SUNIL KUMAR GATTANI,JAIPUR V. THE ASSTT. COMMISSIONER OF INCOME TAX CENTRAL CIRCLE - 2, JAIPUR

SA 17/JPR/2025

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The case involves Shri Sunil Kumar Gattani, who filed a Stay Application against the demand raised by the ACIT, Central Circle-2, Jaipur, following a search operation under section 132 of the Income Tax Act, 1961. The search resulted in the seizure of substantial cash and jewellery, leading to additions in the assessee's income for the assessment year 2019-20. The Tribunal considered the financial constraints and the substantial amount already recovered by the Department through seized assets and the 20% demand payment made by the assessee. The Tribunal's decision to grant a stay was based on the provisions of section 254(2A) of the Income Tax Act, considering the assessee's compliance with the statutory requirements and the potential irreparable loss to the assessee due to the attachment of the bank account.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 785501 (ITAT-JAIPUR)
• Duration Of Justice: 5 day(s)
• Appeal Type: Stay Application
• Pronouncement Date: 29-10-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2019-2020
• Appeal Filed On: 24-10-2025
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ALKA GAUTAM
• Assessee Lawyers: TARUN MITTAL
• Keywords: Opportunity of being heard; Loose papers; Application of stay
• Section: 132; 153A; 6; 2

