OM PRAKASH SHARMA,SANGANER JAIPUR vs. WARD 4(3), JAIPUR, JAIPUR

आयकर अपीलीय अधिकरण] जयपुर न्यायपीठ] जयपुर IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES,”B” JAIPUR Mk0 ,l- lhrky{eh] U;kf;d lnL; ,oa Jh jkBksM deys'k t;UrHkkbZ] ys[kk lnL; ds le{k BEFORE: DR. S. SEETHALAKSHMI, JM & SHRI RATHOD KAMLESH JAYANTBHAI, vk;dj vihy la-@ITA No. 43/JP/2024 fu/kZkj.k o"kZ@Assessment Years : 2016-17 cuke Om Prakash Sharma, ITO Vs. Sanganer, Jaipur Ward 4(3), Jaipur LFkk;h ys[kk la-@thvkbZvkj la-@PAN/GIR No.: BKOPS 5112 G vihykFkhZ@Appellant izR;FkhZ@Respondent fu/kZkfjrh dh vksj ls@ Assessee by : Sh. Ashish Sharma jktLo dh vksj ls@ Revenue by : Sh. Anoop Singh, Addl. CIT lquokbZ dh rkjh[k@ Date of Hearing : 31/07/2024 mn?kks"k.kk dh rkjh[k@Date of Pronouncement: 20/08/2024 vkns'k@ ORDER

PER: RATHOD KAMLESH JAYANTBHAI, AM

Because the assessee is aggrieved by an order of the National Faceless Appeal Centre, Delhi dated 17/07/2023 [here in after ld. CIT(A) ] for assessment year 2016-17 the present appeal is filed on 18.01.2024. That order of the ld. CIT(A) passed because the assessee challenged order dated 24.12.2018 passed under section 143(3) of the Income Tax Act, by ITO, Ward 4(3), Jaipur before him.

2 ITA No. 43/JP/2024 Om Prakash Sharma vs. ITO 2. The present is for the following grounds: -

“1. The A.O. erred in not following the principles of natural justice and in failing to provide adequate and meaningful opportunity and ignoring the evidence on record, without disproving/refuting it and thereby making additions of the entire credits deposited in the bank account totaling Rs. 1,54,15,000/-. In the facts and circumstances the additions are unsustainable and needs to be deleted. 2. The A.O. erred in summarily rejecting the details/explanation of the source of the depositors i.e. Shri Hanuman Choudhary, Ramwilas Choudhary and Madan Lal Choudhary, examined by him on oath without disproving/refuting it in any manner except stating "therefore, I have no option except to make an addition...." and in drawing adverse inference on a surmise and presumption. The action of the A.O. makes the assessment order invalid and liable to be quashed. 3. The A.O. queried the three persons summoned by him, on identical queries, but failed to provide to / confront with, the copy of their statement(s) with the assessee and passed a cryptic order, thereby denying natural justice to the assessee. 4. On the facts and in the circumstances of the ca se the learned AO has legally and factually erred in making an addition of Rs 631425 as unexplained short term capital income (gain). 5. The appellant craves your indulgence to amend, delete, modify, withdraw, add anyone of the Grounds of Appeal before or during the hearing before your honour.

2.1 At the outset of the hearing the bench noted that the registry pointed

out that the present appeal is time barred by 124 days. The assessee along

with the appeal also filed a petition to condone the dealy in bringing the

present appeal which is delayed by 124 days. The petition filed in support of

the reasons stating to be the sufficient reasons to condone the delay reads

as under :

3 ITA No. 43/JP/2024 Om Prakash Sharma vs. ITO

II. Refusing to condone delay can result in a meritorious matter being thrown out at the very threshold and cause of justice being defeated. As against this when delay is condoned the highest that can happen is that a cause would be decided on merits after hearing the parties.

III. Every day's delay must be explained" does not mean that a pedantic approach. should be made. Why not every hour's delay, every second's delay? The doctrine must be applied in a rational common sense pragmatic manner.

IV. When substantial justice and technical considerations are pitted against each other, cause of substantial justice deserves to be preferred for the other side cannot claim to have vested right in injustice being done because of a non- deliberate delay.

