DINESHKUMAR RASIKLAL AGRAWAL,DHULE vs. ASST. COMMISSIONER OF INCOME TAX, DHULE CIRCLE, DHULE, DHULE

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH “A”, PUNE BEFORE SHRI RAMA KANTA PANDA, VICE PRESIDENT AND Ms. ASTHA CHANDRA, JUDICIAL MEMBER

ITA No. 3151/PUN/2025 Assessment Year : 2012-13 Dineshkumar Rasiklal Agrawal, Asst. Commissioner of Plot No. 40, Rasik Vihar, Income Tax, Abhay Nagar, vs. Dhule Circle, Malegaon Road, Opp. MSEB, Sakri Road, Dhule Dhule PAN : AAKPA2554R (Appellant) (Respondent) Assessee by : Shri Sharad A Shah & Shri Rohit S Tapadiya Department by : Shri Uodol Raj Singh, DR Date of Hearing : 16-06-2026 Date of Pronouncement : 07-09-2026 O R D E R PER ASTHA CHANDRA, J.M.:

The appeal filed by the assessee is directed against the order dated 05-10-2025 of the Ld. Commissioner of Income Tax (Appeals), NFAC, Delhi [“CIT(A)/NFAC”], u/s. 250 of the Income Tax Act, 1961 (the “Act”), pertaining to Assessment Year (“AY”) 2012-13.

2 ITA No. 3151/PUN/2025 consideration, the assessee has deposited cash of Rs.94,83,100/- in the Savings Bank Account and in the absence of any return of income filed by the assessee for the AY. 2012-13, the said amount has escaped assessment. In response to notice u/s. 148 of the Act, the assessee filed return on 24-06-2019 showing total income of Rs. 32,06,566/- and also clarified that he has already furnished regular return of income for AY. 2012-13 on 30-03-2013 along with a copy of acknowledgment in support thereof. The assessee also filed objection to the re-opening of assessment, however, the Ld. Assessing Officer (“AO”) rejected the same and proceeded to complete the assessment at total assessed income of Rs. 62,06,570/-, thereby making an addition of Rs.30,00,000/- as unexplained income out of the total cash deposited by the assessee into his various bank accounts, vide his order dt. 24-12-2019, passed u/s. 143(3) r.w.s. 147 of the Act.

“5.1 I have carefully mentioned by the Assessing Officer (hereinafter referred to as "the AO"), and the materials available on record. The judicial precedents mentioned by the AO and the appellant have been perused by me as well. The appellant has challenged the assessment order passed by the Ld. AO under section 143(3) r.w.s 147 of the Income Tax Act 1961 (in short, the Act) by filing this appeal. For the sake of brevity, I won't elaborate on the case facts and the appellant's submission, which have already been discussed in the earlier part of the order. 5.2 Ground No.1 is regarding re-opening u/s 147 of the Act and consequent issuance of notice u/s 148. It is observed from the impugned assessment order that notice u/s.148 was issued on 29.03.2019 and served on the same day calling for the return. However, no return was filed till 24.06.2019 when the appellant filed a return showing total Income of Rs.32,06,566/- and also clarified that the assessee has already filed regular return of income for A.Y. 2012-13 on 30.03.2013 and also furnished copy of acknowledgement of the same showing the same has been filed in Ward 3(1), Dhule with total income of Rs.32,06,570/-. Accordingly the Id AO issued notice u/s 143(2) issued. It

