PAPPU JAISWAL,JAIPUR vs. INCOME TAX OFFICER WARD 2(2), JAIPUR

4. That In the facts and circumstances of the case and in law the learned CIT (A) has erred in virtually confirming the order of the learned AO in making additions under section 68 of Rs. 12,31,000/-, and under section 69 of Rs. 9,60,750/-

5. That in the facts and circumstances of the case and in law the learned CIT (A) has erred in confirming the order passed by the learned AO in making additions of Rs, 2,87,250/- applying N P rate of 15% on contract receipts of Rs. 19,15,000/-

6. That In the facts and circumstances of the case and in law the learned CIT(A) has erred in confirming the order passed by the learned AO without providing adequate opportunity.

423 days in filing of the appeal by the assessee for which the assessee filed an application for condonation of delay with following prayers:

“Re – Condo-nation of delay in filing of an appeal before the Hon’ble ITAT Jaipur Bench, Jaipur In the case of shri Pappu Jayaswal, B-60A, Mitra Vihar Colony, Panchayawala Sirsi Road, Jaipur 302021—Request Regarding Assessment year 2012-2013 PAN: AGOPJ9097Q

Hon’ble Members

The appellant assessee is an individual. In the above regard it is submitted that in the case of the assessee assessment order was passed on 05.12.2019 under section 144/147 assessing total income at Rs, 24,79,000/- as against returned income of Rs. 2,35,020/-. The assessee filed appeal before the learned CIT(A) on 23.01.2020. However the learned CIT(A) has dismissed the appeal of the assessee vide order dated 12.10.2023.

The appellate order passed by the Learned CIT(A) on 12.10.2023 was served online on ITBA Portal on 12.10.2023 which came into the knowledge of the assessee in January-2025 as the old counsel of the assessee has not informed about the passing of the order and he has also not filed any reply before the CIT(A). The assessee was not aware and has no knowledge for receiving of the hearing notices from CIT(A).

In the above regard it is submitted that the assessee did not receive the order of the learned CIT(A). Further assessee is not accustomed to watch email as such being non conversant with the electronic gadgets. The assessee failed to watch any communication from the learned CIT(A). Further the fact of dismissal of appeal by the learned CIT(A) came to the notice of the assesee only on receipt of penalty notice dated 09.01.2025. Soon after that assessee contacted a new chartered Accountant and has now filed appeal before the Hon’ble ITAT. An Affidavit is being filed to the effect of the afore said facts.

Therefore, the assessee has no knowledge regarding issue of hearing notices as well as passing of ex-parte order on 12.10.2023 by the learned CIT(A). There is Pappu Jaiswal vs. ITO delay of 441 days which is bonafide and non-intentional and beyond the control of the assessee. The assessee is very poor and non admission of appeal shall result in financial chaos to the asseseee. Considering the aforesaid facts the Hon'ble I.T.A.T is humbly requested to consider the fact sympathetically and to take mercy upon the assessee and admit the appeal of the assessee by condoning the delay. The following case laws are quoted in support: -

(i) Vijay Vishan Meghani vs. DCIT (Bombay High Court) (2017) 398 ITR 250 Appeal-Condonation of Delay-Claim for deduction under Section 80-0 made by Assessee was disallowed by A0 for Assessment Year 1993-94 and confirmed by the Commissioner of Income Tax (Appeals)-Against order of Commissioner, assessee preferred appeal before Tribunal -Tribunal restored matter back to file of AO for Assessment Year 1993-94-A0 passed order allowing claim under that section of the I.T. Act, 1961-Assessee preferred rectification application to AO to rectify his order for Assessment Year 1994-95 and Assessment Year 1996-97

Rectification application was rejected by A0-CIT(A) upheld order of A0-Assessee filed application for condonation of delay in filling appeal magainst order of CIT(A)_Tribunal held that assessee simply put responsibility for delay on Revenue-Tribunal dismissed two appeals filed by assessee holding that same as barred by limitation-Tribunal held that delay of 2984 days in filling appeal could not be condoned Held,Supreme Court in case of Concord of India Insurance Co. Ltd.Vs. Smt. Nirmala Devi and others held that legal advice tendered by a professional and litigant acting upon it one way or other could be sufficient cause to seek condonation of delay and coupled with other circumstances and factors for applying liberal principles and then said delay can be condoned-None should be deprived of an adjudication on merits unless the Court of law or the Tribunal/Appellate Authority found that litigant deliberately and intentionally delayed filing of appeal Tribunal though aware of these principles but possibly carried away by fact that delay of 2984 days was incapable of condonation--In process Tribunal went about blaming assessee and professionals and equally Department-Tribunal's order did not meet requirement set out in law--Tribunal completely misdirected itself and had taken into account factors, tests and considerations which had no bearing or nexus with issue at hand-Tribunal, therefore, erred in law and on facts in refusing to condone delay--Explanation placed on affidavit was not contested nor Court found that from such explanation , High Court could not arrive at conclusion that assessee was at fault, he intentionally and deliberately delayed matter and had no bona fide or reasonable explanation for delay in filing

(ii) Just Steels vs DCIT (2012) 74 DTR (MA) 86 Appeal could not be filed in time before the ITAT because the order of CIT(A) was misplaced. The firm stood dissolved and was recurring into losses. Delay to be condoned.

(iii) Oracle India Pvt Ltd vs. Deputy Commissioner of Income Tax (2008) 13 DTR 371 that "condonation of delay- reasonable cause - delay of 1297 days in filing appeal being on account of lapse on the part of consultant and not being malafide, there was valid reason warranting condonation of delay and admission of appeal". Copy of order is enclosed.

