ESIC CONSULTANCY PVT. LTD., BILASPUR,BILASPUR vs. ACIT, CIRCLE 1(1), BILASPUR, BILASPUR

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ITA 505/RPR/2025Status: DisposedITAT Raipur31 July 2026AY 2012-1318 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 reopening beyond four years requires the AO to demonstrate the assessee's failure to disclose material facts. Since this was not done, the reassessment order was deemed invalid, bad in law, and void ab initio, and thus quashed.

What were the facts?

The assessee's assessment for AY 2012-13 was reopened by a notice under Section 148 dated March 31, 2019, which was beyond four years from the end of the assessment year. The Assessing Officer (AO) did not provide any specific failure on the part of the assessee to disclose material facts.

What were the issues?

Whether reopening of assessment beyond four years is valid without demonstrating the assessee's failure to disclose material facts.

Which sections of the Income-tax Act were involved?

Section 147,Section 148

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, RAIPUR BENCH, “DB” RAIPUR

Before: SHRI PARTHA SARATHI CHAUDHURY & DR. DIPAK P. RIPOTE

For Appellant: shri G.S Agrawal &
For Respondent: Shri Piyush Tripathi, Sr. DR
Hearing: 29.07.2026Pronounced: 31.07.2026

आदेश / ORDER PER PARTHA SARATHI CHAUDHURY, JM: The present appeal preferred by the assessee emanates from the order of the Ld.CIT(Appeals)/NFAC, Delhi dated 24.06.2025 for the assessment year 2012-13 as per the grounds of appeal on record.

2.

The contention in law as assailed by the Ld. Counsel for the assessee in this case is that for A.Y.2012-13, reopening of the assessment has been done vide notice u/s. 148 of the Act, dated 31.03.2019 which is beyond period of 4 years and the Department has not been pointed any failure on the part of the assessee for not disclosing truly and fully all materials facts at the time of original assessment. In this regard, it would be relevant to extract notice u/s. 148 of the Act which reads as follows:

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3.

Further, relevant show-cause notice dated 10.12.2019 is extracted as follows:

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4.

That on reading of the assessment order as well as show cause notice, there is no whisper at all regarding any failure on the part of the assessee to disclose truly and fully all material facts at the time of original assessment when reopening has been done beyond period of 4 years from the end of the relevant assessment year. Therefore, there is blatant

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violation of “1st Proviso” to Section 147 of the Act which is applicable to A.Y. 2012-13 in the case of the assessee.

5.

We find that similar issue has been adjudicated by the ITAT, DB, Raipur in the case of DCIT-1(1), Raipur (C.G.) Vs. Usha Devi Singhania, ITA No.269 & 270/RPR/2025, dated 31.07.2025 in favour of the assessee and against Revenue observing as follows:

“4. Before proceeding any further, we would like to refer to the “1st proviso” to Section 147 of the Act which reads as follows: “147. Income escaping assessment.—If the Assessing Officer has reason to believe" that any income chargeable to tax has escaped assessment" for any assessment year, he may", subject to the provisions of sections 148 to 153, assess or reassess" such" income "and also any other income chargeable to tax which has escaped assessment and which comes to his notice subsequently in the course of the proceedings" under this section, or re-compute the loss or the depreciation allowance or any other allowance, as the case may be, for the assessment year concerned (hereafter in this section and in sections 148 to 153 referred to as the relevant assessment year) : Provided that where an assessment under sub-section (3) of section 143 or this 'section has been made for the relevant assessment year, no action shall be taken under this section after the expiry of four years from the end of the relevant assessment year, unless any income chargeable to tax has escaped assessment for such assessment year by reason of the failure on the part of the assessee to make a return under section 139 or in response to a notice issued under sub- section (1) of section 142 or section 148 or to disclose fully and truly all material fact necessary for his assessment, for that assessment year……”

5.

