SHRI MAHAVIR PULSES PRIVATE LIMITED,DELHI vs. ASSISTANT COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE 27, DELHI

PER ANUBHAV SHARMA, JM:

These cross appeals are preferred by the assessee and revenue against the

order dated 22.08.2025 of the Ld. Commissioner of Income Tax (Appeals)-29 New

Delhi (hereinafter referred as Ld. First Appellate Authority or in short Ld. ‘FAA’)

in Appeal No.: NFAC/2017-18/10228873 arising out of the order dated 28.03.2023

u/s 147 r.w.s 144B of the Income Tax Act, 1961 (hereinafter referred to as ‘the

Act’) passed by the Assessment Unit, Income Tax Department for AY: 2018-19.

engaged in manufacturing and marketing of Urad dal during the year under

consideration and consequent to a search and seizure operation u/s 132 of the Act

carried out in the case of Pan Group on 19.12.2017 statement of one Sumit Jindal

was recorded who had allegedly deposed on providing bogus sales/purchase entries

and assessee was also found to be a beneficiary therefrom the assessing officer has

reopened the case of the assessee and had passed the assessment order making

addition on the basis that assessee had filed accommodation entries to inflate its

purchases. Ld. CIT(A) has considered the facts and circumstances and modified

the addition with a direction to apply gross profit rate of 10% on the amount of

these purchases of Rs.2,37,25,155/- and thereupon both assessee and department

P a g e | 3 ITA Nos. 6417 & 8157/Del/2025 Shri Mahavir Pulses (AY: 2018-19)

are in appeal before us and at the time of hearing assessee’s counsel has stressed

for disposal of ground No. 1 which raises a pure question of law, as to if, the

reassessment proceedings are on the foundation of notice issued u/s 143(2) of the

Act belatedly and thus, liable to be quashed.

notice u/s 143(2) of Act has been issued beyond stipulated period. We find that

from the perusal of the notice u/s 143(2) of the Act available at PB 61-64 that in

para 2 it is mentioned that the appellant company has made compliance of the

notice u/s 148 on 31.03.2022 by filling a letter dated 31.03.2022. The copy of same

is also available at PB 102-106 and in this request was made to the JAO that the

return of income originally filed on 21.09.2018 be treated as return of income filed

in response to notice u/s 148 of the Act. This compliance has also been accepted by

Assessment Unit to be in order as is indicated in the table in the show cause notice

dated 18.01.2023 available at PB 68-99.

assessment of the return of income filed during FY 2021-22, the notice u/s 143(2)

of the Act was required to be issued and served on the appellant on or before

30.06.2022. But, in the present case, the para 2 of the said notice underlines the

P a g e | 4 ITA Nos. 6417 & 8157/Del/2025 Shri Mahavir Pulses (AY: 2018-19)

fact that the notice has been issued and served on the appellant on 28.12.2022,

beyond the above specified time limit. The assessment in present case is therefore

invalid for the lack of compliance of section 143(2) on account of failure to issue

notice within the time period allowed for such purpose under the proviso to above

section. It is also violation of the mandatory CBDT Guidelines dt: 11.05.2022 as

per which the notice u/s 143(2) in view of the facts of the case was required to be

issued and served on or before 30.06.2022. The Jurisdictional Hon’ble Delhi High

Court decisio’n in the case of Alpine Electronics Asia P Ltd 260 ITR 341 (Del) has

been relied. It was submitted that the above decision is in consonance to the

decision of Indus Tower vs. DCIT 82 Taxmann.com 430 (Del) and the department

SLP against the above decision has been dismissed by Hon'ble Apex Court vide

order dt: 21.01.2019 in Diary No.34285 of 2018. The above view has been upheld

in the decision of Hon'ble Madras High Court in the case of Amec Foster Wheeler

Iberia SLU-India vs. Dy. CIT 451 ITR 117 (Mad).

as ld. CIT(A) had given assessee benefitted on merits the legal grounds were

considered to be academic and left open.

P a g e | 5 ITA Nos. 6417 & 8157/Del/2025 Shri Mahavir Pulses (AY: 2018-19)

(Supra) has considered the question of issuance of notice u/s 143(2) of the Act

within the limitation period is necessary for assumption of jurisdiction.

available at page 61 of the paper book in para No. 2 the assessing officer accepts

that “in response to the notice under section 148 referred to above, you had sent a

communication dated 31.03.2022 saying that the return filed on 21.09.2018 vide

Ack. No. 299825701210918 for the Assessment Year 2018-19 may be treated as

return filed in response to notice under section 148 of the Act.”

response dated 31.03.2022. Admittedly, the proviso to Section 143(2) lays down

the time limit in which the assessee can be served notice u/s 143(2) and the same

indicates that w.e.f 01.04.2021the notice has to be served on the assessee before

the expiry of 3 months and before 01.04.2021 period of 6 months from the end of

financial year in which the return is furnished was provided. In the case before us

once assessee had responded to the respondent by communication dated

31.03.2022 that return filed on 31.09.2018 may be treated as return filed in

response to notice u/s 148 of the Act then the notice u/s 143(2) should have been issued

P a g e | 6 ITA Nos. 6417 & 8157/Del/2025 Shri Mahavir Pulses (AY: 2018-19) within 6 months from 31.03.2022 and the issuance of notice on 28.12.2022 is thus beyond the limitation period and the ground deserves to be sustained. As a consequence of aforesaid the appeal of assessee is allowed and the impugned reassessment proceedings and consequential reassessment order passed gets vitiated and the same deserves to be quashed. Accordingly, we dismiss the appeal of the revenue and allow the appeal of the assessee.

Order pronounced in the open court on 29.04.2026

Sd/- Sd/- (Manish Agarwal) (Anubhav Sharma) ACCOUNTANT MEMBER JUDICIAL MEMBER Dated 29.04.2026 Rohit, Sr. PS