VINOD KUMAR CHUGH,JAIPUR V. THE INCOME TAX OFFICER, WARD-7(3), JAIPUR , JAIPUR

ITA 207/JPR/2025

AI Insights

The case involves Vinod Kumar Chugh, a senior citizen and retired employee of the Indian Railways, who appealed against the orders of the CIT(A) and the AO regarding the assessment of his income for the year 2012-13. The primary issues revolved around the additions made to his income, which included unexplained cash credits and unreported income from pension and interest. The AO had re-opened the case under sections 147 and 144 of the Income Tax Act, citing non-compliance in filing returns and unexplained cash deposits. The CIT(A) upheld these additions, leading to the appeal before the ITAT. The Tribunal's decision highlighted the procedural lapses in the handling of the appeal and the substantive evidence provided by the assessee regarding the sources of the cash deposits.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 126430 (ITAT-JAIPUR)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-04-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2012-2013
• Other Referred Cases: Collector, Land Acquisition vs. Mst. Katiji and Others, 167 ITR 471 (SC), Dhakeswari Cotton Mills Ltd. vs. ITO, Umacharan Shaw & Brothers vs. ITO, Mrs. Nathella Sanjana Anandha vs. ITO, Non-Corporate Ward -1(6), Chennai, Sunil Kothari vs. DCIT, Circle (Intl. Tax.), Jaipur, Abhilasha Jain vs. DCIT
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: GAUTAM SINGH CHOUDHARY
• Assessee Lawyers: TARUN AGARWAL
• Keywords: Condonation of delay; Business income; Opportunity of being heard; Additional evidence; Reasonable cause; Corroborative evidences; Unexplained cash credit; Gift; Principle of natural justice; Source of fund; Competent authority; Initiation of penalty proceedings; Procedural lapse; Supporting evidence; Grounds of appeal; Principal; Satisfaction; No evidence; Dismissed; National Faceless Appeal; Gift deed; Judgment; Section 139(1); Commissioner; Commissioner of Income Tax; Transfer; Transactions; Marriage; Exempt; Deleted; Bank Records; Source of cash deposit; Form No. 36; Department; Maturity amount; Explanation; Withdrawn; Services
• Section: 147; 148; 142(1); 271(1)(c); 139(1); 22; 69; 133(6); 13; 69A; 274; 20

Judgement Text

" vk;dj vihyh; vf/kdj.k] t;iqj U;k;ihB] t;iqj IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES,”SMC” 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. 207/JP/2025 fu/kZkj.k o\"kZ@Assessment Year : 2012-13 Vinod Kumar Chugh G-145, Mandirmarg Shyamnagar Ext. Shyam Nagar, Jaipur cuke Vs. ITO, Ward- 7(3), Jaipur LFkk;h ys[kk la-@thvkbZvkj la-@PAN/GIR No.: ABCPC2182N vihykFkhZ@Appellant izR;FkhZ@Respondent fu/kZkfjrh dh vksj ls@ Assessee by : Sh. Tarun Agarwal, CA jktLo dh vksj ls@ Revenue by : Sh. Gautam Singh Choudhary, JCIT lquokbZ dh rkjh[k@ Date of Hearing : 03/04/2025 mn?kks\"k.kk dh rkjh[k@Date of Pronouncement: 24/04/2025 vkns'k@ ORDER PER: RATHOD KAMLESH JAYANTBHAI, AM On being aggrieved by the order of the learned National Faceless Appeal Centre, Delhi [ for short CIT(A) ] dated 21/11/2023 the above named assessee preferred the present appeal. The dispute relates to the assessment year 2012-13. The said order of the ld. CIT(A) arises because the assessee has challenged the assessment order dated 20.11.2017 2 ITA No. 207/JP/2025 Vinod Kumar Chugh vs. ITO passed under section 147 r.w.s 144 of the Income Tax Act, 1961 [ for short “Act] passed by ITO, Ward-7(3), Jaipur [ for short AO]. 2. In this appeal, the assessee has raised following grounds: - “1 That the Ld. CIT(A) erred in passing an ex-parte order without affording a reasonable opportunity of hearing to the appellant. That the Ld. CIT(A) failed to appreciate that the appellant's consultant, who was handling the case, unfortunately passed away due to COVID-19, resulting in non-appearance and non-compliance with hearing notices. 2. That the Ld. CIT(A) did not verify whether the notices were duly served to the appellant but proceeded to dismiss the appeal in an arbitrary manner. 3. That the Ld. CIT(A) failed to consider that the appellant is a senior citizen with limited knowledge of tax matters and that the delay in compliance was due to genuine and reasonable causes beyond his control. 4. That the Ld. CIT(A) ought to have adjudicated the case on merits instead of passing an ex-parte order dismissing the appeal. 5. The Ld. CIT(A) have erred in law and on facts by holding that the appellant has concealed income of Rs. 1,50,558/- received as pension and Rs. 64,065 received as interest income while the same was duly explained during the assessment proceedings. 6. The Ld. CIT(A) and the Ld AO have erred in law and on facts holding that the appellant has concealed income of Rs. 60,958/- whereas the same was duly explained during the assessment proceedings. 7. The Ld. CIT(A) and Ld AO have erred in law and on facts by treating amount of Rs. 10,00,000/- unexplained income, without taking into consideration the same was properly explained during the assessment proceedings. 8. The Appellant craves to add or alter any ground of appeal during or before the hearing of the case.” 3 ITA No. 207/JP/2025 Vinod Kumar Chugh vs. ITO 3. At the outset of hearing, the Bench observed that there is delay of 378 days in filing of the appeal by the assessee for which the ld. AR of the assessee filed an application for condonation of delay with following prayers: “Most Respectfully Showeth: 1. That the appellant is a senior citizen and a retired employee of the Indian Railways, earning mainly from pension income. 2. That the assessment order under section 144/147 of the Income Tax Act, 1961 was passed on 20.11.2017, determining the total assessed income at ₹12,75,580, along with interest under sections 234A, 234B, and 234C and initiation of penalty proceedings under sections 271(1)(c) and 271F of the Income Tax Act, 1961. 3. That an appeal was filed before the Learned Commissioner of Income Tax (Appeals), but due to unforeseen circumstances, the appellant’s authorised representative handling the case passed away due to COVID-19. 