MRUNMAYEE PRIYADARSHINI PATTNAIK,DELHI vs. ITO WARD 54(1), DELHI

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ITA 7985/DEL/2025Status: DisposedITAT Delhi15 June 2026AY 2018-199 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 the reassessment proceedings were void ab initio due to the non-supply of the approval obtained under Section 151 of the Act, despite specific requests. The assessment order was quashed on this legal ground.

What were the facts?

The assessee purchased properties for less than their stamp value, leading to a reassessment. The Assessing Officer made an addition under Section 56(2)(x) as the source of funds remained unexplained. The CIT(A) dismissed the appeal for non-compliance.

What were the issues?

Whether reassessment proceedings are void ab initio if the approval under Section 151 is not provided to the assessee. Whether the addition under Section 56(2)(x) is applicable when the property transfer occurred prior to its insertion.

Which sections of the Income-tax Act were involved?

Section 56(2)(x),Section 148,Section 148A,Section 151

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI BENCH ‘E’, NEW DELHI

Before: Sh. Raj Kumar Chauhan & Smt. Renu Jauhri

For Respondent: Ms. Ankush Kalra, Sr. DR
Hearing: 26.05.2026Pronounced: 15.06.2026

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH ‘E’, NEW DELHI Before Sh. Raj Kumar Chauhan, Judicial Member & Smt. Renu Jauhri, Accountant Member ITA No. 7985/Del/2025 : Asstt. Year: 2018-19 Mrunmayee Priyadarshini Pattnaik, Vs Income Tax Officer, M1, Lajpat Nagar-II, Ward-54(1), New Delh-110024 New Delhi-110002 (APPELLANT) (RESPONDENT) PAN No. AALPP7403R Assessee by : Sh. Deepak Upadhyay, CA Revenue by : Ms. Ankush Kalra, Sr. DR Date of Hearing: 26.05.2026 Date of Pronouncement: 15.06.2026 ORDER Per Raj Kumar Chauhan, Judicial Member: The appeal of the assessee is directed against order of the ld. CIT(A)/NFAC, Delhi dated 10.09.2025 u/s 250 of the Income Tax Act, 1961 (hereinafter referred to as “the Act”), wherein the addition made u/s 56(2)(x) of the Act of Rs.48,00,000/- vide assessment order dated 25.03.2023 was confirmed and the appeal was dismissed.

2.

Facts in brief as culled out from the authorities below are that the case of the assessee was selected for re-assessment by issuing notice u/s 148 of the Act dated 31.03.2022 on the ground that assessee has purchased two properties in the concerned year for consideration of Rs.48,50,000/- having stamp value of Rs.69,50,000/- along with basement for

2 ITA No. 7985/Del/2025 Mrunmayee Priyadarshini Pattnaik Rs.4,00,000/- having stamp valuation of Rs. 31,00,000/-. Order u/s 148A(d) was passed on 31.03.2022. The source of whole purchase of Rs.52,50,000/- remained unexplained (both transaction) and the assessee having purchased these properties for less than their stamp value having a difference of Rs.48,00,000/- and as such total income of Rs.1,00,50,000/- remained unexplained and has escaped assessment. During the re-assessment proceeding, opportunities were given to the assessee to explain the transaction and the consideration received therein. However, the Assessing Officer was not satisfied and made addition of Rs. 48,00,000/- u/s 56(2)(x) of the Act and also initiated penalty proceedings.

3.

Aggrieved by the Assessment Order, the assessee filed appeal before the ld. CIT(A) who has dismissed the same observing that various notices u/s 250 of the Act were issued to the appellant who did not file any reply or documentary evidence in support of the grounds taken in the appeal. However, the ld. CIT(A) dismissed the appeal on merit and upheld the Assessment Order and the addition made therein.

4.

Aggrieved by the impugned order, the assessee filed appeal before us and has raised following grounds of appeal: “1. That, the notice u/s 148A(b) and order u/s 148A(d) the Income tax Act, 1961, is bad in law and on facts, as the enquiry before reassessment proceedings were initiated and completed without proper compliance to principles of natural justice. The appellant was deprived of adequate opportunity

