Additions towards unexplained investment under Section 69A are unsustainable if based solely on unverified loose sheets, excel exports, or retracted statements without independent corroborative evidence, as the assessing authority must exercise judicial independence beyond merely reproducing search inputs.

O R D E R

Per:Anikesh Banerjee (JM):

The instant appeal of the revenue and cross objection of by assessee filed against the order of the Ld. Commissioner of Income Tax (Appeals)-47, Mumbai [for brevity the “Ld. CIT(A)”], order passed under section 250 of the Income Tax Act 1961 (for brevity ‘the Act’) for Assessment Year 2016-17, date of order 29.12.2025. The impugned order emanated from the order of the Ld. Assistant Commissioner of Income Tax C.C. 8(1), Mumbai (for brevity the ‘Ld. AO’) order passed under section 147 of the Act date of order 09.03.2024.

2. The brief facts of the case are that a search and seizure action u/sec. 132/133A of the Act was conducted on Estate Investment Company Pvt. Ltd. and other related entities of Sakseria Group including assessee on 08.10.2021. Accordingly, the assessee’s case was centralized and assessed u/sec. 147 of the Act. During the assessment the Ld. AO observed that assessee had purchased the share of Veda Real Estate Corporation Pvt. Ltd. (Veda) in assessment year 2016-17. Based on loose sheet of paper dated 18.05.2016 relating to AY 2017-18 from three entities the amount of Rs.5,00,000/- as recorded in the receipt in the diary on 18.01.2017. But the Ld. AO on basis of this record found in the diary and telescoped against the payment made amount to Rs.8,15,00,000/- towards purchase of share of Veda by the assessee related to transactions in cash with the Seksaria Group Entities. The assessee claimed that the assessee only pay Rs.5,00,000/- for purchasing the share of Veda from the Searia Group Entities. So, the addition made by the Ld. AO Rs.8,15,00,000/- is relying on the loose paper and alleged documents which has no basis. The aggrieved assessee filed an appeal before the Ld. CIT(A). The Ld. CIT(A) allowed the appeal of the assessee and deleted the addition. Being aggrieved revenue filed the appeal by challenging the merits of the case. And the assessee had challenged the jurisdiction of the Ld. AO for reopening assessment u/sec. 148 of the Act in cross objection.

3. The Ld. DR argued and contended that on basis of the statement recorded of Shri Pawan K. Sharma the Accountant of the Seksaria Group has confirmed that the cash transaction was duly made with the assessee related to purchase of shares. On evidence, the Ld. AO had mentioned in the assessment order related to the excel sheet and other relevant documents found during the search where the assessee had made the transaction of Rs.8.15crore cash with the Seksaria Group for purchasing the share of Veda. So, accordingly, the Ld. DR stands in favor of the order of Ld. AO.

4. The Ld. AR argued and contended that the Ld. AO had made the addition Rs.8.15 crore u/sec. 69A of the Act by placing reliance on loose paper found by the premises / godown of third party without basis of any facts. There were rough noting and no statement has been recorded in respect of the said noting in A1 page 89. Since the assessee had not been found to be an owner of money, jewellery or other valuable articles the provision u/sec. 69A are not applicable to the facts. So the circumstances, the additions should not be added. Further, he contended that the assessee had made the transaction with three parties, Mr. Tarun Seksaria, Mr. Harsh Seksaria and Mr. Siddharth Mehta amount of Rs.2.15 crore, 2.15 crore and 3.30 crore respectively who have sold the share of Veda which aggregate to Rs.7.59 crore and addition was also made in the hands of the purchaser and as well as the seller. So, in any case the Ld. AO erred in addition amount to the 8.15crore instead of Rs. 7.59crore.

5. The Ld. AR further contended that in case of Mr. Tarun Seksaria the addition was confir