MANISH KUMAR AGARWAL,C/O B K KAPUR AND COMPANY vs. ACIT,GHAZIABAD, GHAZIABAD
Facts
A batch of forty appeals was filed by nine assessees and the revenue. The assessees challenged the legality of impugned assessments due to alleged lack of proper approval under section 148B of the Income Tax Act. For assessment years 2021-22 and 2022-23, they argued that assessments should have been framed under section 148 r.w.s 147 instead of section 143(3), following a search on 02.06.2022.
Held
The Tribunal held that additional grounds challenging the validity of assessment and reassessment proceedings on purely legal grounds can be admitted. It was found that the prescribed authority failed to grant a proper approval under section 148B, vitiating the entire assessment. Furthermore, for the relevant assessment years, assessments ought to have been framed under section 148 r.w.s 147 following the search.
Key Issues
Whether the assessments are valid without proper approval under section 148B, and whether reassessment proceedings should have been initiated under section 148 r.w.s 147 post-search.
Sections Cited
143(3), 147, 148, 148B, 250(6)
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, DELHI BENCH “F”: NEW DELHI
Before: SHRISATBEER SINGH GODARA & SHRIM. BALAGANESH
PERBENCH: 1. The instant batch of forty cases involves nine assessee and the relevant details thereof stand tabulated as follows:- Sr. ITA No. /AY Appellant Respondent Proceedin Order appealed gs under No. against section 1 4143/Del/2025 DCIT, Central Vijay Kumar Agarwal CIT(A)-3, Noida order 143(3) AY 2022-23 Circle, Ghaziabad dated 15.04.2025 2 3879/Del/2025 Vijay Kumar ACIT, Ghaziabad CIT(A)-3, Noida order 143(3) AY 2022-23 Agarwal dated 15.04.2025 3 Manish Kumar ACIT, CIT(A)-3, Noida order 143(3)/147 3881/Del/2025 Agarwal Ghaziabad dated 15.04.2025 AY 2022-23 4 3880/Del/2025 Manish Kumar ACIT, CIT(A)-3, Noida order 143(3)/147 AY 2022-23 Agarwal Ghaziabad dated 14.06.2025 5 4095/Del/2025 DCIT, Central Sanjeev Kumar CIT(A)-3, Noida order 143(3) AY 2022-23 Circle, Ghaziabad Agarwal, Hapur dated 15.04.2025 6. 3891/Del/2025 Sanjeev Kumar DCIT, Central Circle, CIT(A)-3, Noida order 143(3) AY 2022-23 Agarwal, Hapur Ghaziabad dated 15.04.2025 7. 3900/Del/2025 KL Vegetable Oil ACIT, CIT(A)-3, Noida order 147/144 AY 2022-23 Products Pvt. Ltd Ghaziabad dated 15.04.2025 8. 3899/Del/2025 KL Vegetable Oil ACIT, CIT(A)-3, Noida order 147/144 AY 2021-22 Products Pvt. Ltd Ghaziabad dated 15.04.2025 9. 3898/Del/2025 KL Vegetable Oil ACIT, CIT(A)-3, Noida order 147/144 AY 2020-21 Products Pvt. Ltd Ghaziabad dated 15.04.2025 10. 3897/Del/2025 KL Vegetable Oil ACIT, CIT(A)-3, Noida order 147/144 AY 2019-20 Products Pvt. Ltd Ghaziabad dated 15.04.2025 11. 3892/Del/2025 KL Vegetable Oil ACIT, CIT(A)-3, Noida order 147/144 AY 2014-15 Products Pvt. Ltd Ghaziabad dated 15.04.2025 12 3893/Del/2025 KL Vegetable Oil ACIT, CIT(A)-3, Noida order 147/144 AY 2015-16 Products Pvt. Ltd Ghaziabad dated 15.04.2025 13 3894/Del/2025 KL Vegetable Oil ACIT, CIT(A)-3, Noida order 147/144 AY 2016-17 Products Pvt. Ltd Ghaziabad dated 15.04.2025 14 3895/Del/2025 KL Vegetable Oil ACIT, CIT(A)-3, Noida order 147/144 AY 2017-18 Products Pvt. Ltd Ghaziabad dated 15.04.2025 15 3896/Del/2025 KL Vegetable Oil ACIT, CIT(A)-3, Noida order 147/144 AY 2018-19 Products Pvt. Ltd Ghaziabad dated 15.04.2025