(iv) Improvement Trust vs. Ujagar Singh (Supreme Court) CIVIL APPEAL NOS. 2395 of 2008 dated 26.06.2010

Unless mala fides are writ large, delay should be condoned. Matters should be disposed of on merits and not technicalities. The Appellant, local authority, acquired land belonging to one of the Respondents for a development scheme in 1988. As the Appellant did not pay the compensation amount despite notice, the property was auctioned and sale confirmed in favour of the highest bidder in 1992. The bidder deposited the sale proceeds. The Appellant then "woke up from its slumber" and filed objections before the Single Judge for setting aside the auction sale. Even in these proceedings, the Appellant did not appear and the same were dismissed for non-appearance. The sale deed was executed in favour of the highest bidder. The Appellant then filed an appeal before the District Judge which was barred by limitation by a couple of months. This appeal was dismissed on the ground that there was not sufficient ground for condonation of delay. Onmistaken advice, the Appellant filed a second appeal to the High Court which was thereafter treated by the Court as a revision application. This was alsodismissed. The Appellant then filed a review petition which was also dismissed. Against that the Appellant filed a SLP which was also delayed. The delay in filing the SLP was condoned and the question before the Supreme Court was whether the District Judge was justified in dismissing the first appeal on the ground of delay. HELD allowing the appeal:

(a) While considering an application for condonation of delay no strait-jacket formula is prescribed to come to the conclusion if sufficient and good grounds Pappu Jaiswal vs. ITO have been made out or not. Each case has to be weighed from its facts and the circumstances in which the party acts and behaves. From the conduct, behaviour and attitude of the appellant it cannot be said that it had been absolutely callous and negligent in prosecuting the matter;

(b) Justice can be done only when the matter is fought on merits and in accordance with law rather than to dispose it of on such technicalities and that too at the threshold;

(c) Unless malafides are writ large on the conduct of the party, generally as a normal rule, delay should be condoned. In the legal arena, an attempt should always be made to allow the matter to be contested on merits rather than to throw it on such technicalities. Apart from the above, the appellant would not have gained in any manner whatsoever, by not filing the appeal within the period of limitation. It is also worth noticing that delay was also not that huge, which could not have been condoned, without putting the respondents to harm or prejudice. It is the duty of the Court to see to it that justice should be done between the parties; v) Naveen kishore Mehnot Vs ITO (2023) 152 Taxmann.com 658 (mum-Trib)

The assessment of the assessee was completed against which the assessee had filed an appeal before the commissioner (Appeals) on 02.01.2019 which was decided by commissioner (Appeals) vide order dated 01.01.2022. The afore said order was passed ex party by the commissioner (Appeals) which was not received by the assessee and he came to know about the same when a show cause notice under section 271(1)(c) from the department was issued. Thereafter, the assessee appointed a Chartered Accountant and filed an instant appeal which was delayed on that account . Since the delay caused was not due to any neglect but due to circumstances beyond the assessee’s control, he filed an application for condoning the delay in filing instant appeal.

Held, in view of the decision in the case of Midas polymer compounds (p.) Limited Vs. CIT [(IT Appeal No. 288 (Coch.) of 2017, dated 25.06.2018] , delay was to be condoned and appeal was to be admitted for adjudication.

In the circumstances it is submitted that it was because of the bonafide delay due to unseen circumstances. The appeal could not be filed in time. It is submitted that for something which happened due to inadvertence and beyond the control.

Therefore, after recording valid reasons and taking prior approval from the Pr. CIT-I, Jaipur vide letter no. 2134 dated 29.03.2019, conveyed by the Addl. CIT vide letter no. 4323 dated 29.03.2019 notice u/s 148 issued in case of assessee on 29.03.2018 which has been duly served through registered post. In response, no return has been filed by the assessee.

Notices 142(1) was issued on 22.08.2019 fixing date of hearing on 28.08.2019 but no compliance has been made. Again, notice u/s 142(1) of IT Act issued on 11.11.2019 fixing the date of hearing on 18.11.2019 but no compliance has been made. Notice u/s 142(1) of IT Act has again issued on 18.11.2019 fixing the date of hearing on 25.11.2019 but no compliance has been made on the given date.

6.1 In the assessment proceeding the assessee vide submission dated 03.12.2019 submitted computation of income and bank statement, he also construction work and sale/purchase of residential plot/ house, and filed return for this assessment year in accordance with the provision of section 44AD of the Act. Assessee is filing return of income regularly. As is evident from the record that the assessee has three bank accounts during the year under consideration and the same were placed on record. The assessee contended that the deposit of cash in the bank account reflects the business receipts which is received in cash and any immovable property transaction is related to business activity.

6.2 Against that reply to ld. AO, he noted so far as to the contention that the assessee is engaged in the business of civil construction work but the assessee has not produced evidence to this effect. The assessee has not produced any details of sale and purchase of residential plots/houses and of construction work. Secondly, the assessee has stated that cash deposit in bank accounts out of business receipt, which is received in cash, and any immovable property transaction is related to business. However, the assessee has not produced any details that which property sold in the year under consideration and not produced the source of cash deposit. Only written submission is not enough to prove that the cash deposited in bank produced to this effect. Since the assessee has not produced any evidence regarding the source of cash deposit of Rs. 12,31,000/- and regarding Rs. 9,60,750/- (purchase consideration of Rs. 9,15,000+ Stamp duty expenses of Rs. 45,750) investing in purchase of property even various opportunities have been provided to the assessee. Only filing of computation u/s 44AD of IT Act is not enough to prove that the assessee is doing business of sale/ purchase of residential land/ plot and engaged in construction work. The assessee has not filed any details regarding the sale/ purchase of residential plot/ house and construction work. Therefore, an addition of Rs. 12,31,000/- was made on account of cash deposit in bank accounts u/s 68 of the Act and an addition of Rs. 9,60,750/-(purchase consideration of Rs. 9,15,000+ Stamp duty expenses of Rs. 45,750) was made on account of investment in immovable property u/s 69 of IT Act. Ld. AO also noted that the assessee has received contract receipts of Rs. 19,15,000/-during F.Y 2011-12. The assessee has not produced any details from whom the receipts was received and what work done by the assessee. In absence to any details, it is reasonable to disallow 15% of total contract receipt of Rs. 19,15,000/-that comes to Rs. 2,87,250/-. Therefore, an addition of Rs. total income of the assessee was computed as under :

Add: Unexplained cash deposit u/s 68 of IT Act Rs. 12,31,000/- Add: Unexplained investment u/s 69 of IT Act Rs. 9,60,750/- Add: Addition on account of contract receipt Rs. 2,87,250/- Total Income Rs. 24,79,000/-

7. Aggrieved from the order of the Assessing Officer, assessee preferred an appeal before the ld. CIT(A). Apropos to the grounds so raised the relevant finding of the ld. CIT(A) is reiterated here in below: “The present filed appeal is directed against order u/s 147 r.w.s 144 of the Income Tax Act (herein after referred as ‘Act’), issued by AO on 05.12.2019 for the assessment year 2012-13.

