MOHAN LAL YADAV,AJITGARH vs. INCOME TAX OFFICER, WARD-2, SIKAR, SIKAR

of the assessee, it is noticed that the ld CIT(A) has dismissed the appeal of the assessee by observing as under:- ‘’5 It could be seen from the facts that in this case, Ground No. 1 to 3 raised by the appellant pertains to the single issue of addition of Rs. 11,52,000/- on account of unexplained money u/s 69A of the Act and the same is adjudicated as under- 5.1. The appellant is an individual engaged in the business of running a petrol pump and also dealt in whole sale business of seeds, fertilizers & pesticides. The appellant filed his return of income for the AY 2017-18 on 08/02/2018 declaring total income at Rs. 10,63,680/- & agricultural income of Rs.5,48,903/- Subsequently during the course of assessment proceedings, the assessee field revised return of Income on 21/11/2019 declaring total income of Rs. 10,63,680/- SHRI MOHAL LAL YADAV VS ITO, WARD -2, SIKAR &agricultural income of Rs.21,52,000/-. The case was selected for scrutiny through CASS to verify the issue of large agricultural income shown in ITR and notice u/s 143(2) of the Act was issued to the appellant. 5.2. During the assessment proceedings, the AQ issued notices u/s 142(1) of the Act requesting him to explain nature & source of agricultural income shown in the retum of income, In response thereto, the assessee submitted receipts issued by the Krishi Upaj Mandi Samiti in respect of crops sold through it. The assessee could furnish only three receipts issued by the Krishi Upaj Mandi Samiti which supported agricultural income to the tune of Rs.5,69,159/- Thus remaining agricultural income of Rs. 15,82,841/- remained unexplained. The assessee contended that the remaining agricultural income was received in cash and tried to justify it by furnishing affidavits of persons to whom the agricultural crops were sold in cash. On examination, it was noted that the persons admitted to have purchased agricultural produce from the assessee. But they could not establish their creditworthiness that is their capacity to purchase the crops from the assessee for the cost price of the agricultural produce. In view of substantial agricultural land holding, the AO admitted the agricultural income of Rs. 10,00,000/- and treated remaining amount of Rs 11,52,000/- as unexplained money u/s 69A of the Act. The relevant portion of the assessment order passed by the AO is reproduced here as under:- ‘’The explanation as submitted by the assessee cannot be considered as satisfactory in as much as that the assessee could not furnish the details of earnings from agricultural activities. Besides, the assessee has also filed his revised income showing therein increased agricultural income of Rs. 21,52,000/- though in original return agricultural income was shown at Rs. 5,48,903/- only. It goes to show that the assessee has made a futile exercise to give the shape of his undisclosed income under the garb of agricultural income. As such, again the assessee was provided an opportunity to bring substantial evidences on record regarding agricultural income in the form of receipts issued by the Krishi Upaj Mandi Samiti in respect of crops sold through it. The assessee could furnish only three receipts issued by the Krishi Upaj Mandi Samiti which supports only agricultural income to the extent of Rs.5,69,159/-though the assessee has shown agricultural income in the revised return of income at Rs. 21,52,000/- Thus, remaining agricultural income of Rs.15,82,841/- still remains unexplained. The assessee has again tried to justify the remaining agricultural income of Rs. 15,82,841/- by furnishing affidavits to whom the agricultural crops were sold. The persons who tendered their affidavits were examined, by way of issuing Summon u/s 131 of the I. T. Act, 1961. On examination of the persons who submitted their affidavits, it is found that they almost admitted to have purchased agricultural produce from the assessee, but, they could not establish their creditworthiness that they were capable to purchase the crops from the assessee SHRI MOHAL LAL YADAV VS ITO, WARD -2, SIKAR for the cost price of the agricultural produce. Most of the purchasers are laborers. As such, the creditworthiness of these persons remained doubtful. During the course of assessment proceedings, the assessee was also confronted to the statements recorded on oath of the purchasers of the agricultural produce from him. The assessee only stated that the agricultural produce were sold to various persons who have tendered their affidavits. But the affidavits so furnished did not contain any date, the affidavits are not attested by Notary and not signed by witness. The mala-fide intention of the assessee is also proved from the fact that the assessee has declared agricultural income of Rs.3,39,157/- only in the assessment year 2018-19 and no agricultural income was declared in the return of income for the assessment years 2015-16 & 2016-17 However, it cannot be denied that the assessee has held substantial agricultural land in his name and agricultural produce is also possible and the expenses thereon may also be incurred in earning agricultural income including all the crops, vegetables & fodder etc. Considering all these facts, the agricultural income to the extent of Rs. 10,00,000/- is admitted and the balance amount of Rs. 11,52,000/- remains unexplained cash which was deposited in the bank accounts. As such, an amount of Rs. 11,52,000/- is treated as unexplained cash within meaning of section 69A of the I.T. Act, 1961 and added back in the total income of the assessee. The penalty proceedings u/s 271AAC(1) of the IT. Act, 1961 is initiated separately for addition u/s 69A.’’ 5.3. During the appellate proceedings also, the assessee claimed same as during the assessment proceedings without submitting any supporting documentary evidences in support of cash sales of agricultural produce. However, the AO rightly noted that the appellant failed to provide any corroborative evidence, such as sales memos or a cash book, to substantiate the claimed cash deposits. Under Section 69A of the Income Tax Act, 1961, if any person is found to be in possession of money, bullion, or other valuable articles and cannot satisfactorily explain the nature and source of such money, it may be deemed as unexplained income and accordingly charged to tax. The lack of documentation or credible evidence to support the source of the cash deposits during a period when the currency notes were rendered invalid further undermines the appellant's claims. The argument presented, without any substantive evidence, does not meet the burden of proof required under the provisions of the Act. Consequently, the AO's decision to treat the impugned amount as unexplained income is upheld as the appellant has not demonstrated compliance with the statutory requirements set forth in Section 69A In view of the facts discussed above, the nature & source of deposits made by the appellant remained unexplained. Thus the appellant had failed to discharge his SHRI MOHAL LAL YADAV VS ITO, WARD -2, SIKAR onus under section 69A of the Act. Hence, the addition made by the AO of Rs. 11,52,000/- as unexplained money u/s 69A of the Act is confirmed. Accordingly, Grounds No. 1 to 3 are dismissed.’’ 2.2 During the course of hearing, the main thrust of the ld. AR of the assessee was that an appeal order passed by the ld. CIT(A) is without giving opportunity of personal hearing despite request and such order is against the principles of natural justice and thereby he prayed that matter be remanded back to the file of the ld. CIT(A) with a direction that the assessee be given an opportunity of being heard in accordance with the law. 2.3 To support of his submissions, the ld. AR of the assessee has filed following paper book. S.N. Particulars Page No. Submitted with 1. Copy of submission filed with AO 1-1 CIT(A) & AO

