KAMLESH SERAWAT,JAIPUR vs. ITO, WARD 7 (1), JAIPUR

IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES, “SMC” BENCH, JAIPUR BEFORE SMT. ANNAPURNA GUPTA, ACCOUNTANT MEMBER & SHRI T. R. SENTHIL KUMAR, JUDICIAL MEMBER ITA No.1780/JPR/2025 (Assessment Year:2015-16)

Kamlesh Serawat Vs. ITO Kalani & Co LLP, Ward 7(1) Chartered Accountants, Jaipur 5th Floor, Milestone Building, Gandhinagar Turn, Tonk Road, Jaipur �थायीलेखासं./जीआइआरसं./PAN/GIR No:DBNPS 3937K Appellant .. Respondent Assessee by : Sh. P.C. Parwal, CA Departmentby : Ms. Namita Patel, JCIT Date of Hearing 28.07.2026 Date of Pronouncement 27.10.2026 O R D E R Per Annapurna Gupta, AM:- The present appeal has been filed by the assessee against the order passed by the National Faceless Appeal Centre (NFAC), Delhi (hereinafter referred to as “Ld. CIT(A)”), dated 29.09.2025 under Section 250 of the Income Tax Act, 1961 (hereinafter referred to as “the Act”).

P a g e | 2 ITA No.1780/JPR/2025 Kamlesh Serawat 2. The grounds raised by the assessee read as under:- 1. The Ld. CIT(A), NFAC has erred on facts and in law in confirming the addition of Rs.30,23,816/- made by AO u/s 69A of IT Act, 1961 on account of alleged unexplained cash deposit in the bank account on 26.04.2014. 2. The assessee craves to amend, alter and modify any of the grounds of appeal. 3. The appropriate cost be awarded to the assessee. 3. The solitary issue in the present appeal relates to the addition made to the income of the assessee on account of cash found deposited in the bank account of the assessee amounting to Rs.30,23,816/-, source of which remained unexplained. 4. The orders of the authorities below reveal that it was cash deposited by the assessee in his bank account on 26.04.2014 i.e. on a single day, which was treated as from unexplained sources and added to the income of the assessee. The assessee had explained the source of the same as being amount received from his father and father’s brother of Rs.19 lakhs and Rs.15 lakhs respectively, which explanation was rejected by the Ld. CIT(A) for the reason that there was an unreasonable time gap between the date when the amount was withdrawn by these persons from their bank account and given to the assessee and that deposited in the bank account of the assessee. The Ld. CIT(A) placed reliance on the decision of the Hon’ble Supreme Court in the case of Sumati Dayal Vs. CIT [1995] 214 ITR 801 applying the test of human probabilities while holding that the source of cash deposited in the bank account of the assessee remained unexplained to the tune of Rs.30,23,816/-.

P a g e | 3 ITA No.1780/JPR/2025 Kamlesh Serawat 5. Before us, ld. Counsel for the assessee contended that the assessee had explained the availability of cash with him for deposit in his bank account as having received from his father Mr. Madan Lal Jat and Sh. Jagdish Chandra Jat respectively amounting to Rs.19 lakhs and Rs.15 lakhs respectively. He contended that the assessee had also explained the source of money received by these persons to gift to the assessee duly substantiating his explanation with the evidences also. In this regard, he submitted that father of the assessee Sh. Madan Lal Jat had two brothers on Mr. Ramnarayan Jat and another Mr. Jagdish Chandra Jat. That Sh. Ramnarayan Jat had sold an agricultural land on 30.12.2011 for Rs.41,01,000/- out of which he had transferred Rs.17 lacs to Sh. Madan Lal Jat on 19.09.2012 and cash of Rs.2,16,000/- was deposited in his bank account on 04.10.2012 out of which Sh. Madan Lal Jat had withdrawn Rs.5 lacs on 19.10.2012 and Rs.14 lacs on 01.02.2013 which was given by him to the assessee. Sh. Madan Lal Jat, he contended had confirmed giving Rs.19 lacs to the assessee. 6. In this regard, he submitted that the assessee had furnished evidence of sale of land by Sh. Ramnarayan Jat which was placed at paper book page No.13-25, had furnished the copy of bank account of Sh. Madan Lal Jat reflecting the deposit of Rs.17 lacs and Rs.2,16,000/- therein from the amount received from his brother and also reflecting the withdrawal of Rs.5 lacs and Rs.14 lacs for giving to the assessee which was placed at paper book page No.12. Confirmation of Sh. Madan Lal Jat of having gifted Rs.19 lacs to the assessee was also placed before us at paper book page No.7.

