The Kolkata Bench of Income Tax Appellate Tribunal (ITAT) has held that addition could not be based on SMS or WhatsApp messages without corroborative evidence.
The assessee, Atul Tantia filed return of income on 31/08/2018 after claiming deduction. A search and seizure were conducted on 12/09/2017 on GPT Group of cases including the assessee. During the course of search and seizure, mobile data was retrieved and printouts of SMS were taken out from the mobile of Atul Tantia. As per the mobile messages, unaccounted cash transactions were carried out between concerns of GPT Group and others.
The SMS and WhatsApp printouts were suggestive of instructions of Shivratan Sharma and Atul Tantia. Thereafter, statements were recorded of Atul Tantia, in which he never admitted that the money either belonged to him or exchanged hands at his instruction. The Assessing Officer finally added the same to the income of the assessee as undisclosed income under Section 68 of the Income Tax Act 1961 as the assessee did not offer any plausible explanation in the assessment framed under Section 143(3) of the Act.
A.K. Tibrewal, on behalf of the assessee submitted that, the mobile did not belong to the assessee which had been denied right from the beginning and nowhere the WhatsApp messages suggested that money was transferred or was owned by the assessee. He also argued that WhatsApp or SMS messages could not be treated as evidence to make any additions in the hands of the assessee.
Subhrajyoti Bhattacharjee, on behalf of the revenue submitted, that no addition could be made on the basis of messages from SMS or WhatsApp between two persons unless there was corroborative evidence on record.
The Division Bench of Rajesh Kumar, (Accountant Member) and Sonjoy Sarma, (Judicial Member) allowed the appeal referring to the decision in ACIT vs. Machukonda Shyam holding that addition could not be sustained as it based on the SMS or WhatsApp messages without any corroborative evidences.
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