This reply is based on the assumption that the set up of your Onkyo SR706 is basically the same as my Onkyo TX-SR508 and that your connections are via HDMI. I can have the receiver and the TV on and have the TV sound output to the receiver's speakers or listen to music in which case the TV's sound is muted. If I turn the receiver off, the TV sound comes back on. Here is the setup that lets me do that.
The TV cable box output is connected to the receiver's HDMI 3 (the default connection). MY Onkyo DB-CP706 DVD changed is hooked up to HDMI 1 which is, again, the default. HDMI out goes to the TV. All hookups are HDMI. The HDMI settings (Setup/1. HDMI Input) are at the defaut values of BD/DVD - HDMI1, VCR/DVR -HDMI2, CBL/SAT - HDMI 3.
The HDMI Setup (menu selection 10 in setup) is Audio TV Out - Auto, HDMI Control - On, HDMI Control (HIHD) - On, Audio Return Ch (ARC) - Auto, Power Control - On, TV Conrol - On.
Maybe some of these settings could be changed and still provide the disired result, but things are working the way I want.
Hope this helps,
Rich