AYYADURAI ADAIKALAM,SIVAKASI vs. ITO WARD 1, VIRUDHUNAGAR , VIRUDHUNAGAR

PDF · subscribers
ITA 4003/CHNY/2025Status: HeardITAT Chennai25 June 2026AY 2017-185 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal restored the matters to the Assessing Officer for fresh adjudication, granting the assessee one more opportunity to present evidence, subject to payment of costs.

What were the facts?

The assessee did not file returns or respond to notices due to limited education and awareness, leading to ex-parte assessment and appellate orders. Cash deposits in the bank account were treated as unexplained money.

What were the issues?

Whether the assessee should be granted another opportunity to explain cash deposits in his bank account, given his lack of participation in previous proceedings.

Which sections of the Income-tax Act were involved?

Section 69A,Section 144,Section 144B,Section 147,Section 250

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, ‘B’ BENCH, CHENNAI

Before: SHRI GEORGE GEORGE K & SHRI GAGAN GOYAL

Hearing: 24.06.2026Pronounced: 25.06.2026

आदेश/ O R D E R PER GEORGE GEORGE K, VICE PRESIDENT: These appeals filed by the assessee are directed against three orders of the Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi all dated 23.10.2025 passed under section 250 of the Income Tax Act, 1961 (hereinafter called ‘the Act’). The relevant Assessment Years are 2016-17 to 2018-19.

ITA Nos.4002 to 4004/CHNY/2025 - 2 - Ayyadurai Adaikalam 2. At the very outset, we notice that the orders of First Appellate Authority (FAA) are ex-parte, since there was no compliance from the assessee to various notices issued from the office of the FAA. Further, we also note that the assessments have been completed on best judgment basis r.w.s.147 r.w.s. 144 r.w.s.144B of the Act.

3.

The Ld. AR submitted that the assessee is engaged in the business of canvassing orders for fireworks on commission basis. It was submitted that, owing to his limited educational background and lack of awareness of the statutory requirements, the assessee had neither filed the returns of income for the assessment years under consideration nor responded to the notices issued by the Assessing Officer during the course of assessment proceedings. The Ld. AR further submitted that the assessee remained ex-parte even before the FAA, as he failed to take note of the hearing notices issued by the appellate authority due to ignorance and lack of proper understanding of the proceedings. Consequently, the additions made by the AO by treating the cash deposits in the assessee's bank account as unexplained money u/s. 69A of the Act came to be confirmed by the FAA. The Ld. AR contended that the assessee was unable to

ITA Nos.4002 to 4004/CHNY/2025 - 3 - Ayyadurai Adaikalam produce the necessary details and supporting documentary evidence before the lower authorities to substantiate the source of the cash deposits. However, it was submitted that the assessee is now in possession of the relevant documents and is in a position to establish the nature and source of the cash deposits. Therefore, the Ld. AR prayed that one more opportunity may be granted to the assessee to present his cases before the AO and furnish the requisite evidences. The Ld. AR also undertook that he would duly appear and furnish the necessary details as and when called for.

4.

The Ld.DR submitted that adequate opportunities were provided from the offices of the FAA & AO and there is no violation of principles of natural justice. Therefore, it was submitted that the appeals of the assessee may be dismissed.

5.

We have heard rival submissions and perused the materials on record. We note that the assessee did not participate either in the assessment proceedings or in the appellate proceedings before the FAA. Consequently, the AO proceeded to treat the cash deposits in the assessee's bank account as unexplained money u/s. 69A of the Act and the same came to be confirmed by the

ITA Nos.4002 to 4004/CHNY/2025 - 4 - Ayyadurai Adaikalam FAA. The Ld.AR submitted that due to assessee’s limited educational background and lack of awareness of the statutory requirements, the assessee could not effectively respond to the notices issued by the lower authorities. The Ld.AR further submitted submitted that the assessee is now in possession of the necessary documentary evidence to explain the source of the cash deposits and has sought one more opportunity to place the same before the AO. The Ld.AR also undertook that he would duly appear and furnish the necessary details as and when called for. Considering the submissions of the Ld. AR and in the interest of justice and fair play, we are of the view that the matters ought to be restored to the files of the AO with a condition assessee pays a cost of Rs.5,000/- (Rupees five thousand only) in each case to be paid to Tamil Nadu State Legal Services Authority at the Hon’ble High Court of Madras. The amount of Rs.15,000/- shall be paid within a month’s time from the date of receipt of this order and produce the receipt for the said payment before the AO. Accordingly, the matters are remitted to the files of the AO for fresh adjudication. The AO shall afford reasonable opportunity of hearing to the assessee. The assessee is directed to co-operate with the Revenue and furnish all requisite details and evidences in

ITA Nos.4002 to 4004/CHNY/2025 - 5 - Ayyadurai Adaikalam support of his claim and shall not seek unnecessary adjournment. It is ordered accordingly.

6.

In the result, the appeals filed by the assessee are allowed for statistical purposes.

Order pronounced in the open court on 25th June,2026 at Chennai.

Sd/- Sd/- (गगन गोयल) (जॉज� जॉज� के) (GEORGE GEORGE K) (GAGAN GOYAL) लेखा सद�य/ACCOUNTANT MEMBER उपा�य� /VICE PRESIDENT चे�नई/Chennai, �दनांक/Dated, the 25th June, 2026 RSR, Sr.PS आदेश क� ��त�ल�प अ�े�षत/Copy to: 1. अपीलाथ�/Appellant 2. ��यथ�/Respondent 3. आयकर आयु�त /CIT, Madurai 4. �वभागीय ��त�न�ध/DR 5. गाड� फाईल/GF. By Order Digitally signed by REKHA REKHA SENTHIL RAJ SENTHIL RAJ Date: 2026.06.25 17:27:08 +05'30'

More judgments on Section 69A

All 15,297 judgments and leading authorities on Section 69A →

Recent GST High Court judgments

Search GST case law →