16 3901/Del2025 Rajiv Kumar ACIT, CIT(A)-3, Noida order 143(3)/ 147 AY 2022-23 Agarwal Ghaziabad dated 15.04.2025 17 3902/Del/2025 Sonika Agarwal ACIT, CIT(A)-3, Noida order 143(3)/ 147 AY 2022-23 Ghaziabad dated 15.04.2025 18 4109/Del/2025 DCIT, Sonika Agarwal CIT(A)-3, Noida order 143(3) AY 2022-23 Central Circle, dated 15.04.2025 Ghaziabad 19 3903/Del/2025 Shammi Agarwal ACIT, CIT(A)-3, Noida order 143(3)/ 147 AY 2022-23 Ghaziabad dated 15.04.2025 20 4107/Del/2025 DCIT, Shammi Agarwal CIT(A)-3, Noida order 143(3) AY 2022-23 Central Circle, dated 15.04.2025 Ghaziabad 21 3904/Del/2025 JK trading ACIT, CIT(A)-3, Noida order 147/144 AY 2014-15 Company Ghaziabad dated 15.04.2025 22 3505/Del/2025 JK trading ACIT, CIT(A)-3, Noida order 147/144 AY 2015-16 Company Ghaziabad dated 15.04.2025 23 3906/Del/2025 JK trading ACIT, CIT(A)-3, Noida order 147/144 AY 2016-17 Company Ghaziabad dated 15.04.2025 24 3907/Del/2025 JK trading ACIT, CIT(A)-3, Noida order 147/144 AY 2017-18 Company Ghaziabad dated 15.04.2025 25 3908/Del/2025 JK trading ACIT, CIT(A)-3, Noida order 147/144 AY 2018-19 Company Ghaziabad dated 15.04.2025 26 3909/Del/2025 JK trading ACIT, CIT(A)-3, Noida order 147/144 AY 2019-20 Company Ghaziabad dated 15.04.2025 27 3910/Del/2025 JK trading ACIT, CIT(A)-3, Noida order 147/144 AY 2020-21 Company Ghaziabad dated 15.04.2025 28 3911/Del/2025 JK trading ACIT, CIT(A)-3, Noida order 147/144 AY 2021-22 Company Ghaziabad dated 15.04.2025 29 3912/Del/2025 JK trading ACIT, CIT(A)-3, Noida order 147/144 AY 2022-23 Company Ghaziabad dated 15.04.2025 30 3913/Del/2025 Ravinder Oil & ACIT, CIT(A)-3, Noida order 147/144 AY 2014-15 Ginning Mills Ghaziabad dated 15.04.2025 31 3914/Del/2025 Ravinder Oil & ACIT, CIT(A)-3, Noida order 147/144 AY 2015-16 Ginning Mills Ghaziabad dated 15.04.2025 32 3915/Del/2025 Ravinder Oil & ACIT, CIT(A)-3, Noida order 147/144 AY 2016-17 Ginning Mills Ghaziabad dated 15.04.2025 33 3916/Del/2025 Ravinder Oil & ACIT, CIT(A)-3, Noida order 147/144 AY 2017-18 Ginning Mills Ghaziabad dated 15.04.2025 34 3917/Del/2025 Ravinder Oil & ACIT, CIT(A)-3, Noida order 147/144 AY 2018-19 Ginning Mills Ghaziabad dated 15.04.2025 35 3918/Del/2025 Ravinder Oil & ACIT, CIT(A)-3, Noida order 147/144 AY 2019-20 Ginning Mills Ghaziabad dated 15.04.2025 36 3919/Del/2025 Ravinder Oil & ACIT, CIT(A)-3, Noida order 147/144 AY 2020-21 Ginning Mills Ghaziabad dated 15.04.2025 37 3920/Del/2025 Ravinder Oil & ACIT, CIT(A)-3, Noida order 147/144 Ginning Mills Ghaziabad dated 15.04.2025 38 3921/Del/2025 Ravinder Oil & ACIT, CIT(A)-3, Noida order 147/144 AY 2022-23 Ginning Mills Ghaziabad dated 15.04.2025 39 3925/Del/2025 Ravinder Oil & ACIT, CIT(A)-3, Noida order 143(3)/147 AY 2022-23 Ginning Mills Ghaziabad dated 15.04.2025 40 4087/Del/2025 DCIT, Ravinder Oil & Ginning CIT(A)-3, Noida order 143(3) AY 2022-23 Central Circle, Mills dated 15.04.2025 Ghaziabad
We have heard all these assessees as well as the department at length. Case files perused. 