USHA ANNASO YEOLE,PUNE vs. INCOME TAX OFFICER WARD 1, AHMEDNAGAR

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ITA 2668/PUN/2025Status: DisposedITAT Pune12 June 2026AY 2014-155 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the notice under Section 148 was issued beyond the six-year limitation period and was therefore bad in law. Furthermore, the Tribunal found that the addition made on account of unexplained deposits was unsustainable as the assessee had provided sufficient explanation and supporting documents.

What were the facts?

The assessee's appeal concerns AY 2014-15. The primary issue is the validity of a notice issued under Section 148, which the assessee claims was issued beyond the prescribed time limit and not properly served. The assessee also provided explanations for deposits in her bank account.

What were the issues?

Whether the notice under Section 148 was issued within the prescribed time limit and properly served. Whether the addition made under Section 69A was justified given the assessee's explanation for the source of funds.

Which sections of the Income-tax Act were involved?

Section 148,Section 148A,Section 149,Section 69A

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, PUNE BENCH “SMC”, PUNE

Before: SHRI Dr. DIPAK P. RIPOTE & SHRI VINAY BHAMORE

For Appellant: Shri Dr. Prashant Munot
For Respondent: Shri Harish Bist

आदेश /ORDER

PER Dr. DIPAK P. RIPOTE, A.M : This is an appeal filed by the Assessee against the order of the Learned Commissioner of Income Tax (Appeals), NFAC, Delhi [Ld.CIT(A)], passed u/s. 250 of the Income Tax Act, 1961 („the Act‟) for AY 2014-15 on 15/09/2025, emanating from the Assessment Order u/s 147 r.w.s. 144B of the Act, dated 24/03/2022.

2.

Submission of Ld. AR : Ld.AR filed a paper book. Ld.AR submitted that Notice u/s 148 for AY 2014-15 was issued on 01/04/2021 hence it is bad in law as it was issued after lapse of 6 years from the end of the Assessment Year. Ld.AR invited our attention to page 16 of the paper book which is the information obtained by the assessee under Right to information Act. The Notice u/s 148 dated 31/03/2021 was issued on 01/04/2021. Ld.AR relied on the decision of Hon‟ble Delhi High Court in the case of Sumna Jeet Agrwal vs ITO 4449 ITR 517 (Delhi) dated 27/09/2022.

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2.1 Ld. AR on merits submitted that Assessee had filed Return of Income for AY 2014-15 on 31/08/2015 u/s 139 of the Income Tax Act. Ld. AR submitted that assessee earns meger Income. During the year an ancestral Agricultural Land which was in the name of Assessee‟s brother was sold and the amount received was deposited in bank . Ld.AR submitted that Assessee‟s brother is disabled hence the amount was deposited in her bank account. Ld. AR submitted that copy of disability certificate and Sale deed was filed before the AO and CIT(A). Copy of the Disability Certificate is at page 38 of the Paper Book. Copy of Sale Deed at page 30-37 of the Paper Book. Ld. AR submitted that in these facts once assessee has explained the source of deposits the onus was fulfilled , hence no addition can be made in the case of the assessee.

3.

Submission of Ld. DR : Ld. Departmental Representative appeared virtually. Ld. DR relied on the order of the AO and CIT(A).

4.

Findings and Analysis : We have heard both the parties and studied the records produced before us. In this case the Assessee had filed Return of Income on 31/08/2015 for AY 2014-15 declaring Total Income at Rs.2,18,590/-.

4.1 In this case the ITO ward 1 Ahmednagar had received information from Dy. Director Income Tax (Inv) Unit II(1) Pune vide letter dated 16/02/2017 regarding deposits of Rs. 10,15,000/- in the Bank Account during AY 2014-15 . Based on the information in this case a Notice u/s 148 dated 31/03/2021was issued to the assessee electronically on 1/4/2021 for AY 2014-15. This fact has not been rebutted by Ld. DR. Copy at page 16 of the Paper Book.

4.2 Hon‟ble Delhi High Court in the case of Suman Jeet Agrawal vs ITO 449 ITR 517 has held as under : Quote, “25.23 We therefore answer question no. (I) in negative against the Department and hold that the impugned Notices dated 31st March, 2021, which were despatched on 1st April, 2021, or thereafter, would not meet the test of 'issued' under section 149 of the Act of 1961 and would be time barred, unless saved by the judgment of the Supreme Court in Ashish Aggarwal (supra).”Unquote.

