ITO WARD-2(3)(1), KANPUR, KANPUR vs. UNITED MERCANTILE CO-OP BANK LIMITED EMPLOYEES PROVIDENT FUND TRUST, KANPUR

I.T.A. Nos.753 & 754/Lkw/2025 CO. Nos. 67 & 68/Lkw/2025 1 Assessment Years:2013-14 & 2014-15 IN THE INCOME TAX APPELLATE TRIBUNAL LUCKNOW BENCH ‘A’, LUCKNOW BEFORE SHRI KUL BHARAT, VICE PRESIDENT AND SHRI ANADEE NATH MISSHRA, ACCOUNTANT MEMBER I.T.A. Nos. 753 & 754/Lkw/2025 Assessment Years: 2013-14 & 2014-15 ITO Ward-2(3)(1) Vs. United Mercantile Co-op Bank Room No.412, Fourth Floor, Limited Employees Provident Fund 16/69, Aaykar Bhavan, Kanpur Trust Urban, Uttar Pradesh-208001. 106/382, Gandhi Nagar, R. K. Nagar, Kanpur-208012. PAN:AAACU2045A (Appellant) (Respondent) C.O. Nos. 67 & 68/Lkw/2025 (Arising out of I.T.A. Nos.753 & 754/Lkw/2025 Assessment Years: 2013-14 & 2014-15 United Mercantile Co-op Bank Vs. ITO Ward-2(3)(1) Limited Employees Provident Room No.412, Fourth Floor, 16/69, Fund Trust Aayakar Bhavan, Kanpur Urban, 106/382, Gandhi Nagar, R. K. Uttar Pradesh-208001. Nagar, Kanpur-208012. PAN:AAACU2045A (Appellant) (Respondent) Assessee by None Revenue by Shri Mazhar Akram, CIT- D.R. O R D E R PER BENCH:. (A) These appeals have been filed by Revenue and Cross objections have been filed by the assessee against the respective impugned appellate orders of learned Commissioner of Income Tax (Appeals) [“CIT(A)” for short]. For

I.T.A. Nos.753 & 754/Lkw/2025 CO. Nos. 67 & 68/Lkw/2025 2 Assessment Years:2013-14 & 2014-15 the sake of convenience, these two appeals filed by Revenue and these two cross objections filed by the asseessee are disposed of through this consolidated order. The grounds taken in the appeals and cross objections are as under: - “ITA. NO. 753/Lkw/2025 1. The Ld. CIT(A) erred in law and facts by holding that assessment order dated 31.05.2023 stands void on the sole ground that it was initiated and drawn to completion in respect of PAN AAACU2045A that does not belong to the appellant assessee. The Ld. CIT(A) has ignored the fact that assessee trust in its own submission claimed that all investments/recording of transactions of both the United Mercantile Co-Op Bank and United Mercantile Co-Op Bank Limited Employees Provident Fund Trust continued against the same PAN i.e. AAACU2045A till the Trust was allotted fresh PAN: AAATUS108M in March 2013. 2. The Ld. CIT(A) erred in law and facts by ignoring the fact that since the Bank was allotted a fresh PAN in 2008, it was only the assessee Trust which continued to use PAN: AAACU2045A till 12.03.2013. Thus before 12.03.2013 no PAN other than AAACU2045A was allotted to the trust and all investments/recording of transactions under PAN AAACU2045A belonged to the assessee Trust. 3. The Ld. CIT(A) erred in law and facts by accepting the assessee's submission regarding the source of investments/income without verifying the same and giving a finding to the correctness of the source. 4. The Ld. CIT(A) erred in law and facts in declaring the assessment void without considering the fact that during the proceeding u/s 148A(d) assessee in its written submission dated 16.06.2022 claimed that transaction reported in notice u/s 148A(b) belongs to the United Mercantile Cooperative Bank Limited and these transactions do not belong to the assessec. Whereas during the assessment proceeding it has claimed that the transaction reported at PAN AAACU2045A belongs to both Bank as well as Trust. Thus, the assessee has submitted two different replies in two different proceedings. Since the PAN AAAU3038F was already allotted to the bank on 18.11.2008 thus the claim of the assessee that transaction belongs to the Bank was not considered and therefore case was selected for assessment u/s 147 of the IT Act. 1961. 5. The Ld. CIT(A) erred in law and facts in declaring the assessment order dated 31.05.2023 as void without appreciating the fact that case is selected for scrutiny on the basis of information available with the department. Further assessee could not substantiate the transaction reported at PAN AAACU2045A and not get the PAN AAACU2045A deleted or marked as duplicate when new PAN was allotted to it. Further PAN AAAAU2038F was allotted to the Bank in the year 2008 itself therefore claim of the assessee that transaction pertain to the bank is not acceptable. Since the order of the Ld. CIT(A) is erroneous in law and on facts therefore needs to be vacated and the order of the AO be restored. 6. That the appellant craves leave to add or amend any one or more of the grounds of appeal as stated above as and when need for doing so may arise.” ITA. NO. 754/Lkw/2025