3 ITA No. 3151/PUN/2025 is further observed from the assessment order that the assessee submitted detailed compliance vide letter dated 21.11.2019 furnishing various details/ supporting evidences and explanation relating to the details called for as per the questionnaire issued as per notice u/s 142(1) without raising any objection against the reopening of the assessment. The assessee has finally submitted its detailed submission vide letter dated 19.12.2019 on his own without waiting for compliance/ reply against its objection letter filed on 16.12.2019. Hence, the ld AO simultaneously disposing off the objections raised by the assessee as well as deciding the issues of reopening the assessment and passing the assessment order based on the final submissions made by the assessee and the material on record in view of such delayed filing of objections as well as compliance/ furnishing the details and supporting evidences towards the assessee's explanation. The ld AO considered the objection so raised by the appellant before him but did not find it acceptable and hence rejected which has been demonstrated by him in his order. I am not repeating the same for the shake of brevity. 5.3 It is observed from the impugned assessment order that the appellant filed online objection on 16.12.2019 just before the completion of assessment order dated 24.12.2019. Prior to which no objection was raised but filed required details. The appellant seems did not feel it necessary to raise the issue of re-opening the case and at the last minutes felt of raising some objection for re-opening u/s 147 for the sake of record. In my considerate view the appellant cannot raise such objection at his sweet will when the order was about to be passed. There is a process of law set by the Apex court in the case of GKN Driveshafts (India) Ltd vs Income Tax Officer and Ors dated 25th November, 2002 and the appellant is also duty bound to follow the same. In the present case the appellant did not follow the same. Thus, I do not find any merit on the said ground and therefore reject the ground. 5.4 Ground No.2 is regarding addition of Rs. 30,00,000/- on account of cash deposited in his various bank accounts. The Id AO in his order has found that the appellant deposited cash into his various bank accounts which are detailed in his order. In support of the same the appellant furnished explanation and cash flow statement and other details. However, the ld AO did not accept the submission of the appellant in toto and after considering the totality of the fact and discrepancies pointed out by him in his order, added Rs.30,00,000/- as unexplained income out of the total cash deposit Rs. 1,48,86,373/-. 5.5 I have considered the submission of the appellant but do not find merit in it in view of the AO detailed analysis on the fact of the case. The case laws relied upon, being different in situation, are distinguishable and hence does not come in rescue of the appellant. Thus, in considering the totality of the situation and AO's observation, I find no reason to alter his decision and hence confirm the addition of Rs. 30,00,000/-. The ground No.2 of the appeal is, thus, dismissed.”

“1] The learned CIT(A) erred in confirming that the reopening u/s 148 was valid and thereby the reassessment order passed u/s 147 was justified in law. 2] The learned CIT(A) erred in not appreciating that the reasons recorded while issuing a notice u/s 148 were incorrect and hence, the reopening u/s 148 was not justified and the reassessment order passed u/s 147 ought to have been declared null and void.

4 ITA No. 3151/PUN/2025 31 The learned CIT(A) failed to appreciate that the learned A.O. had not passed an order disposing off the objections raised by the assessee to the notice issued u/s 148 and accordingly, the reassessment order passed u/s 147 is null and void. 4] The learned CIT(A) erred in confirming the addition of Rs.30,00,000/- made on account of cash deposits in the bank account without appreciating that no such addition was warranted on the facts of the case. 5] The learned CIT(A) erred in not appreciating that the assessee had explained the sources out of which the cash was deposited in the bank account and therefore, no addition of Rs.30,00,000/- was warranted. 6] The learned CIT(A) erred in not appreciating that the addition made of Rs.30,00,000/- on account of cash deposited in the bank account was on an ad-hoc basis and hence, there was no reason to confirm the said addition in the hands of the assessee. 7] The appellant craves leave to add, alter, amend or delete any of the above grounds of appeal.”

5.1. The Ld.AR further submitted that the Ld.CIT(A)/NFAC has not given any independent finding on the issue of cash deposited in the bank account and confirmed the addition made by the Ld.AO on an adhoc basis.

5 ITA No. 3151/PUN/2025 He submitted that the assessee had filed the relevant bank statements and fund flow and cash flow statements along with other supportive documents (pgs. 27-410 of the paper book refers) explaining the sources of cash deposits, however, the Ld.CIT(A)/NFAC has endorsed the findings of the Ld.AO and confirmed the addition without considering the same.

