RAJSHREE DEVELOPER ENTERPRENUERS PRIVATE LIMITED,KOLKATA vs. DCIT, CENTRAL CIRCLE 4(3),, KOLKATA

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ITA 740/KOL/2026Status: DisposedITAT Kolkata10 July 2026AY 2018-20195 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the approval for issuing the notice under Section 148 was granted by an incompetent authority (PCIT instead of PCCIT) as the reassessment was initiated beyond three years. Consequently, the notice and the assessment were quashed.

What were the facts?

The assessee's return was accepted initially. Later, a notice under Section 148 was issued for reassessment, leading to additions. The assessee challenged the validity of the reassessment proceedings.

What were the issues?

Whether the reassessment proceedings initiated under Section 148 are valid when the approval for issuing the notice was granted by an incorrect authority as per Section 151 of the Income Tax Act.

Which sections of the Income-tax Act were involved?

Section 148,Section 151,Section 147,Section 148A,Section 68

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, KOLKATA ‘D’ BENCH, KOLKATA

Before: SHRI RAJESH KUMAR & SHRI PRADIP KUMAR CHOUBEY

For Appellant: Shri Sunil Surana, AR
For Respondent: Shri Praveen Das Chowdhury, Sr. DR
Hearing: 01.07.2026Pronounced: 10.07.2026

IN THE INCOME TAX APPELLATE TRIBUNAL KOLKATA ‘D’ BENCH, KOLKATA BEFORE SHRI RAJESH KUMAR, ACCOUNTANT MEMBER AND SHRI PRADIP KUMAR CHOUBEY, JUDICIAL MEMBER I.T.A. No.740/KOL/2026 (Assessment Year:2018-19) Rajshree Developer Entrepreneurs DCIT, Pvt. Ltd., Vs. Central Circle – 4(3), 34, Ezra Street, Kolkata – 700001, Kolkata West Bengal [PAN:AABCR2000D] (Appellant) .. (Respondent) Appellant by : Shri Sunil Surana, AR Respondent by: Shri Praveen Das Chowdhury, Sr. DR Date of Hearing 01.07.2026 Date of Pronouncement 10.07.2026

O R D E R PER RAJESH KUMAR, ACCOUNTANT MEMBER:

This appeal preferred by the assessee is against the order of the Learned Commissioner of Income Tax (Appeals),National Faceless Appeal Centre, Delhi(hereinafter referred to as the “Ld.CIT(A)”], dated 17.12.2025 for the Assessment Year (AY) 2017-18.

2.

At the outset of hearing, the learned Authorized Representative (ld. AR) pressed Ground No.2, which is extracted below:

“2. For that the sanction granted u/s 151 by the PCIT was without jurisdiction and further without application of mind ,which made the proceedings u/s 148 to be void and therefore the reassessment is liable to be quashed.”

ITA No.740/Kol/2026/AY 2018-19 Rajshree Developers Entrepreneurs Pvt. Ltd. vs. DCIT 3. The facts of the case in brief are that assessee filed its return of income on 16.10.2018, showing total income of Rs.35,45,250/- under the normal provisions and Rs.35,45,251/- u/s 115JB of the Income-tax Act, 1961 (In short, ‘the Act’). The return was revised subsequently offering same income. The case was selected for scrutiny under CASS and order was framed u/s 143(3) of the Act accepting the returned income. Thereafter, notice u/s 148(b) of the Act was issued and assessee filed objection thereto. The AO then passed order u/s 148A(d) of the Act on 07.04.2022 and also issued notice u/s 148 of the Act to the assessee. Accordingly, the assessee filed return of income on 06.05.202, disclosing the same as declared in the original return of income. The assessee complied and filed the replies/submissions from time to time and assessment was finally passed u/s 147 of the Act vide order dated 31.03.2022 by making addition of Rs.1,62,90,000/- as unexplained cash credit u/s 68 of the Act besides disallowing interest expenses of Rs.35,45,250/- thereby the assessing income at Rs.2,23,99,646/-.

4.

At the time of hearing, the Ld. AR of the assessee submitted that the re- opening of assessment u/s 148 is invalid and bad in law as there is no valid sanction granted u/s 151 of the Act by the competent authority. The Ld. AR while referring to the notice issued u/s 148 of the Act, dated 07.04.2022 submitted that it has been stated that notice was issued after obtaining approval of Ld. PCIT-2, Kolkata dated 17.04.2022 whereas it should have been accorded by Ld. PCCIT-2, Kolkata, Therefore, the same is invalid and so is the consequent notice u/s 148 of the Act as well as assessment framed. The Ld. AR relied on the following decisions in defense of his arguments, viz., (i) M/s Blackstone Overseas Pvt. Ltd. vs. ITO, ITA No.2026 & 202/Kol/2025, dated 18.12.2025, (ii) Compaq Solution Pvt. Ltd. vs. ITO,ITA No.2329/Kol/2025, dated 20.05.2026, (iii) Agnello Oswin Dias vs. ACIT, WP No.3429 of 202, dated

ITA No.740/Kol/2026/AY 2018-19 Rajshree Developers Entrepreneurs Pvt. Ltd. vs. DCIT 22.02.2024 (Bombay – HC), (iv) Vodafone Idea Ltd. vs. DCIT, WP No.2768 of 2022, dated 06.02.2024 (Bombay – HC). Therefore, Ld. AR, prayed that notice u/s 148 of the Act as well as assessment framed u/s 147 of the Act may kindly be quashed as bad in law.