Judgement Text

"vk;djvihyh; vf/kdj.k] t;iqjU;k;ihB] t;iqj IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES,”B” JAIPUR Mk0 ,l- lhrky{eh]U;kf;dlnL; ,oaJhjkBksMdeys'kt;UrHkkbZ] ys[kk lnL; ds le{k BEFORE: DR. S. SEETHALAKSHMI, JM & SHRI RATHOD KAMLESH JAYANTBHAI, AM Stay Application No.17/JP/2025 (Arising out of vk;djvihy la-@ITA No. 1142/JP/2025) fu/kZkj.ko\"kZ@Assessment Year : 2019-20 Shri Sunil Kumar Gattani 2126, Gattani Bhawan, Gangori Bazar Jaipur – 302 001 cuke Vs. The ACIT Central Circle-2 Jaipur LFkk;hys[kk la-@thvkbZvkj la-@PAN/GIR No.: ACSPG 2461 K vihykFkhZ@Appellant izR;FkhZ@Respondent fu/kZkfjrh dh vksjls@Assessee by : Shri Tarun Mittal, CA jktLo dh vksjls@Revenue by: Smt. Alka Gautam, CIT-DR lquokbZ dh rkjh[k@Date of Hearing : 29/10/2025 mn?kks\"k.kk dh rkjh[k@Date of Pronouncement: 29 /10/2025 vkns'k@ORDER PER: RATHOD KAMLESH JAYANTBHAI, AM The assessee has filed a Stay Application praying therein to stay the demand because the assessee will suffer irreparable loss in case the recovery of the demand is not stayed till the disposal of the appeal which is filed before the ITAT Jaipur Benches, wherein the ld. DR sought time and the arguments of the ld AR was over and the matter is fixed for hearing on 04.11.2024. In the meantime revenue attached the bank account of the Printed from counselvise.com 2 SA NO. 17/JP/2025 SUNIL KUMAR GATTANI VS ACIT, CENTRAL CIRCLE-2, JAIPUR assessee even though the assessee has paid 20 % of the demand and therefore, since the bank account of the assessee attached this stay petition filed by the assessee. To this effect, the assessee has submitted following reasons for stay of demand detailing therein facts of the case as to the addition confirmed by the ld. CIT(A); ‘’1. The applicant Sh. Sunil Kumar Gattani is an individual and is partner in M/s. P N & Company, which is engaged in the business of finance on brokerage basis Thus, applicant's total income mainly consists of profit and remuneration from partnership firm along with Interest income under Other Sources Head. 2 Return of income for the captioned assessment year was filed on 29th September 2020, declaring total income of Rs. 86,54,370/-. A search action u/s 132 was carried out in the case of assessee on 06.09.2018, pursuant to which notices u/s 153A were issued to assessee. Details and information as sought by ld.AO was furnished by assessee and assessment was completed u/s.143(3) at Assessed Income ofRs.3,41,99,970/-after making following additions/disallowances. a) Addition on account of Cash found during the course of search of Rs.1,56,15,565/- b) Addition on account of jewellery found during the course of search of Rs.99,29,064/- c) Addition on account of unaccounted brokerage income of Rs. 1,099/- The facts of the case are:- -During the course of search in the case of assessee, various loose papers/documents were found and seized, including the valuables in the form of cash of Rs. 1,56,15,656/- and Jewellery of worth Rs. 1,61,84,539/- -With regards to addition made on account of cash deposit, it is submitted that during the course of search, cash of Rs. 1,56,15,656/ was found and Rs. 1,55,50,000/-was seized from the possession of the assessee. During the course of assessment proceedings, detailed submission was made by assessee, wherein assessee explained to ld. AO that cash was earned from finance brokerage business. However the same were brushed aside by ld.AO Printed from counselvise.com 3 SA NO. 17/JP/2025 SUNIL KUMAR GATTANI VS ACIT, CENTRAL CIRCLE-2, JAIPUR andadditions were made solely on presumption basis without bringing any contrary material on record. -With regard to total jewellery of Rs. 1,61,84,539/- found during the course of search, jewellery equivalent to Rs. 99,29,064/- was seized by the department. During the course of assessment proceedings, detailed submission was made by assessee, wherein assessee explained to ld. AO that jewellery found is procured by the assessee out of explained sources and same is supported in the form of Purchase bills (found/seized during course of search). Further, jewellery is also supported with declaration of jewellery under VDIS and certain jewellery found in the course of search conducted in the case of assessee in A.Y. 1992-93. However, the ld. AO without taking cognizance of same, made the addition in the hands of assessee arbitrarily. -Before the Hon'ble CIT(A), the applicant had again furnished detailed submission as well as documentary evidences, which prove it beyond doubt that both cash and jewellery found during the course of search are duly explained in the hands of assessee. However, ld. CIT(A) confirmed the additions made by ld.AO without considering the provisions of Income Tax Act, 1961 3. That, the applicant has filed an appeal against order passed by Id.CIT(A) before the hon'ble bench on 18.08.2025 which is fixed for hearing on 04 November 2025, 4. That, in respect of additions made as stated above, demand to the tune of Rs. 2,74,93,033/- has been raised as per demand notice. Against such demand, department has already adjusted cash seized during the course of search of Rs. 1,55,50,000/- Beside this, department has also seized jewellery of Rs. 99,29,064, present value of which is more than Rs. 4 crores. 5. That, assessee has already deposited more than 20% of demand in the form of cash found/seized during the course of search, thus there were no recovery of demand from the ld. AO till the appeal is decided by the ld. CIT(A). However, subsequent to order of ld. CIT(A), department had attached the bank account of assessee. 6. That, in view of above, department has already recovered the substantial amount of demand from the assessee and is also in possession of jewellery of which present value is more than Rs. 4 Crore. It is also submitted that no request for release of jewellery shall be filed by assessee till the appeal is not disposed by the Hon'ble Income Tax Appellate Tribunal. 7 That, the coercive action of department in attaching the bank account of assessee will not only hamper its regular business activities but also cause undue hardship to the assessee. Printed from counselvise.com 4 SA NO. 17/JP/2025 SUNIL KUMAR GATTANI VS ACIT, CENTRAL CIRCLE-2, JAIPUR 8. That, the present application for Stay of Demand is filed against the total outstanding amount of Rs. 1,19,43,033/- (as against which jewellery having market value of more than Rs. 4 crore is already available with the department). 9 In these circumstances, it is prayed: a) That the outstanding demand of Rs. 1,19,43,033/-be stayed till final disposal of the above appeal. b) That the hearing of the above appeal may be fixed for an early date convenient to the Hon'ble Court c) For such further and other relief as the facts and circumstances of the case may require. An opportunity of being heard may please be granted before disposing of the application of stay of recovery. The ld. AR of the assessee submitted that hearing in quantum proceeding is already over on his part and the arguments were pending on the part of the revenue. The assessee has already paid 20 % of the demand and thereby the attachment of the account made by the revenue will suffer the irreparable loss to the assessee and thereby the present Stay Application. The ld. AR of the assessee also submitted that the revenue has already seized gold worth market value of 5 cr and assessee also undertake not request for release of the said valuable. 2.0 On the other hand, the ld. DR objected for the stay of the demand and prayed that looking to the nature of addition, no stay is eligible but at the same time the ld. DR contended that looking to the financial constrain Printed from counselvise.com 5 SA NO. 17/JP/2025 SUNIL KUMAR GATTANI VS ACIT, CENTRAL CIRCLE-2, JAIPUR and assessee has partly paid amount and thus the Bench may decide the stay application in accordance with law. 3.0 We have heard both the parties and perused the materials available on record as to the stay application filed by the ld. AR of the assessee. The Bench noted that the Department has raised the demand to the tune of Rs.2,74,93,003/-. Against such demand, department has already adjusted cash seized during the course of search amounting to Rs.1,55,50,000/- which is more than 20% whose details are as under:- Demand Outstanding Rs.2,74,93,033/- Amount already paid Rs.1,55,50,000/- Amount outstanding Rs.1,19,43,033 It is also noted that the Department has also seized jewellery worth Rs.99,29,064/- for which the ld. AR of the assessee submitted that at the present moment, the worth of seized jewellery is more than Rs.5.00 crores. Thus from the entire conspectus of the case, the Bench feels that as per provision of section 254(2A) of the Act since the assessee has already deposited more than 20 % of the demand and therefore, considering the overall facts as present and not controverted by the ld. DR we direct the ld. AO to release the attached bank account of the assessee immediately so that the assessee may run his business smoothly and further directs the Printed from counselvise.com 6 SA NO. 17/JP/2025 SUNIL KUMAR GATTANI VS ACIT, CENTRAL CIRCLE-2, JAIPUR Department not to take any coercive action against assessee and stay of demand is granted till disposal of the appeal or 45 days from the date ld. DR complete his arguments. Thus, the next date of hearing of the appeal is fixed for 04-11-2025 and the parties are directed not take any adjournment in the matter except for a sufficient reasons. 4.0 In the result, the Stay Application of the assessee is allowed as pronounced in open Court on 29-10-2025. 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:- 29/10/2025 *Mishra vkns'k dh izfrfyfivxzsf’kr@Copy of the order forwarded to:s 1. The Appellant- Shri Sunil Kumar Gattani, Jaipur ,. 2. izR;FkhZ@ The Respondent- The ACIT, Central Circle-2, Jaipur . 3. vk;djvk;qDr@ The ld CIT 4. vk;dj vk;qDr¼vihy½@The ld CIT(A) 5. foHkkxh; izfrfuf/k] vk;djvihyh; vf/kdj.k] t;iqj@DR, ITAT, Jaipur 6. xkMZQkbZy@ Guard File (SA No. 17/JP/2025) vkns'kkuqlkj@ By order, lgk;diathdkj@Asst. Registrar Printed from counselvise.com "