2. Aggrieved with the order issued by the AO, the appellant has filed present appeal on 23.01.2020. In the course of appellate proceedings, it is seen that the appellant was issued and served various notices u/s 250 of the Act from this office to present his contentions and any documents supporting them. The said notices were issued right from 2020 through till 2023 and all of them (3 in number) remain un-complied with. The National Faceless Appeal Centre (NFaC) also in November, 2022 enabled communication window to facilitate filing of submissions by the appellant but to no avail.

Thus, the appeal filed by the appellant stands dismissed.”

The assessee is an Individual. During the year the assessee derived income from contract receipts. Return of income was filed on 27.12.2013 disclosing income of Rs. 2,35,020/- , a copy of acknowledgement of return along-with computation of total income and form 26 AS is available on paper book page No 1 to 9. Subsequently the learned AO issued notice under section 148 on 29.03.2019. The assessment has been completed under section 144 on 05.12.2019 determining total income at Rs, 24,79,000/- as against retuned income of Rs. 2,35,020/-. The additions made by the learned AO are as under- S No. Particulars Amount 1 Unexplained Cash deposit in Bank u/s 68 of the IT Act 12,31,000.00 2 Unexplained investment u/s 69 of the IT Act in the purchase of 9,60,750.00 immovable property 3 Additions on account of contract receipt by applying N P rate of 2,87,250.00 15% Total 24,79,250.00

Aggrieved with the order passed by the lead AO the assessee went in appeal before the learned CIT(A). However the learned CIT(A) without affording adequate opportunity dismissed the appeal of the assessee on 12.10.2023. Further during the course of pendency of appeal before the learned CIT(A) the asseseee had requested the learned AO, ITO ward 2 (2) vide letter dated Pappu Jaiswal vs. ITO 14.10.2021 to furnish copy of sanction letter under section 151 by the specified authority approving the recording of reasons. However the learned AO till date failed to furnish the required information. Copy of letter dated 14.10.2021 is available on paper book page NO…24. The learned AO did not furnish information taking the excuse that the relevant records are not available/traceable. . Aggrieved with the order of the learned CIT(A) the assessee has come before the Hon’ble Tribunal with the following grounds of appeal discussed hereunder.

The appeal filed before the Hon’ble Tribunal is late by 441 days. The assessee has separately moved an application for condo-nation of delay along with affidavit to this effect. The appeal could not be filed in time as the assessee came to know of the order of CIT(A) only on getting a penalty notice on 09.01.2025. The assessee is non matriculate and is not aware about the intricacies of the income Tax. It is submitted that by not filing an appeal in time the assessee was not a gainer as such no malafide can be attributed. The assessee being a very small time taxpayer pleads for mercy in condoning the delay. The individual grounds of appeal are discussed here under-

Grounds of Appeal

1. That In the facts and circumstances of the case and in law the learned CIT (A) has erred in dismissing the appeal of the assessee simply on the ground of alleged non compliance of opportunity granted by him whereas the appeal required to be decided on the basis of facts on record

2. That in the facts and circumstances of the case and in law the learned CIT (A) has erred in virtually confirming the order passed by the learned AO under section 147/144 on 05.12.2019 in pursuance to notice issued under section 148 unlawfully on 29.03.2018.

3. That In the facts and circumstances of the case and in law the learned CIT (A) has erred in virtually confirming the order of the learned AO in making additions under section 68 of Rs. 12,31,000/-, and under section 69 of Rs. 9,60,750/-

4. That in the facts and circumstances of the case and in law the learned CIT (A) has erred in confirming the order passed by the learned AO in making additions of Rs, 2,87,250/- applying N P rate of 15% on contract receipts of Rs. 19,15,000/-

5. That In the facts and circumstances of the case and in law the learned CIT(A) has erred in confirming the order passed by the learned AO without providing adequate opportunity.

Ground No. 1 That In the facts and circumstances of the case and in law the learned CIT (A) has erred in dismissing the appeal of the assessee simply on the ground of alleged non compliance of opportunity granted by him, whereas the appeal required to be decided on the basis of facts on record.

In the above regard it is submitted that justice has not been done to the assessee not only by the learned AO, who has passed assessment order under section 144 for no reasons but the assessment order passed under section 144 being illegal could not have been confirmed by the learned CIT(A). The learned CIT(A) has dismissed the appeal of the assessee simply on the ground that assessee failed to make compliance of the notices issued to him. However it is submitted that in any case it was incumbent upon the learned CIT(A) to have passed the order not simply on the basis of non compliance on the part of the assessee but he should have considered facts on record. Having not done so, the learned CIT(A) has passed the order which is not in accordance with law.

In this case the learned AO has made additions of Rs. 12,31,000/- on the ground that the assessee has made cash deposits in the bank account. No details have been given of these cash deposit of Rs. 12,31,000/- such as date of deposit and the relevant bank account.

The learned AO had made additions of Rs. 9,60,750/- on the ground that assessee has purchased immovable property for a sum of Rs, 9,15,000/- and incurred stamp duty expenses of Rs. 45,750/-. Total investment Rs. 9,60,750/-. While making additions it was incumbent upon the leaned AO and also a duty was cast upon him to stipulate the following.

