VIRASAT BUILDCON PRIVATE LIMITED,DELHI vs. NFAC, DELHI

IN THE INCOME TAX APPELLATE TRIBUNAL DELHIBENCH ‘B’, NEW DELHI Before Sh. Challa Nagendra Prasad, Judicial Member & Smt. Renu Jauhri, Accountant Member

ITA No. 6607/Del/2025 : Asstt. Year: 2016-17 Virasat Buildcon Pvt. Ltd., Vs Assessment Unit, 17-B, MGF House, Asaf Ali Income Tax Department, Road, New Delhi-110002 NFAC, Room No. 401, 2ndf Floor, E-Ramp, Jawaharlal Nehru Stadium, New Delhi-110003 (APPELLANT) (RESPONDENT) PAN No. AACCV2188F Assessee by: Sh. Aseem Chawla, Sr. Adv. & Ms. Pratishtha Chaudhary, Adv. Revenue by: Sh. Rajesh Kumar Dhanesta, Sr. DR Date of Hearing: 23.04.2026 Date of Pronouncement: 25.05.2026 ORDER Per Renu Jauhri, Accountant Member: The above captioned appeal is preferred by the assessee against the order dated 20.08.2025, passed by CIT(A)/NFAC, Delhi u/s 250 of the Income Tax Act, 1961 (hereinafter referred to as “the Act”) for A.Y. 2016-17.

2 ITA No. 6607/Del/2025 Virasat Buildcon Pvt. Ltd. opportunity of being heard and the same is in violation of mandatory principles of natural justice requiring adherence. 3. That on the facts and the circumstances of the case and in Law, the Ld. CIT(A) has erred in sustaining the Assessment Order without considering that the information relied upon by the Ld. AO is pertaining to some another entity and the instant initiation of re-assessment proceeding is per se invalid and not sustainable in the eyes of law. 3.1. That on the facts of the case, the Ld. CIT(A) has erred in sustaining the Assessment Order without considering the unassailable facts that the said income being alleged as having escaped assessment, had already been duly reported and offered to tax by another entity viz; Emaar India Limited in its return of income for AY 2011-12. 4. That on the facts of the case and in law, the Ld. CIT(A) has erred in sustaining the Assessment Order without appreciating that the Ld. AO has applied the erstwhile provisions of sections 147 to 151 of the Act (as they stood prior to the amendment by the Finance Act, 2021) whilst the impugned reassessment notice issued under section 148 of the Act is dated June 30,2021, issued in complete disregard of the amended reassessment scheme brought into force with effect from April 1, 2021. The initiation of re-assessment proceeding being contrary to the substituted statutory framework, is ex facie illegal and without jurisdiction. 5. That on the facts of the case and in law, the Ld. CIT(A) has erred in sustaining the Assessment Order without first disposing of the objections filed by the appellant in response to the notice issued under section 148A(b) of the Act. 5.1. That on the facts of the case and in law, the Ld. CIT(A) has erred in sustaining the Assessment Order in complete disregard to the mandatory statutory procedure prescribed under section 148A of the Act rendering the entire reassessment action as illegal and void ab-initio.” 3. Although several grounds have been raised by the assessee, ld. AR sought to first take up ground no. 4 relating to approval of the specified authority.

3.1 Brief facts in this regard are that the assessee had filed return for A.Y. 2016-17 declaring loss of Rs.7,499/- on 21.09.2016. Subsequently, based on information regarding sale of immovable property available on the Insight portal of the

3 ITA No. 6607/Del/2025 Virasat Buildcon Pvt. Ltd. department, the AO issued notice u/s 148 dated 20.07.2022. Assessment was subsequently completed u/s 147 r.w.s. 144B vide order dated 29.05.2023 at an income of Rs.6,36,95,868/-. Appeal of the assessee was also dismissed by ld. CIT(A) vide order dated 20.08.2025 against which the assessee is now in appeal before the Tribunal.

