POPULAAR AGENCIES PRIVATE LIMITED,KOLKATA vs. ITO, WARD 9(1), KOLKATA, KOLKATA

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ITA 1471/KOL/2026Status: DisposedITAT Kolkata16 September 2026AY 2010-20118 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the notice issued under Section 148 of the Act was invalid as it was issued prior to the communication of the approval under Section 151. Consequently, the assessment framed based on this invalid notice was also quashed.

What were the facts?

The assessee's case was reopened under Section 147 based on information of accommodation entries. A notice under Section 148 was issued on March 28, 2017, but the approval under Section 151 was communicated to the AO on March 30, 2017. The AO proceeded with the assessment and added the amount to the assessee's income.

What were the issues?

Whether a notice issued under Section 148 is invalid if it is issued before the communication of approval under Section 151. Whether an assessment framed consequent to an invalid notice under Section 148 can be sustained.

Which sections of the Income-tax Act were involved?

Section 143(3),Section 147,Section 148,Section 151

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “D” BENCH, KOLKATA

For Appellant: Shri Sunil Surana, AR
For Respondent: Shri Dipu Koley, DR
Hearing: 27.08.2026Pronounced: 16.09.2026

Per Rajesh Kumar, AM:

This is an appeal preferred by the assessee against the order of the National Faceless Appeal Centre, Delhi (hereinafter referred to as the “Ld. CIT(A)”] dated 02.02.2026 for the AY 2010-11

2.

At the time of hearing the ld. Counsel for the assessee assailed the order of ld. CIT (A) upholding the order passed u/s 143(3) / 147 of the Act dated 19.12.2017, which is invalid as the same is passed in consequent to invalid notice issued u/s 148 of the Act on 28.03.2017.

ITA No. 1471/KOL/2026 Popular Agencies Private Limited; A.Y. 2010-11 3. The facts in brief are that the return of income was filed on 22.02.2011, showing total income of ₹410/-. Thereafter, the case of the assessee was reopened u/s 147 of the Act by issuing notice u/s 148 of the Act on 28.03.2017, after the ld. AO received information that the assessee is a beneficiary of accommodation entries to the tune of ₹1,62,00,000/- from two parties namely M/s Yogesh Projects Pvt. Ltd. & M/s Apeak Infotech Pvt. ltd. Thereafter, the ld. AO issued notice u/s 148 of the Act which was complied with by filing the return of income and thereafter notice u/s 143(2) and 142(1) of the Act along with questionnaire were issued and were duly complied with by the assessee. The ld. AO finally added the said amount to the income of the assessee in the assessment framed u/s 143(3)/ 147 of the Act dated 19.12.2017, which was confirmed by the ld. CIT (A).

4.

The ld. AR vehemently submitted before us that the order passed by the ld. CIT (A) upholding the order of the ld. AO is wrong as the assessment has been framed consequent to notice issued u/s 148 of the Act dated 28.03.2017, which was issued prior to communication of approval granted u/s 151 of the Act. The ld. AR submitted that the notice u/s 148 of the Act was issued on 28.03.2017, whereas the approval was communicated to the ld. AO on 30.03.2017. Accordingly, the notice issued u/s 148 of the Act even prior to the communication of approval is bad in law and so is the assessment framed by the ld. Assessing Officer.

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ITA No. 1471/KOL/2026 Popular Agencies Private Limited; A.Y. 2010-11 5. The ld. DR on the other hand relied heavily on the orders of the authorities below by submitting that this is internal administrative matter and approval is normally conveyed through telephone and therefore, mere fact the letter of communication was stamped dated 30.03.2017 in the office of the AO, will not vitiate the notice issued u/s 148 of the Act.

6.

After hearing the rival contentions and perusing the materials available on record, we find that in this case the case of the assessee was reopened u/s 147 of the Act by issuing notice u/s 148 on 28.03.2017, for the sake of ready reference, the same is extracted below:-

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ITA No. 1471/KOL/2026 Popular Agencies Private Limited; A.Y. 2010-11 7. We have also examined the approval granted u/s 151 of the Act dated 28.03.2017, which was granted to 35 entities together whose cases were reopened u/s 148 of the Act vide order dated 28.03.2017, but received by the ld. AO on 30th March, 2017, for the sake of ready reference the same is extracted below:-

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ITA No. 1471/KOL/2026 Popular Agencies Private Limited; A.Y. 2010-11

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ITA No. 1471/KOL/2026 Popular Agencies Private Limited; A.Y. 2010-11

8.

We have perused the notice u/s 148 of the Act as well as the sanction granted u/s 151 of the At and note that the notice u/s 148 of the Act was issued prior to the sanction communicated to the ld. AO on 30.03.2017 and therefore, the same is invalid and the assessment framed consequently, is

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ITA No. 1471/KOL/2026 Popular Agencies Private Limited; A.Y. 2010-11 also invalid and cannot be sustained. The case of the assessee is squarely covered by the following decisions:- i. Arya Commotrade Pvt. Ltd. Vs. ACIT in ITA No. 2728/KOL/2025 vide order dated 23.06.2026. ii. Ran International Pvt. Ltd. Vs. ITO in ITA No. 1823/KOL/2024 vide order dated 28.04.2026. iii. Paras Plaza Pvt. Ltd. Vs. ITO in ITA No.2676/KOL/2024 vide order dated 03.11.2025. 9. Therefore, we are inclined to quash the notice issued u/s 148 of the Act as well as the consequent assessment framed u/s 143(3)/ 147 of the Income-tax Act, 1961 (the Act).

10.

Besides , the consolidated approval granted u/s 151 of the Act is itself invalid and wrong and notice issued u/s 148 of the Act pursuant to such approval is also invalid. The case of the assessee is squarely covered by the decision of Hon'ble Bombay High Court in the case of PCIT Vs Citron Projects Ltd. I.T.A. (L) No. 34357 of 2024 and others (2026)485 ITR 670(Bom). Similar ratio has been laid in the following decisions namely ,ACIT vs. Serajuddin and Co. [2024] 163 taxmann.com 118 (SC) dated 28-11-2023, ACIT vs. Serajuddin & Co. [2023] 150 taxmann.com 146 (Orissa) [15- 03-2023],PCIT vs. Anuj Bansal [2024] 165 taxmann.com 3 (SC) dated [11-07-2024], PCIT vs. Anuj Bansal [2024] 466 ITR 251 (Delhi)[13-07-2023], DCIT vs. Jhansi Development

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ITA No. 1471/KOL/2026 Popular Agencies Private Limited; A.Y. 2010-11 Authority [2024] 165 taxmann.com 9 (Delhi - Trib.)/[2024] [08-07-2024

11.

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

Order pronounced on 16.09.2026.

Sd/- Sd/- (PRADIP KUMAR CHOUBEY) (RAJESH KUMAR) (JUDICIAL MEMBER) (ACCOUNTANT MEMBER) Kolkata, Dated: 16.09.2026 Sudip Sarkar, Sr.PS Copy of the Order forwarded to: 1. The Appellant 2. The Respondent 3. CIT DR, ITAT, 4. 5. Guard file. BY ORDER, True Copy// Dy. Registrar Income Tax Appellate Tribunal, Kolkata

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