V. There is no presumption that delay is occasioned deliberately, or on account of culpable negligence, or on account of mala fides. A litigant does not stand to benefit by resorting to delay. In fact he runs a serious risk.

VI. It must be grasped that judiciary is respected not on account of its power to legalize injustice on technical grounds but because it is capable of removing injustice and is expected to do so.”

4 ITA No. 43/JP/2024 Om Prakash Sharma vs. ITO 7. The Hon’ble Supreme Court has re-opened its decision in the case of 1. Senior Bhonsle Estate, 419 ITR 732 /112 taxmann.com 134 2. Golden time service, 412 ITR 102”

In support of the contentions so raised the assessee also submitted

an affidavit. The ld. AR of the assessee also filed a declaration signed by

the earlier counsel certifying the fact that he has upon receipt of the order

on 17.07.2023 forwarded the mail to Sharawanshare76@gmail.com and

amitkumar.tailor088@gmail.com but not to the assessee. Thus, considering

that averments the assessee was not aware of the order passed till the

recovery proceeding initiated against the assessee. Based on these set of

the ld. AR prayed to admit the appeal in the interest of justice.

2.2. Per contra, ld. DR objected to the prayer of the assessee. The

ld. DR submitted that the assessee is not serious his behavior is

causal. It is not disputed by the counsel that the order was not

served it was served and it the duly of the counsel to update the

assessee. Thus, since there is no reasons having sufficient cause

for the delay and therefore, the appeal filed by the assessee should

not be admitted. He also objected to the fact that the assessee

cannot be considered as village as is director in the company and is

fully aware about his duties, so ld. DR strongly objected to the

5 ITA No. 43/JP/2024 Om Prakash Sharma vs. ITO condonation petition filed which are devoid of merits. In support of

the contention so raised the ld. DR relied upon the following

decisions:

• Ajmeer Sherriff & Co. vs. ITO [2015] 61 taxmann.com 301(High Court of Madras) • Inderchand D. Kochar vs. ACIT [2016] 73 taxmann.com 96 (High Court of Madras) • Perfect Circle India Ltd. vs. ACIT [2020] 120 taxmann.com 262 (High Court of Bombay) • Mrs. P. S. Rajeswari vs. ACIT [2015] 56 taxmann.com 219 (High Court of Madras) • Krishna Developers vs. DCIT [2019] 102 taxmann.com 51 (Mumbai-Trib.) • Jyoti Chemicals vs. DCIT [2009] 27 SOT 433 (Mumbai-Trib.) • Abhishek Transtel Ltd. vs. DCIT [2014] 51 taxmann.com 17 (Hyderabad- Trib.) • JCIT vs. Tractors & Farm Equipment Ltd. [2017] 104 ITD (Chennai)(TM) (Chennai-Trib.) • Ajay Kumar Jain vs. ACIT [2020] 121 taxmann.com 384 (Jaipur-Trib.)

2.3. We have heard the rival contentions and perused the material

placed on record and the judicial precedent cited. The bench noted

that the prayer by the assessee for condonation of delay of 124 days

has merit as it is evident that the counsel in whose mail id the order

is served has been forwarded to the other persons and not to the

assessee. The evidence so procedure has further supported that

counsel’s declaration placed on record accepting the facts.

6 ITA No. 43/JP/2024 Om Prakash Sharma vs. ITO Therefore, the mistake of the counsel the assessee should not

suffer. Considering the judicial decision and the fact that the

assessee has sufficient reasons to bring the present appeal with

delay and that reasons advanced along with the supporting evidence

are sufficient to consider the delay in filling the present appeal and

we consider that reasons as sufficient to condone the delay. As held

by the apex court that there is a distinction between an explanation

and an excuse, emphasizing that, mere excuses would not suffice; a

satisfactory and acceptable explanation was required. The court also

added that “there is no formula that caters to all situations and

therefore, each case for condonation of delay based on existence or

absence of sufficient cause has to be decided on its owns facts.” We

therefore, feels that reasons assigned by the assessee with

declaration of counsel and copy of the email being forwarded at

wrong address are sufficient cause for filling the appeal belatedly.