That on verification of the notice u/s.148 of the Act for relevant assessment year dated 28.03.2021 and the “1st proviso” to Section 147 of the Act, it is crystal clear that the

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reopening proceedings has been initiated and the notice u/s.148 of the Act issued to the assessee was beyond the period of four years from the end of the relevant assessment year. This fact has not been disputed by the department. In such scenario, further statutory requirement is that the department should be able to demonstrate specifically any failure on the part of the assessee to disclose fully and truly all material facts required for assessment for that relevant assessment year. In this regard, let us refer to the copy of the reasons recorded for reopening. The copy of the same is annexed at Paper Book-2, Pages 93 to 98 which reads as follows:

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6.

There is no whisper even as per the aforesaid reasons recorded regarding any failure on the part of the assessee in disclosing fully and truly all material facts necessary for assessment during the relevant assessment year. That undisputedly reopening has been done beyond the period of four years, then the revenue mandatorily has to bring on record the said failure on the part of the assessee in not disclosing fully and truly all material facts in compliance to the “1st proviso” to Section 147 of the Act. That once it is proved as in the present case of the assessee that the reopening has been done through issuance of notice u/s. 148 of the Act beyond the period of four years from the end of the relevant assessment year and there has been no failure recorded by the department on the part of the assessee in disclosing fully and truly all material facts for assessment during the relevant assessment year, in such case, such reopening shall become arbitrary, invalid and void ab initio and liable to be quashed. The same ethos has been reflected in the following judicial pronouncements. 7. The Hon’ble Jurisdictional High Court in the case of Hariom Ingots and Power Pvt. Ltd. Vs. Pr. CIT (2022) 444 ITR 306 (C.G.). In the said decision, the Hon’ble Jurisdictional High Court had held as follows: “6…………. For issuance of notice under Section 148 of the I.T. Act, there should be tangible material and mandatory compliance of Section 147 of I.T. Act. Proceedings of reassessment has been initiated against company after lapse of 4 years of submission of return, which is not in dispute. Under first proviso to Section 147 of the I.T. Act, for starting the reassessment proceedings after lapse of 4 years, Assessing Officer has to record his conclusion that there was failure on the part of assessee in not disclosing fully and truly all material facts necessary for assessment of that particular assessment year, which is not appearing from the reading of the Annexure i.e. reasons for issuance of notice.

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7.

Considering the aforementioned facts and circumstances of the case, reason assigned for issuance of notice and provisions mentioned therein, in the opinion of this Court, there was no reason/ground available with Assessing Officer to issue notice under Section 148 of the I.T. Act. Issuance of notice under Section 148 of the I.T. Act to petitioner is not in accordance with the first proviso to Section 147 of the I.T. Act, therefore, it is not sustainable, which is liable to be quashed and it is hereby quashed. 8. The writ petition is accordingly allowed.”

8.

In the aforesaid binding decision, it has been laid down by the Hon’ble Jurisdictional High Court that when reassessment proceedings are initiated after lapse of four years, in such case as per the “1st proviso” to Section 147 of the Act, the A.O has to record his satisfaction that there was failure on the part of assessee disclosing fully and truly all material facts necessary for assessment for that particular assessment year. That when there was no satisfaction available with the A.O with regard to the “1st proviso” to Section 147 of the Act, in such scenario, issuance of notice u/s. 148 of the Act itself is not in accordance with the provisions of the Act thereby liable to be quashed. The writ petition of the assessee was allowed. 9. Further, we find that ITAT, Raipur “DB” Bench in the case of the Avanindra Nath Agrawal Vs. DCIT, Circle-1(1), Raipur, ITA No. 128/RPR/2025, dated 22.07.2025 had dealt with the similar issue observing as follows: “4. At the same time, the department has failed to bring on record any evidence suggesting any failure on the part of the assessee for disclosing truly and fully all material facts necessary for assessment. In this regard, the Ld. Sr. DR was directed to furnish report from the A.O and the said report was placed by her on record. The relevant submission of the A.O as per the said report is extracted as follows: “(2) The reassessment proceedings have to be invoked within a span of 4 years however in the case of the assessee the same was reopened after 6 years. As per old provisions of the Act, Notice u/s. 148 could be issued for 4 years from the end of A.Y. Further, Notice u/s. 148 could have been issued upto 6 years from the end of A.Y

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in cases where income escaping assessment is Rs.1 lakh or more. Since, in the case of the assessee income escaping assessment for A.Y.2012-13 is Rs.61,65,450/- which is more than Rs.1 lakh therefore the case of the assessee was rightly reopened within 6 years by issuing notice u/s. 148 of the Act, dated 31.03.2019.”

