The decision emphasizes that tax assessments must be based on well-substantiated evidence, nullifying assumptions made from contested documents.

ORDER :

BHARGAV D. KARIA, J.

1. Heard learned Senior Standing Counsel Mr.Karan Sanghani for the appellant. This appeal is filed under Sec.260A of the Income Tax Act, 1961 (for short ‘the Act), proposing the following substantial questions of law arising out of the order dated 31.07.2023 passed by the Income Tax Appellate Tribunal, Surat Bench, (for short ‘the Tribunal’), in ITA No. 287/SRT/2022 for the Assessment Year 2017-18:

“[A] Whether on the facts and in the circumstances of the case and in law, the order of the Hon’ble Appellate Tribunal is ex facie perverse, because the Hon'ble Appellate Tribunal has deleted the addition of Rs. 6,31,50,000/- made u/s. 69 of the Act, despite the fact that the addition was made on the basis of incriminating details/document i.e notarized agreement recovered during the survey proceedings, and without appreciating the entire gamut of facts brought on record by the Assessing Officer?

[B] Whether on the facts and in the circumstances of the case and in law, the order of the Hon'ble Appellate Tribunal is ex facie perverse, because the Hon'ble ITAT has deleted the addition made by the AO, by accepting the submission of the assessee that the notarized agreement was signed by him though coercion and threat and against which he has field complain with the various government/police authorities including PMO, without appreciating the fact that none of the complaints have yet reached finality or conclusion in order to accept that the said document was prepared under threat or duress and the contents of the same are not correct?

[C] Whether on the facts and in the circumstances of the case and in law, the Hon'ble ITAT has erred in ex facie perverse, because the Hon'ble ITAT has deleted the addition of Rs.6,31,50,000/- by observing that the addition was made only on the basis of notarized agreement found in the mobile phone of the assessee and the assessee had denied having made such investment over and above Rs.28,00,000/- and this being the case, the DDIT/AO should have investigated the related facts as mentioned in the agreement to take the case to logical conclusion, without taking recourse to the provisions of Sec. 250(4) of the Act which confers jurisdiction to the first appellate authority to make such further enquiries as he thinks fit or may direct the AO to make such further enquiries and report the result of the same to the CIT(A) before deciding the appeal?

[D] Whether on the facts and in the circumstances of the case and in law, the Hon'ble ITAT has erred in ex facie perverse, because the Hon'ble ITAT has held that the matter cannot be remitted to AO and the Assessing officer can't be given second inning as he has already scrutinized the agreement, despite the facts that the agreement is duly notarized and clearly mentioned that the assessee has made payment of Rs.6,31,50,000/- in pieces through bank transfers to the bank account of the first party of the agreement, being his contribution towards the work order, and that too before the execution of the agreement and therefore, there cannot be a case of coercion for signing such agreement as it only suits the assessee as a person who made such investments?

[E] Whether on the facts and circumstance of the case and in law, the impugned order of the Hon'ble Appellate Tribunal is ex facie perverse because the Hon'ble Appellate Tribunal has deleted the addition holding that the agreement dated 21.12.2019 has become null and void despite the facts that the notarized agreement date 21 12 2019 has not been declared null and void by any court or competent authority, the assessee has not taken any step for treating the contract as Void and the Hon'ble ITAT has no power to declare an agreement as null and void under the Indian Contract Act 18727 [F] Whether on the facts and in the circumstances of the case and in law, the Hon'ble ITAT is ex facie perverse, bec