Therefore, we concur with the submission of the assessee and

condone the delay of 124 days in filing the appeal by the assessee

in view of the decision of Hon’ble Supreme Court in the case of

Collector, land Acquisition vs. Mst. Katiji and Others, 167 ITR 471

(SC) as the assessee is prevented by sufficient cause.

7 ITA No. 43/JP/2024 Om Prakash Sharma vs. ITO 3. Succinctly, the fact as culled out from the records is that the

assessee filed his return of income for the assessment year 2016-17 on 30-

03-2017 declaring total income of Rs 5,83,320/-. The assessee has

received salary income from Saathi Textiles Private Limited and

remuneration and interest from Skyzone Technologies and capital gain

income. The case was selected for scrutiny under CASS for Complete

security. Reasons for selection are that "(i) Large cash deposits in saving

bank account(s) (AIR 001, total turnover and other income in Part A - P&L

of ITR). Notice u/s 143(2) of the Income Tax Act, 1961 was issued on 18-

09-2017 which was duly served upon the assessee. Notice u/s 142(1)

along with query letter was issued on 23-07-2018 fixing the case for

hearing on 27-07-2018. In support of the income disclosed in the return of

income the assessee furnished details of immovable property, details of

cash deposits, copy of cash book, copy of cash statement account, details

of sale deed, details of salary, interest and remuneration etc., copy of

confirmation and Ikrarnama’s receipts of the persons from the assessee

received the cash.

3.1 During assessment proceeding the ld. AO noted that the assessee

has cash deposited in Bank of Baroda for an amount of Rs. 1,08,15,000

8 ITA No. 43/JP/2024 Om Prakash Sharma vs. ITO and Rs. 46,00,000/- in Bank of Maharashtra account. The assessee was

asked to furnish the source of cash deposited into the bank account in

response the ld. AR of the assessee furnished seven Ikrarnama’s receips,

some confirmations and cash statement account for source of cash

deposits. The ld. AO asked to produce the persons who have given the

cash amount to the assessee through Ikrarnama receipts. But the AR of the

assessee failed to produce Ikrarnama receipts holders along with their copy

of ITR and bank statement confirmations. The ld. AO issued summons to

all Shri Hanuman Sahay Choudhary, Shri Roshan Lal Choudhary, Shri

Kamlesh Sharma, Shri Bhanwar Lal Choudhary, Shri Kamal Sharma, Shri

Madan Lal Choudhary and Shri Ram Vilash Choudhary. On the date

appointed by the ld. AO Shri Hanuman Sahay Choudhary, Shri Ram Vilas

Choudhary and Nadan Lal Choudhary attended the office and the

statement were recorded.

3.2 As the per the statement recorded pn 14.12.2018 Shri Hanuman

Sahay Choudhary stated that he is a farmer and doing agricultural activities

and yearly earned Rs. 8,00,000/-. But he failed to produce the proof /

source of agricultural income, not produce copy of ITR and also not

produce his bank account for verification. In the absence of documentary

9 ITA No. 43/JP/2024 Om Prakash Sharma vs. ITO evidence, statement of Shri Hanuman Sahay Choudhary was not accepted

by the ld. AO and he presumed that Shri Hanuman Sahay Choudhary has

never given cash amount of Rs. 18,00,000/- to the assessee and that

amount was considered as undisclosed cash deposit in hands of the

assessee.

3.3 Statement of Shri Ram Vilash was recorded on 14.12.2018 wherein

he stated to be farmer and doing agricultural activities and yearly earns Rs.

7 lacs. But he failed to support the contention by filling the ITR and not

produced bank statement for verification. Therefore, the ld. AO noted that

the Shri Ram Vilash has not given cash amount of Rs. 20 lac to the

assessee and it was treated as undisclosed cash deposit of the assessee

and added to the income of the assessee.

3.4 Statement of Shri Madanlal Choudhary was recored on 14.12.2018

wherein he stated himself to be a farmer and engaged in the agricultural

activities. He stated that he earns Rs. 3,50,000/-. But he failed to produce

the proof / source of agricultural income and not produced ITR and bank

statement. In the absence of evidence ld. AO noted that he has no option

to make an addition of Rs. 20 lac as undisclosed income of the assessee.