4. That since the proceedings were faceless, and the consultant’s email ID was provided for communication, the appellant remained unaware of the hearing dates and subsequent ex-parte order. 5. That the CIT(A) passed an ex-parte order on 21.11.2023, dismissing the appeal without considering the facts on record. The Appeal should be filed within 60 days from the date of passing of order of Commissioner of Income Tax (Appeals). As the CIT(A) order was passed on 21.11.2023, the Appeal to the Income Tax Appellate Tribunal in Form No. 36 should be filed till 19.01.2024, and hence, the appeal is delayed for 389 days. 6. That the appellant, being a senior citizen with limited knowledge of tax proceedings, came to know about the said order only recently when a notice dated 16.01.2025 under section 274 r.w.s. 271(1)(c) of the I.T. Act, 1961 was sent to him over the registered address. He took professional assistance for further compliance of the notice, where upon it was learnt about the proceedings. 7. That the delay in filing the present appeal is solely on account of genuine and reasonable causes beyond the control of the appellant, and there is no deliberate or intentional delay. 8. That it is a settled principle of law that substantive justice should prevail over procedural technicalities. The Hon’ble Supreme Court and various High Courts have 4 ITA No. 207/JP/2025 Vinod Kumar Chugh vs. ITO held that liberal interpretation should be applied while condoning the delay in genuine cases. 9. That the appellant has a strong prima facie case on merits and is likely to succeed in appeal. If the delay is not condoned, the appellant will suffer irreparable loss and hardship. Prayer: In view of the above facts and circumstances, the appellant most humbly prays that the Hon’ble Tribunal may kindly condone the delay in filing the appeal and admit the same in the interest of justice. 4. During the course of hearing, the ld. DR stated that reasons advanced are not sufficient to condone the delay of as many as 378 days in the present case. However, prayed that the bench may decide the issue as deem fit in the interest of justice. 5. Heard the parties and perused the materials available on record. The bench noted that counsel of the assessee who was handling the appeal work of the assessee was passed away in the covid-19 pandemic and therefore, there is a merit in the reasons advanced and we concur with the submission of the assessee. Thus the delay of 378 days in filing the appeal by the assessee is condoned 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. 5 ITA No. 207/JP/2025 Vinod Kumar Chugh vs. ITO 6. Succinctly, the fact as culled out from the records is that in this case, no return of income was filed by the assessee u/s 139(1) of the Income-tax Act 1961. As there was information in this case that assessee has deposited cash in his bank account during the year. Therefore, necessary reasons were recorded and after obtaining approval of Addl.CIT, Range-7, Jaipur on 29.03.2017, the case was re-opened and notice u/s 148 was issued on 30.03.2017 which was served upon the assessee through Regd. Post and the assessee was required to furnish return of income within the stipulated time, but compliance was not made by the assessee. Further, in order to complete the proceedings, notice u/s 142(1) was issued on 12.09.2017. In compliance to the notice/ order sheet, the AR of the assessee attended time to time and furnished written submission with a copy of bank statements and other required details / documents which were verified and placed on record. The assessee is a retired person from Indian Railways and getting pension. While assessment proceedings, the AR of the assessee has stated that assessee being a senior citizen and his total income was less than the basic exemption limit during the said financial year, return of income was not filed. Even the assessee has neither filed ROI in response to the notice issued u/s 148 nor furnished any computation of total income. During the period which is under 6 ITA No. 207/JP/2025 Vinod Kumar Chugh vs. ITO consideration, the assessee was maintaining two bank accounts, one with State Bank of India and another with Allahabad Bank. Necessary explanation regarding all the debit/credit entries appearing therein including source of cash deposit, was called for and in turn, the AR of the assessee filed written submission with details thereof vide his letter dated 02.11.2017, 07.11.2017 and 13.11.2017. On making necessary verifications and examinations of the details /documents, bank statements and the written submission filed by the AR of the assessee ld. AO noted that the assessee not placed on record any supporting documentary evidence for the contention raised. The contention of receipt of money in marriage as gift was not considered in absence of the evidence. Further the contention that the amount was received by son and given to the assessee which was deposited by the assessee himself in his account was also not considered because his son was also assessed to tax and having his own bank account. The cash deposited was converted into FDRs and therefore, the explanation of the assessee was considered as baseless. Ld. AO also considered the fact that those FDRs were ultimately given to his sons does not explain the source of cash deposit. Therefore, cash deposit to the extent of Rs. 10,00,000/- was considered as unexplained cash credits and was added as income of the assessee. Ld. AO also added interest income 7 ITA No. 207/JP/2025 Vinod Kumar Chugh vs. ITO of Rs. 64,065/- and Rs. 60,958/- as unexplained credits and thereby against salary head income of Rs. 1,50,558/- income was determined at Rs. 12,75,581/-. 