A Particulars of property purchased by the assessee. B date of purchase of property C name of the person from whom the property was purchased D mode of payment of the consideration

It is unfortunate that none of the above details have been mentioned by the learned AO in the assessment order. It appears that the learned AO has acted without obtaining verified facts. He has followed the information received from I & C I as a thumb rule. The entire addition made by the learned AO is illegal unlawful and unjust. During the year under consideration the asessee has purchased following two properties

A land at Plot NO. 223 Ganesh vihar, Sirsi Road, Jaipur for a sum of Rs. 2,41,000/- + stamp duty expenses of Rs. 13,460/- totaling to Rs, 2,54,460/- the amount have been paid by the assessee in cash on 20.04.2011. The assessee has withdrawn cash from Central Bank of India of Rs. 1,00,000/- on 7.4.2011 and Rs. 2,00,000/- on 20.04.2011 for purchase of the afore said property . Copy of purchase deed is available on paper book page No 25 to 32. Copy of the bank account is enclosed from ready reference and the same is available on paper gook page No.14 to 17.. Thus the source of purchase of this property is fully explained.

B Land at plot no. 72 at Ganesh vihar, sirsi road, jaipur on 16.01.2012 from Shri Gopal singh for a total consideration of Rs, 9,15,000/- + stamp duty of Rs. 35,470/- totaling to Rs. 960,470/-. The source of investment is as under Rs. 7,00,000/- by cheque drawn on Central Bank of India dated 28.12.2011 Rs. 50,000/- by cash on 28.12.2011 Rs. 1,65,000/- by cash on 16.01.2012 ============= Rs. 9,15,000/- Total =============

Regarding availability of cash the assessee is furnishing a cash flow statement which discloses that assessee was having sufficient funds in hand. The major source is Rs. 2,51,000/- received on 12.12.2011 on sale of property which is the trade of the assessee. Copy of bank account reflecting withdrawl of Rs. 7,00,000/- is available on paper book page No. 14 to 17. Copy of cash flow statement is produced below. Copy of purchase deed is available on paper book page No 45 to 54. Copy of bank account is available on paper book page No 10 to 23. .in view of the above the source of Rs. 9,15,000/- is fully explained

Cash flow statement paid for S name of opening Withdrawals deposits in purchase Closing NO, Date Bank balance from Bank bank of property Balance 1 01.04.2011 151000.00 151000.00 2 04.04.2011 C B I 151000.00 50000.00 201000.00 3 05.04.2011 C B I 201000.00 1500.00 199500.00 4 07.04.2011 C B I 199500.00 100000.00 299500.00 5 13.04.2011 C B I 299500.00 500000.00 799500.00 6 20.04.2011 C B I 799500.00 200000.00 999500.00 7 20.04.2011 property 999500.00 241000.00 758500.00 8 23.04.2011 C B I 758500.00 20000.00 778500.00 9 27.04.2011 S B B J 778500.00 10000.00 768500.00 10 03.05.2011 C B I 768500.00 500000.00 1268500.00 11 12.05.2011 C B I 1268500.00 10000.00 1278500.00 12 13.05.2011 C B I 1278500.00 20000.00 1298500.00 13 26.05.2011 S B B J 1298500.00 5000.00 1293500.00 14 03.06.2011 C B I 1293500.00 100000.00 1393500.00 15 06.06.2011 C B I 1393500.00 3000.00 1390500.00 16 10.06.2011 C B I 1390500.00 5000.00 1395500.00 17 10.06.2011 C B I 1395500.00 5000.00 1400500.00 18 13.06.2011 C B I 1400500.00 50000.00 1450500.00 19 17.06.2011 C B I 1450500.00 50000.00 1400500.00 20 22.06.2011 C B I 1400500.00 10000.00 1410500.00 21 27.06.2011 C B I 1410500.00 5000.00 1415500.00 22 08.07.2011 C B I 1415500.00 1500.00 1414000.00 23 18.07.2011 C B I 1414000.00 30000.00 1444000.00 24 18.07.2011 C B I 1444000.00 25000.00 1469000.00 25 20.07.2011 C B I 1469000.00 20000.00 1489000.00 26 20.07.2011 S B B J 1489000.00 5000.00 1494000.00 27 08.08.2011 C B I 1494000.00 1500.00 1492500.00 28 11.08.2011 C B I 1492500.00 50000.00 1442500.00 29 17.08.2011 C B I 1442500.00 20000.00 1462500.00 30 01.09.2011 C B I 1462500.00 10000.00 1472500.00 31 01.09.2011 C B I 1472500.00 25000.00 1497500.00 32 02.09.2011 S B B J 1497500.00 40000.00 1537500.00 33 05.09.2011 C B I 1537500.00 50000.00 1587500.00 34 07.09.2011 C B I 1587500.00 10000.00 1597500.00 35 10.09.2011 S B B J 1597500.00 10000.00 1607500.00 36 19.09.2011 C B I 1607500.00 10000.00 1617500.00 37 21.09.2011 C B I 1617500.00 30000.00 1647500.00 38 23.09.2011 C B I 1647500.00 15000.00 1662500.00

39 01.10.2011 S B B J 1662500.00 25000.00 1637500.00 40 01.10.2011 C B I 1637500.00 25000.00 1662500.00 41 04.10.2011 C B I 1662500.00 10000.00 1672500.00 42 05.10.2011 C B I 1672500.00 10000.00 1682500.00 43 14.10.2011 C B I 1682500.00 30000.00 1652500.00 44 18.10.2011 C B I 1652500.00 15000.00 1667500.00 45 28.11.2011 C B I 1667500.00 30000.00 1697500.00 46 29.11.2011 C B I 1697500.00 500000.00 1197500.00 47 30.11.2011 ICICI 1197500.00 500000.00 697500.00 48 10.12.2011 C B I 697500.00 10000.00 707500.00 49 12.12.2011 property 707500.00 251000.00 958500.00 50 15.12.2011 C B I 958500.00 20000.00 978500.00 51 16.12.2011 C B I 978500.00 40000.00 1018500.00 52 28.12.2011 property 1018500.00 50000.00 968500.00 53 14.01.2012 S B B J 968500.00 2000.00 970500.00 54 16.01.2012 S B B J 970500.00 5000.00 975500.00 55 16.01.2012 property 975500.00 165000.00 810500.00 56 20.01.2012 S B B J 810500.00 5000.00 815500.00 57 25.01.2012 S B B J 815500.00 10000.00 825500.00 58 26.01.2012 S B B J 825500.00 10000.00 835500.00 59 27.01.2012 S B B J 835500.00 2000.00 837500.00 60 08.02.2012 S B B J 837500.00 30000.00 867500.00 61 08.02.2012 C B I 867500.00 5000.00 862500.00 62 13.02.2012 C B I 862500.00 50000.00 812500.00 63 18.02.2012 S B B J 812500.00 10000.00 822500.00 64 12.03.2012 S B B J 822500.00 40000.00 782500.00 65 12.03.2012 S B B J 782500.00 10000.00 792500.00 66 12.03.2012 S B B J 792500.00 10000.00 802500.00 67 12.03.2012 S B B J 802500.00 5000.00 807500.00 68 26.03.2012 S B B J 807500.00 10000.00 817500.00