As per summons issued Shri Roshan Lal Choudhry, Shri Kamlesh Sharma,

Shri Bhanwar Lal Choudhry and Shri Kamal Sharma not attended the

10 ITA No. 43/JP/2024 Om Prakash Sharma vs. ITO before the ld. AO. The total of these persons amount comes to Rs.

54,00,000/-. Thus, the total of those persons who attended comes to Rs. 58

lac and not attended comes to 54 lac totaling to Rs. 1,12,00,000/- was

considered as unexplained. As regards the withdrawal of cash from the

bank and subsequently redeposited into the bank account was not

considered by producing any cogent evidence for withdrawals of cash from

bank account and therefore, the reply for cash withdrawals was not

accepted by the ld. AO. Based on the above ld. AO added a sum of Rs.

1,54,15,000/- was considered as unexplained cash deposited as income of

the assessee.

3.5 The assessee in his return of income claimed deduction of cost of

land of Rs. 3,81,925/- & 2,50,000/- , ld. AO asked the assessee to produce

documents / evidence for claim of deduction of cost of land. The assessee

could not file proper documents and therefore, the same was not allowed.

Consequently the assessee total income of Rs. 1,66,29,757/- was

assessed as against the returned income of Rs. 5,83,332/-.

preferred an appeal before the ld. CIT(A)/NFAC. A propose to the grounds

11 ITA No. 43/JP/2024 Om Prakash Sharma vs. ITO

so raised the relevant finding of the ld. CIT(A)/NFAC is reiterated here in

below:-

5.2 Decision:- I have perused the assessment order, grounds of appeal and submission of the appellant carefully. I find from the assessment order that during the period relevant to AY 2016-17, the appellant had deposited cash of Rs. 1,54,15,000/-. The appellant claimed during the course of assessment proceedings that the source of this cash deposits was advances received from 7 persons and in support of his claim, notarised copies Ikrarnamas, confirmation letters and cash statements were furnished. The AO had requested the appellant to produce the 7 persons for examination before AO but the appellant had failed to do so. Therefore the AO had issued summons u/s 131 to all 7 persons but only 3 persons namely Shri. Hanuman SahayChoudhary, Ram VilashChoudhary and MadanLal Choudhary attended before AO whose statements on oath were recorded. All the 3 persons accepted to have given advance by cash to the appellant of Rs. 18,00,000/-, Rs.20,00,000/- and Rs.20,00,000/- respectively for purchase of lands out of their agricultural income kept in home. The above 3 persons claimed that their annual agricultural income is Rs.8,00,000/-, Rs.7,00,000/- and Rs.3,50,000/- respectively but no supporting evidence was submitted. Remaining 4 persons did not respond to the summons issued. Since the creditworthiness of the 3 persons for giving advance in cash of Rs. 18,00,000/-, Rs.20,00,000/- and Rs.20,00,000/- respectively was not proved with supporting evidences and remaining 4 persons did not respond the summons, the AO rejected the claim of the appellant that the source of cash deposits of Rs.1,54,15,000/- is out advances received. Therefore the AO made addition of Rs.1,54,15,000/- u/s 69 of the IT. Act. During the course of appellate proceedings the appellant has submitted that the copy of the summons was not provided to the parties and the copies statement recorded by the AO have not been provided to the appellant. The appellant had produced the evidences of land holding of the 7 persons from whom the advances claimed to have been received by the appellant. I have perused the facts of the case and submission of the appellant. I find that during the course of assessment proceedings, the appellant failed to prove the creditworthiness of the 7 persons from advances of Rs. 1,54,15,000/- were claimed to have been received with supporting evidences and also failed to produce the said persons before AO for examination. Further when the AO issued the summons to those 7 parties, only 3 persons attended and the others neither attended nor filed adjournment requests seeking more time. The 3 parties though admitted to have given the advances to the appellant by cash, the source such income was not explained with supporting evidences while recording the statement nor such information was filed subsequently before the AO. Regarding

