What did the Tribunal hold?

The Tribunal found that the matter required verification of evidence and granted the assessee one final opportunity to substantiate their claims before the Assessing Officer. The impugned order was set aside and the matter was restored for fresh adjudication.

The assessee appealed against the CIT(A)'s order regarding unexplained cash deposits and bank credits. The assessee claimed the deposits were from salary, advances, gifts, and loan repayments, but the revenue contended these were unsubstantiated.

What were the issues?

Whether the assessee provided sufficient explanation and evidence for cash deposits and bank credits, and if a fresh opportunity for verification should be granted.

Amir Khan, Sas Nagar, Mohali vs ITO | ITAT Chandigarh 2026

आयकर अपीलीय अिधकरण,च"ीगढ़ "ायपीठ , च"ीगढ़ IN THE INCOME TAX APPELLATE TRIBUNAL, CHANDIGARH BENCH “SMC”, CHANDIGARH HEARING THROUGH: PHYSICAL MODE "ी लिलत कुमार, "ाियक सद" BEFORE: SHRI. LALIET KUMAR, JM आयकर अपील सं./ ITA No. 155/Chd/2026 "नधा"रण वष" / Assessment Year : 2018-19 बनाम Amir Khan, The ITO, HNo. 417, Gobind Nagar, Warad 6(1), Naya Gaon, SAS Nagar, Chandigarh Mohali 160013 "ायी लेखा सं./PAN NO: EWSPK2542P अपीलाथ"/Appellant ""थ"/Respondent

िनधा"रती की ओर से/Assessee by : Sh. Amit Parsad, Advocate राज" की ओर से/ Revenue by : Sh. Vivek Varadhan, Addl. CIT Sr. DR सुनवाई की तारीख/Date of Hearing : 07.07.2026 उदघोषणा की तारीख/Date of Pronouncement : 03.08.2026 आदेश/Order

This appeal by the assessee is directed against the order of the ld. Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, dated 3.9.2025 for the assessment year 2018-19. 2. At the outset, the Ld. Authorised Representative (AR) submitted that the authorities below had failed to appreciate the facts in their proper perspective. It was contended that the cash deposits and bank credits were duly explained as representing salary, salary advance,

gifts/financial assistance received from family members and friends for construction of the residential house, interest credited by the bank, and reversal of banking transactions. It was further argued that the assessee, being a person of limited means and not maintaining regular books of account, had furnished a plausible explanation regarding the source of the deposits, which deserved proper verification instead of outright rejection. The Ld. AR prayed that one effective opportunity may be granted to the assessee to substantiate the claim by producing the necessary documentary evidence, confirmations and other supporting material before the Assessing Officer.

Submissions of the Ld. DR 3.1 The Ld. Departmental Representative (DR), on the other hand, relied upon the assessment order as well as the order of the Ld. CIT(A). It was submitted that despite adequate opportunities, the assessee had failed to establish the identity and creditworthiness of the alleged donors/creditors and the genuineness of the transactions. It was, therefore, argued that the addition had rightly been sustained by the Ld. CIT(A). However, the Ld. DR fairly submitted that if the Tribunal was inclined to restore the matter, appropriate directions may be issued to the assessee to fully cooperate in the fresh assessment proceedings.

Findings and Decision of the Tribunal 4.1 I have heard the rival submissions and have carefully perused the orders of the authorities below along with the material available on record. I find that the dispute essentially revolves around the explanation furnished by the assessee regarding the source of the cash deposits and other credits reflected in the bank account. The assessee claims that the deposits represented salary, salary advance, financial assistance/gifts from family members and friends for construction of his residential house, bank interest and reversal of banking transactions, whereas the Revenue has held that the assessee failed to substantiate the said explanation with cogent documentary evidence. 4.2 Considering the totality of the facts and circumstances of the case, I am of the considered opinion that the ends of justice would be adequately met if one final opportunity is granted to the assessee to substantiate his claim before the Assessing Officer. Since the matter requires verification of the evidences, confirmations and other supporting documents, which have not been properly examined, I deem it appropriate to set aside the impugned order and restore the matter to the file of the Assessing Officer for fresh adjudication. 5. Accordingly, the impugned order of the Ld. CIT(A) is set aside and the matter is restored to the file of the Assessing Officer with a

direction to decide the issue afresh, in accordance with law, after affording adequate and reasonable opportunity of being heard to the assessee. The Assessing Officer shall consider all the documentary evidence and explanations that may be furnished by the assessee and shall pass a speaking order in accordance with law. 5.1 Needless to state, the assessee shall fully cooperate and actively participate in the fresh assessment proceedings by producing all relevant evidence as may be called for by the Assessing Officer. However, in the event the assessee fails to appear or fails to furnish the requisite material despite reasonable opportunities, the Assessing Officer shall be at liberty to decide the matter on the basis of the material available on record and in accordance with law. 5.2 The restoration of the matter is, however, made subject to the payment of costs of Rs. 3,000/-, which shall be deposited by the assessee in the PGI Poor Relief Fund, Chandigarh, within two months from the date of receipt of this order. The receipt evidencing such deposit shall be furnished before the Assessing Officer at the time of fresh assessment proceedings. 5.3 It is made clear that in the event the assessee fails to deposit the aforesaid amount within the stipulated period, the benefit of this remand order shall automatically stand withdrawn, the order passed by the Ld. CIT(A) shall revive and remain operative, and the Assessing

Officer shall proceed to give effect thereto and take consequential action for recovery of the demand in accordance with law. 6. In the result, the appeal of the assessee is allowed for statistical purposes, subject to the aforesaid condition regarding payment of costs Order pronounced in the open court on 03.08. 2026 (LALIET KUMAR) JUDICIAL MEMBER rkk

आदेश की "ितिलिप अ"ेिषत/ Copy of the order forwarded to : 1. अपीलाथ"/ The Appellant 2. ""थ"/ The Respondent 3. आयकर आयु"/ CIT 4. िवभागीय "ितिनिध, आयकर अपीलीय आिधकरण, च"ीगढ़/ DR, ITAT, CHANDIGARH 5. गाड" फाईल/ Guard File

सहायक पंजीकार/

AMIR KHAN,SAS NAGAR, MOHALI vs. INCOME TAX OFFICER, WARD 6(1), CHANDIGARH, MOHALI, CHANDIGARH

What did the Tribunal hold?

What were the facts?

What were the issues?

Which sections of the Income-tax Act were involved?

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