P a g e | 4 ITA No.1780/JPR/2025 Kamlesh Serawat 7. Similarly, for the Mr. Jagdish Chandra Jat, the ld. Counsel for the assessee contended that it was explained to the authorities below that Sh. Jagdish Chandra Jat had sold an agricultural land on 09.11.2011 for Rs.1,01,23,200/- .Copy of the sale deed furnished to the authorities below is placed before us at paper book page No.28-36. That out of the same, he had given Rs.15 lacs to the assessee on 09.11.2013. Confirmation of Sh. Jagdish Chandra Jat was also furnished, which was placed before us at paper book page No.27. 8. Ld. Counsel for the assessee contended that none of the documents furnished by the assessee have been doubted nor any infirmity in the same found by the authorities below. That applying the test of human probabilities therefore the assessee had duly explained the source of cash deposited. 9. The Ld. DR however, drew our attention to the findings of the Ld. CIT(A) at para 5.4.4 to 5.6 as under:- …… 5.4.4 In respect of S. No. 3, the appellant claimed that the amount was received from Shri Jagdish Chandra Jat, his father's brother, and submitted a copy of the sale deed to substantiate the transaction. However, upon examination of the sale deed, it was noted that out of the total sale consideration of 1,01,23,000, Shri Jagdish Chandra received only 1,51,000 in cash, while the remaining amount was received through cheques and deposited into his bank account. The appellant failed to furnish a copy of Shri Jagdish Chandra's bank passbook to corroborate the claim. Further, the date of sale was 31.10.2011, whereas the alleged date of receipt was 09.11.2013, with the deposit made on 26.04.2013. This significant time gap undermines the credibility of the explanation. The sale deed, therefore, does not support the appellants claim of having received cash from Shri Jagdish Chandra Jat 5.4.5 Moreover, no explanation was provided as to how Madan Lal retained such a substantial amount of cash for several years without utilizing or depositing it in a bank. The appellant did not submit income tax returns, cash flow statements, or any other evidence of

P a g e | 5 ITA No.1780/JPR/2025 Kamlesh Serawat creditworthiness to substantiate the claim. The "money transaction document" submitted is self-serving and lacks independent corroboration. 5.5 Considerable time lapse and absence of supporting documentation, the explanation offered is improbable and unsatisfactory when assessed against the test of human probabilities, as laid down by the Hon'ble Supreme Court in Sumati Dayal v. CIT [1995] 214 ITR 801 (SC). Accordingly, the source of the cash deposit remains unexplained. Further, the appellant referred to the case law: Amrita Choudhary v. ITO (ITA No. 1063/Kol/2023) in his reply-. The referred case differs on factual matrix and evidentiary standards also differ significantly from the case under consideration. The precedent does not override the requirement of verifiable documentation, especially when large cash deposits are involved and the AO has already exercised due diligence. 5.6 In view of the foregoing analysis, only the deposit of Rs. 10,24,000 (out of total cash deposit of Rs.40,47,816) has been considered as satisfactorily explained by the appellant. The source of the remaining amount (Rs.30,23,816) stands unexplained. Accordingly, the Assessing Officer is directed to reduce the addition under Section 69A to the extent of Rs. 10,24,000. As a result, the ground of appeal no.2 is partly allowed. …… 10. She pointed out that the Ld. CIT(A) had rightly noted a huge time gap in the transaction of transfer of money between Sh. Ramnarayan Jat to the father of the assessee Sh. Madan Lal Jat, who allegedly had sold the land in December 2011 and transferred Rs.19 lacs to the father of the assessee Sh. Madan Lal Jat almost a year later on 19.09.2012 and 04.10.2012. 11. She further pointed out that there was a huge time gap between the withdrawal of amount of Rs.5 lakhs by Sh. Madan Lal Jat on 19.10.2012 and Rs. 14 lacs on 01.02.2013 and the deposit of the same by the assessee on 24.04.2014. 12. Similarly, she pointed out that in the case of Sh. Jagdish Chandra Jat also he had received money on sale of land in November 2011, while he had given Rs.15 lacs to the assessee two years later in