5.2. In support of his above proposition, the Ld.AR relied on the following cases:

i. Vanita Sanjeev Anand –W.P.(C) 12359/2018 & CM APPL. 47876/2018 – Delhi HC ii. Milind Madhukar Edke - ITA No. 648/PUN/2020 – Pune ITAT iii. Atul Bhanudas Shinde - ITA No. 970/PUN/2025 – Pune ITAT iv. Sagar Enterprise (2002) 257 ITR 335 – Gujarat HC v. Mumtaz Haji Mohmad Memon – (2018) 408 ITR 268 – Gujarat HC vi. Smt. Monika Rani - ITA No. 582/Chd/2019 – CHD ITAT

6 ITA No. 3151/PUN/2025 behalf of the assessee. We have also considered the various judicial precedents relied upon by the Ld.AR. The facts of the case are not in dispute. We find that the Ld.AO completed the assessment u/s. 143(3) r.w.s. 147 of the Act making an addition of Rs. 30,00,000/- on account of unexplained cash deposits into various bank accounts of the assessee. The assessee challenged the reopening of assessment by raising objections to the reasons recorded for the reopening, however, the same has been rejected both by the Ld.AO as well as the Ld.CIT(A)/NFAC. We find that the Ld.CIT(A)/NFAC has dismissed the appeal of the assessee for the reasons which we have already reproduced in the preceding paragraphs. It is the submission of the Ld. AR that the notice u/s. 148 of the Act has been issued on wrong facts and when the re-assessment proceedings are initiated on the basis of wrong facts, such re-assessment proceedings are liable to be quashed. The Ld.AR reiterated the submissions made before the lower authorities and drew the attention of the Bench to the reasons recorded wherein the Ld.AO has specifically stated that the assessee has not filed his return of income for the relevant AY. 2012-13 on the basis of which he initiated the re-assessment proceedings. However, the assessee duly filed his original return of income on 30-03-2013, the acknowledgement copy of which is placed at pgs. 17-26 of the paper book. This fact was duly brought to the attention of the Ld.AO by the assessee, vide his letter filed on 20-05-2019 in response to notice u/s. 148 of the Act, which is placed at pg. 5 of the paper book.

7 ITA No. 3151/PUN/2025 8. We find that in the instant appeal, the case of the assessee has been reopened for the reasons reproduced below:

8 ITA No. 3151/PUN/2025 9. The assessee filed his objections to the above stated reasons for initiation of reopening proceedings which reads as under:

9 ITA No. 3151/PUN/2025 10. From the perusal of the above, it is evidently clear that the Ld.AO issued the notice u/s. 148 of the Act for the reasons that the assessee had deposited cash of Rs. 94,83,100/- in his savings bank account and failed to file his return of income for AY. 2012-13 u/s. 139 of the Act. We, therefore, find force in the arguments advanced by the Ld. Counsel for the assessee that the re-assessment proceedings are initiated on wrong facts as the assessee had in fact filed his return of income on 30-03-2013, the acknowledgement copy of which is on the records of the Revenue.