As evident, it is admitted by the department that the case of the assessee was reopened after 6 years. It is also the contention of the A.O that notice u/s. 148 of the Act can be issued upto 6 years from end of the assessment year in cases where income escaping assessment is Rs.1 lakh or more and since in the case of the assessee income escaping assessment for A.Y.2012-13 is Rs.61,65,450/- which was more than Rs.1 lakh therefore, the case of the assessee was rightly reopened within 6 years by issuing notice u/s. 148 of the Act, dated 31.03.2019. 5. In this regard, let us refer to relevant provision of Section 147 of the Act which deals with the contended issue before us: “147. Income escaping assessment.—If the Assessing Officer has reason to believe" that any income chargeable to tax has escaped assessment" for any assessment year, he may", subject to the provisions of sections 148 to 153, assess or reassess" such" income "and also any other income chargeable to tax which has escaped assessment and which comes to his notice subsequently in the course of the proceedings" under this section, or recompute the loss or the depreciation allowance or any other allowance, as the case may be, for the assessment year concerned (hereafter in this section and in sections 148 to 153 referred to as the relevant assessment year) : Provided that where an assessment under sub-section (3) of section 143 or this 'section has been made for the relevant assessment year, no action shall be taken under this section after the expiry of four years from the end of the relevant assessment year, unless any income chargeable to tax has escaped assessment for such assessment year by reason of the failure on the part of the assessee to make a return under section 139 or in response to a notice issued under sub- section (1) of section 142 or section 148 or to disclose fully

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and truly all material fact necessary for his assessment, for that assessment year……” 6. That as evident as applicable to the assessment year in question i.e. A.Y.2012-13 wherein assessment has been completed for the relevant assessment year, no action shall be taken as per this provision after expiry of 4 years from the end of the relevant assessment year unless any income chargeable to tax has escaped assessment for such assessment year by reason of the failure on the part of the assessee to make a return under section 139 or in response to a notice issued under sub-section (1) of section 142 or section 148 or to disclose fully and truly all material fact necessary for his assessment, for that assessment year. None of the limbs applies to the case of the assessee nor the revenue has able to place on record any evidence regarding any failure on the part of the assessee “to disclose truly and fully all material facts necessary for assessment.” At the same time, ground taken by the A.O justifying the reopening beyond the period of 6 years saying that whenever there is a case where income escaping assessment is Rs.1 lakhs or more, in such cases, notice u/s. 148 of the Act could have been issued upto 6 years from the end of the assessment year, however, no such limb emanates from the said proviso to Section 147 of the Act and therefore, this reason as stated by the A.O is not emanating from the statute, hence, the said observation is perverse and infructuous and does not contain legal validity. We find that the Hon’ble Supreme Court in its recent order passed in the case of Union of India Vs. Rajeev Bansal (2024) 469 ITR 46 (SC) had, inter alia, observed that the order passed without jurisdiction is nullity. It was further observed that if a statute expressly confers a power or imposes a duty on a particular authority, then such power or duty must be exercised or performed by that authority itself. Elaborating further, the Hon’ble Apex Court had observed that any exercise of power by statutory authorities inconsistent with the statutory prescription is invalid. Apart from that, it was observed that as there cannot be any waiver of a statutory requirement or provision that goes to the root of the jurisdiction of assessment, therefore, any consequential order passed or action taken will be invalid and without jurisdiction. For the sake of clarity, the observations of the Hon’ble Apex Court are culled out as under: “xxxx xxxx xxxx xxxx xxxx 30. If a statute expressly confers a power or imposes a duty on a particular authority, then such power or duty must be

