ITAT Delhi Strikes Down Rs 22-Crore Tax Notice Based on WhatsApp Chat for Lack of Credible Proof
The Income Tax Appellate Tribunal (ITAT) Delhi quashed a Rs 22 crore tax notice issued to a taxpayer based solely on WhatsApp chats. ITAT found that the digital evidence, including images of envelopes and an unsigned interest calculation sheet, lacked authenticity and corroboration. Consequently, the tribunal ruled the evidence inadmissible and struck down the notice due to absence of credible proof.
In a recent decision, the Income Tax Appellate Tribunal (ITAT) Delhi invalidated a Rs 22 crore tax notice that the Income Tax Department had issued based on WhatsApp chat evidence recovered from the taxpayer's mobile phone. The key issue was whether digital data found on the phones of Praveen Kumar Jain and Vaibhav Jain constituted incriminating evidence to trigger provisions under Section 153C of the Income Tax Act. The tribunal scrutinized the assessing officer's satisfaction note, which heavily relied on photographs of envelopes allegedly containing cash or cheque amounts and an image of a sheet showing interest calculations. However, ITAT observed that the envelopes did not bear the taxpayer’s name, and the sheet was unsigned, unauthenticated, and non-specific. Without any additional corroboration, the WhatsApp-based evidence was deemed insufficient to support the tax department's claims. This ruling highlights the tribunal's insistence on credible, authenticated evidence beyond digital chats for tax assessments and reinforces that such uncorroborated digital data cannot serve as a solid basis for high-value tax demands.
