ASOKEN ABIMANNAN,BANGALORE vs. INCOME TAX OFFICER, WARD 3(3)(3), BANGALORE, BANGALORE

PDF · subscribers
ITA 1707/BANG/2025Status: DisposedITAT Bangalore19 May 2026AY 2017-185 pages
AI SummaryPartly Allowed

What did the Tribunal hold?

The Tribunal condoned the delay in filing appeals, set aside the ex-parte orders, and remitted the quantum addition issue to the AO for fresh consideration. The penalty for non-compliance was deleted, accepting the assessee's explanation of incorrect address.

What were the facts?

The assessee did not respond to notices from the AO and CIT(A) due to an incorrect address, leading to ex-parte orders. The AO treated cash deposits during demonetization as unexplained income and imposed a penalty for non-compliance.

What were the issues?

Whether cash deposits made during demonetization are unexplained income when the assessee claims they are bank withdrawals, and if penalty for non-compliance is justified when notices were not received due to an incorrect address.

Which sections of the Income-tax Act were involved?

Section 69A,Section 144,Section 272A(1)(d)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, ‘A’ BENCH : BANGALORE

Before: SHRI PRASHANT MAHARISHI & SHRI SOUNDARARAJAN K.

For Appellant: Shri Prathik P, CA
For Respondent: Shri Balusamy N., JCIT-DR

IN THE INCOME TAX APPELLATE TRIBUNAL ‘A’ BENCH : BANGALORE

BEFORE SHRI PRASHANT MAHARISHI, VICE PRESIDENT AND SHRI SOUNDARARAJAN K., JUDICIAL MEMBER

ITA Nos. 1703 & 1707/Bang/2025 Assessment Year : 2017-18

Shri Asoken Abimannan, Khimsura Insurance & Investments, The Income Tax Brigade Majestic, Officer, No. 26/5, 1st Main Road, Ward – 3(3)(3), Gandhinagar, Bangalore. Vs. Bengaluru – 560 009. PAN: AGLPA1840P APPELLANT RESPONDENT

Assessee by : Shri Prathik P, CA Revenue by : Shri Balusamy N., JCIT-DR

Date of Hearing : 11-03-2026 Date of Pronouncement : 19-05-2026

ORDER PER SOUNDARARAJAN K., JUDICIAL MEMBER

These are the appeals filed by the assessee challenging the quantum order as well as the penalty orders dated 21/10/2024 and 18/10/2024 in respect of the A.Y. 2017-18.

2.

The brief facts of the case are that the assessee filed his return of income and his return was selected for scrutiny under CASS for the reason to enquire about the cash deposits made during the demonetization period. Thereafter notices u/s. 143(2) and 142(1) were issued but the assessee had not responded to the said notices. Therefore the AO completed the

Page 2 of 5 ITA Nos. 1703 & 1707/Bang/2025 assessment u/s. 144 of the Act and treated the cash deposits made during the demonetization period as unexplained money u/s. 69A of the Act. Similarly, the AO had also imposed penalty u/s. 272A(1)(d) of the Act.

3.

The assessee had challenged the quantum order as well as the penalty order. During the appeal proceedings, several hearing notices were sent to the assessee but the assessee had not responded and therefore the Ld.CIT(A) had passed an ex-parte order by rejecting the appeals filed by the assessee.

4.

As against the said orders, the assessee is in appeals before this Tribunal with a delay of 211 and 212 days. The assessee also filed an application to condone the said delays and explained the reasons for the said delays. The assessee also submitted that he is a senior citizen and not previously assessed under the provisions of the Act and therefore he has not opened the portal and therefore he was unaware about the appeal order passed by the Ld.CIT(A). Only when the penalty proceedings are initiated, the assessee came to know about the appellate order and thereafter filed the appeal with a delay of 211 and 212 days. We have considered the said reasons and also considering the fact that the assessee had not availed the opportunities before the AO as well as before the Ld.CIT(A), in the interest of justice, we are inclined to condone the said delays in respect of both the appeals and proceeded to decide the appeals on merits.

