RAN INTERNATIONAL PVT. LTD.,NEW DELHI vs. I.T.O., WARD - 4(1), KOLKATA

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ITA 1823/KOL/2024Status: DisposedITAT Kolkata28 April 2026AY 2009-201010 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the reopening of assessment was bad in law because the notice under Section 148 was issued before the approval from the competent authority was communicated to the AO. Therefore, the assessment order is invalid.

What were the facts?

The assessee's appeal was delayed by 1684 days. The Assessing Officer (AO) reopened the assessment based on information about large cash deposits, treating ₹3,12,00,000 as unexplained cash credit. The CIT(A) confirmed the AO's order.

What were the issues?

Whether the notice issued under Section 148 of the Income Tax Act is invalid if it is issued prior to the communication of approval from the competent authority under Section 151 of the Act.

Which sections of the Income-tax Act were involved?

Section 148,Section 151,Section 68

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “A” BENCH, KOLKATA

For Appellant: Shri Amit Agarwal, AR
For Respondent: Shri Bonnie Deb Barma, DR
Hearing: 20.04.2026Pronounced: 28.04.2026

Per Rajesh Kumar, AM:

This is an appeal preferred by the assessee against the order of the Commissioner of Income-tax (Appeals)-2, Kolkata(hereinafter referred to as the “Ld. CIT(A)”] dated 18.12.2019 for the AY 2009-10.

2.

At the outset, we note that the appeal of the assessee is barred by limitation by 1684 days. At the time of hearing the counsel of the assessee explained the reasons for delay in filing the appeal. The Ld. D.R did raise any objection in condoning the delay. After hearing the rival contentions and perusing the materials available on record, we find that the

3.

At the time of hearing, the ld. Counsel for the assessee pressed only one ground that notice issued u/s 148 of the Act is bad in law and hence, the reopening of assessment as well as the assessment order are invalid and may be quashed.

3.1. The facts in brief are that the case of the assessee was reopened u/s 147 of the Act after the ld. AO received information from DDIT Investigation unit 4(1), Kolkata vide letter dated 22.03.2016, wherein it was stated that the assessee is a beneficiary of huge cash deposited to the tune of ₹2,72,95,000/- during F.Y. 2008-09, relevant to A.Y. 2009- 10. Thereafter, the ld. AO on perusal of detail received from DDIT(Inv.) Unit 4(1), Kolkata noted that the amount of dubious transactions were ₹3,12,85,000/-instead of 2,72,95,000/-. Accordingly, notice u/s 148 of the Act was issued on 29.03.2016, which was complied with by the assessee by filing the return of income on 05.09.2016, declaring total income of ₹34,072/-. Thereafter, the assessee furnished various details/ information as called for by the ld. AO. Finally, the ld. AO noted that the assessee received ₹3,12,00,000/- from various parties in cash which was deposited into the bank account of the assessee and treated the same as unexplained cash credit u/s 68 of the Act. The same was added to the income of the assessee.

3.2. The ld. CIT (A) also confirmed the order of the ld. Assessing Officer.

3.3. The ld. DR on the other hand stated that it is the practice of the department to have sanction of the PCIT over phone which is followed by the formal communication on behalf of the ld. Pr. Commissioner of Income Tax. Therefore the plea of the assessee may be dismissed. The ld. DR submitted that the argument of the ld. AR that the notice u/s 148 of the Act was issued prior to approval granted u/s 151 of the Act is not correct and may be dismissed.

3.4. After hearing the rival contentions and perusing the materials available on record, we find that in this case the reopening of assessment has been made by issuing of notice u/s 148 of the Act on 29.03.2016 by ITO Ward 39(3), Kolkata, for the sake of ready reference the notice issued u/s 148 of the Act would extract below:-

”

4.

However, the said approval was conveyed and communicated to the office of the ld. AO on 31.03.2016 by the office of Pr. Commissioner of Income Tax. The copy of the letter was also extracted below:-

5.

In our opinion, the notice u/s 148 of the Act has to be issued by the ld. AO after recording reasons to believe which are duly approved by the competent authority and only after obtaining the approval from the competent authority, the ld. AO is

“04. After hearing the rival contentions and perusing the materials available on record, we find that in this case the notice u/s 148 of the Act was issued by the ld. AO on 26.03.2019, whereas the approval was communicated to the ld. AO, the ACIT, Circle10(2), Kolkata by ITO Ward 10(4), Kolkata for PCIT-4, Kolkata vide letter dated 28.03.2019. For the sake of ready reference the same is extracted below: - “No. Pr. CIT-4/Kol/148/2018-19/13414 Dated 28.03.2019 To The DCIT, Circle-10(2), Kolkata Sir, Sub: Approval for reopening of proceedings u/s. 147 of the I.T. Act, 1961 in the case of M/s. Paras Plaza Pvt. Limited.; PAN AAECP8301N for the A.Y. 2012-13- matter regarding. Please refer to the above I am directed to inform you that Ld. Principal Commissioner of Income Tax- 4. Kolkata, has given his kind sanction for reopening of proceedings u/s. 147 of the Income Tax Act, 1961, in respect of the above-mentioned case. I am enclosing herewith the form for recording the reasons for initiating proceedings under section 148 and obtaining the approval of the Pr. Commissioner of Income Tax- 4. Kolkata, on the above-mentioned case for your information and necessary action. Encl: As stated above Yours faithfully

7.

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

Order pronounced on 28.04.2026.

Sd/- Sd/- (PRADIP KUMAR CHOUBEY) (RAJESH KUMAR) (JUDICIAL MEMBER) (ACCOUNTANT MEMBER) Kolkata, Dated: 28.04.2026 Sudip Sarkar, Sr.PS Copy of the Order forwarded to: 1. The Appellant 2. The Respondent 3. CIT DR, ITAT, 4. 5. Guard file. BY ORDER, True Copy//

Asst. Registrar Income Tax Appellate Tribunal, Kolkata

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