10 ITA No. 3151/PUN/2025 income on 30/03/2011, copy of which is placed at page no. 1 of the assessee‟s compilation. The assessee had also shown the investment in agricultural land amounting to Rs. 52,20,000/- in her Balance Sheet as on 31/03/2010, copy of which is placed at page no. 2 of the assessee‟s compilation therefore both the reasons given by the A.O. i.e; the assesse had not filed the return of income and invested in the property amounting to Rs. 1,49,02,500/- were wrong. 10.2 On a similar issue the Hon'ble Gujarat High Court in the case of Sagar Enterprises Vs. ACIT (supra) held as under: “that it was apparent that the fact of non-filing of the return for the assessment year 1991-92 had weighted with the respondent for arriving at the satisfaction about the failure on the part of the assessee and escapement of assessment of income. However, the material on record showed that the return had been filed. In such circumstances, it could not be said with certainty as to which fact would have weighed with the officer concerned and once it was shown that an irrelevant fact had been taken into consideration, to what extent the decision was vitiated would be difficult to say. Moreover the Income-tax Officer had stated that the payment which was stated to be undisclosed income relevant for the assessment year 1991-92 could have been made during the financial year 1990-91 relevant to the assessment year 1991-92 and hence, “to cover up that probability, protective addition was made in the assessment year 1992-93.” The first appellate authority decided the appeal for the assessment year 1992-93 on January, 1996, and the reason had been recorded thereafter on August 18, 1997. The notice of reassessment was not valid and was liable to be quashed.” 10.3 A similar view has been taken by the ITAT, Chandigarh „SMC‟ Bench in the case of Baba Kartar Singh Dukki Educational Trust Vs. ITO (supra) wherein it has been held as under: HEAD NOTE: “ Where Assessing Officer processed under section 143(1) returns of income filed by assessee for assessment years 2001-02 to 2003-04 and subsequently he reopened said assessments on sole basis that assessee had not filed returns for years preceding to assessment year 2004-05 and, therefore, its income having escaped assessment, reopening of assessment was on basis of suspicion and non-existent and incorrect facts and it was invalid” 10.4 Similarly the ITAT “L” Bench, Mumbai quashed the reopening of the assessment which was based on incorrect facts vide order dt. 28/02/2018 in the case of Van Oord Dredging and Marine Contractors BV vs. ADIT (supra) by observing as under: “ In AY 2005-06, the A.O. has reopened the assessment on incorrect facts and further the assessing officer has failed to demonstrate that there was failure on the part of ht assessee to disclose fully and truly all material facts during the course of original assessment proceedings. Hence the reopening of assessment of AY 2005-06 is liable to be quashed on these two grounds also. Accordingly we set aside the order passed by Ld. CIT(A) on this issue and hold that the reopening of assessments of both the years are not in accordance with the law and accordingly quash the assessment orders passed for both the years under consideration.” 10.5 Similar view has been taken by the ITAT Jaipur Bench in case of Shri Ram Mohan Rawat Vs. ITO(supra) vide order dt. 10/10/2019 the relevant findings given therein read as under: “Thus the reasons recorded by the AO for formation of belief that income assessable to tax has escaped assessment are based on two counts. One, the assessee has made bogus purchases and the second, that the purchases are not verifiable as the assessee has not filed the return of income. Thus the formation of belief is based on these two factual aspects that the assessee has made bogus purchases which are not verifiable as assessee has not filed the return of income. The reasons for nonverifiable of the purchases made by the

11 ITA No. 3151/PUN/2025 assessee due to non filing of the return of income as stated by the AO is absolutely incorrect and wrong and contrary to the record when the assessee has filed the return of income electronically on 29.10.2007. This fact was also subsequently accepted by the AO that the assessee filed the return of income under section 139(1). The second aspect of the reasons that the assessee has made bogus purchases is also not based on any enquiry or verification of record by the AO but this is simply reproduction of information received from the Investigation Wing. The said information is also incomplete as regards the details of the purchases and the parties from whom such purchases were made by the assessee. Thus the reasons recorded by the AO manifest that there is no application of mind and the averments as recorded in the reasons are very vague and general and rather inconsistent with the facts available on record so far as the filing of return of income by the assessee. The formation of belief on such incorrect and vague reasons would lead the reopening of the assessment as invalid.” 10.6 In the present case also the A.O. reopened the assessment on the basis of wrong facts, so respectfully following the ratio laid down in the aforesaid referred to cases, I am of the view that the reopening of the assessment in the present case was not valid, accordingly, the same is quashed. Since the appeal of the assessee is decided on the legal issue, therefore no findings are being given on the merit of the case relating to the quantum of addition. 11. In the result, appeal of the assessee is allowed.”

Order pronounced in the open Court on 07-09-2026

Sd/- Sd/- (RAMA KANTA PANDA) (ASTHA CHANDRA) VICE PRESIDENT JUDICIAL MEMBER पुणे/Pune; दिन ांक/Dated : 07-09-2026 Tadepalli Naga Digitally signed by Tadepalli Naga Murali Mohan TNMM Murali Mohan Date: 2026.09.08 12:00:19 +05'30'

12 ITA No. 3151/PUN/2025 आिेश की प्रदिदिदप अग्रेदिि / Copy of the Order is forwarded to: 1. अपीि र्थी / The Appellant प्रत्यर्थी / The Respondent 2. 3. The concerned Pr.CIT, Pune 4. DR, ITAT, „A‟ Bench, Pune 5. ग र्ड फ ईि / Guard file. आदेशानुसार/ BY ORDER, // True Copy // Assistant Registrar आयकर अपीिीय अदिकरण ,पुणे / ITAT, Pune