The court ruled that tax assessments based on uncorroborated evidence, such as WhatsApp chats, are unjustified, emphasizing the need for concrete evidence to support tax liabilities.

आदेश / ORDER

Per, Dr. A. L. Saini, AM:

Captioned appeal filed by the Assessee, pertaining to assessment year (A.Y.) 2013-14, is directed against the final assessment order passed by the Assessing Officer, dated 31.12.2024, after incorporating the directions of the Dispute Resolution Panel (in short “DRP”), vide DRP order dated 29.11.2024, under section 144C(5) of the Act.

2. The grounds of appeal raised by the assessee are as follows:

“1.The Assessing Officer erred in reopening the assessment by issue of notice u/s 148 of the Act. The reopening of the assessment was barred by limitations of time.

2.The Assessing Officer erred in reopening the assessment by issue of notice u/s. 148 of the Act. The reopening of the assessment was beyond the scope of the powers of the Assessing Officer.

3.Without prejudice to ground no. 1 and 2, the Assessing Officer erred in making an addition of Rs. 5,50,00,000 (Rs. Five Crores Fifty Lakhs) to the income under the provisions of section 69 of the Act.”

Facts of the Assessee`s case:

3. Succinctly, the factual panorama of the case is that assessee before us is an Individual. The assessee is NRI (non- resident) and residing at UAE, outside India.The assessee has not filed return of income for the assessment year ( AY) 2013-14. Information was flagged on Insight Portal, in accordance with the Risk Management Strategy, formulated by CBDT relevant to assessment year (AY) 2013- 14, whereupon a search & seizure of operation on Rajiv Saxena Group of companies and others was conducted on 30/09/2021. During the search and seizure action, certain incriminating data, in the form of digital data, containing details of unaccounted cash transaction between Mansur Mehta & others were found and seized from the residential premise of Shri Mansur Mehta, (who was also covered u/s 132 at premise C wing 3003. Raneja Viviera, Sane Guruji Road, Mumbai Central, Mumbai). Digital Data Backup of these devices were taken and the same were seized and inventoried as Annexure A1 A2 and A3. As per assessing officer, these incriminating documents pertain to or the information contained therein relates to the assessee and the assessee has been identified through the WhatsApp chat /e-mail communications found in the digital devices of Shri Mansur Mehta, who deal with him in cash transactions. In the email, Shri Mansur Mehta has sent some images that contain hand written notes with some calculations of money, as on 01.12.2012, with the assessee. Therefore, by following the due procedure, as per section 148A of the Act, the assessee`s case was reopened u/s 147 of the Act and a notice u/s 148 of the Act, was issued on 31/03/2023, requiring the assessee to file return of income, within 30 days from the receipt of notice. The assessee, did not file Return of Income (ROI) for the assessment year (AY) 2013-14, as required by notice u/s 148 of the Act. Thereafter, notice(s) u/s. 142(1) of the Act, were issued through ITBA Module, calling certain information/details in respect of reason(s) on which the case was reopened u/s 147 of the Act, which were duly served upon the assessee.

4. In response to the notice(s) generated through ITBA Module, the assessee furnished submission/reply(s), before the assessing officer, vide letter dated 11/03/2024, through e-mail, using e-filing portal for compliance of notice(s). The assessing officer observed that during the course of post search investigation, while analyzing the I-phone 12 Pro Max of Mansur Mehta, which