7. Aggrieved from the order of 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: “3.4. I have perused the grounds of appeal, statement of facts and the assessment order. From the assessment order it can be seen that the AO has followed the due procedure laid down in the I.T. Act, 1961 after recording reasons, getting due approval from the competent authority the case was reopened and notice u/s 148 was issued on 30.03.2017 and duly served upon the assessee. Further notice u/s 142(1) was issued on 12.09.2017. In compliance to the notice A/R of the appellant appeared before the AO from time to time and explained his case. 3.5 During the assessment proceedings it was claimed that since the assessee is a retired employee of Indian Railways and is a senior citizen, and as the income was less than the basic exemption limit during the concerned financial year, so, return of income was not filed. The assessee also did not file the ROI in response to notice u/s 148. The AO discovered during the assessment proceedings that the appellant has received Rs 1,50,558/- as pension from the bank statement. Total interest credited to his account was Rs 64,065/- and unexplained cash credit in his SBI account amounted to Rs 60,958/ only. The interest income was added by the AO as the corresponding income was not disclosed and brought to tax in the concerned year. The appellant claimed that the sum of Rs. 60,958/- treated as unexplained cash credit, was rental receipt in respect of property owned by his son. However, the said amount whether was offered for taxation under the head house property. by his son, could not be established to the satisfaction of the AO. Further, it was recorded in the assessment order as reproduced below. 6.1 From the above submission given by the AR, it is cleared that the claim of assessee is not correct. As, the assessee has not furnished any documentary evidences regarding 8 ITA No. 207/JP/2025 Vinod Kumar Chugh vs. ITO nature of receipts and also not found to be able to sustain his claim, therefore considering the facts, the total of credit entries of Rs. 60,958/- is treated as unexplained cash credits and is added to the total income of the assessee. 3.6 During the concerned assessment year the appellant has deposited cash in the savings bank accounts maintained with SBI on 11.04.2011 and 01.11.2011 respectively, cumulating an amount of Rs 10,00,000; and also deposited cash in the S/B a/c maintained with Allahabad bank on 28.07.2011 of an amount of Rs 5,00,000/-only. The explanation was called for by the AO and the air of the assessee submitted various documents in support of the claim of the assessee. However, the AO was not fully satisfied with the explanation provided during assessment and made an addition of Rs 10,00,000/- on this account. The relevant portion of the assessment order is reproduced below for ready reference: 7.3 The submission given by the AR is considered but not found verifiable on the following reasons:- i) That no supporting documentary evidences have been filed in regard to claim. ii) The claim of assessee regarding receipts of a huge amount as marriage gift is not acceptable considering the facts of the case and in absence of the any documentary evidences. iii) Further, the claim that the amount was received by son and given to the assessee which was deposited by assessee himself in his account, is not acceptable facts considering that the son was also assessed to tax and was having is own bank account (iv) It is very surprising facts that the cash receipts claim to be marriage gift was utilized by the assessee in making FDRs. This fact is clearly evident that in both the instance, the assessee has deposited the entire cash for making FDRs. v) As, the assessee was not having any fund other than the cash gift as claimed, therefore claim regarding purchase of FDRs from the cash gifts, is totally baseless because it is not possible that a person have not incurred any singly penny in marriage of his son. vi) Further, the transfer of maturity amount of the FDRs to the account of Sh. Ravi Kumar Chugh as claimed, does not explain the source of fund utilized in purchase of the FDRs. 3.6 The appellant has not produced any material to controvert the findings of AO as stated above. On merits AO's order appears to be as per law. No evidence regarding source of unexplained cash credits and cash deposits were furnished during appellate proceeding, as well, despite several opportunities being provided 9 ITA No. 207/JP/2025 Vinod Kumar Chugh vs. ITO from this end. Further, from the above conduct of the assessee, it is clear that the appellant is not interested in prosecuting his appeal. In the event, I have no reason to interfere with the findings of the AO. In such circumstance, I dismiss the claim of the appellant. 4. In the result, the appeal is dismissed.” 8. Feeling dissatisfied with the above finding of the ld. CIT(A) dismissing the appeal of the assessee present appeal is preferred by the assessee. To support the various grounds raised by the assessee, ld. AR of the assessee, has filed the written submissions in respect of the various grounds raised by the assessee and the same is reproduced below: “Brief of the Appellant The appellant, who is a senior citizen (Age 78 years), has been retired from the Indian Railways from the post of Assistant Accounts. The appellant maintained a good record of his services at the Indian Railways. The source of earnings of the appellant is onlyof pension from Indian Railways. The appellant being a senior citizen and from non-taxation background, was non-conversant with information technology. The appellant was having pension and interest income below the taxable limits throughout the period, hence, he was not well versed with the taxable pension provisions of the Income Tax Act, 1961. Facts of the Case 1. The appellant, who is a senior citizen (Age 78 years), has been retired from the Indian Railways from the post of Assistant Accounts. The appellant maintained a good record of his services at the Indian Railways. The source of earnings of the appellant is only of pension from Indian Railways. The appellant being a senior citizen and from non-taxation background, was non-conversant with information technology. 