12 ITA No. 43/JP/2024 Om Prakash Sharma vs. ITO the claim of the appellant that the copies of summons were not provided to the parties appears to be incorrect since the summons were issued to the parties on 10/12/2018 whereas they attended on 14/12/2018. This shows that without receiving the summons, the parties could not have attended before the AO. Regarding the non receipt of copies of statements, I find that the statements were reproduced in the assessment order and the appellant has applied before the AO after 4.5 years and the appellant has not pointed out specific grievance. On the contrary I find that the said 3 person's statementsare in favour of the appellant but are not supported by any reliable evidence as far as the sources of cash advances given to the appellant are concerned. The appellant neither submitted such evidence before theAO during the course of assessment proceeding nor produced the same during the appellate proceedings. Merely producing the land holding extract does not prove that the concerned persons were having that much agricultural income to give the advances to the appellant. It is further noted from the appellant's submission that he had opted for VSV scheme but did not pay the due taxes as per Form No.3 issued under VSV scheme since as per the appellant, the relevant income is already taxed and hence there is double taxation. However appellant has not demonstrated with supporting evidences as to how the relevant income has already been taxed. I further find that the facts of the decisions relied upon by the appellant are not identical the facts of the present case. Therefore the contention raised by the appellant is not found acceptable. In view of the above discussion, the ground raised by the appellant is dismissed. 6.2 Decision:- I have perused the assessment order, grounds of appeal and submission of the appellant. I find that the same information/evidences were also produced before the AO but the AO pointed of certain discrepancies and did not allow the deduction of cost of acquisition and expenses from the computation of short term capital gain. I find from the submission of the appellant and supporting evidences that the appellant is entitled for deduction of cost of acquisition and expenses incurred. Therefore, the addition made by the AO is directed to allow the deduction of cost of acquisition and expenses incurred from the short-term capital gain after due verification. Thus, this ground of partly allowed.

preferred the present appeal. To support the various grounds so raised by

the ld. AR of the assessee, he relied on the written submissions in respect

13 ITA No. 43/JP/2024 Om Prakash Sharma vs. ITO

of the various grounds raised by the assessee. The written submission is

reproduced herein below:

GOA 1: The A.O. erred in not following the principles of natural justice and in failing to provide adequate and meaningful opportunity and ignoring the evidence on record, without disproving / refuting it and thereby making additions of the entire credits deposited in the bank account totaling Rs. 1,54,15,000/-. In the facts and circumstances the additions are unsustainable and needs to be deleted. AND GOA 2: The A.O. erred in summarily rejecting the details/explanation of the source of the depositors i.e. Shri Hanuman Choudhary, Ramwilas Choudhary and Madan Lal Choudhary, examined by him on oath without disproving / refuting it in any manner except stating “therefore, I have no option except to make an addition…” and in drawing adverse inference on a surmise and presumption. The action of the A.O. makes the assessment order invalid and liable to be quashed. Submissions: (Paper book filed separately) 1. The AO, in page 2-4 of the order has noted the date-wise, cash deposits in the Bank of Baroda, account, (totalling Rs. 1,08,15,000/-) and in Bank of Maharashtra account (totalling Rs. 46 Lakhs) and sought details of the source of the deposits. The AO noted that, in reply to the questionnaire, issued on 16.11.2018.

14 ITA No. 43/JP/2024 Om Prakash Sharma vs. ITO

15 ITA No. 43/JP/2024 Om Prakash Sharma vs. ITO

16 ITA No. 43/JP/2024 Om Prakash Sharma vs. ITO 8. The AO also felt that the assessee in reply, furnished on 22.11.2018, had stated in reply to his query number 8, that he did not maintain books of account. Yet, later he has produced copy of the cash book which therefore, seems to be a manipulation and so was not acceptable to the AO. This observation of the AO on page 7, is also misleading. In fact, the query made by AO was at point number 18 of his questionnaire which was “Please furnish the particulars of books of accounts maintained by you for the relevant year” (PB page number....). The reply of the assessee was “Books of account not prepared” (PB page number....). This reply has been distorted by the AO and is a casual surmise, as seen from the fact that no proceedings were initiated u/s 271A of the Act for the stated default u/s 44AB. The cash book / books of account of the assessee were also not rejected u/s 145(3) of the Act. Hence, this cannot be a valid reason for rejection/disproving/refuting of the cash book. 9. In reply to the query of the AO, the appellant had explained (reproduced by AO on page 8 of the order), the purpose of the frequent withdrawals and deposit of cash. For a property dealer, the ready availability of cash was necessary to strike a good deal at the spur of the moment. The frequent deposit / withdrawal in the bank account was a normal feature in the nature of a real estate broker, arranging sale / purchases for the clients. Therefore, the withdrawals were made to keep cash handy and in case, the deal was not negotiated, the withdrawals were re-deposited. However, the AO discounted it without disproving or refuting but causally stating