ITA No. 1703/Bang/2025: 5. At the time of hearing, the Ld.AR submitted that the notices issued by the authorities including the Ld.CIT(A) were not received by the assessee since the address has been wrongly mentioned in the return of income filed by the assessee. The Ld.AR, on merits, submitted that the cash deposits are nothing but the withdrawals made from his bank account and therefore the addition u/s. 69A could not be made. The Ld.AR further submitted that the assessee was not able to respond to the notices issued by the AO since the said notices were not received by him. The Ld.AR submitted that the notices might have been sent to the address mentioned in the return of income

Page 3 of 5 ITA Nos. 1703 & 1707/Bang/2025 which is not a correct address and therefore submitted that the assessee had no intention not to respond to the notices issued by the AO and therefore prayed to delete the penalty amount also. The Ld.AR also filed an application for admission of additional evidences u/s. 254 of the Act. The assessee also filed a paper book enclosing the bank statements.

6.

The Ld.DR submitted that the assessee had not discharged his burden of proving that the cash deposits are from the known sources and in the absence of such non-compliance, the AO has no other option except to make the addition u/s. 69A of the Act. Similarly, in respect of the penalty imposed u/s. 272A(1)(d) of the Act, the Ld.DR submitted that the AO had correctly sent the hearing notices to the address mentioned in the return of income and therefore the present plea that the address may be a wrong one does not holds good and prayed to dismiss the appeals.

7.

We have heard the arguments of both sides and perused the materials available on record.

8.

The main argument advanced by the assessee is that the notices were not sent by him and therefore he could not explain the source for the said cash deposits into his bank account. On the very same reason, the assessee submitted that he has also not received the hearing notices from the Ld.CIT(A). From the said submissions made by the assessee, it is understood that the assessee was not heard by the AO as well as by the Ld.CIT(A) before passing the impugned orders. In the quantum appeal, the assessee had submitted that he is having all evidence to show that the cash deposits are withdrawn from his bank account and subsequently, redeposited into his bank account. The said plea could not be examined by the AO since the assessee had not responded to the various notices. In such circumstances, the AO had made the addition u/s. 69A of the Act.

9.

Considering the fact that the AO as well as the Ld.CIT(A) had passed the orders ex-parte, we deem it fit to grant an opportunity to the assessee to

Page 4 of 5 ITA Nos. 1703 & 1707/Bang/2025 appear before the AO. We therefore, set aside the order of the AO as well as the Ld.CIT(A) and remit this issue to the file of the AO for denovo consideration. Since we are remitting the entire issue to the AO for denovo consideration, we are not adjudicating the additional evidences filed by the assessee at present and it is open to the assessee to furnish all the evidences before the AO at the time of assessment. The assessee is also directed to co-operate with the department by furnishing the records to show that the assessee is having the source for the cash deposits and therefore the same could not be treated as unexplained money u/s. 69A of the Act.

10.

In the result, the appeal filed by the assessee in ITA No. 1703/Bang/2025 is partly allowed for statistical purposes.

ITA No. 1707/Bang/2025: 11. Insofar as the penalty imposed u/s. 272A(1)(d) of the Act for not responding to the statutory notices issued by the AO, we are of the view that the penalty imposed by the AO seems not to be a correct one. The reason given by the assessee that the assessee had wrongly mentioned the address and therefore the notices were not served on him could be treated as a valid explanation for avoiding the penalty. We are accepting in the quantum appeal about the non service of the notices and remitted the issue to the file of the AO for fresh consideration. Even though, section 272A(1)(d) does not give any discretion to the authorities while imposing penalty it need not be levied automatically. In such circumstances, penalty levied u/s. 272A(1)(d) of the Act for non-compliance to the various statutory notices issued by the AO seems to be not a correct one and therefore the appeal filed by the assessee in respect of the penalty imposed u/s. 272A(1)(d) is allowed.

12.

In the result, the appeal filed by the assessee in ITA No. 1707/Bang/2025 is allowed.

Page 5 of 5 ITA Nos. 1703 & 1707/Bang/2025 13. In the combined result, the quantum appeal filed by the assessee in ITA No. 1703/Bang/2025 is partly allowed for statistical purpose and the penalty appeal in ITA No. 1707/Bang/2025 is allowed.

Order pronounced in the open court on 19th May, 2026.

Sd/- Sd/- (PRASHANT MAHARISHI) (SOUNDARARAJAN K.) Vice President Judicial Member

Bangalore, Dated, the 19th May, 2026. /MS /

Copy to: 1. Appellant 2. Respondent 3. CIT 4. DR, ITAT, Bangalore 5. Guard file 6. CIT(A) By order

Assistant Registrar, ITAT, Bangalore

More judgments on Section 69A

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

Recent GST High Court judgments

Search GST case law →