2395000.00 1272500.00 456000.00 817500.00

Copies of title deeds of aforesaid properties are enclosed for verification. These facts go to establish that the learned AO was not in possession of correct facts regarding purchase of immovable properties and investment therein. The very initiation of proceedings under section 147/148 therefore was bad in law being based on incorrect facts. The Hon’ble ITAT is therefore requested to quash the assessment order and alternatively delete the addition of Rs, 9,60,750/-.

Ground No. 2

That in the facts and circumstances of the case and in law the learned CIT (A) has erred in virtually confirming the order passed by the learned AO under section 147/144 on 05.12.2019 in pursuance to notice issued under section 148 unlawfully on 29.03.2018. 1. No Approval under section 151 is unlawful

The learned AO was requested under letter dated 14.10.2021 copy of which is available on paper book page no. cited supra to furnish copy of reason recorded as well as copy of sanction given by the specified authority under section 151 but the same has not made available to the assessee till date. In the absence of copy of sanction letter under section 151 by the specified authority, the assessment is not backed by legal sanction. The assessee submits that in the case of the assessee no sanction under section 151 from the specified authority was obtained. If there had been sanction under section 151 the same should have been provided to the assessee. Despite passing of 36 month these primary records had not been made available to the assessee. The Hon’ble ITAT is requested to quash the assessment order on this ground alone

In the case of the assessee notice under section 148 was issued on 29.03.2019. The learned AO was suo moto required to furnish to the assessee a copy of the reasons recorded for issuance of notice under section 148 alongwith the copy of sanction letter obtained under section 151 from the Specified authority before completion of assessment proceedings, but the same was not provided to the assessee. In view of this the assessee could not object to the reasons recorded. Failure to furnish reasons is in direct violation of the directions of the Hon’ble Supreme Court in the case GKN Driveshaft (India) Ltd. (2003) 259 ITR 19 (SC). The Hon,ble Supreme Court had issued instruction that the reasons for issuing notice under section 148 should be provided to the assessee and before proceeding further in the assessment proceedings, the learned AO will be required to dispose the objection filed by the assessee, if any, to the issuance of notice under section 148. It is submitted that since in the case the reasons for issuing notice under section 148 were not provided, the assessee was deprived of the opportunity to raise objections against issuance of notice under section 148. Hence the entire proceedings of issuance of notice under section 148 and subsequent completion of assessment are ab-initio void. The following case laws are quoted in support i) GKN Driveshaft (India) Ltd. (2003) 259 ITR 19 (SC)

Pappu Jaiswal vs. ITO AO has to dispose of the objection by passing a speaking order before proceeding with the assessment. ii) CIT Vs Pentafour software Employees welfare foundation (Mad) (2019) 418 ITR 0427

In our considered view, the decision arrived at in the case of Jayanthi Narayanan (supra) reflexes the correct position of law because, the procedure carved out by the Hon'ble Supreme Court in GKN Driveshafts (India) Ltd. (supra) not only binds the assessee, but also the Revenue. Filing of objections to the reasons for reopening is not an empty formality. If this is so, passing a speaking order on the objections cannot be treated as an empty formality and to be brushed aside as a procedural error. The purpose for passing a speaking order on the objections is to afford an opportunity to the assessee to question the same, in the event the assessee is aggrieved by such an order. Therefore, to state that it would be sufficient for the Assessing Officer to deal with the objections in the assessment order http://www.judis.nic.in T.C.A.Nos.582 to 584 of 2009 and thereafter, if the assessee is aggrieved, he can file a statutory appeal, is a proposition which would be against the principles of natural justice. Therefore, if an order violates the law laid down by the Hon'ble Supreme Court, then it has to be necessarily held to be an order without jurisdiction. The law declared by the Hon'ble Apex Court is a binding character and is a source of law and to itself which will bind all authorities. iii) Kirti P Chidambaram (2018) 402 ITR 488 (Mad) Allowing the petition the Court held that , since reassessment order was passed without disposing of assessee’s objections to reopening of assessment and without passing a speaking order, same was unjustified. Court also held that where claim of assessee of exemption of income under section 10(1) on proceeds from sale of coffee subjected to only pulping and drying was accepted for several years and there were hundreds of coffee growers whose income were also exempted, reopening notice issued only against assessee during relevant assessment year was unjustified. (AY. 2009-10) iv) Jayanti Natrajan Vs ACIT (2018) 161 DTR 281 (Mad)

S. 147: Reassessment —Natural justice -Order passed without disposing of objections raised by assessee for reopening was improper and null and void [ S. 143(2), 148 ] Pappu Jaiswal vs. ITO Allowing the petition the Court held that , Order passed without disposing of objections raised by assessee for reopening was improper and null and void . The law laid down by the Supreme Court is of binding nature and is a source of law unto itself, which would bind on all the authorities. Gkn Driveshafts (India) Ltd. v. ITO ( 2003) 259 ITR 19 (SC) lays down a law and failure to comply would render the assessment order without jurisdiction ( AY. 2009-10) v) Cenveo Publisher services India Ltd. v. UOI ( 2019) 180 DTR 244(Bom) S. 147 : Reassessment –Delay in filing objections- -If the assessee delays filing objections to the reasons and leaves the AO with little time to dispose of the objections and pass the assessment order before it gets time barred, it destroys the formula provided in Asian Paints Ltd v. Dy. CIT ( 2008) 296 ITR 90 (Bom) that the AO should not pass the assessment order for 4 weeks- A writ petition to challenge the reopening is not entertained [S.148 ]