2. The appellant was having pension and interest income below the taxable limits throughout the period, hence, he was not well versed with the provisions of the Income Tax Act, 1961. 10 ITA No. 207/JP/2025 Vinod Kumar Chugh vs. ITO 3. The appellant was issued notice under section 148 of the Income Tax Act on 30/03/2017 by Ld. AO for charging income tax on the escaped assessed income within the meaning of section 147 of the Income Tax Act for the assessment year 2012-13. On 12/09/2017, notice under section 142(1) of the Income Tax Act, 1961 was issued to produce a Source of income, copy of IT return filed with Computation of total income, copy of audit report with all enclosures, evidence regarding Deduction claims under Chapter VI of the Income Tax Act, 1961, Copy of all Bank statements for the relevant period, and Source of Cash deposited and Credit entries. The assesse complied with the aforesaid notice under section 142(1) of the Income Tax Act, 1961 through an Authorized Representative (AR), CA K.L. Sharma. 4. The Show Cause notice was issued under section 144 of the Income Tax Act 1961 for AY2012-13, ex parte assessment on 26.10.2017 by stating that the last opportunity given to produce the details, documents, books of accounts and explanations with supporting evidence on cash deposit of Rs. 500,000/- in Allahabad Bank Ltd, Rs. 10,00,000/- in State Bank of India, and credit entries of Rs. 18,394/- and Rs. 4,02,601/-. But, the assessee failed to comply with the aforesaid notice. 5. During the Assessment Proceedings, various notices were issued upon the Appellant against which the response were filed on 02.11.2017, 07.11.2017 and 13.11.2017. 6. The assessment order under section 144/147 of the Income Tax Act 1947 was passed on 20.11.2017 with the total assessed income of Rs.12,75,580/- and charged interest under sections 234A, 234B, and 234C of the Income Tax Act 1961. Penalty proceedings u/s 271 (1)(c) read with section 274 and u/s 271F of the Income Tax Act 1961 were initiated on an even date. The order stated that the assessee through AR attended from time to time and furnished written submission with a copy of Bank statements and other needed details in compliance with the notice u/s 142(1). AR of the assessee stated that the total income of the assessee was less than the basic exemption limit during the said financial year. Even, the assessee did not file the return of income in response to the notice u/s 148 and did not furnish any computation of total income for AY2012-13. 7. In furtherance to above, the order stated that on verifications and examinations of submitted documents, Bank statements, and written submissions by AR, the assessee received total pension of Rs. 1,50,558/- for the AY2012-13, interest income on saving Bank a/c with State Bank of India of Rs. 45,649/- interest income on saving Bank a/c with Allahabad Bank of Rs. 18,416/-, unexplained credits of Rs. 60,958/-, and unexplained cash credits of Rs. 11 ITA No. 207/JP/2025 Vinod Kumar Chugh vs. ITO 10,00,000 (including Rs. 500,000/- in SBI Bank on 11.04.2011 and Rs. 5,00,000/- in Allahabad Bank on 28.07.2011). Break up of Income of Rs. 12,75,580/- assumed by Assessing Officer (AO) S .No. Particulars Amount in Rs. 1. Pension Income 1,50,558 2. Interest Income 64,065 3. Unexplained Credit 60,958 4. Cash Deposited dated 11.04.2011 with State Bank of India (SBI) 5,00,000 5. Cash Deposited dated 28.07.2011 with Allahabad Bank 5,00,000 Total Income 12,75,580/- 8. Appeal filed before CIT(A) Income Tax Department on 16.04.2018 and the CIT (A) order was passed on 21/11/2023, DIN & Order No : ITBA/NFAC/S/250/2023-24/1058106844(1). The order stated that the appellant has failed to produce any material to controvert the findings of the Ld. AO. No evidence was furnished during appellate proceeding and despite several opportunities being provided. The CIT (A) order also stated that the appellant is not interested in pursuing his appeal so have no reason to interfere with the findings of the Ld. AO. The appeal is dismissed. 9. The appellant could not participate in the appellate proceedings due to a Bonafide reason (death of the appellant's authorized representative) and as the mail id on which the notices were sent also belonged to the A/R of the appellant. 10. It was only when notice dated 16.01.2025 under section 274 r.w.s. 271(1)(c) was served upon the appellant on his registered address, upon which he consulted to a Tax Consultant, and came to know about the order of the Ld. CIT (A). 11. Upon verification of the Income Tax login of the appellant, it was seen that the notices were served upon the mail id of the A/R and as the faceless proceedings were carried out, the appellant had no clue about the proceedings being undertaken. 12. Being aggrieved by the order of the Ld. CIT (Appeals), this appeal is filed before this Honorable Bench of ITAT. Grounds of Appeal 12 ITA No. 207/JP/2025 Vinod Kumar Chugh vs. ITO 1. That the Ld. CIT(A) erred in passing an ex-parte order without affording a reasonable opportunity of hearing to the appellant. That the Ld. CIT(A) failed to appreciate that the appellant’s consultant, who was handling the case, unfortunately passed away due to COVID-19, resulting in non- appearance and non-compliance with hearing notices. 2. That the Ld. CIT(A) did not verify whether the notices were duly served to the appellant but proceeded to dismiss the appeal in an arbitrary manner. 3. That the Ld. CIT(A) failed to consider that the appellant is a senior citizen with limited knowledge of tax matters and that the delay in compliance was due to genuine and reasonable causes beyond his control. 4. That the Ld. CIT(A) ought to have adjudicated the case on merits instead of passing an ex-parte order dismissing the appeal. 5. The Ld. CIT(A) have erred in law and on facts by holding that the appellant has concealed income of Rs. 1,50,558/- received as pension and Rs. 64,065 received as interest income while the same was duly explained during the assessment proceedings. 