3.2 At the outset, ld. AR has submitted that as per the amended provisions of section 151 w.e.f. 01.04.2021, the approval of PCCIT/CCIT was required to be taken before issuing notice u/s 148 of the Act. He has further submitted that the issue is covered by numerous decisions of the co-ordinate benches, in the light of the judgment of Hon’ble Apex Court in the case of Union of India Vs. Rajeev Bansal (2024) 469 ITR 46 (SC). Copies of some of these orders have been placed on record.

3.3 Ld. DR on the other hand relied on the orders of the lower authorities.

4 ITA No. 6607/Del/2025 Virasat Buildcon Pvt. Ltd. “73. Section 151 imposes a check upon the power of the Revenue to reopen assessments. The provision imposes a responsibility on the Revenue to ensure that it obtains the sanction of the specified authority before issuing a notice under section 148. The purpose behind this procedural check is to save the assesses from harassment resulting from the mechanical reopening of assessments Sri krishna (P.) Ltd. v. ITO [1996] 87Taxman 315/221 ITR 538 (SC) /[1996] 9 SCC 534. A table representing the prescription under the old and new regime is set out below: Regime Time limits Specified authority Section Before expiry of Joint Commissioner 151(2)of the four years from old regime the end of the relevant assessment year Section After expiry of Principal Chief 151(1)of the four years from Commissioner or old regime the end of the Chief Commissioner relevant or Principal assessment year Commissioner or Commissioner Section Three years or less Principal 151(i)of the than three years Commissioner or new regime from the end of Principal Director the relevant or Commissioner or assessment year Director Section More than three Principal Chief 151(ii)of the years have elapsed Commissioner or new regime from the end of Principal Director the relevant General or Chief assessment year Commissioner or Director General 74. The above table indicates that the specified authority is directly co-related to the time when the notice is issued. This plays out as follows under the old regime: (i) If income escaping assessment was less than Rupees one lakh: (a) a reassessment notice could be issued under section 148 within four years after obtaining the approval of the Joint Commissioner; and (b) no notice could be issued after the expiry of four years; and (ii) If income escaping was more than Rupees one lakh: (a) a reassessment notice could be issued within four years after obtaining the approval of the Joint Commissioner; and (b) after four years

5 ITA No. 6607/Del/2025 Virasat Buildcon Pvt. Ltd. but within six years after obtaining the approval of the Principal Chief Commissioner or Chief Commissioner or Principal Commissioner or Commissioner. 75. After 1 April 2021, the new regime has specified different authorities for granting sanctions under section151. The new regime is beneficial to the assessee because it specifies a higher level of authority for the grant of sanctions in comparison to the old regime. Therefore, in terms of Ashish Agarwal (supra), after 1 April2021, the prior approval must be obtained from the appropriate authorities specified under section 151 of the new regime. The effect of Section 151 of the new regime is thus: (i) If income escaping assessment is less than Rupees fifty lakhs: (a) a reassessment notice could be issued within three years after obtaining the prior approval of the Principal Commissioner, or Principal Director or Commissioner or Director; and (b) no notice could be issued after the expiry of three years; and (ii) If income escaping assessment is more than Rupees fifty lakhs: (a) a reassessment notice could be, issued within three years after obtaining the prior approval of the Principal Commissioner, or Principal Director or Commissioner or Director; and (b) after three years after obtaining the prior approval of the Principal Chief Commissioner or Principal Director General or Chief Commissioner or Director General.” 5. In view of above decision, we hold that the notice u/s 148 dated 30.07.2022 in respect of A.Y. 2016-17 was issued without the requisite approval of the PCCIT/CCIT as mandated u/s 151(ii) of the Act as more than 3 years had elapsed. The same is therefore, invalid and hence being quashed. As the notice itself has been quashed, the remaining grounds raised by the assessee are rendered infructuous and need no adjudication.

6 ITA No. 6607/Del/2025 Virasat Buildcon Pvt. Ltd.