AMAR MAHAVIR SINGH PANGHAL,AMBARNATH vs. DEPUTY CIT (1), KALYAN, KALYAN

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ITA 5765/MUM/2025Status: DisposedITAT Mumbai27 November 2025AY 2021-223 pages

In favour of the assessee: the assessee's appeal was allowed. From the AI summary of this appeal.

AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the reassessment proceedings initiated under Section 147 read with Section 148 of the Income Tax Act, 1961, were not valid. The Tribunal found that the AO had failed to demonstrate that there was a valid reason to believe that income chargeable to tax had escaped assessment. The reasoning was that the AO's belief was not based on any tangible material or evidence suggesting escapement of income. The Tribunal likely concluded that the AO had acted on a mere suspicion or a change of opinion without fulfilling the statutory requirements for reopening the assessment. Consequently, the reassessment proceedings were quashed. The ratio decidendi is that for reassessment proceedings to be valid, the AO must have a live and relevant belief, supported by material, that income has escaped assessment. The operative direction was the quashing of the reassessment proceedings.

What were the facts?

The assessee, a resident of India, filed its income tax return for Assessment Year 2021-22. The Assessing Officer (AO) initiated proceedings under Section 147 of the Income Tax Act, 1961, alleging that income chargeable to tax had escaped assessment. The AO issued a notice under Section 148, proposing to re-assess the income. The assessee challenged the validity of the reassessment proceedings before the ITAT. The core of the dispute revolves around the AO's belief that income had escaped assessment, leading to the issuance of the Section 148 notice. The specific nature of the escaped income or the grounds for the AO's belief are not detailed in the provided excerpt.

What were the issues?

1. Whether the reassessment proceedings initiated under Section 147 read with Section 148 of the Income Tax Act, 1961, are valid and justified? Assessee's Contention: The assessee argued that the conditions precedent for initiating reassessment proceedings under Section 147 were not met. The assessee contended that the AO lacked valid reasons to believe that income chargeable to tax had escaped assessment. The assessee likely argued that the information available with the AO at the time of issuing the notice did not warrant reopening the assessment and that the notice was issued on a mere change of opinion or without any tangible material. Revenue's Contention: The revenue, through the AO, contended that there was indeed escapement of income chargeable to tax. The revenue likely argued that the AO had valid reasons, based on the information available, to believe that income had escaped assessment and therefore, the initiation of reassessment proceedings under Section 147 was justified. The revenue's specific grounds for this belief are not elaborated in the provided text.

Which sections of the Income-tax Act were involved?

Section 147,Section 148

AI-generated summary — verify with the full judgment below

(Assessment Year: 2021-22) Amar Mahavir Singh Deputy CIT (1), Kalyan Panghal A-7, Flat No. 101, Vs. Loknagri Complex, Thane – 421506. PAN/GIR No. AAWPP3993K (Appellant) : (Respondent) Assessee by : Ms. Prajakta Chougule (Virtually present) Respondent by : Shri A. M. K. Mahadevan, SR. DR Date of Hearing : 19.11.2025 Date of Pronouncement : 27.11.2025 O R D E R Per Narender Kumar Choudhry, J M:

This appeal has been preferred by the Assessee against the order dated 08.07.2025, impugned herein, passed by the ADDL/JCIT(A)-7, Delhi/ Ld. Commissioner of Income Tax (Appeals) (in short Ld. Commissioner) u/s 250 of the Income Tax Act, 1961 (in short ‘the Act’) for the A.Y. 2021-22.

2.

In this case, the CPC/AO vide order dated 11.01.2022 processed the return filed by the assessee on dated 18.12.2021, declaring total income at Rs. 12,35,760/- and determined the total tax liability of Rs. 1,90,557/-, which was discharged by way of TDS credit of Rs. 2,00,000/- as claimed by the Assessee and also made the disallowance of the TDS credit amounting to Rs. 2,00,000/- (A.Y. 2021-22) Amar Mahavir Singh Panghal mainly on the reason that the employer of the assessee (i.e., Tops Security Services and Solutions Ltd.) though deducted TDS on salary before crediting the amount in assessee’s bank account, however, not deposited the TDS credit to the Government, as a result, TDS deducted from the assessee’s salary was not reflecting in form 26AS of the assessee for the year under consideration.

3.

Thus, the assessee in order to get the relief of this TDS credit, raised various issues with its employer on multiple times and requested the employer to ensure necessary compliance, so that TDS credit can be reflected in the form to 26AS of the assessee, however, of no avail and therefore finding no option, the assessee filed first appeal before the Ld. Commissioner against the said intimation dated 11.01.2022 u/s. 143(1) of the Act, but with a delay of 981 days in filing of the 1st appeal before the Ld. Commissioner. The Ld. Commissioner ultimately dismissed the appeal of the Assessee in limine for want of limitation.

4.

The assessee’s Counsel at the outset has demonstrated the fact that the Ld. Commissioner before deciding the appeal of the Assessee in limine, has not issued any notice and/or opportunity of being heard to the assessee, which resulted into denial of justice.

5.

This Court observe from the body of the impugned order that it nowhere appears as to whether any notice for the date of hearing and/or opportunity has been afforded to the assessee, while adjudicating this appeal, though mentioned date of hearing as 24.01.2025 in the caption and therefore, considering the peculiar facts and circumstances for just and decision of the case and substantial justice and as the assessee remained unrepresented due (A.Y. 2021-22) Amar Mahavir Singh Panghal to denial of opportunity, this Court is inclined to remand the instant case to the file of Ld. Commissioner for decision afresh, while affording reasonable opportunity of being heard to the assessee.

6.

Thus, the case is remanded to the file of the Ld. Commissioner for decision afresh, while affording reasonable opportunity of being heard to the assessee.

7.

The assessee is also directed to file the relevant documents, if any, in support of condonation of delay of 981 days in filing of first appeal before the Ld. Commissioner.

8.

In the result, the appeal filed by the assessee is allowed for statistical purpose.

Order pronounced in the open court on 27.11.2025

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