P a g e | 6 ITA No.1780/JPR/2025 Kamlesh Serawat November 2013 and the assessee had deposited the same only in February 2014. 13. That these huge time gaps in the transactions allegedly undertaken justifying the cash in the hand of the assessee for depositing in his bank account, raised a huge suspicion about the genuineness of the transaction and therefore he contended that the Ld. CIT(A) had rightly applied the test of human probabilities lay down by the Hon’ble Apex Court in the case of Sumati Dayal (Supra) to reject the explanation of the assessee. She heavily supported the order of the Ld. CIT(A). 14. We have heard both the parties and gone through the orders of the authorities below. We are convinced with the explanation of the ld. Counsel for the assessee that the source of cash deposited in the bank account of the assessee of Rs.30,23,816/- was duly explained. The assessee’s explanation of the source of cash deposited emanating from cash given to him by his father and uncle is duly substantiated with the confirmations given by the said parties through bank accounts reflecting withdrawals of cash, which the assessee stated was given to him and the assessee has also substantiated the source of credits available in the donors bank account as emanating out of sale of land. 15. In the case of father, the sale of land was undertaken by his brother, who had given a portion of the amount received to his brother, the father of the assessee before us. And in the case of Sh. Jagdish Chandra Jat, he had himself sold land. The assessee has filed evidences

P a g e | 7 ITA No.1780/JPR/2025 Kamlesh Serawat of sale of land also in both the cases. No infirmity has been found in any of the documents filed by the assessee. The only reason for rejecting the assessee’s explanation is the huge time gap between the transactions of receiving money by donors from sale of land and giving to the assessee or receipt of money by assessee from donors and deposit in his bank account. 16. Admittedly, there is a huge time gap between the sale of land, the transfer of money in the bank account of the different persons their withdrawal therefrom and giving cash to the assessee, who ultimately retained it from some period of time before depositing in his bank account. But the fact also remains that the said parties have confirmed to have given the amounts to the assessee from the sources as explained by the assessee. Except for the time gap in the transactions there is no other reason to doubt the explanation of the assessee, and considering the fact that the parties themselves have confirmed the cash given to the assessee and there is no other evidence with the Revenue to hold the explanation to be false or untrue. We are of the view that the assessee’s explanation cannot be rejected on the test of human probabilities. In fact as rightly pointed out by the ld. Counsel for the assessee considering the explanation of the assessee duly substantiated with evidences and confirmation of the parties giving the amounts to the assessee, the test of human probabilities supports the case of the assessee. We accordingly hold that the addition made of Rs.30,23,816/- on account of cash found deposited in bank account of the assessee is

P a g e | 8 ITA No.1780/JPR/2025 Kamlesh Serawat grossly unjustified on the facts and the addition is accordingly directed to be deleted. 17. In effect, appeal of the assessee is allowed. Order pronounced in the Open Court on 27.10.2026

Sd/- Sd/- (T.R. Senthil Kumar) (Annapurna Gupta) JUDICIAL MEMBER ACCOUNTANT MEMBER Dated 27.10.2026 Mittali, Sr. PS Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals) 5. DR: ITAT By Order, Mittali Digitally signed by: Mittali DN: CN = Mittali email = Asst. Registrar mittaligupta34671@gmail.com ITAT, Jaipur C = IN O = Personal Date: 2026.10.30 12:41:02 + 05'30'