6. The Ld. CIT(A) and the Ld. AO have erred in law and on facts holding that the appellant has concealed income of Rs. 60,958 whereas the same was duly explained during the assessment proceedings. 7. The Ld. CIT(A) and Ld. AO have erred in law and on facts by treating amount of Rs. 10,00,000/- unexplained income, without taking into consideration the same was properly explained during the assessment proceedings. 8. The Appellant craves to add or alter any ground of appeal during or before the hearing of the case. Our Submissions on the Ground1 to 4 as the grounds are related with each other The appellant respectfully submits that the Ld. Commissioner of Income Tax (Appeals) [CIT(A)] erred in passing an ex parte order without affording a reasonable opportunity of hearing. The principles of natural justice mandate that no adverse order should be passed without granting the appellant a fair opportunity to present its case. The appellant’s authorized representative, who was handling the case, unfortunately passed away due to COVID-19. This unforeseen and tragic event resulted in non-appearance and non-compliance 13 ITA No. 207/JP/2025 Vinod Kumar Chugh vs. ITO with hearing notices, which was entirely unintentional and beyond the appellant’s control. It is a settled principle of law that an order passed without providing a fair opportunity of hearing is not justified. The Hon’ble Supreme Court and various High Courts have consistently held that the right to be heard is a fundamental aspect of justice. The appellant respectfully submits that the Ld. Commissioner of Income Tax (Appeals) [CIT (A)] erred in dismissing the appeal without verifying whether the hearing notices were duly served upon the appellant. This action amounts to a violation of the principles of natural justice. The Ld. CIT (A) arbitrarily dismissed the appeal without ascertaining whether the notices were properly delivered to the appellant. The appellant was deprived of an opportunity to present its case due to this procedural lapse. It is a settled principle that any order passed without ensuring proper service of notice is unsustainable in law. The Hon’ble Supreme Court and various High Courts have held that failure to serve notice properly vitiates the entire proceedings. The present appeal has been filed against the order of the Learned Commissioner of Income Tax (Appeals) [CIT(A)] dated 21.11.2023 vide Letter No. ITBA/NFAC/S/250/2023-4/1058106844(1) wherein the appellant’s claim has been unjustly rejected without due consideration of the genuine and reasonable cause for the delay in compliance. The appellant is a senior citizen with limited knowledge of taxation laws and procedures. Due to his advanced age and lack of expertise in tax matters, the delay in compliance was not intentional but was caused due to genuine hardship beyond his control. The Learned CIT (A) has erred in not appreciating the genuine difficulty faced by the appellant and has proceeded with a strict interpretation of procedural requirements, thereby causing undue hardship. In view of the facts and circumstances of the case, the appellant humbly prays that the delay in compliance be condoned and relief be granted accordingly. The appellant respectfully submits that the learned Commissioner of Income Tax (Appeals) [CIT (A)] has erred in law and on facts in dismissing the appeal ex- parte without adjudicating the case on merits. The order passed by the CIT (A) is against the principles of natural justice, as the appellant was deprived of an opportunity to present its case effectively. The Hon’ble ITAT has consistently held that an opportunity of being heard must be provided to the assessee before deciding any appeal, as enshrined under the principles of natural justice. The appellant craves leave to rely upon landmark judgment of Collector, Land Acquisition Versus Mst. Katiji And Others to support this principle. 14 ITA No. 207/JP/2025 Vinod Kumar Chugh vs. ITO Our Submissions on the Ground 5 The Learned Commissioner of Income Tax (Appeals) [CIT(A)], has erred on Law as well as in facts that the appellant has concealed income by not filing a return of income. The appellant respectfully submits that the said conclusion is unjustified, both in law and on facts, for the following reasons: The appellant is a retired railway officer receiving a pension income of Rs. 1,50,558/- and interest income of Rs. 64,065/- (Rs. 45,649 from State Bank of India and Rs. 18,416 from Allahabad Bank) and no other income during the A.Y. 2012-13. The appellant did not file a return of income for the relevant assessment year since the total income (Rs. 2,14,623/-) was below the basic exemption limit, which was Rs. 2,50,000, as per the provisions of the Income Tax Act, 1961. The appellant’s total income, consisting of pension and interest income, was below the basic exemption limit as prescribed under the Income Tax Act. As per section 139(1), an individual is required to file a return of income only if the total income after deductions exceeds the maximum amount not chargeable to tax. Since the appellant’s income was below this threshold, there was no legal requirement to file a return. The entire income was derived from disclosed sources, namely pension and Bank interest, which are traceable through Banking channels. Therefore, the finding of concealment is completely unjustified. The Ld. CIT(A) erred in holding that the appellant concealed income without considering the fact that the appellant had no taxable income requiring the filing of a return. The addition made is arbitrary and against the settled principles of taxation. Our Submissions on the Ground 6 The present appeal has been filed against the order of the Ld. Commissioner of Income Tax (Appeals) [CIT(A)], wherein it has been erroneously held that the appellant has concealed income of Rs. 60,958, whereas the same was duly explained during the assessment proceedings. The appellant is a senior citizen who is responsible to manage the household expenses to support his whole family and hence it was decided by the appellant’s son to transfer his certain monthly receipts around Rs. 5000 per month total in the whole year of Rs. 60,958 to his bank account. The Ld. AO and Ld. CIT(A) have erred in law and on facts in holding that the appellant has concealed income when, in fact, the entire rental income was duly explained during the assessment proceedings. 