Sambasivam Bhaskaran Vs Assessment Unit (Madras High Court)
Madras HC: ₹84 Lakh Section 69 Addition Largely Represented Housing Loan — Ex Parte Assessment Set Aside on ₹5 Lakh Deposit
Summary: The Madras High Court set aside the assessment order dated 08.01.2026 arising from proceedings under Sections 144 read with 144B for Assessment Year 2024-25, primarily on the ground of breach of principles of natural justice. The petitioner asserted that he became aware of the proceedings only in April 2026 when contacted by the Income-Tax Department regarding non-payment of penalty. He contended that the substantial liability included ₹84 lakhs treated as unexplained investment under Section 69 of the Income-tax Act, 1961, which actually represented a home loan.
The Revenue pointed out that the petitioner had been provided multiple opportunities and had failed to respond to notices issued under Sections 143(2) and 142(1) as well as the show cause notice. The Court therefore held that the petitioner could not be absolved of responsibility for his non-compliance.
However, the Court noted that the aggregate tax demand flowed largely from the ₹84 lakh Section 69 addition. The petitioner asserted that the amount related to a home loan and produced documents showing a loan of ₹66,34,950/- from Axis Bank, Pallavaram Branch, Chennai. Considering this aspect, the Court held that the interest of justice warranted providing the petitioner an opportunity, subject to terms.