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4.3 In this case Ld. DR has not brought on record any decision of Hon‟ble Bombay High Court on the issue or has not pleaded that the AO had followed the procedure of issuing Order u/s 148A(d) as per Hon‟ble Supreme Court‟s Decision in the case of Ashish Aggrwal.In this case there is no procedure followed by AO as per the directions of Hon‟ble Supreme Court in the case of Ashish Aggrwal. AO had not issued any Order u/s 148A(d) of the Act.

4.4 In these facts and circumstances of the case respectfully following Hon‟ble Delhi High Court we hold that the Notice u/s 148 dated 31/03/2021 issued on 01/04/2021 for AY 2014-15 is barred by limitation as it has been issued after a period of Six Years from the end of the Assessment Year.

5.

In this case the Ld.AR has filed copy of the information obtained from the ITO Ward 1 Ahmednagar, where in the ITO has admitted that the Notice u/s 148 was send by Post and the said Notice u/s 148 has been Returned by Postal Authorities with the remark as “left address return to sender”. It means the Notice u/s 148 was not properly served on the Assessee. The Assessee had filed Return of Income hence the AO was having the latest address of the Assessee.

5.1 Hon‟ble Bombay High Court in the case of Lok Developers vs DCIT [2023] 149 taxmann.com 93 (Bombay) has held as under : Quote “ In our view the AO ought to have sent the notice u/s 148 to both the primary address and the email address mentioned in the last Return of Income filed to preempt a jurisdictional error on account of valid service; there was neither any cost to it or any prejudice to any party for sending it on more than one email in a given circumstance as in the present case. We see no wrong with the petitioner's refusal to participate in a proceeding vitiated by valid service of notice. This Court in the case of Mrs. Chitra Supekar v. ITO [Writ Petition No. 15580 of 2022, dated 15-2-2023] has held that it was imperative for the AO to have checked if there was a change of address before initiating a proceeding; and that a valid service of notice under section 148 is a condition precedent lest it would be a jurisdictional error.” Unquote. 6. In the result, the Legal Ground raised by the Assessee are allowed.

7.

On Merits of the Addition : In this case during the Assessment Proceedings the Assessee had submitted that the amount deposited was received by the assessee from

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her brother who had sold ancestral agricultural land. Assessee had submitted that the amount was deposited in the assessee‟s account because her brother is disabled. During Assessment Proceedings Assessee had filed copy of the impugned sale deed, copy of disability certificate, copy of bank statement. This fact is established from the E-Proceedings acknowledgements filed at page 24-26 of the paper book. Thus during the Assessment Proceedings, the Assessee explained source of the deposits. AO in the Assessment Order has merely written that the explanation is not acceptable. The AO has not given any reason for not accepting the explanation. The AO has not doubted the documents filed by the Assessee. The AO has not bothered to verify the explanation. Once the Assessee had explained the source of deposits, assessee has fulfilled the onus casted on her. Now, it was for the AO to rebut the submission of the assessee. AO has not brought on record any evidence to negate the submission of the assessee. In these facts, we hold that the addition of Rs.10,15,000/- u/s 69A of the Act is unsustainable.

8.

In the result, Ground Nos. 5 and 6 of the assessee are allowed.

9.

In the result, the appeal of the assessee is allowed.

Order pronounced in the open Court on 12th June, 2026

Sd/- Sd/- (VINAY BHAMORE) (Dr. DIPAK P. RIPOTE) JUDICIAL MEMBER ACCOUNTANT MEMBER

पुणे/Pune; दिन ांक/Dated : 12-06-2026 Ravi Kumar Digitally signed by Ravi Kumar Ravi Kumar Date: 2026.06.15 13:10:45 +05'30' आदेश की प्रतितिति अग्रेतिि/Copy of the Order is forwarded to: 1. अपील र्थी / The Appellant 2. प्रत्यर्थी / The Respondent 3. The concerned Pr. CIT, Pune 4. DR, ITAT, „SMC‟ Bench, Pune 5. ग र्ड फ ईल / Guard file. आदेशानुसार/ BY ORDER, // True Copy // Assistant Registrar आयकर अपीलीय अदिकरण ,पुणे / ITAT, Pune

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S.No. Details Date Designation 1 Draft dictated on Sr. PS/PS 2 Draft placed before author Sr. PS/PS Draft proposed & placed before the Second 3 JM/AM Member 4 Draft discussed/approved by Second Member AM/AM 5 Approved Draft comes to the Sr. PS/PS Sr. PS/PS 6 Kept for pronouncement on Sr. PS/PS 7 Date of uploading of Order Sr. PS/PS 8 File sent to Bench Clerk Sr. PS/PS Date on which the file goes to the Office 9 Superintendent 10 Date on which file goes to the A.R. 11 Date of Dispatch of order

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