15 ITA No. 207/JP/2025 Vinod Kumar Chugh vs. ITO Hence, in view of the above facts, the addition made by the Ld. AO and upheld by the Ld. CIT(A) should be deleted, as the appellant was not required to file the return of income. Our Submissions on the Ground 7 “The Ld. CIT(A) and Ld. AO have erred in law and on facts by treating amount of Rs. 10,00,000/- unexplained income, without taking into consideration the same was properly explained during the assessment proceedings.” As per provision of section -69A \"Where in any financial year the assessee is found to be the owner of any money, bullion, jewellery or other valuable article and such money, bullion, jewellery or valuable article is not recorded in the books of account, if any, maintained by him for any source of income, and the assessee offers no explanation about the nature and source of acquisition of the money, bullion, jewellery or other valuable article, or the explanation offered by him is not, in the opinion of the Assessing Officer, satisfactory, the money and the value of the bullion, jewellery or other valuable article may be deemed to be the income of the assessee for such financial year. The appellant was not having any business income nor he required to maintain any specific books of accounts as prescribed in section 44AA of the income tax and rules made there under. Therefore Ld. AO is required to first establish the noncompliance, if any, in relation to maintenance of books of accounts then only the provision of section 69A can be attracted in this case. As per provision of section 69A, if person neither required nor maintaining any books of account, shall only explain the source of money, bullion, jewellery or other valuable article received, in this respect assessee has duly explained all the source of amount so deposited. It is also important to mention the following points in support of the argument that the cash deposit of Rs. 5,00,000/ out the gifts received at the time of marriage is not unexplained money: 1) The appellant was not carrying on any activity in the nature of business or trade and was only dependent on the pension income received by him. 2) The amount was deposited in the bank account out of the cash gifts received on the occasion of his son’s marriage and that the same was explained to the Ld AO during the assessment proceedings. 16 ITA No. 207/JP/2025 Vinod Kumar Chugh vs. ITO 3) The amount deposited in the bank account did not represent any income to him at all, further this amount on maturity, was transferred to his son through RTGS on 29.04.2016, as also examined and confirmed to the Ld AO. 4) The receipt of cash gifts during the time of marriage is a common custom in Indian society and should not be treated as income. The same was to be repaid to his son, evidencing its non-income nature. 5) The amount was received from various persons, mostly belonging to the Sindhi community, which is an influential community in Jaipur. The system of giving cash gifts as shagun is a prevailing customary practice, being practiced all over India. 6) It is apparent that the pension holder having old age without any working capacity, retired from a very lower cadre with a pension of Rs. 12,500, otherwise also, how he can earn so much of heavy amount on a particular day. Hence, the Ld. AO grossly erred to treat the amount deposited in Bank Account as unexplained income. 7) Further, the Appellant had regularly withdrawn his pension amount from the Bank and spending the same on day to day basis, which itself makes clear that the appellant had no other source to earn such income. Further, on this issue, we would rely on the decision of the Honorable Chennai Bench of ITAT in the case of Mrs. Nathella Sanjana Anandha Versus Income Tax Officer, Non- Corporate Ward -1 (6), Chennai. (ITA No. : 1452/Chny/2024), where it was held “We have heard the rival contentions and gone through the orders of the lower authorities. The assessee has deposited Rs. 5,45,000/- to her bank account during the demonetisation period. Further, she got married on 15/05/2015 and stated that the source for the deposit of cash was gifts received during the Marriage function from the relatives, friends and well wishers. Since, the amount of deposit made to bank account and the gift received by the assessee on occasion of the marriage is a reasonable and by following the decision of the tribunal relied by the assessee we are inclined to delete the addition of Rs. 5,45,000/- made by the AO u/s. 69 of the Act as unexplained by allowing the ground the appeal of the assessee.” On the matter of the Gift from the relative of the appellant, we would like to submit the following: 17 ITA No. 207/JP/2025 Vinod Kumar Chugh vs. ITO 1) The amount of Rs. 5,00,000/- was gifted by the sister-in-law out of love and affection, as the appellant family was taking care of her daughter and does not represent income in the hands of the assessee. 2) The said amount was then transferred to Mr. Ravi Kumar Chugh, the elder son who looked after the family as the appellant used to remain sick and the responsibility was given to his elder son. This amount was then paid to his son on 29.04.2016, as also examined and confirmed during assessment, which is duly recorded by the Ld AO in his order. 3) The gifts have been received from relatives as defined u/s 56(2)(vi), which is exempted under the Income Tax Act, no dispute has been raised to the fact that the sister-in-law of the assessee does not have a sufficient source of income. 