AHILYA SHARMA,DELHI vs. DCIT CENTRAL CIRCLE - 15, DELHI

INCOME TAX APPELLATE TRIBUNAL DELHI BENCH “B”: NEW DELHI

BEFORE MS MADHUMITA ROY, JUDICIAL MEMBER AND SHRI KRINWANT SAHAY, ACCOUNTANT MEMBER

ITA No. 1934/Del/2026 (A.Y 2023-24) Puneet Sharma Vs. DCIT RZP-6, Raj Nagar, Part-II, Central Circle-15 Indira Park, Palam Village, Delhi South West Delhi-110045 (Appellant) (Respondent) PAN: AZZPS7009K

ITA No. 1935/Del/2026 (A.Y 2023-24) Kannu Priya Sharma Vs. DCIT B 902, Gokul Apartment, Central Circle-15 Apni CGHS Ltd. Delhi RZP-6, Raj Nagar, Part-II, Palam Colony, Sector-8, Dwarka, Delhi-110045 (Appellant) (Respondent) PAN: AZXPS9794H ITA No. 1937/Del/2026 (A.Y 2023-24) Shrimahanand Leisure Vs. DCIT valley Private Limited Central Circle-15 RZP-6, Raj Nagar, Part-II, Delhi Palam Colony, Indira Park, Dabri, South West Delhi- 110045 (Appellant) (Respondent) PAN: AABCM4253D ITA No. 1938/Del/2026 (A.Y 2023-24) Ahilya Hotels & Resorts Vs. DCIT Badri Nath Road, Central Circle-15 Biyasi, Narendra Nagar, Delhi Atali-Byasi, B.O. Atali, Tehri Garhwal, Uttarakhand- 249192

(Appellant) (Respondent) PAN: AAXFA1795M

2 ITA Nos. 1934& ors /Del/2026 Puneet Sharma & ors Vs. DCIT

ITA No. 1939/Del/2026 (A.Y 2023-24) Bhavyeh Hotels & Resorts Vs. DCIT Private Limikted Ganga Central Circle-15 Beach Resort Tapowan, Delhi Tapoban, B. O. Tapowan, Tehri, Garhwal, Uttarakhand-249192

(Appellant) (Respondent) PAN: AAECB9150H ITA No. 1941/Del/2026 (A.Y 2023-24) Ahilya Sharma Vs. DCIT RZP-6, Raj Nagar, Part-II, Central Circle-15 Dwarka Sector-8, Delhi, Delhi Indira Park, Dabri, South West Delhi-110045 (Appellant) (Respondent) PAN: AZXPS9791C

ITA No. 1942/Del/2026 (A.Y 2023-24) Ganga Retreat Vs. DCIT Badrinath Road, Tapovan, Central Circle-15 Tehri, Garhwal, Delhi Uttarakhand-249192 (Appellant) (Respondent) PAN: AAVFG1567D

ITA No. 1943/Del/2026 (A.Y 2023-24) Ganga Beach Resort Vs. DCIT Shesdhara, Tapovan, Central Circle-15 Laxman Jhula Road, Delhi Rishikesh, Dehradun, Uttarakhand-249192 (Appellant) (Respondent) PAN: AAGFG0354H Assessee by : Shri Ved Jain, CA, Ms. Uma Updhyaya, CA & Shri Ankur Garg, CA Revenue by: Shri Rajesh Mahajan, CIT (DR)

Date of Hearing 25/06/2026

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Date of pronouncement 19/08/2026

O R D E R PER MADHUMITA ROY, JM.:

This bunch of appeals preferred by different assessees are

directed against different orders dated 26.12.2025, 29.12.2025,

31.12.2025, 26.12.2025, 24.12.2025, 24.12.2025, 26.12.2025 and

26.12.2025, passed by the Ld. Commissioner of Income-tax (Appeals),

Delhi-26 under Section 250 of the Income-tax Act, 1961 (hereinafter

referred to as ‘the Act’), arising out of the assessment orderspassed by

the Assessment Unit, Income-tax Department under Section 143(3) of

the Act for all Assessment Years 2023-24. Since, all the appeals relate

to a common issue and arising out of a common search, these are

heard analogously and are being disposed of by a common order for

the sake of convenience.

and seizure operation under Section 132 of the Act was conducted on

various offices and residential premises of Mahananda Group on

02.05.2024 in which the Assessees herein are also covered.