5.

On the other hand, Learned Senior Departmental Representative (Ld. Sr. DR) relied heavily on the orders of the lower authorities below and submitted that the approval was granted in accordance with law.

6.

We have heard rival submissions and perused the materials available on record. We find that notice u/s 148 was issued by AO on 17.04.2022 after following the procedure laid down u/s 148A of the Act. We note that the approval has been granted by Ld. PCIT-2, Kolkata on 17.04.2022 u/s 151 of the Act for issuing such notice u/s 148 of the Act whereas in terms of provisions of section 151 of the Act, approval was required to be obtained from Ld. PCCIT, Kolkata. Therefore, approval granted is invalid and nullity in the eyes of law. Consequently, notice u/s 148 of the Act as well as assessment are nullity and bad in law. The issue is squarely covered by the decision in case of M/s Blackstone Overseas Pvt. Ltd. vs. ITO, ITA Nos.2026 & 2027/Kol/2025, dated 18.12.2025 held as under:

“2.3 After hearing the rival contentions and perusing the materials available on record, we find that the assessment was reopened after a period of three years from the end of the relevant assessment year as the notice u/s 148 of the Act was issued on 07.04.2022, whereas the assessment year involved is 2018-19 and thus is beyond three years from the end of the relevant assessment year. Therefore, in term of section 151 of the Act, the approval was required to be taken from the ld. PCCIT, whereas the assessee has taken an approval from ld. PCIT-2, Kolkata. Accordingly, in our opinion, the approval has not been granted by the competent authority as prescribed under the Act under section 151 of the Act. Therefore, the notice issued u/s 148 of the Act and consequent assessment is nullity and bad in law. The issue is covered by the decision of Hon'ble Bombay High Court in Writ Petition No.3249 of 2022 in

ITA No.740/Kol/2026/AY 2018-19 Rajshree Developers Entrepreneurs Pvt. Ltd. vs. DCIT case of Agnello Oswin Dias Vs. ACIT dated 22.02.2024, wherein it has held as under:- “4. The impugned order and the impugned notice both dated 22 April 2022 state that the Authority that has accorded the sanction is the PCIT, Mumbai- 5. The matter pertains to Assessment Year ("AY") 2018-2019 and since the impugned order as well as the notice are issued on 22 April 2022, both have been issued beyond a period of three years. Therefore, the sanctioning authority has to be the PCCIT as provided under Section 151 (ii) of the Act. The proviso to Section 151 of the Act has been inserted only with effect from 1" April 2023 and, therefore, shall not be applicable to the matter at hand. 5. In the circumstances, as held by this Court in Siemens Financial Services Private Limited Vs. Deputy Commissioner of Income Tax & Ors., the sanction is invalid and consequently, the impugned order and impugned notice both dated 22nd April 2022 under Sections 148A(d) and 148 of the Act are hereby quashed and set aside.” 7. The co-ordinate bench has followed the decision of Bombay High Court deciding in case of Agnello Oswin Dias (supra). Therefore, we respectfully following the decisions cited above, quash the notice u/s 148 of the Act as well as the assessment framed by the AO. The ground is allowed.

8.

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

The order is pronounced in the open Court on 10/07/2026.

Sd/- Sd/- (Pradip Kumar Choubey) (Rajesh Kumar) JUDICIAL MEMBER ACCOUNTANT MEMBER Kolkata, Dated: 10/07/2026 SAMANTA आदेश �ȧ ĤǓ�ͧ �ͪ �\ Ē ȯͪ��/Copy of the Order forwarded to: 1. \ �Ȣ�ȡ�ȸ/ The Appellant 2. Ĥ×��ȸ/ The Respondent. 3. Ȳ�Ȳͬ��आयकर] �ǕÈ�/ Concerned CIT 4. आयकर] �ǕÈ�(अपील) / The CIT(A)- 5. ��ȡ�Ȣ�ĤǓ�Ǔ�ͬ �, आयकर\ �Ȣ�ȣ�\ͬ ����,/ DR, ITAT, Kolkata

ITA No.740/Kol/2026/AY 2018-19 Rajshree Developers Entrepreneurs Pvt. Ltd. vs. DCIT 6. �ȡ�[�ȡ_�/ Guard file.

BY ORDER, // TRUE COPY // Asstt.Registrar, ITAT, Kolkata

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