputed fact that the issue under consideration is in respect of land transactions done by the assessee through cash. The assessee has already provided detailed reconciliation justifying the cash balance available in its books of accounts and utilized for purchase of lands from farmers. As explained earlier, cash was sent out of balance available either with the assessee company or M/s. Waaree Energies Ltd. Hence, the cash component paid to farmers are made out of the available cash balance and need not be withdrawn from bank for each of the payments made to the farmers in cash. Hence, in respect of such land transactions done through duly accounted cash, there cannot be one to one flow of funds from the Bank account of the assessee to the farmers. i) Your Honour would appreciate that during the course of search action on Waaree group, there is no proof of unaccounted cash available with the Printed from counselvise.com P a g e | 18 ITA No. 4031, 4032/Mum/2025 A.Y. 2015-16, 2016-17 Waaneep Solar Private Limited assessee which is alleged to have been utilized for the purchase of lands by the assessee company. Thus, the allegation of cash paid by the assessee out of undisclosed income is based on mere surmises and conjectures, without corroborating it with any concrete evidence to prove that the assessee in possession of such undisclosed cash / assets / investments. It is also a well settled proposition in law that the suspicion, howsoever strong it may be, cannot be made basis for making any addition/ disallowance. Therefore, in the present case, no addition can be made based only on suspicion and presumptions. The assessee had duly reconciled the land purchase transactions as per the email document of Shri Kamal Marwah with the books of accounts of the assessee company with the help of requisite documents. Therefore, we request Your Honour not to make any addition in respect of the same.” 7.3 The AO further noted that M/s Waaree Energies Limited entered into EPC agreement with M/s Waaneep Solar Pvt. Ltd for its Icchawar Solar Project. In the process of land procurement, assessee Company has incurred amount totalling to Rs. 8,20,40,360/- in cash. Shri Hitesh Chimanlal Doshi, Managing Director of Waaree Group had accepted the facts and offered the amount of Rs. 8,20,40,360/- for taxation purpose considering the same as his undisclosed investments out of his undisclosed income generated through cash sale/scrap sale/land transactions etc. Although the assessee Company as well as MD of the Flagship entity of the Group Shri Hitesh Doshi had emphasized upon the reconciliation to the tune of Rs. 6.2 cr., he failed in establishing one to one money trail through cogent evidences. There was no documentary evidence on the application of cash withdrawn from the Printed from counselvise.com P a g e | 19 ITA No. 4031, 4032/Mum/2025 A.Y. 2015-16, 2016-17 Waaneep Solar Private Limited banks towards purchase of these lands. The assessee also could not establish the business expediency of such large scale cash purchase of lands. Moreover, had the cash withdrawn been accounted and trailed perfectly, the complete amount of Rs. 8,20,40,360/- as appearing in the spreadsheet would have tallied and not a part of it. Therefore, the assessee has failed in its responsibility to explain the incurrence of such cash expenditures for purchase of land. 7.4 In view of the above discussion, Rs. 8,06,32,460/-, incurred in cash during AY 2015-16 by the assessee company, M/s Waaneep Solar Pvt. Ltd., was treated as unexplained capital expenditure u/s 69C of the Act and added to the total income of the assessee. 8. Before the ld.CIT(A), it was claimed that assessee had reconciled the accounts and as per the reconciliation sheet, the transaction of land purchase by payment in cash had been reconciled with the books of account of M/s. Waaneep Solar Pvt. Ltd. (the assessee) and M/s. Waaree Energies Ltd. to the tune of Rs.6,19,59,530/-. It was contended that the said amount was also duly reflected in the land purchase agreements, which was confirmed by Shri Hitesh Doshi in his statement recorded on 23.02.2021.The AO refused to accept the explanation and the contention raised. It was contended that the Printed from counselvise.com P a g e | 20 ITA No. 4031, 4032/Mum/2025 A.Y. 2015-16, 2016-17 Waaneep Solar Private Limited impugned additions are made on the basis of suspicion, surmises and conjectures without corroborating evidence. It was contended that the file/worksheets attached to the email of Shri Kamal Marwah, an employee of the searched person could not be relied upon or used against the assessee. The presumption under Section 132(4A) or 292C of the Act is available only against the person searched and not against any third party. In appeal, in relation to assessment year 2015-16 the