आदे श / ORDER

PER. RAVISH SOOD, JM :

The captioned cross-appeals filed by the assessee and the revenue are directed against the order passed by the CIT(Appeals) for AY 2017-18, dated 17/03/2025, which in turn arises from the order passed by the AO under Section 153C of the Act, dated 30/03/2022. As the present appeals involve common issues, they are taken up and disposed of together. The revenue has assailed the CIT(A) order on the following grounds of appeal before us:

“1. The order of Ld. CIT(A) is erroneous both on the facts and in Law.

2. The Ld. CIT(A) erred in summarily allowing the appeal of the assessee on sole ground of non-admissible seized material evidence used by the Assessing Officer during the assessment proceedings u/s.153C, consequent to search action conducted in the case of M/s. Polisetty Somasundaram group.

3.. The Ld. CIT(A) erred in giving a finding that the pen drive seized from the business premises of M/s Polisetty Somasundaram group and marked as Annexure A/PSS/CORP/19 was an inadmissible digital evidence as held by Hon'ble ITAT in the case of M/s Polisetty Somasundaram and hence the same can't be considered as a valid digital evidence in the case of the assessee. The Ld. CIT(A) ought to have appreciated the fact that the said decision of Hon'ble ITAT was not accepted by the Department and further appeal to High Court was filed and the same is pending adjudication as on date. The Ld.CIT(A) ought to have appreciated the fact that the finding of Hon'ble ITAT either had not attained any finality or accepted by the Department as on date and thus, relying on the said decision of Hon'ble ITAT would be adverse in the interest of Revenue.

4. The Ld.CIT(A) erred in allowing relief to the assessee by considering the decision of Hon'ble ITAT in the case of M/s Polisetty Somasundaram, by ignoring the fact that the seized pen drive was an independent primary source of evidence u /s 65B of Indian Evidence Act and when the extracts of the said pen drive were confronted to the key persons of M/s Polisetty Somasundaram group, the assessee never raised an objection with regard to the contents of the said seized pen drive.

5. The Ld.CIT(A) erred in not appreciating the fact that the seized material marked as A/PSS/CORP/18 consists hard copies in the form of printouts of excel sheets. The Ld.CIT(А) ought to have appreciated the fact that though the seized material in the form of pen drive marked as A/PSS/CORP/19 was an inadmissible evidence, the seized material marked as A/PSS/CORP/18 was in fact in the form of hard copies and thus it can't be ignored while allowing the relief to the assessee.

6. The Ld.CIT(A) erred in allowing relief to the assessee based on the decision of Hon'ble ITAT in the case of M/s. Polisetty Somasundaram group, though the key person of the searched group, i.e. Sri Polisetty Shyam Sundar of Polisetty Somasundaram group, had confirmed the financial transactions done with the assessee in his sworn statement u/s 132(4) dt. 08.06.2020.

7. The Ld.CIT(A) erred in allowing relief to the assessee that it had never questioned the validity of the seized material during the course of scrutiny proceedings, before Assessing Officer and it is only an afterthought. The Ld.CIT(A) ought not to have considered the afterthought claim made by the assessee and it was raised by the assessee only after the relief got by the searched person, M/s. Polisetty Somasundaram, before Hon'ble ITAT on validity of the seized material.

8. The Ld.CIT(A) has erred in not considering the information contained in the electronic record reproduces or is derived from such information fed into the computer in the ordinary course of the said activities in this case, the Pen drive. Reference is invited to the decision of Hon'ble Supreme Court in the case of Ambalal Sarabhai Enterprise Ltd Vs. KS Infra space LLP Limited and Another in Civil Appeal No(s). 9346 of 2019 dated 6th January, 2020. Wherein pertaining to whatsapp evidence, the Hon'b