MADAN LAL JAT,JAIPUR vs. ITO WARD 7(1), JAIPUR, JAIPUR

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ITA 1883/JPR/2025Status: DisposedITAT Jaipur30 June 2026AY 2013-145 pages
AI SummaryPartly Allowed

What did the Tribunal hold?

The Tribunal found the assessee's explanation corroborated by bank entries showing corresponding withdrawals. It directed deletion of the addition and restricted it to Rs. 1,60,304/-, representing estimated profits under Section 44AD, as admitted by the assessee.

What were the facts?

The assessee's bank account showed cash deposits of Rs. 20,03,800/-. The assessee, a labour contractor, explained that these were business receipts deposited and then withdrawn for labour payments and expenses, with only net profit being taxable. The CIT(A) had set aside the issue to the AO for fresh assessment.

What were the issues?

Whether the entire cash deposits in the bank account are unexplained income, or if only the net profit is taxable. The validity of the CIT(A)'s order to set aside the issue for fresh assessment without deciding on merits.

Which sections of the Income-tax Act were involved?

Section 147,Section 144,Section 68,Section 44AD,Section 80C,Section 234A,Section 234B,Section 234C,Section 250

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, JAIPUR BENCHES, “SMC” BENCH, JAIPUR

Hearing: 23.06.2026Pronounced: 30.06.2026

IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES, “SMC” BENCH, JAIPUR BEFORE SMT. ANNAPURNA GUPTA, ACCOUNTANT MEMBER ITA No. 1883/JPR/2025 (Assessment Year:2013-14) Madan Lal Jat Vs. ITO Nitharwalo Ki Dhani, Ward 7(1) Mundli Renwal Jaipur Raj. Jaipur 303603 (Present address C/o G.S. Stonex, 3/185- Bachamanglam Ring Road Semanur Village Bagur Krishnagiri Tamil Nadu 635108, Jaipur �थायीलेखासं./जीआइआरसं./PAN/GIR No:BDQPJ 0380 Q Appellant .. Respondent Appellant by : Sh. Shrawan Kumar Gupta, Adv. Respondent by : Mrs. Aarti Rawat, Addl. CIT Date of Hearing 23.06.2026 Date of Pronouncement 30.06.2026 O R D E R The present appeal has been filed by the assessee against the order passed by the National Faceless Appeal Centre, Delhi (NFAC) (hereinafter referred to as “Ld. CIT(A)”), under Section 250 of the Income Tax Act, 1961 (hereinafter referred to as “the Act”) dated 31- 10-25.

P a g e | 2 ITA No. 1883/JPR/2025 Madan Lal Jat 2. The grounds of appeal raised by the assessee read as under:- 1. The impugned order u/s 147 rws 144 of the I. T. Act, 1961 dated 24.03.2022 as well as the notice u/s 147 rws 144 and action or proceedings u/s 147/144 are illegal, bad in law, barred by limitation, without jurisdiction, without approval/satisfaction from the proper or competent authority, in valid exparty order in gross breach of the law and against the principle of natural justice and various other reasons or and further contrary to the real facts of the case hence the same may kindly be quashed.

2.

The Id. CIT(A) has grossly erred in law as well as on the facts of the case in set-aside the assessment to AO for making a fresh assessment without deciding our legal grounds and other grounds of appeal when all the details were available before him and also covered matter by the Honble ITAT orders, Honble High Court Orders and nothing new facts and material were/are to be filed by the assessee. Hence the order of the Id. CIT(A) are bad in law, invalid, illegal and on facts of the case, for and various other reasons and hence the same may kindly be quashed. 3.Rs.20,03,800/-: The Id. AO has grossly erred in law as well as on the facts ofthe case in making the addition of Rs.20,03,800/- on account of alleged unexplained cash deposit in the bank account u/s 68 and the Id. CIT(A) has also grossly erred in setaside the same to the Id. AO without considering the details, submissions and various judgments/orders, material available, evidences and documents. The Ld. AO and the Id. CIT(A) have also erred in not considering the vital facts and material available on record in their true perspective and sense. Hence the addition so made by the Id. AO and setaside by the Id. CIT(A) is being totally contrary to the provisions of law and facts on the record and hence same may kindly be deleted in full.

4.

The ld. AO has grossly erred in law as well as on the facts of the case in charging the interest u/s 234A, B,C. The interest so charged is being totally contrary to the provision of law and on facts of the case and hence same may kindly be deleted in full.

5.

That the appellant prays your honour indulgences to add, amend or alter of or any of the grounds of the appeal on or before the date of hearing 3. The solitary issue in the present appeal pertains to addition made to the income of the assessee of cash found deposited in his bank account to the tune of Rs.20,03,800/- on account of the source of the same remaining unexplained. The assessment in the present case was framed u/s 147 r.w.s. 144 of the Act. The assessment order was an ex

P a g e | 3 ITA No. 1883/JPR/2025 Madan Lal Jat parte order with no participation by the assessee in the proceedings before the AO. 4. Before the Ld. CIT(A), however, I have noted that, the assessee’s explanation was that he was Labour Contractor and all his earnings were deposited in the Bank account and thereafter withdrawn for payment of the labourers employed by him and for other expenses. It was also pointed out, that these facts clearly appeared from the Bank statement itself where every deposit of money was accompanied with many entries of withdrawal. The assessee contended that it was only the netprofit which was taxable. 5. That even considering the entire deposits in the bank account to be his business receipts, the same amounting to Rs.20,03,800/-, and applying the provisions of presumptive taxation u/s 44AD of the Act, the taxable profits of the assessee came to Rs.1,60,304/- which could be treated as the income of the assessee, after claiming deduction u/s 80C of the Act. 6. These submissions of the assessee are reproduced in the Ld. CIT(A)s order at page 11 and 12. 7. Before me, ld. Counsel for the assessee produced copy of the bank statement demonstrating the aforesaid facts. The ld. CIT(A) however, I have noted, has restored the issue back to the AO for consideration afresh. 8. I do not find any merit in the order passed by the Ld. CIT(A). The facts as stated by the assessee are very much corroborated by the entries in the bank account of the assessee, which I have perused. The

P a g e | 4 ITA No. 1883/JPR/2025 Madan Lal Jat credits in the bank account are succeeded by corresponding debits corroborating assesses explanation of utilizing the amounts collected from his business of labour contractor for payments made to labourers. The assessee being a small Labour contractor with total credits in the bank account of Rs.20.34 lakhs, I see no reason for submitting the assessee to another round of assessment before, the AO. Finding merit in the submissions made by the assessee, I accordingly direct deletion of the addition made on account of the cash found deposited in the bank account of the assessee to Rs.20.34 lakhs and restrict addition to Rs.1,60,304/- as admitted by the assessee himself, estimating profits earned by applying the provisions of Section 44 AD of the Act to the total receipts by the assessee. 9. In view of the above, the appeal of the assessee is partly allowed in above terms. Order pronounced in the open court on 30.06.2026.

Sd/- (Annapurna Gupta) ACCOUNTANT MEMBER Dated 30.06.2026 Mittali, Sr. PS Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals)

P a g e | 5 ITA No. 1883/JPR/2025 Madan Lal Jat 5. DR: ITAT By Order, Asst. Registrar ITAT, Jaipur

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