2. Copy of statement of buyer Shri Ramesh 2-4 CIT(A) & AO Chand Saini recorded during the assessment proceedings by the AO

3. Copy of statement of buyer shri Suresh 5-8 CIT(A) & AO Kumar Solet recorded during the assessment proceedings by the AO

4. Copy of statement of buyer Shri Shankar Lal 9-12 CIT(A) & AO Yadav recoreded during the assessment proceedings by the AO

5. Copy of statement of buyer Shri Ramesh 13-15 CIT(A) & AO Kumar recorded during the assessment proceedings by the AO

6. Copy of statement of Shri Raj Kumar Yadav 13-22 CIT(A) & AO (son of assessee) recorded during the assessment proceedings by the AO

7. Copy of submission filed with ld CIT(A) 23-30 CIT(A)

2.4 On the other hand, the ld. DR supported the order of the ld. CIT(A). 2.5 The Bench heard both the parties and perused the materials available onrecord. In this case, it is noted that the AO made two additions i.e. Rs.11,52,000/- as unexplained money u/s 69A of the Act and Rs.50,000/- being the leakage in trading activities as the assessee failed to furnish the vouchers. In appellate proceeding, the ld CIT(A) confirmed both the additions as mentioned at para 5.3 and 5.4 of his order. The Bench while hearing of the appeal of the assessee noticed that there was thrust from the side of the ld. AR of the assessee that the assessee was deprived of personal hearing by the ld. CIT(A) despite specific request was made. The Bench by taking into consideration the facts and circumstances of the case feels that one more opportunity of personal hearing should be provided by the ld. CIT(A) with a view to resolving the issue in disputes (supra). Hence, the Bench is of the view that lis between the parties has to be decided on merits so that nobody’s rights could be scuttled down without providing opportunity of personal hearing to the assessee. Hence, the matter is restored to the file of the ld. CIT(A) to decide it afresh by providing one more opportunity of hearing, however, the assessee will not seek any adjournment on frivolous ground and remain cooperative SHRI MOHAL LAL YADAV VS ITO, WARD -2, SIKAR duringset aside proceedings. Thus, the appeal of the assessee is allowed for statistical purposes. 3.0 In the result, the appeal of the assessee is allowed for statistical purposes. Order pronounced in the open court on 27/05/2025.

Sd/- Sd/- ¼Mk0 ,l- lhrky{eh ½ ¼jkBksMdeys'kt;UrHkkbZ ½ (Dr. S. Seethalakshmi) (Rathod Kamlesh Jayantbhai) U;kf;dlnL;@Judicial Member ys[kklnL;@Accountant Member Tk;iqj@Jaipur fnukad@Dated:- 27 /05/2025 *Mishra आदेश की प्रतिलिपिअग्रेf’ात@ब्वचल वf जीम वतकमत वितूंतकमक जवरू 1. The Appellant- Shri Mohan Lal Yadav, Ajitgarh 2. izR;FkhZ@ The Respondent- The ITO, Ward 2, Sikar 3. vk;djvk;qDr@ Theld CIT 4. विभागीय प्रतिनिधि] आयकरअपीलीय अधिकरण] जयपुर@क्त्ए प्ज्Aज्ए Jंपचनत 5. xkMZQkbZy@ Guard File ( By order,

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