RAVINDRA GAJANAN MAHADIK ,PUNE vs. ITO WD-3(1), PUNE

ITA 2169/PUN/2026Status: DisposedITAT Pune05 October 2026AY 2010-114 pages
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What were the facts?

The assessee, Ravindra Gajanan Mahadik, is an individual engaged in the business of computer repair and servicing. For Assessment Year 2010-11, the assessee failed to file a return of income. The Assessing Officer (AO) passed an assessment order dated 21.12.2017 under section 143 read with section 147 of the Income Tax Act, 1961, making an addition for unexplained cash deposits. The assessee appealed to the Additional/Joint CIT(A)-2, Chennai, who passed an order dated 02.03.2026, partly confirming the additions. The assessee has now appealed to the Income Tax Appellate Tribunal (ITAT), Pune Bench, challenging the CIT(A)'s order. The total cash deposit in dispute was initially Rs. 34,25,000/-, which the assessee claimed was Rs. 20,50,000/-.

What did the Tribunal hold?

The Tribunal noted that the assessee did not press the legal grounds raised. Regarding the factual issue of unexplained cash deposits, the Tribunal observed that the assessee is engaged in the business of computer hardware and that the transactions were mainly on account of business activity, with some for immovable property purchase. However, due to the absence of complete details of books of account and necessary details to examine each transaction, the Tribunal deemed it appropriate to estimate the Net Profit of the assessee at 8% under section 44AD of the Act. This estimation resulted in a Net Profit of Rs. 2,74,000/-. Accordingly, the finding of the CIT(A) was reversed, and an addition of Rs. 2,74,000/- was sustained, with the remaining addition being deleted. The ratio decidendi is that in the absence of proper books of account for a business, the income can be estimated as per the presumptive taxation provisions of section 44AD.

What were the issues?

1. Whether the addition of Rs. 20,50,000/- treating the entire cash deposit amount as unexplained income of the appellant under section 69A of the Act is justified, and if not, to what extent it should be deleted. - Assessee's contention: The cash deposits of Rs. 20,50,000/- were sourced from prior cash withdrawals and business receipts. Specifically, Rs. 11,85,000/- were sourced from immediate prior cash withdrawals, and the remaining Rs. 8,65,000/- were from business receipts of computer repairing and consultancy services. The assessee also argued that since no separate books were maintained for the small business, profit should be estimated at 8% as per section 44AD of the Act. The assessee also relied on a remand report dated 27.05.2019 furnished by the AO. - Revenue's contention: Not recorded in the judgment.

Which sections of the Income-tax Act were involved?

Section 143,Section 147,Section 69A,Section 44AD

AI-generated summary — verify with the full judgment below

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

Before: DR.MANISH BORAD

For Appellant: Shri Mahavir Jain, CA
For Respondent: Dr. Amit Munde
Hearing: 25.08.2026Pronounced: 05.10.2026

The captioned appeal at the instance of assessee pertaining to Assessment Year 2010-11 is directed against the order dated 02.03.2026 of Addl/JCIT(A)-2, Chennai emanating out of Assessment order dated 21.12.2017 passed u/s.143 r.w.s.147 of the Income Tax Act, 1961 (in short ‘the Act’).

2.

Assessee has raised the following grounds of appeal :

“The following grounds are taken without prejudice to each other -On facts and in law, 1] The Ld. CIT(A)/NFAC has erred in partly confirming the additions made by the Ld. AO in the impugned assessment order passed u/s 144 r.w.s. 147 of the Income Tax Act which is patently illegal and unsustainable in law and the same may please be deleted. 2] The Ld. CIT(A)/

The order continues below.

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