NIMISH MAHESHKUMAR BHA vs. AR,AHMEDABAD

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ITA 32/AHD/2026Status: DisposedITAT Ahmedabad27 March 2026AY 2019-204 pages
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What did the Tribunal hold?

The Tribunal found that the notice issued under section 148 for reopening the assessment was invalid because the escapement of income (Rs. 5 lacs) did not meet the threshold of Rs. 50 lakhs or more required under section 149(b) for reopening beyond three years and three months from the end of the assessment year. Therefore, the proceedings were void ab initio.

What were the facts?

The assessee claimed an exemption of Rs. 5,00,000/- under section 80GGC for a donation made to a political party. The Assessing Officer (AO) denied this exemption, treating the donation as bogus. The CIT(A) confirmed the AO's addition. The assessee appealed to the Tribunal.

What were the issues?

Validity of reopening of assessment under section 148 when the conditions stipulated in section 149 are not met, and consequently, the legality of additions and disallowances made pursuant to such reopening.

Which sections of the Income-tax Act were involved?

Section 80GGC,Section 148,Section 149,Section 139(1),Section 250,Section 234A,Section 234B,Section 234C,Section 270A

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Income Tax Appellate Tribunal, AHMEDABAD “A” BENCH

Before: Dr. BRR Kumar & Ms. Suchitra Kamble

For Appellant: Ms. Urvashi Shodhan, A.R
For Respondent: Shri Veerabadram Vislavath, Sr. D.R

आदेश/ORDER PER DR. BRR KUMAR, VICE PRESIDENT:

1.

This appeal is filed by the assessee against the appellate order dated 11.11.2025 passed by the Commissioner of Income Tax (Appeals)/National Faceless Appeal Centre, Delhi, relating to the Assessment Year 2019- 20.

2.

The grounds of appeal

are as under:- “1. Ld. CIT (A) (NFAC) erred in law and on facts in confirming addition of Rs. 5, 00, 000/- made by AO denying exemption claimed u/s 80GGC of the Act.

2. Ld. CIT (A) (NFAC) erred in law and on facts in confirming addition of Rs. 5, 00, 000/- donation made to a political party

3. Ld. CIT (A) (NFAC) erred in law and on facts confirming addition without taking into consideration the affidavit that no cash was ever returned by the political party against genuine donation made by the appellant.

4. Ld. CIT (A) (NBAC) erred in law and on facts addition made on the basis of statement of third person without affording opportunity of cross examination demanded by the appellant is totally against the principles of Natural Justice.

5. Levy of interest u/s 234A/ 234B & 234C of the Act is unjustified.

6.

Initiation of penalty proceedings u/s 270A of the Act is unjustified.” Additional ground of appeal: “Appellant craves leave to raise this additional ground in cross objections filed before the Hon'ble ITAT. This is a legal ground and therefore as per the decision of Hon'ble Supreme Court in the case of National Thermal Power (229 ITR 383) it can be raised before the Hon'ble ITAT.

1. Ld. CIT (A) erred in law and on facts in upholding the reopening of the assessment which is unlawful & without legal sanction since the condition precedent for valid reopening is not satisfied.

2. The order passed by NFAC u/s 250 of the Act upholding the disallowance of Rs. 5,00,000/- u/s 80GGC of the Act treating the impugned donation as bogus is wholly illegal, unlawful & against the principles of Natural Justice.”

3.

The undisputed facts of the case are that notice u/s. 148 has been issued on 28-04-2023 for escapement of income on account of donation paid of Rs. 5 lacs. The assessment year before us is assessment year 2019-20 and the assessee has filed regular return of income u/s. 139(1) dated 28-04-2023 declaring total income of Rs. 49,05,600/- Nimish Maheshkumar Bhavsar, A.Y. 2019-20 The relevant facts are: (i) Assessment Year 2019-20 (ii) Escapement of income is Rs. 5 lacs (iii) Provisions of section 149 reads as under:- “149. (1) No notice under section 148 shall be issued for the relevant assessment year,— (b) if three years and three months, but not more than five years and three months, have elapsed from the end of the relevant assessment year unless the Assessing Officer has in his possession books of account or other documents or evidence related to any asset or expenditure or transaction or entries which show that the income chargeable to tax, which has escaped assessment, amounts to or is likely to amount to fifty lakh rupees or more….

3.1 Considering the provisions of section 149(b), the escapement of income prima facie is not likely to be Rs. 50 lakhs or more as the donation was Rs. 5 lacs only. Hence, keeping in view the provisions of section 149(b), notice issued u/s.148 is invalid in the proceedings void ab initio.

4.

In the result, the appeal of the assessee is allowed.

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