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Facts
The assessee, a commission agent, did not file a return for AY 2012-13 as income was below the taxable limit. The assessment was reopened under Section 147, and the AO made additions totaling Rs. 44,46,395 for unexplained bank deposits under Section 69A. The CIT(A) confirmed the additions due to lack of documentary evidence.
Held
The Tribunal noted the assessee's claim of non-compliance due to wrong advice and decided to grant one more opportunity. The matter was restored to the AO to re-adjudicate after allowing the assessee to present further evidence and be heard.
Key Issues
The key legal issues were the validity of the reopening under Section 147 and the confirmation of additions for unexplained bank deposits under Section 69A due to the assessee's failure to provide documentary evidence.
Sections Cited
Section 143(3), Section 147, Section 148, Section 69A, Section 234, Section 44AD
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, RAJKOT BENCH, RAJKOT
Before: DR. ARJUN LAL SAINI & DR. DINESH MOHAN SINHA
आदेश / ORDER Per, Dr. Dinesh Mohan Sinha, JM: Captioned appeal filed by the assessee, pertaining to Assessment Year (AY) 2012-13, is directed against the order passed by the Learned Commissioner of Income Tax(Appeals), National Faceless Appeal Centre, Delhi [in short “the Ld. CIT(A)/NFAC”], dated 16.09.2025, which in turn arises out of an assessment order dated 07.12.2019.passed by Assessing Officer (in short ‘the AO”) u/s 143(3) r.w.s. 147 of the Income Tax Act, 1961 (hereinafter referred to as “the Act”). 2. Grounds of appeal
1. 1. 1. 1. 1. 1. raised by the assesse, are as follows: “1. The grounds mentioned of appeal hereunder are without prejudice to one another.
2. The Id. Commissioner of Income-tax Appeal (Appeals), National Faceless Centre, Delhi (hereinafter referred to as the "CIT(A)"]erred in rejecting the ground related to validity of notice issued u/s 148 of the Income tax Act, 1961. That on facts as also in Dharmesh A. Bhatt law, the proceedings-initiated u/s. 147 of the Act is invalid, void ab initio and bad in law therefore the assessment invalid initiation finalized deserves to be quashed and may kindly be quashed. such on 3.The Id. CIT(A)erred on facts as also in law in confirmingthe addition of Rs.44,46,395/- made by aggregating credit entries of bank account held with different banks on the alleged ground that the appellant failed to explain the source of such cash/cheque alongwith documentary evidence. The addition confirmed by Ld. CIT(A) is unjustified and uncalled for.
4. Your Honour's appellant craves leave to add, to amend, alter, or withdraw any or more grounds of appeal on or before the hearing of appeal.”
Brief facts of the case that the Appellant is an Individual aged about 35 years, the appellant is assessed to tax by the assessing officer, for the A.Y.2012-13, the Appellant had carried on business of commission agent. Turnover for the year was Rs.328250/- and the net income thereof was Rs.101676/-, which was covered under section 44AD. As the income was below basic taxable limit, regular return of income for A.Y.2012-13 was not filed. Later on 26.03.2019, the said assessing Officer reopened assessment for A.Y.2012-13 and issued a notice under section 148 of the Income Tax Act, 1961, requiring the assessee to file his return of income for the year. In compliance to the requirement of filling of return of income for A.Y.2012-13, the Appellant pursued his old papers and files and prepared and uploaded his Return of Income for A.Y. 2012-13 declaring total income of Rs.136700/- on 31/08/2019. The Appellant had business income of Rs.101676/- under section 44AD and bank interest income of Rs.35022/-.
The assessing officer completed the assessment u/s.143(3) r.w.s.147 by making variation to the Total income as per his assessment order dated 07.12.2019, as under:
Returned Income Rs. 1,36,698/- Addition of deposits of cash into IDBI Bank Account Rs. 31,08,576/- IDBI Bank Account Rs. 4,787/- Axis Bank Account Rs. 13,33,032/- Assessed Income Rs. 4583093 Page 2 of Dharmesh A. Bhatt 5. That the assessee filed an appeal against the order of the AO, before the Ld.CIT(A). which was dismissed the appeal by observing as follows:
“8.6 Therefore, in absence of any documentary evidence with respect to the nature and character of the transaction and source of the monies deposited in the bank accounts as mentioned supra, grounds of appeal contested by the assessee at serial No. 5 is dismissed and an addition made by the assessing officer under section 69A is confirmed.
9. The assessee has contested grounds of appeal at serial No. 6 in respect of levy of interest under section 234 Of the IT Act. Therefore, considering the facts and circumstances of the case, such consequential grounds of appeal contested by the assessee is dismissed for statistical purpose.
10. The assessee has contested grounds of appeal at serial No. 7 which is general in nature. Therefore, considering the facts and circumstances of the case, such general ground of appeal is dismissed for statistical purpose.
11. In the result, the appeal of the assessee is dismissed. ”
6. That the assessee filed an appeal against the impugned order of the Ld.CIT(A), before this Tribunal. a. During the course of hearing, the Ld.AR of the assesse submitted that requested for an opportunity may kindly be given to the assessee to explain the case before lower authorities. b. On the other hand, the Ld.DR for the revenue relied on the order of the Ld.CIT(A).
We have heard both the parties and perused the material available on record and perused the order of the Ld.CIT(A) dated 16.09.2025. We note that the finding of the Ld.CIT(A) may be appreciated that during the course of assessment proceedings and appellate proceedings, the assessee has not submitted any documentary evidence with respect to the names and addresses, PAN number, amount, date of receipt, nature and character of transaction, confirmation of the deposited, et cetera. It may be appreciated that the assessee has collected these monies from the persons known to the assessee. However, in spite of rendering Page 3 of Dharmesh A. Bhatt ample opportunities during the course of assessment proceedings and appellate proceedings assessee for the best reasons known to him remain non-compliance and did not submit any documentary evidence. That the non-compliance of notice was due to the wrong advice of the counsel that after filing the return incompliance to the notice u/s. 148 of the Act, nothing further is to be done due to that reasons the Appellant could not comply to the notices.
Considering the above fact and circumstances of the case, we are of the view that one more opportunity should be given to the assessee to present his case before the AO. Therefore the matter restored back to the file of the AO and adjudicate the matter in accordance with law, after giving due opportunity of being heard to the assessee. The assessee will also be at liberty to let in further evidence to substantiate it’s case.
In the result, appeal of the assessee, is allowed for statistical purpose.
Order is pronounced in the open court on 09/03/2026.