4) The appellant has duly explained the nature and source of both transactions, supported by Bank records and confirmation from the relevant persons. 5) The Ld. AO and CIT(A) have not rebutted the evidence submitted, nor have they provided any basis to disregard the explanation given. The additions made are arbitrary, unjustified, and contrary to the principles of natural justice. As the Ld AO has made the addition on the basis of mere suspicion, we would like to rely on the judgment passed by the Honorable Supreme Court in the following cases: In the case of Dhakeswari Cotton Mills Ltd. the Hon’ble Supreme Court has held that the AO cannot complete the assessment purely on guess and without any reference to evidence or any material at all. Also, in the case of Umacharan Shaw & Brothers (supra), the Apex Court has held that AO cannot complete the assessment merely on suspicion which cannot take the place of proof in these matters. Further, in support of our argument, we are also relying on the order of the Honorable Coordinate Bench in the following referred cases: 1. Sunil Kothari Versus Dcit, Circle (Intl. Tax.), Jaipur. (2022 (8) Tmi 1072 - Itat Jaipur) 2. Abhilasha Jain Vs Dcit (2022 (8) Tmi 303 – Itat Jaipur) Hence, in view of the above facts, it is requested that your kind Honors to kindly delete the addition of Rs. 10,00,000 and allow the appeal of the appellant.” 18 ITA No. 207/JP/2025 Vinod Kumar Chugh vs. ITO 9. The contention raised in the written submission were supported by the following evidence as filed in the form of paper book by the assessee; Sr. no Particulars Page 1 Written submissions 1-12 2 Bank Statement of SBI from 01.04.2011 to 31.03.2012 13-17 3 Passbook copy of Allahabad Bank from 01.04.2011 to 31.03.2012 18-19 4 Case law: Mrs. Nathella Sanjana Anandha V. ITO, Non-Corporate Ward- 01(6), Chennai (ITA No. 1452/Chny/2024 dated 09.08.2024) 20-23 5 Case law: Sunil Kothari v. DCIT, Circle (Int. Tax.,), Jaipur ( IT(IT) A No. 218/JP/2021 dated 23.08.2022 24-31 6 Case law: Abhilasha Jain vs. DCIT (IT(IT)A. No. 05/JP/2022 dated 7-7- 2022 32-45 10. The ld. AR of the assessee in addition to the above written submission so filed vehemently argued that the assessee is senior citizen aged approximately 79 years having no knowledge of online proceedings. Though, the assessment order alleged to have been passed u/s. 144 of the Act but the assessee has placed all the relevant details which were not considered. When the matter carried before the ld. CIT(A) that appeal of the assessee was dismissed because the assessee has not filed any evidence to support the contention raised before the ld. AO and ld. CIT(A) and therefore, to support the contention already on record the assessee filed an affidavit for the amount of gift received at the time of marriage of his son along with the list of members who have given the gift. The assessee also supported that contention by filling a marriage certificate of his son marriage 19 ITA No. 207/JP/2025 Vinod Kumar Chugh vs. ITO for the amount of Rs. 5 lac and for another five lac he submitted another affidavit of Mrs. Indu Mendiratta confirming the gift and thereby he submitted that the contention raised for deposit of Rs. 10 lac stands duly supported by an affidavit. Ld. AR of the assessee also submitted that the ld. AR of the assessee who was dealing with this matter in the assessment and filed the first appeal. In the meanwhile, on account of Covid-19 that consultant was expired and therefore, the proceedings before ld. CIT(A) were not attended and could not place on record the relevant material to strengthen the contention already on record. Ld. AR of the assessee vehemently argued and submitted that whatever contentions recorded in the order of Assessing Officer and in furtherance to that assessee filed an his affidavit and that of Smt. Indu Mendiratta for the gifts. Ld. AR of the assessee in furtherance to the contention so raised also filed an affidavit that the sources of money for an amount of Rs. 5,00,000/- contended before the ld. AO was sourced from the money received at the time of marriage ceremony of his Son Sh. Samir Chugh younger son of the assessee who got married. The assessee in support of that contention and in furtherance to the contention so raised before Assessing Officer filed an affidavit given names of all the parties who are relative to the assessee given marriage gift for an amount of Rs. 5,17,040/- and out of that money, 20 ITA No. 207/JP/2025 Vinod Kumar Chugh vs. ITO the assessee has deposited cash, so the contention raised before Assessing Officer is further supported by gift deed and affidavit and therefore, looking to this record which are not additional evidence but in furtherance to the contentions already on record and considering the age of the assessee and in the interest of substantial justice the contention of the assessee be considered at this stage. The assessee was a government employee and deposit of cash of Rs. 10,00,000/- stand explained and considering the interest of substantial justice and looking to the age of the assessee the matter may be decided based on this evidence. 11. Per contra, ld. DR relied upon the finding recorded in the order of the lower authority. He particularly relied upon the finding recorded at at para 3.5 & 3.6 of the order of ld. CIT(A) wherein this contention of the assessee were discussed in detailed. As the assessee did not support their contention by filing relevant evidence, Ld. DR relied upon the orders of lower authorities. 12. In the rejoinder the ld. AR of the assessee submitted that the assessee submitted explanation and record reveals that before passing an ex-parte order as per provisions of section 144 of the Act. The AO has not 21 ITA No. 207/JP/2025 Vinod Kumar Chugh vs. ITO issued mandatory show cause notice to the assessee. Ld. AO has not exercised power u/s. 133(6) of the Act to confirm the gift deed with Smt. Indu Mendiratta and his son Shri Samir Chugh and therefore, the assessee being super senior citizen, the appeal of the assessee may be decided based on the evidence placed on record. 