The Petitioner has raised the objections before the Assessing Officer to the notice of reopening of the assessment on 14.12.2018. Objections were disposed of by the Assessing Officer on 28.12.2018. Since the last date for framing the assessment was fast approaching and the assessment would get time barred on 31stDecember, 2018, the Assessing Officer passed the order of assessment on 28.12.2018. The Petitioner has approached the Court challenging very notice of reopening of the assessment and also including the challenge to the order of reassessment as consequential to the main challenge to reopening of the assessment. Dismissing the petition the Court held that reasons for reopening of the assessment by the Assessing Officer was supplied to the assesee on 14.9.2018. Without filing the objection the assessee approached the Court by filing the Writ Petition in November, 2018 After withdrawing the petition on 13 - 11-2018 the objection was filed on 14-12-2018 .Dismissing the petition , considering the facts of the case the Court held that ; if the assessee delays filing objections to the reasons and leaves the AO with little time to dispose of the objections and pass the assessment order before it gets time barred, it destroys the formula provided in Asian Paints Ltd v. Dy. CIT ( 2008) 296 ITR 90 (Bom) that the AO should not pass the assessment order for 4 weeks. Accordingly the writ petition was not entertained . ( WP No. 284 of 2019, dt. 01.02.2019)(AY.2011- 12. Ground NO. 3

That In the facts and circumstances of the case and in law the learned CIT (A) has erred in virtually confirming the order of the learned AO in making additions under section 68 of Rs. 12,31,000/-, and under section 69 of Rs. 9,60,750/-

In the above regard it is submitted that learned AO has made addition of Rs. 12,31,000/- under section 68 on account of deposits in bank. It is the case of the learned AO that the assessee failed to furnish any source of deposits of Rs. 12,31,000/- in the bank account.

In this regard it is submitted that position of withdrawal from bank account and deposit in bank account is reflected in the cash flow statement is as under Cash flow statement paid for S name of opening Withdrawls depsoits in purchase of Closing NO, Date Bank balance from Bank bank property Balance 1 01.04.2011 151000.00 151000.00 2 04.04.2011 C B I 151000.00 50000.00 201000.00 3 05.04.2011 C B I 201000.00 1500.00 199500.00 4 07.04.2011 C B I 199500.00 100000.00 299500.00 5 13.04.2011 C B I 299500.00 500000.00 799500.00 6 20.04.2011 C B I 799500.00 200000.00 999500.00 7 20.04.2011 property 999500.00 241000.00 758500.00 8 23.04.2011 C B I 758500.00 20000.00 778500.00 9 27.04.2011 S B B J 778500.00 10000.00 768500.00 10 03.05.2011 C B I 768500.00 500000.00 1268500.00 11 12.05.2011 C B I 1268500.00 10000.00 1278500.00 12 13.05.2011 C B I 1278500.00 20000.00 1298500.00 13 26.05.2011 S B B J 1298500.00 5000.00 1293500.00 14 03.06.2011 C B I 1293500.00 100000.00 1393500.00 15 06.06.2011 C B I 1393500.00 3000.00 1390500.00 16 10.06.2011 C B I 1390500.00 5000.00 1395500.00 17 10.06.2011 C B I 1395500.00 5000.00 1400500.00 18 13.06.2011 C B I 1400500.00 50000.00 1450500.00 19 17.06.2011 C B I 1450500.00 50000.00 1400500.00 20 22.06.2011 C B I 1400500.00 10000.00 1410500.00 21 27.06.2011 C B I 1410500.00 5000.00 1415500.00 22 08.07.2011 C B I 1415500.00 1500.00 1414000.00 23 18.07.2011 C B I 1414000.00 30000.00 1444000.00 24 18.07.2011 C B I 1444000.00 25000.00 1469000.00

25 20.07.2011 C B I 1469000.00 20000.00 1489000.00 26 20.07.2011 S B B J 1489000.00 5000.00 1494000.00 27 08.08.2011 C B I 1494000.00 1500.00 1492500.00 28 11.08.2011 C B I 1492500.00 50000.00 1442500.00 29 17.08.2011 C B I 1442500.00 20000.00 1462500.00 30 01.09.2011 C B I 1462500.00 10000.00 1472500.00 31 01.09.2011 C B I 1472500.00 25000.00 1497500.00 32 02.09.2011 S B B J 1497500.00 40000.00 1537500.00 33 05.09.2011 C B I 1537500.00 50000.00 1587500.00 34 07.09.2011 C B I 1587500.00 10000.00 1597500.00 35 10.09.2011 S B B J 1597500.00 10000.00 1607500.00 36 19.09.2011 C B I 1607500.00 10000.00 1617500.00 37 21.09.2011 C B I 1617500.00 30000.00 1647500.00 38 23.09.2011 C B I 1647500.00 15000.00 1662500.00 39 01.10.2011 S B B J 1662500.00 25000.00 1637500.00 40 01.10.2011 C B I 1637500.00 25000.00 1662500.00 41 04.10.2011 C B I 1662500.00 10000.00 1672500.00 42 05.10.2011 C B I 1672500.00 10000.00 1682500.00 43 14.10.2011 C B I 1682500.00 30000.00 1652500.00 44 18.10.2011 C B I 1652500.00 15000.00 1667500.00 45 28.11.2011 C B I 1667500.00 30000.00 1697500.00 46 29.11.2011 C B I 1697500.00 500000.00 1197500.00 47 30.11.2011 ICICI 1197500.00 500000.00 697500.00 48 10.12.2011 C B I 697500.00 10000.00 707500.00 49 12.12.2011 property 707500.00 251000.00 958500.00 50 15.12.2011 C B I 958500.00 20000.00 978500.00 51 16.12.2011 C B I 978500.00 40000.00 1018500.00 52 28.12.2011 property 1018500.00 50000.00 968500.00 53 14.01.2012 S B B J 968500.00 2000.00 970500.00 54 16.01.2012 S B B J 970500.00 5000.00 975500.00 55 16.01.2012 property 975500.00 165000.00 810500.00 56 20.01.2012 S B B J 810500.00 5000.00 815500.00 57 25.01.2012 S B B J 815500.00 10000.00 825500.00 58 26.01.2012 S B B J 825500.00 10000.00 835500.00 59 27.01.2012 S B B J 835500.00 2000.00 837500.00 60 08.02.2012 S B B J 837500.00 30000.00 867500.00 61 08.02.2012 C B I 867500.00 5000.00 862500.00 62 13.02.2012 C B I 862500.00 50000.00 812500.00 63 18.02.2012 S B B J 812500.00 10000.00 822500.00 64 12.03.2012 S B B J 822500.00 40000.00 782500.00 65 12.03.2012 S B B J 782500.00 10000.00 792500.00

