Madhubhai Shambhubhai Sojitra Vs ITO (ITAT Surat)
₹3.12 Crore Financial Transactions Trigger Reassessment
The appeal before the ITAT Surat arose from the ex-parte appellate order dated 03.09.2025 passed by the CIT(A), National Faceless Appeal Centre, Delhi, relating to Assessment Year 2017-18. The assessee, an individual, had not filed his return of income under Section 139(1) of the Income-tax Act, 1961.
The Income Tax Department received information that the assessee had made cash deposits of Rs.3,07,54,760/- in his bank account maintained with ICICI Bank and cash withdrawals of Rs.4,70,804/-, taking the total financial transactions to Rs.3,12,25,564/-.
Since no return had been filed, reassessment proceedings were initiated. According to the order, the assessee failed to respond, resulting in an order under Section 148A(d) and issuance of notice under Section 148 on 28.03.2024. Despite various notices under Section 142(1), the assessee did not furnish a reply.
AO Made ₹3.12 Crore Addition Under Section 69A
The Assessing Officer consequently completed the assessment ex parte under Section 147 read with Section 144 and treated Rs.3,12,25,564/- as unexplained income under Section 69A of the Income-tax Act, subject to taxation under Section 115BBE.
The assessee challenged the reassessment before the CIT(A). Three opportunities of hearing were given on 05.01.2025, 20.05.2025 and 08.08.2025. Although the assessee sought two adjournments, no written submissions were filed. The CIT(A), therefore, passed an ex-parte appellate order confirming the demand raised by the Assessing Officer.
Assessee Challenged Reassessment and Section 69A Addition Before ITAT
Before the Tribunal, the assessee raised both jurisdictional and merits-based grounds. One of the principal technical objections was that notices under Sections 148A(b), 148A(d) and 148 had been issued by the Jurisdictional Assessing Officer (JAO) and not by the Faceless Assessing Officer (FAO), which the assessee contended was contrary to Section 151A.
