ESPAN INFRASTRUCTURE LIMITED (PREVIOUSLY KNOWN AS ESPAN I NFRASTRUCTURE (I) LIMITED,DELHI vs. DCIT CIRCLE -7 (1) DELHI, DELHI

ITA No.5871/DEL/2026 ESPAN INFRASTRUCTURE LIMITED IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH “E” NEW DELHI BEFORE SHRI VIMAL KUMAR, JUDICIAL MEMBER AND SHRI SANJAY AWASTHI, ACCOUNTANT MEMBER ITA No.5871/DEL/2026 Assessment Year: 2019-20 ESPAN INFRASTRUCTURE LIMITED, V DCIT, (previously known as Espan Infrastructure (I) s. Circle 7(1), Limited), Shop No.29, Ground Floor, CSC, Delhi. Block C, Nirman Vihar, East Delhi, Delhi 110092. PAN No. AACCE7048R Appellant Respondent Assessee by Shri Ved Jain, Adv. & Uma Upadhyay, CA Revenue by Shri Tarun Sharda, Sr. DR Date of hearing: 18.08.2026 Pronouncement on 18.08.2026 O R D E R PER SANJAY AWASTHI, ACCOUNTANT MEMBER: 1. This appeal arises from order dated 30.03.2026, passed u/s 250 of the Income Tax Act, 1961 (hereafter as “the Act”), by NFAC.

1.1 In this case, the Ld. AO issued a notice u/s 148 of the Act after an order u/s 148A(d) of the Act on 19.04.2023. This exercise was undertaken on the basis of allegation that the assessee had carried out significant financial transactions with one M/s RCM Finance & Leasing Pvt. Limited. There was an indication of accommodation entries benefitting the assessee. The Ld. AO added Rs.50,00,000/- on the basis of transaction

ITA No.5871/DEL/2026 ESPAN INFRASTRUCTURE LIMITED with M/s RCM Finance & Leasing P. Ltd. and also disallowed interest of Rs.3,11,980/-, being interest paid on the alleged bogus loan.

1.2 The assessee approached the Ld. CIT(A) where also he could not succeed on the basis of detailed finding given on pages 44 to 49 of the impugned order.

1.3 The aggrieved assessee has now approached the ITAT with grounds primarily challenging the assumption of jurisdiction and the addition on merits. The assessee has primarily contended that the notice issued u/s 148 of the Act was without appropriate statutory approval.

i. First notice u/s 148A(b) issued on 27.03.2023; ii. Reply to this notice was filed by the assessee on 05.04.2023; iii. These proceedings were dropped by the Ld. AO and thereafter another notice u/s 148A(b) was issued on 06.04.2023; iv. An order u/s 148A(d), along with notice u/s 148 of the Act, was issued on 19.04.2023 with the approval of PCIT (relevant documents placed at pages 44 to 46 of the PB).

The Ld. AR argued that the amount involved was Rs.50,00,000/- and certainly more than three years had elapsed from the end of the

ITA No.5871/DEL/2026 ESPAN INFRASTRUCTURE LIMITED assessment year under consideration. It was the submission that the authority prescribed u/s 151 for this purpose would be the Pr. CCIT and not PCIT. It was argued that there was a direct violation of the statutory provisions and therefore not only was the notice u/s 148 of the Act issued with improper approval but the consequent proceedings were also bad in law. The Ld. AR relied on a coordinate bench order in the case of Ashish Banga [ITA 6770/Del/2025, order dated 25.03.2026]. The Ld. AR read out from relevant portions of this order and stated that here also AY 2019-20 was involved. It was the further submission that approval had to be obtained from an authority mentioned in Section 151(ii) of the Act, whereas the approval had been obtained from an authority mentioned in Section 151(i) of the Act.

2.1 The Ld. DR relied on the orders of the authorities below.

ITA No.5871/DEL/2026 ESPAN INFRASTRUCTURE LIMITED years had elapsed from the end of the assessment year, being AY 2019-20; d) The amount involved was Rs.7 lakhs and thus, the same was below Rs.50 lakhs as mentioned in section 149(1)(b) of the Act. For all these reasons the Ld. AR stated that the assumption of jurisdiction was bad in law and thus, the entire proceedings deserved to be quashed. 2.1 The Ld. DR relied on the orders of the authorities below. 3. We have carefully considered the rival submissions and have gone through the records before us. It is seen that indeed the documents, including the statutory notices issued to the assessee, reveal that approval has been obtained from the PCIT and not from the PCCIT. Since this is a clear violation of section 149(1)(b) and section 151(i) of the Act, hence, the impugned proceedings cannot be valid in the eyes of law. Accordingly, the assessment order is hereby directed to be quashed. 4. In the result, the appeal is allowed.” We find that the only difference between the facts of Ashish Banga (supra) and the present case are that the amount involved here is exactly Rs.50,00,000/-. However, the law would apply equally to the facts of the present case since in this case also the approval had to be obtained from Pr. CCIT and not PCIT, leading to an incurable fertility. The reassessment proceedings are therefore legally untenable and so is consequential the assessment order.

Order pronounced in the open court on 18.08.2026

Sd/- Sd/- (VIMAL KUMAR) (SANJAY AWASTHI) JUDICIAL MEMBER ACCOUNTANT MEMBER Dated: 10.09.2026 *Kavita Arora, Sr. P.S.

ITA No.5871/DEL/2026 ESPAN INFRASTRUCTURE LIMITED Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals) 5. DR: ITAT ASSISTANT REGISTRAR ITAT, NEW DELHI