3 ITA No. 7985/Del/2025 Mrunmayee Priyadarshini Pattnaik to present her case, and the assessment was done ex parte based on alleged non compliance which is factually incorrect. 2. That, the notice u/s 148 of the Income tax Act, 1961, is bad in law and on facts. 3. That, the Approval taken u/s 151 of the Income Tax Act, 1961 is illegal, invalid and bad in law. 4. That, the AO has not issued any notice under section 143(2). In such circumstances, the mere observation that the return is invalid in the assessment order, without any statutory notice under section 143(2), is a complete non application of mind and is contrary to settled law by Patna High Court in the case of CIT Vs. Nagendra Prasad, (2023) 156 taxmann.com 19 (Pat). 5. That, the learned Assessing Officer (AO) grossly erred in making an addition of Rs. 48,00,000 under section 56(2)(x) as Income from Other Sources on the ground of difference between the stamp duty value and the consideration paid for purchase of two properties, without appreciating that the transfer and possession actually took place in FY 2006-07 and FY 2013-14, which is prior to the insertion of section 56(2)(x) with effect from 1 April 2017. Hence, the provision does not apply to the impugned transactions. 6. That, the order passed under section 147 read with section 144 and 144B of the Income tax Act, 1961, is bad in law and on facts, as the reassessment proceedings were initiated and completed without proper compliance to principles of natural justice. The appellant was deprived of adequate opportunity to present her case, and the assessment was done ex parte based on alleged non compliance which is factually incorrect. 7. That, the appellant craves leave to add to, alter, amend, modify, substitute, DLEETE OR otherwise revise all OR any of the foregoing grounds of appeal, and to raise such further OR other grounds at OR before the time of hearing of this appeal, as may be considered necessary OR expedient. 11. Whether there is any delay in filing of appeal (if yes, please attach application seeking condonation of delay).” 5. During the hearing, the assessee moved an application dated 28.05.2026 for admitting additional grounds raised as under: “On the facts and circumstances of the case and in law, the reassessment proceedings initiated under section 147/148 of the Income Tax Act, 1961 are bad in law and liable to be quashed as the Assessing Officer failed to

4 ITA No. 7985/Del/2025 Mrunmayee Priyadarshini Pattnaik provide the approval/sanction obtained under section 151 of the Act despite specific request of the assessee in RTI citing, thereby violating principles of natural justice and rendering the reassessment proceedings invalid.” 6. We have heard the ld. AR and the ld. DR on the additional ground. It is argued that the additional ground so raised is purely legal in nature and does not require any investigation into any facts outside the material already available on record. It is further submitted that assessee has specifically requested for supply of approval granted u/s 151 of the Act in RTI. In the reply to the RTI, it has been stated that “on perusal of the ITBA Portal as well as the file folder forwarded by ITO, Ward-54(1), Delhi, it is observed that no such documents is available in the file records ITBA-Systems.” It is therefore submitted that and in the additional ground be admitted and the re-assessment done in the absence of supply of approval u/s 151 of the Act being bad in law. The impugned order is liable to be quashed.

7.

We have considered the rival submissions on admission of the additional ground. We have noticed that the ground raised as additional ground is purely legal ground and does not require any fresh facts to be brought on record. Hence, following the law laid down by the Hon’ble Supreme Court in the case of National Thermal Power Company Ltd. Vs. CIT reported in 229 ITR 383(SC), the additional grounds is admitted for adjudication.

5 ITA No. 7985/Del/2025 Mrunmayee Priyadarshini Pattnaik

8.

In respect of additional ground, at the very outset, it has been submitted that the entire re-assessment done is bad in law and is liable to be quashed because despite repeated requests even during the re-assessment proceedings and also subsequently the Revenue has failed to provide the copy of sanction u/s 151 of the Act despite a specific request of the assessee in RTI. The ld. AR has relied various judgments including the judgment of Delhi Tribunal in the case of Arpit Goel Vs. ITO in ITA Nos. 349, 350 & 351/Del/2017 order dated 27.06.2025 wherein identical issue was decided in favour of the assessee.

9.

The ld. DR on the other hand admitted that despite a report having been called from the Assessing Officer as placed on record on 03.06.2026, the concerned ITO in e-mail dated 06.05.2026 i.e. ITO, Ward-54(1), Delhi, conveyed that the “relevant documents as sought by RTI application is not found in the folder furnished by your office”. However, the RTI was disposed of observing as under: “In response to mail dated 06.05.2026, the ITO, Ward-54(1) Delhi vide mail dated 07.05.2026 submitted that ‘all relevant records available with their office have already been forwarded to you. Furthermore, as the PAN data of the applicant is already accessible at your end. Therefore, you are requested to kindly process the RTI application and take further necessary action accordingly’. Keeping in view the time limitation as per RTI section 7(1), this office vide mail dated 29.05.2026 disposed of the received RTI with the following remarks.

6 ITA No. 7985/Del/2025 Mrunmayee Priyadarshini Pattnaik S.No. Query as per RTI Remarks 1. Copy of request letter to On perusal of the ITBA Portal as sanction authority by well as the file folder forwarded ITO,Ward-54(1) and by ITO,Ward-54(1) Delhi, it is approval u/s 151 of the observed that no such Income Tax Act, 1961 documents is available in the file records and in the ITBA- Systems. 2. Reason for non-issuance ‘Assessee filed an invalid return of notice u/s 143(2) of the in response to notice u/s. 148 of Act, even return filed in the Act'. response to notice u/s 148