66 12.03.2012 S B B J 792500.00 10000.00 802500.00 67 12.03.2012 S B B J 802500.00 5000.00 807500.00 68 26.03.2012 S B B J 807500.00 10000.00 817500.00

2395000.00 1272500.00 456000.00 817500.00

This statement shows that during the year under consideration total withdrawls from the bank accounts are Rs 21,44,000/- (Rs. 23,95,000/- – Rs. 2,51,000/-) and total deposits in bank accounts are Rs. 12,72,500/- only, meaning thereby that total withdrawls from the bank account is much more than the total deposit in the bank account. Hence the total deposit in the bank account is fully explained. The perusal of the cash flow statement reveals that the availability of cash was always there with the assessee. The source of deposits is withdrawls from bank itself and sale of property of Rs. 2,51,000/-. There is no unexplained deposit in the bank account and the additions made under section 68 deserve to be deleted.

Section 68 is not applicable to the case of the assessee

It is further submitted that the assessee is not maintaining any books of account, therefore provisions of section 68 are not applicable in the case of the assessee. Section 68 is applicable only where there are credits in the books of accounts of the assessee. Therefore the learned AO was not justified in invoking the provisions of section 68.

The learned AO has also made additions of Rs, 9,60,750/- on account of unexplained investment in the purchase of property. As mentioned in the forgoing para the investment in property is fully explained.

The facts are as under During the year under consideration the asessee has purchased following two properties

A land at Plot NO. 223 Ganesh vihar, Sirsi Road, Jaipur for a sum of Rs. 2,41,000/- + stamp duty expenses of Rs. 13,460/- totaling to Rs, 2,54,460/- the amount have been paid by the assessee in cash on 20.04.2011. The assessee has withdrawn cash from Central Bank of India of Rs. 1,00,000/- on 7.4.2011 and Rs. 2,00,000/- on 20.04.2011 for purchase of the afore said property . Copy of the bank account is enclosed from ready reference and the same is available on B Land at plot no. 72 at Ganesh vihar, sirsi road, jaipur on 16.01.2012 from Shri Gopal singh for a total consideration of Rs, 9,15,000/- + stamp duty of Rs. 35,470/- totally Rs. 960,470/-. The source of investment is as under Rs. 7,00,000/- by cheque drawn on Central Bank of India dated 28.12.2011 Rs. 50,000/- by cash on 28.12.2011 Rs. 1,65,000/- by cash on 16.01.2012 ============= Rs. 9,15,000/- Total =============

Regarding availability of cash the assessee is furnishing a cash flow statement which discloses that assessee was having sufficient funds in hand. The major source is Rs. 2,51,000/- received on 12.12.2011 on sale of property which is the trade of the assessee. Copy of bank account reflecting withdrawl of Rs. 7,00,000/- is enclosed. Copy of cash flow statement has been produced in the aforesaid paras. Copy of purchase deed is available on paper book page No cited Supra. Copy of bank account is available on paper book page No cited supra. In view of the above the source of Rs. 9,15,000/- is fully explained

Copies of title deeds of aforesaid properties are enclosed for verification. These facts go to establish that the learned AO was not in possession of correct facts regarding purchase of immovable properties and investment therein. The very initiation of proceedings under section 147/148 therefore was bad in law being based on incorrect facts. The Hon’ble ITAT is therefore requested to quash the assessment order and alternatively delete the addition of Rs, 9,60,750

In view of the position the additions made under section 69C is unlawful, illegal and deserves to be deleted.

Ground No. 4

That in the facts and circumstances of the case and in law the learned CIT (A) has erred in confirming the order passed by the learned AO in making additions of Rs, 2,87,250/- applying N P rate of 15% on contract receipts of Rs. 19,15,000/- It is submitted that assessee is engaged in the business of purchase of small pieces of land, develop the same and sales it after constructing small house(s).

Pappu Jaiswal vs. ITO During the year under consideration the total receipt disclosed by the assessee in the return of income is Rs. 34,90,750/- . The assessee applied 8% of N P rate w r to section 44AD and disclosed income of Rs. 2,79,260/- and paid taxes thereon. The NP rate disclosed by the assessee is as per norms and in accordance with the provisions of income tax Act. The learned AO has wrongly applied N P rate of 15% without any ground. The additions made by the learned AO of Rs. 2,87,250/- is illegal unlawful and wrong. The assessee has already disclosed profit of Rs. 2,79,260/- in the return of income filed on…27.12.2013. Copy of return of income is available on paper book page No 1…to 5. it is further submitted that while completing the assessment the learned AO has ignored the return of income filed by the assesseee, otherwise there would have been no occasion for making additions for Rs. 2,87,250/-. The assessee disclosed gross receipt of Rs. 34,90,750/- as against lesser receipts taken by the learned AO at Rs. 19,15,000/-. The learned AO has erred in applying N P rate of 15% without any basis or any comparable case. The assessee had already disclosed profit of Rs, 279260/- in the return of income by applying 8 % of N P rate. These facts have remained unconsidered by the learned AO. The addition made by the learned AO is apparently misplaced and deserved to be deleted. These facts make it evident that the learned AO was not in possession of correct facts in respect of gross receipt also, as also in respect of investment in immovable property. The proceedings under section 148 were therefore based on wrong facts and hence deserve to be quashed. On the basis of these facts the Hon’ble ITAT is requested to quash the assessment order and alternately delete the additions of Rs, 2,87,250/-.