13. We have heard the rival contentions and perused the material placed on record. The bench noted that in this appeal the assessee has raised almost 8 grounds of appeal, but effectively it challenges the addition of interest, salary, other credits in the bank account and cash deposit as income of the assessee. The brief facts of the case are that for the year under consideration the assessee has not filed voluntary return as per provision of section 139(1) of the Act. For the year under consideration the ld. AO was in possession of information that assessee has deposited cash in his bank account during the year. Therefore, necessary reasons were recorded and after obtaining approval of Addl.CIT, Range-7, Jaipur on 29.03.2017, the case was re-opened and notice u/s 148 was issued on 30.03.2017 and served upon the assessee. Ld. AO issued notice u/s 142(1) on 12.09.2017 and other statutory notices. In response the assessee attended from time to time and furnished written submission with a copy of 22 ITA No. 207/JP/2025 Vinod Kumar Chugh vs. ITO bank statements and other required details / documents which were verified and placed on record by the ld. AO. The assessee is a retired person from Indian Railways and getting pension. While assessment proceedings, the AR of the assessee has stated that assessee being a senior citizen and his total income was less than the basic exemption limit during the said financial year, return of income was not filed. Even the assessee has neither filed ROI in response to the notice issued u/s 148 nor furnished any computation of total income. Based on that set of facts ld. AO considered the pension income and interest income as undisclosed income in the hands of the assessee. Considering the overall material facts of the case since the assessee is retired government employee his pension income cannot be considered as unexplained income and thereby even the interest income also so far as the principal amount is not disputed. Therefore, we direct the ld. AO to tax that income regular income of the assessee. Based on this observation ground no. 5 raised by the assessee is allowed. Vide ground no. 6 the assessee challenges the addition of Rs. 60,958/-. The brief facts related to that dispute are that a sum of Rs. 60,958/- claimed to be received as rent from the son’s property. The money has been credited every month in the bank account of the assessee. The ld. 23 ITA No. 207/JP/2025 Vinod Kumar Chugh vs. ITO AO has treated that amount as unexplained cash credits in the absence of evidence. Records also reveal that verification of record were called for from Shri Ravi Kumar Chugh and he has replied by giving his ITR. The ld. AO added that amount only on ground that the ITR does not shows income, how income which is received by his father be recorded in his sons ITR at most he musth have claimed expenses, but the ld. AO has not called for any further details thus, the income received on account of the rent cannot be considered as unexplained at most the same can be considered as income without owning property be taxed as other income in the hands of the assessee when the ld. AO has not made any further verification of facts with Shir Ravi Kumar. Based on that set of facts the ld. AO directed to charge that income as other income in the hands of the assessee therefore, ground no. 6 is disposed off with that observation. Vide ground no. 7 the assessee challenges the addition of Rs. 10,00,000/- being the amount of cash deposited in his bank account. The bench noted that in the assessment proceeding the assessee vide submission dated 07.11.2017 stated that on 14.04.2011 his son got married [ marriage certificate was given ] after the marriage the assessee was given money for safe keeping with the assessee, which he has deposited on the very same day for an amount of Rs. 5,00,000/- in the bank account 24 ITA No. 207/JP/2025 Vinod Kumar Chugh vs. ITO maintained with State Bank of India [ page 13 of the paper book ]. The assessee also deposited a sum of Rs. 5,00,000/- on 28.07.2011. The source of that money claimed to have been received from his sister in law Indu Mendiaratta on account of engaged of her daughter, which was taken care of by the assessee and his son Shri Ravi Kumar. In support of that claim assessee filed a signed letter of gift dated 25.07.2011 and in furtherance to that an affidavit duly singed and notarized before the notary public dated 02.04.2025 she has confirmed the fact of giving the gift to the assessee. The ld. AO though this information available on record has merely called the ITR of Ravi Kumar but not confirmed the marriage gift and ld. AO also remained silent on the gift received from Mrs. Indu. The affidavit of the his son and Mrs. Indu were placed on record in furtherance to the facts already on record and therefore, the same cannot be considered as additional evidence but it is considered to render substantial justice to the assessee. Based on those facts which are already on record and further supported by an affidavit we see no reason to sustain that addition of Rs. 10 lac in the hands of the assessee and thereby we considered ground no. 7 raised by the assessee. 25 ITA No. 207/JP/2025 Vinod Kumar Chugh vs. ITO Since we have considered the grounds on merits, other technical ground no. 1, 2, 3 and 4 becomes academic. Ground no. 8 being general does not require our finding. In the result, the appeal of the assessee is allowed. Order pronounced in the open court on 24/04/2025. 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 vkns'k dh izfrfyfi vxzsf’kr@Copy of the order forwarded to: 1. The Appellant- Vinod Kumar Chugh, Jaipur 2. izR;FkhZ@ The Respondent- ITO, Ward-7(3), Jaipur 3. vk;dj vk;qDr@ The ld CIT 4. vk;dj vk;qDr¼vihy½@The ld CIT(A) 5. foHkkxh; izfrfuf/k] vk;dj vihyh; vf/kdj.k] t;iqj@DR, ITAT, Jaipur 6. xkMZ QkbZy@ Guard File (ITA No. 207/JP/2025) vkns'kkuqlkj@ By order, lgk;d iathdkj@Asst. Registrar "