17 ITA No. 43/JP/2024 Om Prakash Sharma vs. ITO As such, the conclusion of the CIT(A) that the assessee had failed to produce these persons and that “only 3 persons attended and the others neither attended nor filed adjournment requests seeking more time”, without ascertaining the issue / service of the stated summons for compliance in the given short period was hurried, inappropriate and a conjecture. The CIT(A) further, compounded this mistake by observing. “I find that the statements were reproduced in the assessment order and the appellant has applied before the AO after 4.5 years (for copies of statements) and the appellant has not pointed out specific grievance”. This is a gross violation of the Principles of Natural Justice 11. The CIT(A) accepted that the three persons examined affirmed their advances to the assessee for purchase of agriculture land, and has not refuted the evidentiary value of the notorised agreements as well (Ikaranama). It is also admitted by the CIT(A) On page 10 of his order that “The appellant had produced the evidences of land holding of the 7 persons from whom the advances claimed to have been received by the appellant”. Yet, the CIT(A) acted on a conjecture that “Merely producing the land holding extract does not prove that the concerned persons were having that much agricultural income to give the advances to the appellant”. Thus, both the AO and CIT(A) required the assessee to explain the source of the source, and when it was also explained, the rejection was made on surmise and conjecture. 12. In these facts and circumstances, the premises drawn by the AO / CIT(A) for rejecting the notorised agreements, the statements recorded, confirmations filed, evidence in form of land holding Jamabandi and seeking the source of the source is contrary to law and facts in the case of the assessee and makes the addition, unsustainable. These grounds of appeal may please be allowed. GOA 3: The A.O. queried the three persons summoned by him, on identical queries, but failed to provide to / confront with, the copy of their statement(s) with the assessee and passed a cryptic order, thereby denying natural justice to the assessee. Submission:- 1. The AO has not provided the copy of statements, recorded by him, of the three persons in namely Shri Hanuman, Shri Ram Vilas and Shri Madan Lal. Moreover, The AO has not brought any evidence on record of issuing summons u/s 131 to the other four persons namely Shri Roshan Lal, Shri Kamlesh Sharma, Shri Banwar Lal and Shri Kamal Sharma, and their service upon them. The appellant requested the AO to provide copy of the statements and the summons on 19.06.2023 (PB page ....) and again vide RTI application dated 01.04.2024 / email, but the complete statements has not been provided yet.

18 ITA No. 43/JP/2024 Om Prakash Sharma vs. ITO 2. In his order the CIT(A) admitted that the statements of three persons “are in favour of the appellant but are not supported by any reliable evidence as per as the sources of cash advances given to the appellant are concerned”. The CIT(A) also observed on page 10 that “The appellant had produced the evidences of land holding of the 7 persons from whom the advances claimed to have been received by the appellant”. (Emphasis supplied) Yet, the CIT(A) contradicted himself by stating that “Merely producing the land holding extract does not prove that the concerned persons were having that much agricultural income to give the advances to the appellant”. 3. Further, the CIT(A) ignored the Principles of Natural Justice, in observing that “I find that the statements were reproduced in the assessment order and the appellant has applied before the AO after 4.5 years (for copies of statements) and the appellant has not pointed out specific grievance” and that “only 3 persons attended and the others neither attended nor filed adjournment requests seeking more time”. 4. Thus, not only the AO but also the CIT(A) were seeking the source of the source but also discounted the evidence produced before them on a surmise and conjectures and refuting/ disproving it in any manner. A document / statement has to be read as a whole and not in selective parts. The AO / CIT have not even produced evidence of issuing summons and their service upon all the person and have sought to justify the failure to provide copies of the recorded statements, in utter disregard to Principles of Natural Justice. 5. The assessment order is unsustainable on this ground alone and needs to be quashed. GOA 4: On the facts and in the circumstances of the case the learned AO has legally and factually erred in making an addition of Rs 631425 as unexplained short term capital income (gain). Submission :- 1. The AO had not allowed the claim of the cost of the acquisition i.e. Rs. 3,81,925/- and Rs. 2,50,000/- of the land sold by the assessee and evidenced by the copy of the possession letter and receipts of the colonizers dated 07.01.2014, and added these amounts as short term capital gains. 2. The CIT(A) reproduced the submission of the assessee in this regard, and noted “I find from the submission of the appellant and supporting evidences that the appellant is entitled for deduction of cost of acquisition and expenses incurred. Therefore the addition made by the AO is directed to allow the deduction of cost of acquisition and expenses incurred from the short term capital gain after due verification”.

