SHANKAR ANANDA PADALKAR,SOLAPUR V. ITO WARD 1(2), SOLAPUR

ITA 1900/PUN/2025

AI Insights

The case involves Shankar Ananda Padalkar, who appealed against the order of the CIT(A)/NFAC confirming the addition of 50,20,000 under section 69A read with section 115BBE of the Income Tax Act, 1961. The addition was based on large cash deposits in a joint bank account held by the assessee and his wife during the demonetization period. The assessee argued that the deposits were from past savings, supported by affidavits and income tax returns. However, the Assessing Officer and CIT(A) were not satisfied with the explanations, leading to the appeal. The Tribunal found merit in the assessee's arguments and remanded the case for a fresh assessment.

• Counselvise Citation: [2026] 140 COUNSELVISE.COM (IT) 827619 (ITAT-PUNE)
• Duration Of Justice: 4 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 05-01-2026
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2017-2018
• Appeal Filed On: 07-08-2025
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: GANESH B. BUDRUK
• Assessee Lawyers: S.G. BHUTADA; V. D. BHUTADA
• Keywords: Source of fund
• Section: 143(3); 142(1)

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH “B”, PUNE BEFORE SHRI MANISH BORAD, ACCOUNTANT MEMBER AND SHRI VINAY BHAMORE, JUDICIAL MEMBER आयकर अपील सं. / ITA No.1900/PUN/2025 िनधाᭅरण वषᭅ / Assessment Year : 2017-18 Shankar Ananda Padalkar, 416, Gr. Floor, Gala No.3, Kuldaivat Gold Market, Solapur- 413002. PAN : ANWPP7661H Vs. ITO, Ward-1(2), Solapur. Appellant Respondent आदेश / ORDER PER VINAY BHAMORE, JM: This appeal filed by the assessee is directed against the order dated 26.06.2025 passed by Ld. CIT(A)/NFAC for the assessment year 2017-18. 2. The appellant has raised the following grounds of appeal :- “1. Ground No. 1 The learned CIT(A) erred in law and on facts in confirming the addition of ₹50,20,000/- under section 69A read with section 115BBE of the Act, without properly appreciating Assessee by : Shri S. G. Bhutada & Shri V. D. Bhutada Revenue by : Shri Ganesh B. Budruk Date of hearing : 18.12.2025 Date of pronouncement : 05.01.2026 Printed from counselvise.com ITA No.1900/PUN/2025 2 the explanation of the appellant regarding the source of funds, and without considering the evidences placed on record. 2. Ground No. 2 The learned CIT(A) erred in rejecting the explanation of the appellant's spouse regarding Rs.26,70,000/- deposited in the joint bank account, ignoring her income-tax returns, without any adverse material or contradiction. 3. Ground No. 3 The learned CIT(A) failed to consider that the appellant and his spouse are regular tax filers from A.Y. 2004-05 onwards, and the cumulative incomes declared over the years reasonably support the cash holdings, given their rural background and minimal lifestyle expenses. 4. Ground No. 4 The authorities below erred in treating the deposits as unexplained solely on suspicion, without applying the test of human probability and without appreciating the socio- economic context of rural cash savings practices. 5. Ground No. 5 The learned CIT(A) failed to address the fact that in a similar case of the appellant's daughter-in-law, cash deposits during the same period were accepted, resulting in unequal and discriminatory treatment. 6. Ground No. 6 The appellant reserves the right to add, alter, amend or withdraw any of the above grounds at the time of hearing.” 3. Facts of the case, in brief, are that the assessee is an individual and furnished his return of income on 02.11.2017 declaring an income of Rs.1,42,090/-. The case was selected for scrutiny under CASS with the reason of large cash deposited compared to returned income. Notices u/s 143(2) and 142(1) along with questionnaire respectively were issued to the assessee. In response to above notice and questionnaire, the assessee submitted that he maintains savings bank account with Bank of India which is jointly held by Printed from counselvise.com ITA No.1900/PUN/2025 3 him and his spouse i.e. Smt. Malabai Shankar Padalkar. In this bank account, an amount of Rs.50,20,000/- was deposited in cash on 13.11.2016. Out of this amount, an amount of Rs.23,50,000/- was claimed to be deposited by the assessee himself from past savings and an amount of Rs.26,70,000/- was claimed to be deposited by his wife, Smt. Malabai Shankar Padalkar from her past savings. The assessee also submitted copy of income tax returns furnished by him and by his wife for the past 12 years and also furnished an affidavit duly sworn in by his wife stating that the amount of Rs.26,70,000/- were deposited by her in the joint bank account. Not being satisfied with the reply of the assessee, vide order dated 12.12.2019, the Assessing Officer completed the assessment u/s 143(3) of the IT Act and determined total income at Rs.51,62,90/- as against the income returned by the assessee at Rs.1,42,090/-. The above assessed income includes addition u/s 69A r.w.s. 115BBE of the IT Act of Rs.50,20,000/- cash deposited in joint bank account on 13.11.2016. 