ELUMALAI DHURAIMURUGAN,TIRUVANNAMALAI vs. ITO, WARD 1 TIRUVNANNAMALAI, TIRUVANNAMALAI

Brief facts of the case are that the assessee received the reassessment order dated 10.03.2025 passed u/s. 147 read with section 144B of the Income-tax Act, 1961 (“the Act”) by the Assessment Unit vide DIN & Order No. ITBA/AST/S/147/2024- 25/1074266854(1), whereby the taxable total income of the assessee was determined at Rs.2,12,79,805/-. The assessee was subjected to reassessment proceedings on the basis of information relating to cash deposits made by the assessee during the relevant assessment year. The Juri ictional Assessing Officer (“JAO”) passed an order u/s. 148A(d) of the Act on 31.03.2024 and notice u/s. 148 of the Act was issued on the same date. Thereafter, notices u/s. 142(1) of the Act were issued calling for details regarding the nature and source of the cash deposits made by the assessee during the relevant assessment year. Thereafter, the Assessment Unit passed the reassessment order dated 10.03.2025 u/s. 147 read with section 144B of the Act, determining the taxable total income at Rs.2,12,79,805/-. The assessee has challenged the said reassessment order both on juri ictional grounds as well as on merits. Elanholi Talappil Firoz Vs ITO W-1 Tiruvannamalai 4. Aggrieved by the reassessment order, the assessee preferred an appeal before the learned CIT(A). However, the learned CIT(A), observing that the assessee had failed to furnish material evidence in support of the claims made in Form No.35, dismissed the appeal and confirmed the assessment order. Now assessee is in appeal before the Tribunal.

Before us, the learned Authorised Representative (“Ld. AR”) submitted that neither the Assessing Officer/Assessment Unit nor the learned CIT(A) afforded the assessee a proper and effective opportunity to substantiate its case. It was contended that the assessee had raised both juri ictional and substantive grounds before the first appellate authority, but the learned CIT(A) dismissed the appeal without properly adjudicating the issues on merits.

The Ld. AR further submitted that the assessee is in a position to produce the relevant documents and evidences in support of the nature and source of the cash deposits and also to substantiate the juri ictional objections raised against the reassessment proceedings. It was, therefore, prayed that one final opportunity may be granted to the assessee and the matter may be restored to the file of the learned CIT(A) or AO for fresh adjudication in accordance with law.

The learned Departmental Representative (“Ld. DR”), on the other hand, supported the order of the learned CIT(A) and prayed for dismissal of the appeal. Elanholi Talappil Firoz Vs ITO W-1 Tiruvannamalai 8. We have heard the rival submissions and perused the material available on record. We have also carefully considered the chronology of the reassessment proceedings and the order of the learned CIT(A). From the facts placed before us, it is evident that the reassessment resulted in an addition of Rs.2,12,79,805/- by treating the cash deposits as unexplained money u/s. 69A of the Act. The assessee has challenged the reassessment proceedings not only on merits but also on juri ictional grounds. We find that the learned CIT(A) has dismissed the appeal primarily on the ground that the assessee failed to furnish material evidence in support of the claims made in Form No.

However, the impugned appellate order does not demonstrate an effective adjudication of the juri ictional as well as substantive grounds raised by the assessee.

In our considered view, where the assessee has challenged the very assumption of juri iction for reopening the assessment as well as the addition made u/s. 69A of the Act, the first appellate authority is required to adjudicate the grounds raised before it by passing a speaking and reasoned order. Dismissal of the appeal merely on account of non-furnishing of supporting evidence, without proper adjudication of the grounds raised, does not advance the cause of substantial justice. We also take note of the fact that the assessee had admittedly submitted a reply to the notice u/s. 142(1) on 05.02.2025. Thereafter, show-cause notices were issued and the reassessment order was ultimately passed on 10.03.2025. The assessee now seeks one final opportunity to place all relevant documents and evidence on record. Considering the totality of the facts and circumstances of the case, and in the interest of substantial justice, we are of the considered opinion that the Elanholi Talappil Firoz Vs ITO W-1 Tiruvannamalai assessee deserves one effective opportunity to present its case before the first appellate authority. At the same time, the assessee is expected to make full and proper compliance and substantiate its claims with documentary evidence. Accordingly, the impugned order of the learned CIT(A) is set aside and the matter is restored to the file of the learned CIT(A) for de novo adjudication. The learned CIT(A) shall adjudicate the appeal afresh after providing reasonable and effective opportunity of being heard to the assessee as well as to the Assessing Officer/Department. The assessee shall be at liberty to furnish all relevant documents and evidences in support of its grounds, including the evidence relating to the nature and source of the cash deposits of Rs.2,12,79,805/- and the material in support of the juri ictional grounds challenging the reassessment proceedings. The learned CIT(A) shall consider and adjudicate all the grounds raised by the assessee, including the juri ictional grounds as well as the grounds on merits, in accordance with law and shall pass a detailed, speaking and reasoned order. Needless to say, the learned CIT(A) shall provide adequate opportunity to the Assessing Officer/Department to examine and respond to any fresh evidence furnished by the assessee. The assessee is also directed to extend full cooperation and shall not seek unnecessary adjournments. We make it clear that we have not expressed any opinion on the merits of the juri ictional or substantive issues raised by the assessee. All such issues are left open for consideration and adjudication by the learned CIT(A) in accordance with law. Elanholi Talappil Firoz Vs ITO W-1 Tiruvannamalai 10. In the result, the appeal of the assessee is allowed for statistical purposes. Order pronounced in the open court on the 08th day of September, 2026 in Chennai. (इंतूरी रामा राव) (मनु कुमार िग"र) (INTURI RAMA RAO) (MANU KUMAR GIRI) लेखा सद*य/ACCOUNTANT MEMBER "या"यक सद*य/JUDICIAL MEMBER चे"नई/Chennai, +दनांक/Dated: 08th September 2026. SNDP, Sr. PS

""थ"/Respondent 3. आयकरआयु"/CIT, Chennai / Madurai / Salem / Coimbatore. 4. िवभागीय"ितिनिध/DR 5. गाड"फाईल/GF Digitally signed SANDE by SANDEEP KUMAR EP Date: 2026.09.11 KUMAR 12:44:06 +05'30'