Assessment proceeding for all the assessees for A.Y 2023-24 were

initiated undercompulsory selection of returns for complete scrutiny in

terms of the guidelines of CBDT Circular dated 24.05.2023 as search

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action under Section 132 of the Act was conducted in the case of the

assessee on 02.05.2024 as part of Mahananda Group of Companies

and other related entities and persons. However, the Assessee joins

issue here to this effect that as the Ld. A.O. has relied upon the

document/statement recorded during the course of search on

02.05.2024, Explanation 2 of Section 148 of the Act is to be applied

since the said search was conducted after first day of April 2021.

Under these circumstances, the Ld. A.O. shall be deemed to have

information suggesting the Assessee escaped income chargeable to tax

and the assessment ought to have been initiated by taking recourse of

the provision of Section 147/148 of the Act and not under Section

143(3) of the Act.

reassessment under the facts and circumstances should have been

initiated upon issuance of Notice under Section 148 of the Act, prior

approval of Additional CIT(A)/Joint Secretary before passing the such

reassessment order (in case of a search) is also required to be obtained

under Section 148B of the Act.

and vehemently argued that the Assessing Officer has rightly finalized

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the issue under the normal provision as the entire issue was pending

before him as on the date of search.

the case of Mahandanda Group and the assessees case was also

covered as the related parties. So far as the contention made by the

Ld. AR that the assessment under these facts and circumstances of

the matter ought to have been initiated under Section 148 of the Act

the relevant provisionbeing Explanation 2 of 148 of the Act, needs to

be considered, the provision whereof reads as follows:

"Explanation 2.-For the purposes of this section, where,- (i) a search is initiated under section 132 or books of account, other documents or any assets are requisitioned under section 132A, on or after the 1st day of April,2021, in the case of the assessee; or (ii) a survey is conducted under section 133A, other than under sub-section (2A) of that section, on or after the 1st day of April, 2021, in the case of the assessee; or

(iii) the Assessing Officer is satisfied, with the prior approval of the Principal Commissioner or Commissioner, that any money, bullion, jewellery or other valuable article or thing, seized or requisitioned under section 132 or under section 132A in case of any other person on or after the 1st day of April, 2021, belongs to theassessee; or (iv) the Assessing Officer is satisfied, with the prior approval of Principal Commissioner or Commissioner, that any books of account or documents, seized or requisitioned under section 132 or section 132A in case of any other person on or after the 1st day of April, 2021, pertains or pertain to, or any information containedtherein, relate to, the assessee.”

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the reassessment ought to have been initiated under Section 148 of

the Act and in that view of the matter whether sanction or prior

approval from the Additional Director of Income Tax or Joint

Commissioner of Income Tax before passing such assessment order is

required to be obtained is to be considered. Section 148 B of the Act

reads as follows:

“prior approval for assessment, reassessment or re- computation in certain cases. 148B. No order of assessment or reassessment or re-computation under this Act shall be passed by an Assessing Officer below the rank of Joint Commissioner, in respect of an assessment year to which clause (i) or clause (ii) or clause (iii) or clause (iv) of Explanation to section 148 apply except with the prior approval of the Additional Commissioner or Additional Director or Joint Commissioner or Joint Director."

which suggests that the income chargeable to tax has escaped

assessment in the case of the Assessee where the search is initiated or

books of accounts, other documents or any asset are requisitioned or

survey is conducted in the case of the Assessee or money, bullion,

jewellery or other valuable article orthing or books of accounts or

documents are seized or requisitioned in the case of any other person.