4. Being aggrieved with the above assessment order, the assessee preferred an appeal before Ld. CIT(A)/NFAC. After considering Printed from counselvise.com ITA No.1900/PUN/2025 4 the reply of the assessee, Ld. CIT(A)/NFAC dismissed the appeal filed by the assessee. 5. It is the above order against which the assessee is in appeal before this Tribunal. 6. We have heard Ld. Counsels from both the sides and perused the material available on record including the paper book furnished by the assessee. In this regard, we find that the addition of Rs.50,20,000/- was made to the returned income of the assessee on the ground of cash deposit on 13.11.2016 i.e. during demonetization period in the Bank of India, Savings Bank Account jointly held by the assessee with his wife. In this regard, we find that the assessee tried to explain before the Assessing Officer that out of Rs.50,20,000/- an amount of Rs.23,50,000/- and an amount of Rs.26,70,000/- was deposited by him and his wife respectively from past savings. In support of this contention, an affidavit duly sworn in by his wife, Smt. Malabai Shankar Padalkar was also furnished wherein she accepted to have deposited above amount of Rs.26,70,000/- in the joint bank account. The assessee also furnished copy of income tax returns for the past 12 years pertaining Printed from counselvise.com ITA No.1900/PUN/2025 5 to himself and his wife, however the Assessing Officer rejected the claim which was subsequently confirmed by Ld. CIT(A)/NFAC. 7. It was the contention of Ld. Counsel of the assessee that the return of daughter in law of the assessee i.e. Smt. Sunita Ramchandra Padalkar for the assessment year 2017-18 was also selected for scrutiny under CASS on the ground of large cash deposited compared to returned income i.e. Rs.16,00,000/- deposited in her bank account in one go. And on the basis of copy of earlier year’s return of income, the Assessing Officer accepted the contention of Smt. Sunita Ramchandra Padalkar that the amount was deposited out of savings of past years. Accordingly, Ld. AR contended that under identical facts the Assessing Officer is accepting the contention of one of the family member regarding deposit of cash of Rs.16,00,000/- from past savings but another officer is rejecting the same claim made by the other family member. 8. Apart from above, it was also the contention of Ld. Counsel of the assessee that when an affidavit was furnished by the wife of the assessee and the bank account was also found to be a joint bank account held by the assessee and his wife, the Assessing Officer Printed from counselvise.com ITA No.1900/PUN/2025 6 ought to have accepted the contention of the assessee that an amount of Rs.26,70,000/- was deposited by wife of the assessee or have initiated the proceedings in the case of the assessee’s wife and if not satisfied with the contention of the assessee’s wife, the additions could have been made in the hands of the assessee’s wife. 9. Apart from above, it was also the contention of Ld. Counsel of the assessee that the son of the assessee was also a regular income tax payer and has disclosed an income of Rs.15,85,761/- for the period under consideration and was looking after his parents since last many years. Accordingly, it was the contention of the assessee that the doubt of Assessing Officer that the amount disclosed as income in the earlier year’s returns must have been spent by the assessee and his wife for household expenditure is not correct. 10. Considering the totality of the facts of the case and in the interest of justice and in view of our above discussions in preceding paragraphs of this order, we deem it appropriate to set-aside the order passed by Ld. CIT(A)/NFAC and remand the matter back to the file of Ld. CIT(A)/NFAC with a direction to decide the appeal afresh and as per fact and law after providing reasonable opportunity of hearing to the assessee. The assessee is also hereby Printed from counselvise.com ITA No.1900/PUN/2025 7 directed to respond to the notices issued by Ld. CIT(A)/NFAC and to produce the relevant documents, submissions and evidences, if any, in support of grounds of appeal without taking any adjournment under any pretext, otherwise Ld. CIT(A)/NFAC shall be at liberty to pass appropriate orders as per law. Thus, the grounds of appeal raised by the assessee are allowed for statistical purposes. 11. In the result, the appeal filed by the assessee is allowed for statistical purposes. Order pronounced on this 05th day of January, 2026. Sd/- Sd/- (MANISH BORAD) (VINAY BHAMORE) ACCOUNTANT MEMBER JUDICIAL MEMBER पुणे / Pune; ᳰदनांक / Dated : 05th January, 2026. Sujeet आदेश कᳱ ᮧितिलिप अᮕेिषत / Copy of the Order forwarded to : 1. अपीलाथᱮ / The Appellant. 2. ᮧ᭜यथᱮ / The Respondent. 3. The Pr.CIT concerned. 4. िवभागीय ᮧितिनिध, आयकर अपीलीय अिधकरण, “B” बᱶच, पुणे / DR, ITAT, “B” Bench, Pune. 5. गाडᭅ फ़ाइल / Guard File. आदेशानुसार / BY ORDER, // True Copy // Assistant Registrar आयकर अपीलीय अिधकरण, पुणे / ITAT, Pune. Printed from counselvise.com "