Benefit of telescoping not allowed

It is further submitted that the learned AO has made additions both on account of receipt as well as on account of expenditure. While doing so it was incumbent upon the learned AO to have given benefit of income against expenditure. The assessee has disclosed income of Rs. 2,79,260/- from contractual receipt/sales of residential house. Setting off this income should have been allowed against addition on account of purchaser of property. This submission is being made as a matter of abundant caution otherwise the investment in the purchase of property/deposit in bank fully stand explained individually.

The assessee considers it relevant to submit that the learned AO has passed the order in haste. He has mentioned at first line, that no return of income was filed, whereas return stood filed on 27.02.2013 disclosing income of Rs. 2,35,020/-. Thus the assessment order contains wrong facts which vitiate the same. In view

It is submitted that during the course of hearing on 16.04.2025 the assessee was required to furnish a statement showing the peak of gross receipts in the bank account during the year under consideration. In this regard, as already been submitted that the assessee was having bank account with three banks. It is submitted that the assessee is furnishing a statement showing bank wise/date wise details of receipts. The perusal of the statement reveals that the gross receipt (other than cash, as cash is deposited out of previous withdrawls from banks itself, Cash flow statement has already been furnished in the submission furnished on 09.04.2025) for the year in all the three banks comes to Rs. 24,85,200/-. Whereas the assessee has already disclosed a gross receipt of Rs. 34,90,750/- and disclosed Net profit @ 8% (Rs. 2,79,260/-) in the return of income filed under section 44AD of the income Tax Act 1961. It is submitted that Gross receipt of Rs, 34,90,750/- disclosed by the assessee is much higher than the peak amount of Rs 24,85,200/- calculated in the chart attached herewith.

S No Particulars Paper book page No(s) 1 copy of acknowledgement of return along-with computation of total 1 to 9 income and form 26AS 2 Copy of the bank account No. 10000147937 with state Bank of Bikaner 10 to 13 and Jaipur 3 Copy of the bank account No. 1834118316 with Central Bank of India 14 to 17 4 Copy of Bank account No. 23505001244 with ICICI Bank 18 to 23 5 Copy of letter dated 14.10.2021 furnished before the learned AO for 24 obtaining sanction under section 151 6 Copy of purchase deed 20.04.2011 25 to 32 7 Copy of Sales deed dated 03.12.2011 33 to 44 8 Copy of purchase deed 16.01.2012 44 to 54

As regards the estimation of profit the bench observed that the ld. AO has already appreciated the nature of business activity and while making estimation of profit @ 15 % he has not provided any basis for the same.

Whereas considering the limit of the turnover of the assessee and considering the presumptive taxation scheme as per provision of section 44AD of the Act, the contract receipt is required to be charged 8 % of the receipt.

Now coming to the last addition for Rs. 9,60,750/- on the ground that assessee has purchased immovable property for a sum of Rs, 9,15,000/- and incurred stamp duty expenses of Rs. 45,750/-. Total investment was for Rs. 9,60,750/-. Ld. AO made the addition for purchase of land at plot no. 72 at Ganesh vihar, sirsi road, Jaipur on 16.01.2012 from Shri Gopal Singh for a total consideration of Rs, 9,15,000/- + stamp duty of explained by the assessee was Rs. 7,00,000/- by cheque drawn on Central Bank of India dated 28.12.2011, Rs. 50,000/- by cash on 28.12.2011 and Rs. 1,65,000/- by cash on 16.01.2012. The bench noted that assessee was having the cash on hand out of the fund available with the assessee and has made withdrawal of cash for an amount of Rs. 23,95,000. Therefore, the source of cash cannot be doubted and added back as unexplained investment. So far as regards the payment of Rs. 7,00,000/- made by an account payee cheque the bench has observed from the copy of the bank statement placed on record that the assessee was having the opening bank balance of Rs. 19,66,441/- [ paper book page 15 ] and therefore, payment of cheque which was sourced from the opening balance cannot be termed as unexplained in the hands of the assessee. Based on this observation we see no reason to sustain the addition of Rs. 9,60,750/- and therefore, direct the ld. AO to delete the same.

Since we have decided the appeal of the issue on merits the technical grounds raised by the assessee become academic and therefore, we would not like to deal with those grounds.

In the result, the appeal of the assessee is allowed.

Sd/- Sd/- ¼ Mk0 ,l- lhrky{eh ½ ¼ jkBksM deys'k t;UrHkkbZ ½ (Dr. S. Seethalakshmi) (Rathod Kamlesh Jayantbhai) U;kf;d lnL;@Judicial Member ys[kk lnL;@Accountant Member Tk;iqj@Jaipur fnukad@Dated:- 24/04/2025 *Ganesh Kumar, Sr. PS आदेश की प्रतिलिपि अग्रेf’ात@ब्वचल वf जीम वतकमत वितूंतकमक जवरू 1. The Appellant- Pappu Jaiswal, Jaipur 2. izR;FkhZ@ The Respondent- ITO, Ward 2(2), Jaipur 3. vk;dj vk;qDr@ The ld CIT vk;dj vk;qDr¼vihy½@The ld CIT(A) 4. विभागीय प्रतिनिधि] आयकर अपीलीय अधिकरण] जयपुर@क्त्ए प्ज्Aज्ए Jंपचनत 5. xkMZ QkbZy@ Guard File (ITA No. 281/JP/2025) 6. vkns'kkuqlkj@ By order,

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