ITAT Overturns ‘On-Money’ Additions, Rules Third-Party Documents Inadmissible Without Verification

ITAT deleted ₹42 lakh unexplained money additions, ruling that third-party documents are inadmissible without verification. The bench held that the AO cannot rely on unverified bank statements and loose papers seized from others to make additions against the assessee. The case involved alleged unaccounted transactions based on documents found during a search of another entity. ITAT emphasized that Section 68 additions require direct evidence linking the assessee to unexplained credits. This reinforces the principle that tax assessments must be based on verified materials with proper evidentiary value. The ruling protects taxpayers from arbitrary additions based on unsubstantiated third-party information, requiring authorities to establish clear connections before making such demands.