learned CIT(A) has found that the statement of Shri Hitesh Doshi recorded on 22.11.2018 and subsequently on 06.12.2018 were conditional as Shri Hitesh Doshi had sought time for reconciliation, 8.1 The ld.CIT(A) observed that it was undisputed that appellant had submitted reconciliation of cash expenses incurred in relation to purchase of land for the said project. The AO has also noted that appellant could only submit reconciliation for amount of Rs. 6,19,59,530/- as against the total amount of Rs. 8,20,40,460/-. Having gone through the Excel Sheets seized during the course of search, he noted that such sheets contained date-wise cash receipt and payments made under various heads in relation to purchase of land. Though appellant claimed that these sheets were just rough data meant for control of cash payments and should not be taken as final summary of Printed from counselvise.com P a g e | 21 ITA No. 4031, 4032/Mum/2025 A.Y. 2015-16, 2016-17 Waaneep Solar Private Limited land expenses, however, the details submitted by appellant for reconciliation defied the same. As the details filed by the appellant clearly depict that amounts and other narration mentioned in excel sheets are matching with reconciliation. It was also noted that in case of statement of Shri. Mayank Shah, the reconciliation of Rs. 13,55,000/- had been explained by Mr. Shah. It is noted that vide letter 18.12.2020 and 15.03.2021, appellant had submitted following documents for reconciliation: i) Statement showing reconciliation of details filled in seized worksheet columns with details as per books of account. ii) Copy of cashbook reflecting cash balance available in the books and payments made for purchase of land. iii) Copy of agreements for purchase of lands reflecting cash payment made for purchase of such land. iv) Copy of land ledger in books of assessee. 8.2 He further noted that apart from above, appellant had mapped the column of ‘cash received as per email sheet with cash remitted from Waaneep Solar Pvt Ltd. and Waaree Energies Ltd. (holding company of the appellant as well as EPC Contractor for the impugned solar project). appellant had also mapped the column of ‘Land’ & ‘Associated to land’ with various parcels of land debited in the books of account. These reconciliations were never questioned or doubted by the AO during the course of assessment proceedings. Moreover, the cash book and other related ledgers and account were also Printed from counselvise.com P a g e | 22 ITA No. 4031, 4032/Mum/2025 A.Y. 2015-16, 2016-17 Waaneep Solar Private Limited not doubted. These parcels of land are situated in remote part of Madhya Pradesh and appellant was supposed to purchase land directly from the farmers. Therefore, the payment of cash could not be doubted as unaccounted or unexplained payment until proved otherwise. It was also noted that the purchase deed of land contains the amount paid in cash by the appellant. 8.3 In view of above discussion and details submitted during the course of appeal as well as assessment proceedings, he held that except for a vague admission of Mr. Hitesh Doshi during the course of statement recorded on 22.11.2018, the documents submitted during the course of assessment proceedings and statement of Shri. Hitesh Doshi recorded during the assessment proceedings clearly established that details recorded in seized materials, were in nature of cash expenses associated with purchase of agriculture land from the farmers. The ld. CIT(A) further found that the reconciliation was submitted in respect of an amount of Rs.6,19,59,530/-, as a result of which he sustained the addition to the extent of the balance of Rs.1,86,72,930/- (Rs.8,06,32,460/-minus Rs.6,19,59,530/-). The amount which was reconciled through the reply of the appellant was allowed as expense and Printed from counselvise.com P a g e | 23 ITA No. 4031, 4032/Mum/2025 A.Y. 2015-16, 2016-17 Waaneep Solar Private Limited the balance of Rs. 1,86,72,930/- (Rs. 8,06,32,460-- Rs. 6,19,59,530) was sustained as Unexplained expenditure. 9. Before us, it was submitted by the ld. AR that the AO was not justified in making the impugned addition by relying upon some loose sheets (worksheet) attached to the email sent by Shri Kamal Marwah to Shri Mayank Shah. It is submitted that Shri Hitesh Doshi had retracted his statement offering the amount to tax by an Affidavit dated 06.12.2018. It is pointed out that the Revenue has not challenged the retraction as not acceptable. It is submitted that eventually reconciliation of a substantial part of the addition was also made. It is thus submitted that the ld.CIT(A) while accepting the reconciliation could not have made the impugned addition for the balance amount. The ld.DR howoever, pointed out that the assessee was not able to reconcile the impugned transactions in cash fully and therefore, the ld.CIT(A) rightly upheld the addition, though partly. 