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exercised or performed by that authority itself. (Dr. Premachandran Keezhoth Vs. Chancellor, Kannur University). Further, when a statute vests certain power in an authority to be exercised in a particular manner, then that authority has to exercise its power following the prescribed manner (CIT Vs. Anjum M.H. Ghaswala; State of Uttar Pradesh Vs. Singhara Singh). Any exercise of power by statutory authorities inconsistent with the statutory prescription is invalid…………. xxxx xxxx xxxx xxxx xxxx 32. A statutory authority may lack jurisdiction if it does not fulfil the preliminary conditions laid down under the statute, which are necessary to the exercise of its jurisdiction. (Chhotobhai Jethabhai Patel and Co. V. Industrial Court, Maharashtra Nagpur Bench). There cannot be any waiver of a statutory requirement or provision that goes to the root of the jurisdiction of assessment. (Superintendent of Taxes Vs. Onkarmal Nathmal Trust). An order passed without jurisdiction is a nullity. Any consequential order passed or action taken will also be invalid and without jurisdiction. (Dwarka Prasad Agrawal V. B.D. Agrawal). Thus, the power of assessing officers to reassess is limited and based on the fulfilment of certain preconditions. (CIT Vs. Kelvinator of India Ltd.)” Therefore, considering the facts that viz. (i) reopening was done beyond the period of 6 years; (ii) department has not proved any failure on the part of the assessee to disclose fully and truly all material facts necessary for assessment; (iii) the A.O has stated frivolous invalid ground justifying the action of the department, therefore, such reassessment proceedings initiated beyond the period of 6 years is invalid, void ab initio, hence quashed. 7. Since the reassessment is quashed thereafter all the other proceedings becomes non-est in the eyes of law. As the legal issue has been answered in favour of the assessee therefore the grounds on merits becomes academic only. 8. As per the aforesaid terms the grounds of appeal raised by the assessee stands allowed.

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9.

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

10.

Respectfully following the aforesaid judicial pronouncements on the same parity of reasoning, we hold that the reassessment order is invalid, bad in law, void ab initio and hereby quashed. Since the reassessment is quashed thereafter all the other subsequent proceedings becomes non-est in the eyes of law. 11. That as per the aforesaid terms the application filed by the assessee under Rule 27 of the ITAT Rules, 1963 is allowed. Since the impugned order i.e. order of the Ld. CIT(Appeals)/NFAC has become non-est, the appeal preferred by the revenue against non-est order becomes infructuous and hence dismissed. 12. In the result, appeal of the revenue in ITA No.269/RPR/2025 for A.Y.2013-14 is dismissed.”

6.

Respectfully following the aforesaid judicial pronouncements on the same parity of reasoning, we hold that the reassessment order is invalid, bad in law, void ab initio and hereby quashed. Since the reassessment is quashed thereafter all the other subsequent proceedings becomes non-est in the eyes of law.

7.

In the result, appeal of the assessee is allowed.

Order pronounced in the open court on 31st July, 2026.

Sd/- Sd/- DR.DIPAK P. RIPOTE PARTHA SARATHI CHAUDHURY (ACCOUNTANT MEMBER) (JUDICIAL MEMBER) रायपुर/ RAIPUR ; �दनांक / Dated : 31st July, 2026. SB, Sr. PS आदेश क� ��त�ल�प अ�े�षत / Copy of the Order forwarded to :

18 EICS Consultancy Private Limited Vs. ACIT, Circle-1(1), Bilaspur (C.G.) ITA No.505/RPR/2025

1.

अपीलाथ� /The Appellant. 2. ��यथ� /The Respondent. 3. The CIT(Appeals)-1, Raipur (C.G.) 4. �वभागीय ��त�न�ध, आयकर अपील�य अ�धकरण, रायपुर ब�च, रायपुर / DR, ITAT, Raipur Bench, Raipur. 5. गाड� फ़ाइल / Guard File. Samiran आदेशानुसार / BY ORDER, Bera, Sr. PS, // True Copy // ITAT, Raipur Senior Private Secretary आयकर अपील�य अ�धकरण, रायपुर / ITAT, Raipur. Digitally signed by Samiran Bera, Sr. PS, ITAT, Raipur Date: 2026.07.31 14:06:01 +05'30'

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