Section 148B of the Act further requires the Ld. A.O. to obtain prior

7 ITA Nos. 1934& ors /Del/2026 Puneet Sharma & ors Vs. DCIT

approval from the Additional CIT/Joint CIT before passing assessment

order in the case of search.

search conducted on 02.05.2024 i.e. after 01.04.2021, the permissible

statutory course was to issue notice under Section 148 of the Act and

to obtain prior approval under Section 148B of the Act before passing

such assessment order in the case in hand.

Section 143(3) of the Act without issuing notice under Section 148 of

the Act. In other words, no compliance has been made by the Ld.

AO,neither initiated proceeding under Section 148 of the Act. In this

regard, we have further considered the Judgment relied upon by the

Ld. AR in the case of Mirha Exports Pvt. Ltd. Vs. DCIT in ITA Nos.

8131, 8132, 8133, 8134 & 8135/Del/2025. While dealing with the

identical issue, the Co-ordinate Bench has been pleased to observe as

follows:-

“22. We find that for the instant year, it is an admitted fact that the assessment is made under the provisions of section 143(3) of the Act. We also note that a search u/s 132, in the present case, was conducted on 21.01.2023 i.e. F.Y. 2022-23 relevant to A.Y. 2023-24. We therefore, agree with the assessee that as per the Explanation 2 to section 148, the only permissible statutory course available to AO for initiating the assessment proceedings was to issue notice u/s 148 and to complete the assessment after

8 ITA Nos. 1934& ors /Del/2026 Puneet Sharma & ors Vs. DCIT

obtaining prior approval u/s 148B before passing assessment order. Instead, we find that in the impugned AY, the AO has taken recourse to normal provisions of section 143(3) of the Act as against conducting reassessment proceedings u/s 148 of the Act and complying with the provision of section 148B of the Act. We therefore, following the decision of ITAT in Montage Enterprises Pvt. Ltd. v. DCIT, Central Circle II, Delhi (supra), are of the considered view that the assessment proceedings initiated as also assessment order passed by the AO for AY 2022-23, is without jurisdiction and therefore bad-in-law. The grounds are allowed."

02.05.2024 in the case of Mahananda Group, where the Assessee was

also covered and as per Explanation 2 of Section 148 of the Act, the

only permissible statutory course available to the Ld. A.O. for

initiating reassessment proceeding was by issuance of notice under

Section 148 of the Act and further such assessment order to be

passed only upon obtaining prior approval under Section 148B of the

Act, from the concerned authority failing which the entire proceeding

cannot be said to be in accordance with law.

ordinate Bench of the Tribunal in the case of Mirha Exports Pvt. Ltd.

Vs. DCIT in ITA Nos. 8131, 8132, 8133, 8134 & 8135/Del/2025

which is also found to be squarely applicable where the Judgment

passed by the Co-ordinate Bench Judgments in the case of Montage

Enterprises Pvt. Ltd. v. DCIT, Central Circle II, Delhi was also considered.

9 ITA Nos. 1934& ors /Del/2026 Puneet Sharma & ors Vs. DCIT

of the Act, the assessment was initiated against the

Assessee.Reassessment proceeding by issuance of notice under

Section 148 of the Act and completion thereof by complying the

provision under Section 148B of the Act,since not having been done,

the entire proceeding is found to be void ab initio and, therefore, liable

to be quashed. We pass orders accordingly. All the appeals filed by

the assessees on the identical issues are, thus, allowed.

Order pronounced in the open court on 19/08/2026. Sd/- Sd/- (KRINWANT SAHAY) (MADHUMITA ROY) ACCOUNTANT MEMBER JUDICIAL MEMBER

Dated: 19/08/2026 R. Naheed, Sr PS Copy forwarded to 1. Applicant 2. Respondent 3. CIT 4. CIT (A) 5. DR:ITAT ASSISTANT REGISTRAR ITAT, New Delhi

10 ITA Nos. 1934& ors /Del/2026 Puneet Sharma & ors Vs. DCIT