Can builder's loose papers lead to an income tax notice? ITAT explains the law

Mumbai ITAT ruled that the Income Tax Department cannot tax a property buyer merely because their name appears in a builder's seized cash records.

The Revenue must prove an undisclosed cash payment with independent corroborative evidence before invoking Section 69A.

The taxpayer purchased a commercial unit from M/s Roshni Enterprises for ₹50 lakh via banking channels, with a registered agreement.

The department alleged ₹90 lakh cash payment based on loose papers from a search on GNP Group, but ITAT found no independent evidence linking the taxpayer.

ITAT deleted the ₹90 lakh addition under Section 69A, noting no money was found in the taxpayer's possession and essential conditions were unsatisfied.