2. It is noticed at the outset with the able assistance coming from both the sides that these assessees/ appellants seek to raise their twin additional grounds i.e. interalia challenging legality of the impugned assessments for want of a valid approval; and, for AYs 2021-22 and 2022- 23, their respective stand is that when counted from the date of search in issue i.e 02.06.2022, the learned lower authorities ought to have framed respective assessments in question u/s 148 r.w.s 147 than that u/s 143(3) of the Act. 3. Learned CIT-DR vehemently objects to assessees instant identical application(s) regarding both the foregoing additional grounds. Ms. Singh’s case is that it was the assessees’ bounden duty to have raised the same before the CIT(A) so as to get an comprehensive adjudication thereupon u/s 250(6) of the Act. She further opposes the assessees’ aforesaid plea for want of all the corresponding supportive material/ evidence before the tribunal as well. 4. We hardly see any reason to accept the Revenue’s foregoing objections against the assessees respective applications seeking to admit the foregoing twin additional substantive grounds. We wish to make it clear that hon’bleapex court in NTPC Limited v/s CIT (1998) 229 ITR 383 (SC) has already settled the issue that this tribunal could very well entertain such a pure legal ground going to root of the matter. This is indeed coupled with the tribunal’s Special Bench in All Cargo Global Logistics Ltd. vs. DCIT(2012) 137 ITD 287 (Mum) (SB) that we could very well admitan additional ground so as to determine the correct tax liability of an assessee subject to a rider that all the relevant facts form part of the records. We find that all these assessees have already filed paper book running into 45 pages in support of both these additional grounds. We, thus, admit the same in very terms. Page | 6
Next comes the first and foremost issue between the parties i.e. 5. validity of impugned assessments on account of the learned prescribed authority alleged failure in granting a proper approval u/s 148B of the Act. We are taken to the assessees’ detailed paper book wherein the learned prescribed authority i.e. Addl-CIT, Central Range, Meerut accorded its aforesaid identical approval for eg. Dated 29.03.2003 in Ms. Sonika Agarwal case; observing therein that he had occasion to go through the seized materials, appraisal reports and various documents from time to time. The matter admittedly did not end up to this stage. These assessees appear to have their filed respective “RTI” applications as to whether the said seized records etc; allegedly running into thousands of pages (23 to 25 in Paper Book annexure-A), had been sent to the learned prescribed authority or not. The Revenue’s stand in the said RTI matters intimated to these assessees reads “upon verification of the records all the case presently available; it is observed that no formal communication/ correspondence in this regard are placed on record”.] [This clinching factual position has gone unrebutted from the 6. Revenue side. We are of the considered view in these facts that both the learned lower authorities; and, more particularly, the learned Assessing Officer as well as the Additional CIT have failed to comply with this statutory mandate of a valid approval u/s 148B of the Act i.e a provision parimateria to Section 153D and not sustenable in law as perPCIT v. Siddarth Gupta (2023) 450 ITR 534 (All), ACIT v. Serajuddin and Co. [2024] 163 taxmann.com 118 (SC) PCIT v/s Anuj Bansal (2024) 165 taxmann.com 2 (Delhi) holding against the department that such an invalid approval vitiates the entire assessment itself. We, thus, find merit in the assessee’s instant first additional ground to quash all these impugned assessments as non–est ones in the eyes of law in very terms.]
