SUNIL LAKHI DATWANI ,MUMBAI vs. ACIT CIRCLE 19(3), MUMBAI

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ITA 7287/MUM/2025Status: DisposedITAT Mumbai20 May 2026AY 2014-154 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 notice issued under section 148 of the Income Tax Act was barred by limitation, following the Supreme Court's decision in Union of India vs. Rajeev Bansal. Consequently, the reassessment order was deemed bad in law.

What were the facts?

The assessee's appeal challenged a reassessment order for AY 2014-15. The primary contention was that the notice for reassessment was issued beyond the prescribed limitation period.

What were the issues?

Whether the reassessment proceedings were initiated within the time limit prescribed by law, and if the notice issued under section 148 was valid.

Which sections of the Income-tax Act were involved?

Section 147,Section 149(1),Section 148,Section 151A,Section 68

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, MUMBAI BENCHES, MUMBAI

Before: HON’BLE SHRI AMIT SHUKLA & HON’BLE SHRI GIRISH AGRAWAL

Pronounced: 20.05.2026

INCOME TAX APPELLATE TRIBUNAL, MUMBAI BENCHES, MUMBAI BENCH: G BEFORE HON’BLE SHRI AMIT SHUKLA, JUDICIAL MEMBER AND HON’BLE SHRI GIRISH AGRAWAL, ACCOUNTANT MEMBER ITA 7287/MUM/2025 निर्धारणवर्ा/Assmt. Year: 2014-15) Permanent Account Number: AACPD0452F ACIT CIRCLE 19(3) SUNIL LAKHI DATWANI PIRAMAL CHAMBERS, 12, MILAN, 16 PAII ROAD, LALBAUG, PAREL. BANDRA WEST., MUNDI- Vs. MUMBAI-400012, 400050, MAHARASHTRA MAHARASHTRA (प्रत्यर्थी Respondent) (अपीलार्थी Appellant)

निर्धाऩरतीद्वधरध/Assessee represented by: Shri SuchekAnchaliya, Ms. Vaishali More, CA रधजस्वद्वधरध/Revenue represented by: Shri Pradipsinh Saktavat, Sr. DR सुिवधईकीतधरीख / Date of conclusion of hearing: 25-Feb-2026 घोर्णधकीतधरीख / Date of pronouncement: 20.05.2026 आदेश / ORDER PER GIRISH AGRAWAL, ACCOUNTANT MEMBER: This appeal is filed by the assessee against the order of CIT(A)/NFAC vide DIN: - ITBA/NFAC/S/250/2025-26/1080854288(1) dated 18.09.2025 passed against the assessment order by Assessment Unit of the Income-tax Department u/s 147 r.w.s. 144B of the Income- tax Act, 1961 (hereinafter referred to as the Act) dated 24.05.2023 for Assessment Year 2014-15.

2.

Assessee has raised the following grounds of appeal:

ITA 7287/Mum/2025 Sunil Lakhi Datwani AY 2014-15

1.

