RATAN KISAN BORADE,NASHIK V. ITO WARD 2(1), NASHIK

ITA 949/PUN/2025

AI Insights

The case involves Ratan Kisan Borade, the appellant, who contested the reassessment proceedings initiated by the Income Tax Officer (ITO) under section 148 of the Income Tax Act, 1961, for the Assessment Year 2015-16. The reassessment was based on information regarding cash deposits and other financial activities that allegedly indicated unreported income exceeding Rs. 50,00,000. The appellant argued that the notice for reassessment was issued beyond the prescribed time limit, making it invalid, and that the additions made were based on unverified information and incorrect interpretations of financial transactions. The Commissioner of Income Tax (Appeals) partly allowed the appeal, leading to further contest at the Tribunal level, where the legal validity of the notice and the merits of the additions were both challenged.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 774035 (ITAT-PUNE)
• Duration Of Justice: 5 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-09-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2015-2016
• Appeal Filed On: 08-04-2025
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MANOJ TRIPATHI VIRTUAL
• Keywords: Reassessment proceedings; Peak credit; Principle of natural justice; TDS
• Section: 147; 148; 44AD

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL PUNE “SMC” BENCH : PUNE BEFORE DR. MANISH BORAD, ACCOUNTANT MEMBER I.T.A.No.949/PUN/2025 (Assessment Year : 2015-2016) Ratan Kisan Borade, Panchak Borademala, Near Railway Line, Jail Road, Nashik (Maharashtra) PAN : ATWPB 9256 C vs. ITO, Ward-2(1), Nashik. (Appellant) (Respondent) For Assessee : None For Revenue : Shri Manoj Tripathi (Virtual) Date of Hearing : 08.09.2025 Date of Pronouncement : 10.09.2025 ORDER This appeal at the instance of the assessee is directed against the order of Ld. Commissioner of Income Tax (Appeals)/NFAC, Delhi [“CIT(A)”], dated 17/02/2025 framed u/s. 250 of the Income Tax Act, 1961 (‘Act') for the Assessment Year 2015-16 (AY). 2. When the case called for, none appeared on behalf of the assessee. In the past also, on the date of hearing fixed for 25/06/2025 & 23/07/2025, none appeared on behalf of the assessee. Under these given facts, I proceed to adjudicate the appeal ex-parte qua assessee with the assistance of learned Departmental Representative (DR) and available records. Printed from counselvise.com 2 ITA.No.949/PUN /2025 (Ratan Kisan Borade, Nashik) 3. The assessee has raised the following grounds of appeal:- “1. On the facts and in the circumstances of the case and in law Ld. AO erred in initiating reassessment proceedings u/s 147 by issuing notice u/s 148 on 02/04/2022, since the notice issued beyond 31/03/2022, same is barred by limitation and therefore the proceedings are without jurisdiction and consequential order needs to be annulled. 2. On the facts and in the circumstances of the case and in law Ld. AO erred in initiating reassessment proceedings u/s 147 for AY 2015-16, on the basis of unverified information, thereby alleging that escaped income is beyond Rs. 50,00,000. Since the belief is based on unverified information, entire proceedings are bad in law and deserves to be struck down, facts also get support from the Assessment order wherein actual addition is less than Rs.50,00,00/-. 3. On the facts and in the circumstances of the case and in law lower authorities have erred in making an addition of Rs. 20,26,700/- u/s 69A - Unexplained Money, being summations of certain cash deposits/credit entries in bank account by rejecting the appellant's submission and further erred in not appreciating that there were cash withdrawals from the bank account and alternatively appellant was entitled to get credit of such withdrawals by applying the theory of peak credit. Your appellant prays for deletion of entire addition. Your appellant craves for to add, alter amend, modify, delete any or all grounds of appeal before or during the course of hearing in the interest of natural justice.” 4. With the assistance of ld.DR and available records, I notice that the assessee is an individual and he did not file the return of income for the A.Y. 2015-16. Based on the information under ‘NMS category’ regarding deposit of cash and time deposit and TDS statement, Ld.AO issued notice u/s. 148 of the Act by carrying out the re-assessment proceedings. In response to the notice issued u/s. 148 of the Act, the assessee furnished return on 04/07/2023 declaring income of Rs. 10,609/-. Thereafter, the details filed by the assessee were examined by the Ld.AO and concluded the re-assessment Printed from counselvise.com 3 ITA.No.949/PUN /2025 (Ratan Kisan Borade, Nashik) proceedings making various additions to the tune of Rs. 49,55,119/-. 5. Aggrieved with these additions, the assessee filed appeal before the Ld.CIT(A) and raised the following grounds of appeal:- “1. That on the facts and in the circumstances of the case and in law AO has erred in making addition of Rs.2526700/- u/s 69A of the Act, stating that your appellant has failed to prove source for cash deposit. In fact there is no provision under section 44AA of The Income Tax Act 1961 or any rule thereunder nor any other law or rule mandate to maintain the books of accounts and records to farmer. 2. That on the facts and in the circumstances of the case and in law AO has erred in treating well explain Fixed deposit or Term Deposits as unexplained cash deposits under section 69A. 3. That on the facts and in the circumstances of the case and in Law AO has not pass on benefits of the provisions of section 44AD of the Act. 4. The appellant craves leave to add, alter, amend or substitute one or more ground of appeal as and when necessary.\" 6. The Ld.CIT(A) after examining the details filed by the assessee, partly allowed the assessee’s appeal. Thereafter, the assessee has preferred the appeal before this Tribunal. Along with grounds raised on merits for the additions sustained by the Ld.CIT(A), assessee has also raised legal ground challenging the validity of notice issued u/s. 148 of the Act, alleged to be issued beyond the prescribed time limit and therefore barred by limitation. I note that the assessee has not raised the legal ground before both the lower authorities. Before the Ld.AO, assessee has furnished the return Printed from counselvise.com 4 ITA.No.949/PUN /2025 (Ratan Kisan Borade, Nashik) incompliance to the notice u/s. 148 of the Act and thereafter, before the Ld.CIT(A) only the grounds on merits have been raised. However, considering the fact that legal grounds can be raised at any stage and as the legal issue raised in this appeal goes to the very foundation of the assessment proceedings, the same is admitted. But as this legal issue has been raised for the first time before this Tribunal, I deem it appropriate to restore all the issues raised in the instant appeal including the legal issue to the file of Ld.CIT(A) for necessary adjudication and to decide in accordance with law after giving due opportunity to the assessee. The effective grounds of appeal raised by the assessee are allowed for statistical purposes. 7. In the result, appeal of the Assessee is allowed for statistical purposes. Order pronounced in the open Court on 10.09.2025. Sd/- [MANISH BORAD] ACCOUNTANT MEMBER Dated : 10th September, 2025 vr/- Printed from counselvise.com 5 ITA.No.949/PUN /2025 (Ratan Kisan Borade, Nashik) Copy to 1. The appellant 2. The respondent 3. The CIT(A), Pune concerned. 4. D.R. ITAT, SMC Bench, Pune. 5. Guard File. By Order //True Copy // Senior Private Secretary ITAT, Pune. Printed from counselvise.com "