The outcome of these assessee’s above latter additional grounds 7. (supra) is hardly any different. We wish to reiterate here that once the learned lower authorities had carried out the search in issue dated 02.06.2022, both these impugned assessment years i.e AY: 2021-22 & 2022-23 ought to have been assessed only u/ 148 r.w.s 147 then u/ 143(3) of the Act. There is admittedly no denial to the fact that the learned prescribed authority had itself approved the impugned assessments u/s 148B of the Act (supra). We further take note of the Explanatory Memorandum of the Finance Bill; 2021. Further settling the issue in the assessees’ favour that such a case is covered under the newly introduced Section 147 only as per “three Assessment Years immediately preceding the assessment year reliable to the previous year in which this search is initiated…………….” Case law (2026) 182 taxmann.com 11 (Del) Montage Enteprise (P) Ltd. V/s DCIT has declined the Revenue’s very stand as well. We thus quash the impugned assessments for these latter assessment years 2021-22 and 2022-23 in above terms. Next comes unexplained investment to property addition of 8. Rs.3,42,34,540/- made to Ms. Sonika and Shammi Agarwal’s hands forming subject matter of our apt adjudication. Both the learned lower authorities have considered the total investment at Rs.6,53,38,873/- in the twin properties in question. Coming to the impugned sumn of Rs.3.42 (crores), learned counsel takes us to the seized document “Sanjeev Kumar Agarwal” indicating the same to be Rs.1,69,13,950/- only. We thus reject the Revenue’s vehement contentions and hold the assessee as entitled for further relief of Rs.1,73,20,590/- in above terms. Necessary computation shall follow. Lastly comes the final issue of cash addition of Rs.4,55,93,004/- 9. made in the assessee namely Ravinder Kumar Agarwal’s hands i.e. ITA No. 3925 & 4087/Del/2025. He admittedly happenes to be director in the Page | 8
company/assessee M/s KL Vegetables Oil Products Ltd. which are also assessed @ 1% NP i.e. Rs.4,41,61,257/- in AYs; 2014-15 to 2022-23. Learned counsel refers to the assessee’s search statement as 04.06.2022 (supra) in reply “ Ex. No. 13” admitting the impugned cash belonging to the company only which has nowhere been disputed as well. That being the case , we direct the learned Assessing Officer to consider and grant “telescoping” benefit to the assessee qua the aforesaid sum assessed in the company’s hands so as to avoid any double addition after verifying all relevant facts. Ordered accordingly. Necessary computation shall follow. To sum up, these nine assessees’ all the instant appeals in ITA Nos. 10. 3879/Del/2025, 3881/Del/2025, 3880/Del/2025,3891/Del/2025, 3900/Del/2025, 3899/Del/2025, 3898/Del/2025, 3897/Del/2025, 3892/Del/2025, 3893/Del/2025, 3894/Del/2025, 3895/Del/2025, 3896/Del/2025, 3901/Del2025, 3902/Del/2025, 3903/Del/2025, 3904/Del/2025, 3505/Del/2025, 3906/Del/2025, 3907/Del/2025, 3908/Del/2025, 3909/Del/2025, 3910/Del/2025, 3911/Del/2025, 3912/Del/2025, 3913/Del/2025, 3914/Del/2025, 3915/Del/2025, 3916/Del/2025, 3917/Del/2025, 3918/Del/2025, 3919/Del/2025, 3920/Del/2025, 3921/Del/2025, 3925/Del/2025, are allowed and Revenue’s corresponding Cross-appeals in ITA Nos. 4143/Del/2025, 4095/Del/2025, 4109/Del/2025, 4107/Del/2025, 4087/Del/2025, as the case may be stand dismissed in above terms. A copy of this common order be placed in the respective case files.
Order pronounced in the open court on 27/03/2026. -Sd/- -Sd/- (M. BALAGANESH) (SATBEER SINGH GODARA) ACCOUNTANT MEMBER JUDICIAL MEMBER Dated: 27/03/2026 A K Keot Page | 9
