DNYANESHWAR DEORAM SONAWANE,NASHIK vs. INCOME TAX OFFICER WARD 2, NASHIK

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ITA 2306/PUN/2026Status: DisposedITAT Pune26 October 2026AY 2018-194 pages
AI SummaryRemanded

What did the Tribunal hold?

The ITAT, in the larger interest of justice and without delving into the merits of the case, decided to set aside the impugned order of the CIT(A) dated 09.03.2026. The Tribunal remitted all the issues raised in the appeal back to the file of the CIT(A) for necessary adjudication. To ensure compliance, the assessee was directed to update their correct email and postal addresses on record with the CIT(A) and the ITBA Portal, remain vigilant in tracking appellate proceedings, file all relevant details and documents upon receiving hearing notices, and refrain from seeking adjournments unless for a reasonable cause. The CIT(A) was directed to adjudicate the appeal afresh after granting the assessee a reasonable opportunity of being heard. The effective grounds of appeal raised by the assessee were allowed for statistical purposes.

What were the facts?

The assessee, Dnyaneshwar Deoram Sonawane, an individual engaged in the franchisee business of Shriram Finance, failed to file a return of income for Assessment Year 2018-19. The case was reopened based on information regarding cash deposits of Rs. 1.51 crore and cash withdrawals of Rs. 18.96 lakh. Despite statutory notices, the assessee did not comply. The Assessing Officer, invoking Section 147 read with Sections 144 and 144B of the Income Tax Act, 1961, made an addition of Rs. 1,51,33,000/- under Section 69A for unexplained cash deposits and Rs. 9,600/- as undisclosed brokerage/commission income. The assessee's appeal before the NFAC, Delhi (CIT(A)) was also unsuccessful due to non-compliance with notices, leading to the confirmation of the additions. The assessee then appealed to the Income Tax Appellate Tribunal (ITAT).

What were the issues?

1. Whether the ITAT should restore the issues to the file of the CIT(A) for adjudication on merits, given that the orders of the lower authorities were ex-parte and the entire cash deposits may not be includible as undisclosed income? (Mixed question of law and fact, concerning principles of natural justice and proper adjudication). Assessee's Contention: The assessee argued that since both the Assessing Officer's and CIT(A)'s orders were ex-parte, and the addition of the entire cash deposits as undisclosed income might be incorrect, the matter should be restored to the CIT(A) in the interest of justice for adjudication on merits. Revenue's Contention: The learned Departmental Representative supported the order of the CIT(A).

Which sections of the Income-tax Act were involved?

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

AI-generated summary — verify with the full judgment below

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

Before: DR.MANISH BORAD & SHRI PAVAN KUMAR GADALE

For Appellant: Shri Ashish Mahendra Bhalgat, CA
For Respondent: Shri Rajesh Haladkar
Hearing: 01.09.2026Pronounced: 26.10.2026

PER DR. MANISH BORAD, ACCOUNTANT MEMBER :

The captioned appeal at the instance of assessee pertaining to A.Y. 2018-19 is directed against the order dated 09.03.2026 of ld.NFAC, Delhi which is arising out of Assessment Order dated 21.03.2023 passed u/s.147 r.w.s.144 r.w.s.144B of the Income Tax Act, 1961 (in short ‘the Act’).

2.

Brief facts as emanating from the record are that the assessee is an individual and deriving income from franchisee business of Shriram Finance. Assessee has not filed the return of income for the year under consideration. Based on the information available with the Department that assessee has deposited huge cash deposits to the tune of Rs.1.51 crore, withdrawn cash of Rs.18.96 lakh and received commission and 2 Dnyaneshwar Deoram Sonawane

brokerage amount of Rs.9,600/-, case of the assessee reopened. Various statutory notices were issued to the assessee and there was no compliance from the side of assessee. Ld. Assessing Officer concluded the assessment proceedings making addition of Rs.1,51,33,000/- u/s.69A of the Act as the assessee has failed to explain the source of such sum. He also made addition of Rs.9,600/- towards the brokerage/commission income treating the same is undisclosed income. Aggrieved assessee challenged the additions made by the Assessing Officer before ld.CIT(A) but failed to succeed on account of failure on the part of assessee to comply with the notices issued by ld.CIT(A). Now the assessee has approached this Tribunal.

3.

We have heard the rival submissions and perused the record placed before us. It is a fact borne out from the record that the assessee has neither participated in the proceedings before the Assessing Officer nor before the First Appellate Authority, resulting into confirmation of addition made by the Assessing Officer. Ld. CIT(A) has not adjudicated the issues on merits. Before us, ld. Counsel for the assessee submitted that since both the orders of the lower authorities are exparte and since entire cash deposits cannot be added as undisclosed income, in the interest of justice, a prayer is made to restore the issues raised in the instant appeal to the file of ld.CIT(A) for necessary adjudication on merits. Ld. Departmental Representative supported the order of ld.CIT(A).

4.

Considering the factual matrix and the prayer made by ld. Counsel for the assessee, we in the larger interest of justice, without dwelling upon the merits of the case, remit back all the issues raised in the instant appeal to the file of ld.CIT(A) for necessary adjudication. Impugned order dated 09.03.2026 passed by the CIT(A) is set aside. However, in order to 3 Dnyaneshwar Deoram Sonawane

ensure compliance and co-operation by the assessee during the appellate proceedings before the ld.CIT(A), we direct the assessee to take steps to update the correct email address and postal/communication address on record before the ld.CIT(A) and at the ITBA Portal. Assessee is directed to be vigilant and track the appellate proceedings through ITBA Portal. Assessee is also directed to file all relevant details, documents and submission before the ld.CIT(A) on receiving notice of hearing and refrain from taking adjournments unless otherwise required for reasonable cause. Ld. CIT(A) is directed to adjudicate the appeal afresh in accordance with law after granting reasonable opportunity of being heard to the assessee. Effective grounds of appeal raised by the assessee are allowed for statistical purposes.

5.

In the result, the appeal of the assessee is allowed for statistical purposes.

Order pronounced on this 26th day of October, 2026. (PAVAN KUMAR GADALE) ACCOUNTANT MEMBER पुणे / Pune; दिन ांक / Dated : 26th October, 2026. Satish

4 Dnyaneshwar Deoram Sonawane

आदेश की प्रतिलिपि अग्रेषित / Copy of the Order forwarded to : अपीलार्थी / The Appellant. 1. प्रत्यर्थी / The Respondent.

2.3.

The Pr. CIT concerned. विभागीय प्रतिनिधि, आयकर अपीलीय अधिकरण, “A” बेंच, 4. पुणे / DR, ITAT, “A” Bench, Pune. गार्ड फ़ाइल / Guard File. 5. आदेशानुसार / BY ORDER, Sunil Kumar More More Date: 2026.10.26 17:16:25 +05'30' ////

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