On the facts and circumstances of the case and in law, the assessment order passed by the Assessment Unit u/s. 147 of the Act is bad in law, disregarding the fact that the said notice was issued beyond 6 years from end of relevant assessment year i.c. 31.03.2015 and therefore, it is barred by limitation in view of first proviso to section 149(1) of the Act and also beyond the surviving time limit calculation given in case of Union of India vs. Rajeev Bansal [2024] 167 taxmann.com 70 (SC). 2. On the facts and circumstances of the case and in law, the Ld. CIT(A), NFAC erred in not considering that the assumption of jurisdiction by the Assessing Officer is incorrect in law as the conditions laid down under the Act for initiating reassessment proceedings under section 147 of the Act have not been fulfilled. 3. On the facts and in the circumstances of the case and in law, the Ld. CIT(A), NFAC erred in not adjudicating and considering that the assumption of jurisdiction for reopening the case by the Ld. Assessing Officer is bad in law as the Ld. Jurisdictional Assessing Officer failed to follow the provision of section 151A of the Act and the notification issued thereunder and without appreciating the fact that the Ld. Jurisdictional Assessing Officer has no jurisdiction to issue a notice under 148A or 148 of the Act. 4. On the facts and in the circumstances of the case and in law, the Ld. CIT(A), NFAC erred in not holding the notice issued under section 148 as bad in law as notice was issued without bearing the DIN number, which makes the notice invalid as per Circular No. 19/2019 dated 14.08.2019 5. On the facts and circumstances of the case and in law, the Ld. CIT(A), NFAC erred in confirming the addition u/s 68 of the Income Tax Act, 1961 of Rs. 1,29,08,323/-, being Long Term Gain received on sale of shares of Ravinay Trading Limited, by alleging that the appellant has taken bogus accommodation entries in form of LTCG from some Mr. Naresh Jain without considering the fact that the appellant had purchased and sold the shares at prevailing market prices on the Recognised Stock Exchange through a registered broker and that the appellant had duly submitted all the documentary evidences to substantiate the same. 3. Through ground no.1, assessee contested on the legal issue of reopening proceeding, initiated u/s. 147 being barred by limitation in view of first proviso to section 149(1) and also, going beyond the surviving period as mandated by the decision of Hon’ble Supreme Court in the case of Union of India vs. Rajeev Bansal [2024] 167 taxmann.com 70 (SC). To adjudicate on the above ground raised by the assessee, the list of events as submitted by the assessee and corroborated by the documentary evidence placed on record is tabulated below:

ITA 7287/Mum/2025 Sunil Lakhi Datwani AY 2014-15

Sr. Event/Action Date/Period Page No. No. 1 Issuance of notice u/s 148 of the Act 21.06.2021 1 under old regime 2 Surviving time left to issue the notice 9 Days u/s 148 of the Act i.e. under new (Days between regime as per Supreme Court order in 2 1.06.2021 - case of Rajeev Bansal (Supra) 30.06.2021) 3 Show Cause Notice issued u/s 25.05.2022 2 to 3 148A(b) of the Act 4 Date on which the assessee has filed 18.07.2022 4 the reply 5 The date till which a notice u/s 148 27.07.2022 of the Act under new regime should (18.07.2022 + be issued as per Supreme Court 9 Days) order in case of Rajeev Bansal (Supra) 6 Actual date of notice issued u/s 148 31.07.2022 5 to 6 of the Act under new regime 4. The facts tabulated above are un-disputed. The issue raised is no longer res integraconsidering the decision in the case of Rajeev Bansal (supra) followed by Hon’ble jurisdictional High Court of Bombay in the case of Hitesh Ramniklal Shah vs. ACIT [2025] 180 taxmann.com 642 (Bom). Hon’ble Court held that- “Where Assessing Officer issued notice under unamended section 148 on 29- 6-2021 for Assessment Year 2014-15 and thereafter show cause notice was issued on 25-5-2022, since computation of limitation under section 149, after giving effect to first proviso and considering exclusion period, yielded a mere two-day surviving period expiring on 27-6-2022, notice under section 148 issued on 27-7-2022 was time barred, inasmuch as it was issued much after surviving period” 5. Having considered the provisions of the Act, before as well as after the amendment by the Finance Act, 2021, and the TOLA, in the light of the decision of the Hon'ble Supreme Court in Rajeev Bansal (supra), we are of the considered view that the notice issued under section 148 of the Act on 31.07.2022 for the relevant assessment year is barred by limitation period specified under section 149 of the Act.

6.

Consequently, the impugned reassessment order is also bad in law. Ground raised by the assessee in this regard is allowed.

ITA 7287/Mum/2025 Sunil Lakhi Datwani AY 2014-15 7. Since, we have already upheld the aforesaid ground by quashing the impugned reassessment order, other grounds raised by the assessee on different legal issues and merits of the case are rendered academic and therefore left open.

8.

In the result, appeal of the assessee is allowed.

Order is pronounced in the open court on 20th May, 2026

Sd/- Sd/- (Amit Shukla) (Girish Agrawal) Judicial Member Accountant Member Dated: 20 May, 2026 MP, Sr.P.S. Copy to: 1 The Appellant 2 The Respondent 3 DR, ITAT, Mumbai 4 Guard File 5 CIT BY ORDER,

(Dy./Asstt.Registrar) ITAT, Mumbai

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