10. We have carefully considered all the relevant facts of the case. The impugned addition is based on internal communication between the key persons of the assessee company. Even though the ld.AR has contested the entries recorded therein, in fact the assessee has submitted a reconciliation before the authorities below which confirmed Printed from counselvise.com P a g e | 24 ITA No. 4031, 4032/Mum/2025 A.Y. 2015-16, 2016-17 Waaneep Solar Private Limited that a part of the transactions indeed was found recorded in the books of account. Therefore, the validity of the said communication and annexures is established without doubt that it pertained to the assessee. In fact, the MD of the group company had in the initial period had admitted the impugned transaction of Rs 8.20 cr. as Undisclosed income although the statement was later retracted. However, in the assessment proceedings, reconciliation was done and the assessee could be able to reconcile figure to the extent of Rs 6.19 cr. only. Consequently, the ld.CIT(A) gave relief to the assessee to this extent and upheld by the balance amount. Before us, nothing more has been brought on record by the ld.DR so as to reconcile the balance amounts as well. In such a situation, we do not find any reasons for interference in the matter and uphold the appellate order dismissing the grounds of appeal in this regard. 11. In the result, appeal of the assessee is dismissed. 12. ITA No. 4032/MUM/2025 (A.Y. 2016-17) 1)(a) The assessment order passed u/s. 153C of the Act by the Ld. Assessing Officer is without jurisdiction, invalid and bad in law and in violation of the principles of natural justice. (b)The Ld. Assessing Officer erred in law and on facts in initiating proceedings u/s. 153C of the Act, without recording proper and valid satisfaction thereby rendering the entire proceedings invalid and void ab initio. Printed from counselvise.com P a g e | 25 ITA No. 4031, 4032/Mum/2025 A.Y. 2015-16, 2016-17 Waaneep Solar Private Limited (c) The satisfaction recorded by the Ld. Assessing Officer is in the form of a consolidated satisfaction note, which is generic, vague, non-specific, and not in accordance with the mandatory requirement of law. 2)(a) The Ld. CIT(A) erred in facts and in law in upholding the addition of Rs. 14,08,000/- u/s. 69C of the Act as unexplained expenditure towards purchase of land parcels without appreciating the details, documents and explanations placed on record by the appellant. (b) The Ld. CIT(A) failed to appreciate that the addition has been sustained solely on the basis of entries in an excel file allegedly found from the email account of a director, without any corroborative evidence to establish that the appellant was in possession of unaccounted cash purportedly utilized for the purchase of land. (c) The Ld. CIT(A) further erred in placing reliance upon unauthenticated, incomplete, and informal data contained in a draft excel file attached to the email received from an employee, which does not bear any signature, approval, or acknowledgment of the appellant, and which cannot be treated as conclusive evidence against the appellant and even the presumption under section 132(4A) or section 292C of the Act arises only in relation to the person subjected to search, and cannot be extended to a third party without independent evidence. 13. For AY 2016-17, assessee filed its return declaring a loss of Rs.112,13,19,560/-. In this case, in the scrutiny assessment under Section 143(3) of the Act completed and the total income was determined at Rs.12,13,95,570/-, which was subsequently rectified determining the loss of Rs.99,99,23,990/- by granting set off of current year’s business losses. 14. Since all the ground are common as in AY 2015-16,our decision in para 11 above would apply mutatis mutandis to the instant appeal as well. Accordingly, both grounds are dismissed and the appeal are dismissed. Printed from counselvise.com P a g e | 26 ITA No. 4031, 4032/Mum/2025 A.Y. 2015-16, 2016-17 Waaneep Solar Private Limited 15. In the result, both the appeals of the assessee in ITA No.4031 and 4032/Mum/2025 stand dismissed. Order pronounced in the open court on 12/01/2026. Sd/- Sd/- [Justice (Retd. ) C.V. BHADANG] [PRABHASH SHANKAR] PRESIDENT ACCOUNTANT MEMBER Place: म ुंबई/Mumbai ददनाुंक /Date 12.01.2026 Lubhna Shaikh / Steno आदेश की प्रतितलति अग्रेतिि/Copy of the Order forwarded to : 1. अपीलार्थी / The Appellant 2. प्रत्यर्थी / The Respondent. 3. आयकर आयुक्त / CIT 4. विभागीय प्रविविवि, आयकर अपीलीय अविकरण DR, ITAT, Mumbai 5. गार्ड फाईल / Guard file. सत्यावपि प्रवि //True Copy// आदेशानुसार/ BY ORDER, उि/सहायक िंजीकार (Dy./Asstt. Registrar) आयकर अिीलीय अतिकरण/ ITAT, Bench, Mumbai. Printed from counselvise.com "