ITAT Allows Appeal in Demonetization-Era Case, Finds CIT(A) Order Deficient in Reasoning [Read Order]
The tribunal emphasized that appellate authorities must provide clear findings when adjudicating disputes
![ITAT Allows Appeal in Demonetization-Era Case, Finds CIT(A) Order Deficient in Reasoning [Read Order]](https://www.taxscan.in/wp-content/uploads/2025/04/ITAT-ITAT-Allows-Appeal-Demonetization-Demonetization-Era-Case-taxscan.jpg "ITAT Allows Appeal in Demonetization-Era Case, Finds CIT(A) Order Deficient in Reasoning [Read Order]")
The Income Tax Appellate Tribunal (ITAT) Pune Bench has allowed an appeal filed by Jyoti Santosh Parakh Swaraj Cement Distributors, setting aside an order by the Commissioner of Income Tax (Appeals) [CIT(A)] that had upheld tax additions related to cash deposits made during the demonetization period. The tribunal found the CIT(A)'s order lacked proper reasoning and directed a fresh...
The Income Tax Appellate Tribunal (ITAT) Pune Bench has allowed an appeal filed by Jyoti Santosh Parakh Swaraj Cement Distributors, setting aside an order by the Commissioner of Income Tax (Appeals) [CIT(A)] that had upheld tax additions related to cash deposits made during the demonetization period. The tribunal found the CIT(A)'s order lacked proper reasoning and directed a fresh examination of the case.
The case pertains to assessment year 2017-18, when the assessee's bank account was flagged for cash deposits totaling Rs. 20.70 lakh during the demonetization window (November-December 2016). The Assessing Officer (AO) had treated the deposits as unexplained income under Section 69A of the Income Tax Act, 1961, after the assessee failed to file returns or respond to notices. The CIT(A) later dismissed the appeal without a detailed analysis, prompting the assessee to approach the ITAT.
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The ITAT admitted the appeal despite a 359-day delay, accepting the assessee's affidavit explaining the reasons for the delay. During proceedings, the assessee submitted additional evidence and requested the matter be remanded to the CIT(A) for reconsideration. The Revenue did not oppose this request.
In its order, the ITAT noted that the CIT(A) had failed to pass a "speaking order"—one that discusses evidence and reasoning—as required under Section 250(6) of the Income Tax Act. The tribunal emphasized that appellate authorities must provide clear findings when adjudicating disputes. It directed the CIT(A) to re-examine the case, consider the new evidence, and issue a reasoned order after seeking a remand report from the AO.
The decision was pronounced by Manish Borad, Accountant Member. The appeal was allowed for statistical purposes, meaning the case will now return to the CIT(A) for fresh adjudication in line with the tribunal's directions.
To Read the full text of the Order CLICK HERE
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