19 ITA No. 43/JP/2024 Om Prakash Sharma vs. ITO

was placed on the following evidence / records / decisions:

S NO. PARTICULAR PAGE NO FROM TO

PAPER BOOK-I 1 Copy of letter filed to ITO ward 4(3) in response to his 1-22 notice u/s 142(1) including enclosures mentioned in this letter dated 23.07.2018

2 Copy of application to ITO ward 4(1) filed on 23 31/05/2023, seeking copy of statements. Copy provided to CIT(A) also submissions before CIT(A)

3 Copy of submissions filed before CIT(A) on 01/07/2023 and 24-61 the paper book filed before CIT(A)

20 ITA No. 43/JP/2024 Om Prakash Sharma vs. ITO

4 Copy of Jamabandi i.e. ' Record Of Right' of land owned by 62-79 listed persons filed before CIT(A) on 13/07/2023

5 Copy of confirmation letter(s) filed before the AO 80-89

PAGE NO. PARTICULARS S.NO. FROM TO PAPER BOOK-II

1 Copy of RTI application dated 01.04.2024 90-91

2 Copy of 131 summon vide letter number 2616, dated 92 30.11.2018 for appearance of 05.12.2018 (In case of Madan Lal).

93 3 Copy of 131 summon vide letter number 2618, dated 30.11.2018 for appearance of 05.12.2018 (In case of Bhanwar Lal).

4 Copy of 131 summon vide letter number 2683, dated 94 10.12.2018 for appearance of 14.12.2018 (In case of Hanuman Singh Choudhary).

5 Copy of 131 summon vide letter number 2685, dated 95 10.12.2018 for appearance of 14.12.2018 (In case of Ram Vilas).

6 Copy of letter of appellant dated 30.06.2018 to CIT(A), 96 with Jamabandi's.

7 Copy of email dated requesting for copy of statement / 97-98 summons

the ld. AO were appeared and have confirmed to have given the money to

21 ITA No. 43/JP/2024 Om Prakash Sharma vs. ITO the assessee. Once they have appeared and confirmed the contention

addition in the hands of the assessee cannot be made. As regards the other

four person the ld. AO stated to have issued on 10.12.2018 but the same

has been issued on 30.11.2018 and the same was also served after the

date of remaining present to that summoned party Shri Bhawalal Chodhary.

That copy of summons issued filed at page 93 of the paper book. So the

contention that the summons were issued on 10.12.2018 is not correct. The

assessee vide an application dated 01.04.2024 filed an application for Right

to Information wherein the assessee has asked for the statement of the

persons recorded and copy of the summons issued to those four persons

who alleged to have not been appeared. The assessee at page 38 given

the detailed break up of cash deposit and withdrawals. As regards the

availability of cash the ld. AO did not find any mistake merely the withdrawal

cash cannot be considered as unexplained. Based on this contention the ld.

AR of the assessee submitted that the addition of Rs. 1,54,15,000/- is

required to be deleted. As regards the cost of acquisition, the ld. CIT(A)

should have granted the relief instead of sending back to the ld. AO for

verification.

