Poonacha, who took over as the national coach last December, had signed a one-year deal with the OHA with a mission to help Oman finish among the top six at the Asia Cup.
Despite playing some attractive hockey in the Bangladeshi capital of Dhaka during the eight-nation Asia Cup last month, Poonacha's men finished eighth.
Following the return of the team and with no major events in the near future, Poonacha was relieved of his national team duties after he was approached by former His Majesty's Cup winner and his former club, Ahli-Sidab, to lead the club in the 2017 HM's Cup campaign that began on Thursday.
Poonacha began his latest stint with Ahli-Sidab on a winning note on Thursday when his team recorded a hard-fought 3-2 win over defending champion Seeb in the opening clash but suffered a reverse in the next match against Bausher, losing 3-4 on Friday.
Poonacha took over from Germany's Oliver Kurtz, who was sacked in December 2015. Omani coach Ahmed al Darmaki served as an interim coach till December 2016, when Poonacha was offered the coach's role.
Poonacha first served as Oman coach from February 2010 to November 2011, during which Oman took part in the Asian Games qualifiers in Dhaka, Bangladesh and the 2010 Asian Games in Guangzhou, China.
After his exit, Poonacha, who has 52 international caps for India, took charge of Ahli-Sidab in April 2012.
He returned as Oman's coach on an interim basis towards the end of 2012, when the national team took part in round one of the Hockey World League (HWL) in Doha, Qatar and the Asian Champions Trophy. That spell lasted less than a month, though.
Poonacha was the fourth Indian to have coached the national team on a full-time basis.
S A S Naqvi was the first to be appointed in 1982 ahead of Oman’s first participation at the Asian Games in New Delhi, while Olympians Inam-ur-Rehman and Joaquim Carvalho also served as coach.
Meanwhile, top sources have said that the OHA board and the chief, Talib al Wahaibi, is keen to get a high-performance expert as a national coach.
Oman's next big challenge is to qualify for the 2018 Asian Games in Jakarta, Indonesia. Muscat has been awarded the rights to host the Asian Games Qualifiers in March.