SUMIT SUNEJA,DELHI vs. ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE 34(1), DELHI, DELHI

The Assessee has filed this Appeal against the Order of the National
Faceless Appeal Centre (NFAC), Delhi dated 08.01.2025 relating to assessment year 2011-12 on as many as 6 grounds, however, he has argued only on the legal issues wherein he has raised the following grounds:-
1. The impugned assessment is invalid and without juri iction as the said assessment is completed without complying with legal requirements of provisions of section 147/148 of the Income Tax Act therefore such assessment is void ab initio and liable to be quashed.
2. The authorities below has erred both in law and circumstances of the case in initiating action u/s. 147 of the Act ignoring the fact that the proceedings have been initiated without application of independent mind on the material, if any, available. In view of the above defects in the 2

compliances the resultant reassessment proceedings are required to be set aside.
3. The authorities below has erred both in law and circumstances of the case in initiating action u/s. 147 of the I.T. Act ignoring the fact that the proceedings have been initiated by mechanical approval accorded by the PCIT and such approval vitiates the assessment.
2. Brief facts are that the assessee’s case was reopened for assessment u/s.
147 of the Act based on the information of cash deposits in bank account. AO noted that the assessee had deposited cash amount Rs. 38,72,062/- in bank account held in PNB and Rs. 2,10,600/- in bank account with South India Bank.
The assessee remained non-responsive during the assessment proceedings, consequently, the AO passed the best judgement order u/s. 144 with addition of total amount of Rs. 40,82,662/- as unexplained deposits.
3. Against the aforesaid action of the AO, assessee preferred the appeal before the Ld. CIT(A). Ld. Upon assessee’s appeal, Ld. CIT(A) sent back the matter to the file of the AO for fresh consideration, due to the fact that the same was finalized u/s. 144 of the Act by not providing proper opportunity to the assessee.
4. Aggrieved with the aforesaid action of the Ld. CIT(A)/NFAC, Delhi,
Assessee is in appeal before me.
5. At the time of hearing, Ld. AR has reiterated the grounds of appeal no.
1 to 3 and also the submissions made before the authorities below, more particularly that invocation of reassessment proceedings based on non-existing provision of law and also errors in the performa for obtaining approval and mechanical approval by Pr. CIT. He relied upon the Coordinate Bench decision dated 18.12.2024 in the case of Amit Khatri vs. ITO decided in ITA No.

2430/Del/2023 (AY 2012-13) wherein on similar facts the assessment was quashed by the Tribunal.
5.1
Per contra, Ld. DR relied upon the order of the Ld. CIT(A)/NFAC and submitted that the same does not require any interference, hence, the same may be confirmed.
6. I have heard rival contentions and perused the relevant records.
6.1
It reveals from records that i.e. Page No. 40 of the paper book which is the Form for recording the reasons for initiating proceedings u/s. 148 and for obtaining approval of the Pr. CIT for reopening of assessment, in column 7 of the said Form the AO has stated that the provisions applicable for reopening of assessment is section 147(a) of the Act. The ld. Counsel for the assessee submits that the AO has quoted the non-existent provisions for reopening the assessment which shows that there is complete non-existent provision for reopening the assessment which shows that there is complete non application of mind. It is also noted that the provisions of section 147(a) /147(b) have ceased to be in the statute book from 01.04.1989 and mentioning of these incorrect and non-existing sections is clearly a case of non-application of mind by the AO and also by authorities providing sanction u/s. 151 of the Act. Further, it is noted that there is mechanical approval which is undated mentioned at page no. 40 of the Paper Book granted by the Pr. CIT and even the reasons recorded on the basis of which the approval u/s. 151 was taken also undated. The approval granted by the Pr. CIT at page no. 40 only mentioned he line “Yes, I am satisfied on the basis of reason recorded it is a fit case for issue of notice u/s.
148.” The aforesaid remarks coupled with undated sanction shows non application of mind of the lower authorities.
6.2 I find plausible contention of the Ld. AR that on identical facts the Tribunal vide its order dated 18.12.2024 in the case of Amit Khatri vs. ITO decided in 4

ITA No. 2430/Del/2023 (AY 2012-13) has held that the reassessment order is bad in law wherein the Tribunal has observed us under:-
“8. Heard rival submissions, perused the orders of the authorities below. Undisputedly in this case there is non- application of mind by the AO in taking approval from the appropriate authority u/s. 151 of the Act. Perusal of Form for recording the reasons for initiating proceedings u/s. 148
for obtaining approval of the Pr. CIT, Delhi -8, New Delhi which is placed at Paper Book page no. 38 suggests that the AO mentioned the provisions under which the assessment was reopened as 147(b) of the Act. It is observed that the provisions of section 147(a)/147(b) have seized to be in the statute book from 1.4.1989. Therefore, mentioning all these incorrect and non-existent sections for obtaining approval for recording the reasons for initiating proceedings u/s. 148
is a clear case of non-application of mind by the AO and also by the authorities providing satisfaction u/s. 151 of the Act.” We find that Full Bench of the Hon’ble Juri ictional
The above said decision was duly affirmed by the Hon’ble
In this case the Hon’ble Apex Court has held that after 1st
April, 1989 Assessing Officer has power to reopen the assessment u/s. 147 provided that Assessing Officer has reason to believe that income has escaped assessment and there is tangible material to come to the conclusion that there is escapement of income; mere change of opinion may not per se to be a reason for reopening.
9…………………….
10. Facts being identical. Respectfully following the said decision the reassessment order dated 09.12.2019 passed u/s.

147/143(3) of the Act for the AY 2012-13 is quashed and the additional ground nos. 1 to 3 are allowed.”
6.3
In the background of the aforesaid discussions and respectfully following the precedent, as aforesaid, in my considered opinion, the reassessment order dated 30.11.2018 passed u/s. 147/144 of the Act for the AY 2011-12 is quashed and accordingly, the ground nos. 1 to 3 raised by the assessee stand allowed.
7. In the result, the Assessee’s appeal is allowed in the aforesaid manner.
Order pronounced on 04/08/2025. (MAHAVIR SINGH)

VICE PRESIDENT
Date: 11.08.2025

SRBhatnaggar