Further, it is worthy to mention here that the statutory order dated 31.03.2022 passed u/s 148A(d) of the Income Tax Act itself containing a remarks at the end para of the same that ‘_This order is being passed with prior approval of the Principal Commissioner of Income Tax-12, Delhi. Notice u/s 148 of the Income Tax Act, 1961 is issued along with this order after obtaining prior approval of the PCIT-12 Delhi.” 10. It is thus clear from the above submissions on behalf of Revenue that the approval u/s 151 of CPC has not been supplied to the assessee in this case. We have noted that the identical issue has been decided by the Delhi Tribunal in ITA No. 349, 350 & 351/Del/2017 in the case of Arpit Goel (supra), the relevant portion from Paras 3 to 8 is extracted below as under: “3. The Ld. Counsel for the assessee further submitted that the AO reopened the assessment by issue of notice u/s 148 of the Act without the approval from the appropriate authority u/s 151 of the Act. Ld. Counsel for the assessee therefore submits that since the assessments were reopened without the approval of competent authority u/s 151 of the Act the consequential reassessments made by issue of notice u/s 148 in the absence of any approval of such reassessments are bad in law and void ab initio. 4. On the other hand, Ld. DR supported the orders of the authorities below. 5. Heard rival submissions, perused the orders of the authorities below. On perusal of the reasons recorded for initiation of proceedings u/s 147/148 issued by the AO for the assessment years 2009- 10 to 2011-12 were all undated. Further the AO did not mention in the reasons whether he has taken any prior approval for initiating the reassessment proceedings and for issue of notice u/s 148 for these assessment years. We observe that the assessee also filed under RTI seeking to supply a copy of approval granted by the competent authority

7 ITA No. 7985/Del/2025 ITA No. 7985/Del/2025 Mrunmayee Priyadarshini Pattnaik Mrunmayee Priyadarshini Pattnaik for reopening of these assessments. The 2 ITA Nos.349, 350 for reopening of these assessments. The 2 ITA Nos.349, 350 for reopening of these assessments. The 2 ITA Nos.349, 350 & 351/Del/2017 CPIO/ITO, Ward 48(1), New Delhi by order & 351/Del/2017 CPIO/ITO, Ward 48(1), New Delhi by order & 351/Del/2017 CPIO/ITO, Ward 48(1), New Delhi by order dated 04.07.2023 informed the assessee as under: informed the assessee as under:-

6.

From the perusal of the above order, we noticed that the 6. From the perusal of the above order, we noticed that the 6. From the perusal of the above order, we noticed that the Revenue could not provide any copy of approval as they were Revenue could not provide any copy of approval as they were Revenue could not provide any copy of approval as they were not in a possession of the case records. We observed that not in a possession of the case records. We observed that not in a possession of the case records. We observed that since the AO never stated in the reasons recorded whether since the AO never stated in the reasons recorded whether since the AO never stated in the reasons recorded whether any approval has be any approval has been taken by him from the competent en taken by him from the competent authority before issue of notice u/s 148 of the Act for authority before issue of notice u/s 148 of the Act for authority before issue of notice u/s 148 of the Act for reopening of assessments for the assessment years 2009-10 reopening of assessments for the assessment years 2009 reopening of assessments for the assessment years 2009 to 2011-12 creating a doubt whether at all the AO has 12 creating a doubt whether at all the AO has 12 creating a doubt whether at all the AO has obtained any prior mandatory prior u/s 151 of the Act obtained any prior mandatory prior u/s 151 of the Act more so more so when the reasons for reopening of assessments were all when the reasons for reopening of assessments were all when the reasons for reopening of assessments were all

8 ITA No. 7985/Del/2025 Mrunmayee Priyadarshini Pattnaik undated. The Revenue also could not provide any copy of approval if any granted for reopening of the assessments. In the absence of any approval u/s 151 from the competent authority for reopening of assessments the assessments made without such approval becomes bad in law and void ab initio . Thus, we quash the reassessment orders for assessment years 2009-10 to 2011-12 as the reassessments were made without the prior approval of the competent authority u/s 151 of the Act. 7. Since we have quashed the reassessments for the assessment years 2009-10 to 2011-12 on a legal issue. We are not inclined to go into the merits of the addition/disallowance made by the AO in the assessment orders for all these years as it would be of only academic in nature at this stage and the same are left open. 8. In the result, appeals of the Assessee are partly allowed as indicated above.“ 11. We have considered the rival submissions, in view of the factual position and the documentary evidence discussed above and respectfully following the judgment of the Delhi Tribunal in ITA No. 349, 350 & 351/Del/2017, we are of the considered opinion that the re-assessment in this case, without following the due procedure i.e. non-supply of approval u/s 151 of the Act has made the proceeding void ab initio and the re- assessment proceeding as well as the impugned order are not sustainable and the Assessment Order is accordingly quashed. The additional ground so raised is accordingly allowed in above terms.

9 ITA No. 7985/Del/2025 Mrunmayee Priyadarshini Pattnaik 12. In the result, the appeal of the assessee is allowed. Order Pronounced in the Open Court on 15/06/2026. Sd/- Sd/- (Renu Jauhri) (Raj Kumar Chauhan) Accountant Member Judicial Member Dated: 15/06/2026 *Subodh Kumar, Sr. PS* Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals) 5. DR: ITAT ASSISTANT REGISTRAR

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