22 ITA No. 43/JP/2024 Om Prakash Sharma vs. ITO 8. The ld DR is heard who relied on the findings of the lower authorities

and more particularly advanced the similar contentions as stated in the

order of the ld. AO and ld. CIT(A). He stated that out of the 7 person

wherein the assessee has alleged to have received the money 3 of them

appeared before the ld. AO but four of them did not appear even though the

summons were issued. Thus, so far as the three-person money they did not

support the contention with any evidence and four of the person did not

appear before the ld. AO so the conclusions received by the ld. AO and with

that of the ld. CIT(A) is clearly support there the assessee did not support

the contention of the receipt of the money by him. So since the

creditworthiness is not proved the addition is rightly made as undisclosed

income of the assessee. The ld. AO has categorically proved that the

assessee did not support the contention that he has received the money for

agricultural land at Rs. 1,12,00,000/- and the original ikrarnama were also

not produced by the assessee. There is no mention about the basic details

of what is the timeline, what are the condition for giving back the money etc.

all these primary details are missing therefore, this Ikranama’s is nothing

but afterthought. As regards the contention that the in respect of the four

parties whether the summons were issued or not let he submitted that in the

23 ITA No. 43/JP/2024 Om Prakash Sharma vs. ITO interest of justice the issue may be set aside to the file of the ld. AO as the

issue of allowability is already pending with the ld. AO.

received and accounted in the cash book is supported by the ikrarnama and

the details of the summons issued is also not correct and in the absence

the details of the summons addition cannot be confirmed. The assessee

being broker of property the withdrawal of cash and re-deposited cannot be

doubted.

on record. The bench noted that in the present case the assessee alleged

to have received a sum of Rs. 1,12,00,000 on account of Ikranama for

purchase of agricultural land for seven different persons. Out of those

seven persons, three appeared before the ld. AO but could not justify the

source of cash given to the assessee. As regards the four person the

assessee alleged that date of summons mentioned in the order is not

correct as the summons issued in the case of Shri Bhanwar Lal Choudhry

the date of summons is 30.11.2018 and not 10.12.2018 as alleged by the

ld. AO. Even the assessee was not given the statement of three persons

24 ITA No. 43/JP/2024 Om Prakash Sharma vs. ITO whose statement is relied upon by the revenue while making the addition,

even though the assessee filed an application under RTI. Thus, we are of

the considered view that the addition in this case is made without giving

proper opportunity to the assessee to prove the source of Rs. 1,12,00,000/-.

As regards the balance cash deposited into the bank account the assessee

submission is that the cash has been withdrawn from the bank and the

source of that is not disputed. Merely the purpose of the withdrawal is not

explained the addition cannot be made of the money which has been

withdrawn from the bank account. Here also we note that there is no clear

finding of the lower authority as to why the same cannot be accepted.

Looking to the overall aspect of the matter we deem it fit that the ld. AO

should examine all the aspect of the matter a fresh regarding the source of

cash deposited by the assessee in his bank account after affording proper

opportunity of being heard to the assessee and after undertaking required

verification. Based on these observations ground no. 1 to 3 raised by the

assessee is allowed for statistical purposes. Ground no. 4 raised by the

assessee is for allowability of deduction claimed against the capital assets

sold by the assessee. This ground was raised before the ld. CIT(A) who has

considered the evidence submitted by the assessee already set aside the

25 ITA No. 43/JP/2024 Om Prakash Sharma vs. ITO issue before the ld. AO and therefore, we do not find any merits to deviate

from the finding of the ld. CIT(A) in the matter.

In the result, for statistical purposes, the appeal is treated as allowed.

Order pronounced in the open court on 20/08/2024.

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:- 20/08/2024 *Ganesh Kumar, Sr. PS आदेश की प्रतिलिपि अग्रेf’ात@ब्वचल वf जीम वतकमत वितूंतकमक जवरू 1. The Appellant- Om Prakash Sharma, Sanganer, Jaipur 2. izR;FkhZ@ The Respondent- ITO, Ward 4(3), Jaipur vk;dj vk;qDr@ The ld CIT 3. vk;dj vk;qDr¼vihy½@The ld CIT(A) 4. 5. विभागीय प्रतिनिधि] आयकर अपीलीय अधिकरण] जयपुर@क्त्ए प्ज्Aज्ए Jंपचनत 6. xkMZ QkbZy@ Guard File (ITA No. 43/JP/2024) vkns'kkuqlkj@ By order,

सहायक पंजीकार@Aेेज. त्महपेजतंत