I.T.A. Nos.753 & 754/Lkw/2025 CO. Nos. 67 & 68/Lkw/2025 3 Assessment Years:2013-14 & 2014-15 1. The Ld. CIT(A) erred in law and facts by holding that assessment order dated 31.05.2023 stands void on the sole ground that it was initiated and drawn to completion in respect of PAN AAACU2045A that does not belong to the appellant assessee. The Ld. CIT(A) has ignored the fact that assessee trust in its own submission claimed that all investments/recording of transactions of both the United Mercantile Co-Op Bank and United Mercantile Co-Op Bank Limited Employees Provident Fund Trust continued against the same PAN i.e. AAACU2045A till the Trust was allotted fresh PAN: AAATUS108M in March 2013. 2. The Ld. CIT(A) erred in law and facts by ignoring the fact that since the Bank was allotted a fresh PAN in 2008, it was only the assessee Trust which continued to use PAN: AAACU2045A till 12.03.2013. Thus before 12.03.2013 no PAN other than AAACU2045A was allotted to the trust and all investments/recording of transactions under PAN AAACU2045A belonged to the assessee Trust. 3. The Ld. CIT(A) erred in law and facts by accepting the assessee's submission regarding the source of investments/income without verifying the same and giving a finding to the correctness of the source. 4. The Ld. CIT(A) erred in law and facts in declaring the assessment void without considering the fact that during the proceeding u/s 148A(d) assessee in its written submission dated 16.06.2022 claimed that transaction reported in notice u/s 148A(b) belongs to the United Mercantile Cooperative Bank Limited and these transactions do not belong to the assessec. Whereas during the assessment proceeding it has claimed that the transaction reported at PAN AAACU2045A belongs to both Bank as well as Trust. Thus, the assessee has submitted two different replies in two different proceedings. Since the PAN AAAU3038F was already allotted to the bank on 18.11.2008 thus the claim of the assessee that transaction belongs to the Bank was not considered and therefore case was selected for assessment u/s 147 of the IT Act. 1961. 5. The Ld. CIT(A) erred in law and facts in declaring the assessment order dated 31.05.2023 as void without appreciating the fact that case is selected for scrutiny on the basis of information available with the department. Further assessee could not substantiate the transaction reported at PAN AAACU2045A and not get the PAN AAACU2045A deleted or marked as duplicate when new PAN was allotted to it. Further PAN AAAAU2038F was allotted to the Bank in the year 2008 itself therefore claim of the assessee that transaction pertain to the bank is not acceptable. Since the order of the Ld. CIT(A) is erroneous in law and on facts therefore needs to be vacated and the order of the AO be restored. 6. That the appellant craves leave to add or amend any one or more of the grounds of appeal as stated above as and when need for doing so may arise.” C.O. No. 67/Lkw/2025 1. BECAUSE otherwise also, reassessment order dated 31.05.2023 was not maintainable for the reasons that (i) notice under section 148 dated 29.06.2021 was barred by limitation; (ii) approval’ by specified authority under section 151 had not been granted after due application of mind; and

I.T.A. Nos.753 & 754/Lkw/2025 CO. Nos. 67 & 68/Lkw/2025 4 Assessment Years:2013-14 & 2014-15 (iii) approval’ (so to say) had been granted by Id. Pr. CIT, whereas it should have been granted by Hon’ble Pr. Chief Commissioner of Income Tax. 2. BECAUSE copy of ‘approval’ as had been provided to the assessee, was just a mechanical approval which is ‘no approval’ under the Income Tax Act. 3. BECAUSE the Id. Assessing Officer has erred in law and on facts in treating the transaction amounting to Rs. 17,45,79,628/- as unexplained investment within the meaning of deeming provisions of section 69 of the Act. 4. BECAUSE all these grounds had been canvassed/pleaded before the Id. First Appellate Authority and a fair adjudication of the same should have been accorded. 5. Because the appeal has not been adjudicated upon by ld. CIT(A), in accordance with the provisions of law, for the reasons mentioned above.” C.O. No. 68/Lkw/2025

I.T.A. Nos.753 & 754/Lkw/2025 CO. Nos. 67 & 68/Lkw/2025 5 Assessment Years:2013-14 & 2014-15 “2. It is vehemently submitted that copy of such appeal set, consisting of Form 36 and Grounds of Appeal, have only been received by the respondent Trust on 06.12.2025 via Speed Post. Accordingly, the limitation to file cross objection against the said appeal (filed by the revenue) expires on 06.01.2026. 3. It is stated that the instant cross objection of the appellant have been filed on 23.12.2025, which is well within the limitation provided under the Income Tax Act, 1961, and accordingly, no delay in filing the above referred cross objection exists. 4. In view of the submissions made here-in-fore, it is respectfully prayed that the Hon’ble Bench be pleased to entertain/admit the cross objection of the respondent, and deciede the issues involved therein on merits thereof.” (B.1) In view of the foregoing, the delay in filing the cross objections is condoned and the same are admitted.

(C) We now take up the appeal filed by Revenue in ITA No. 753/Lkw/2025 and the cross objection filed by the assessee in C.O. No. 67/Lkw/2025, both pertaining to the Assessment Year 2013–14. The assessment order dated 31.05.2023 was passed u/s 147 read with section 144 of Income Tax Act, 1961 (“Act”, for short) whereby the assessee’s total income was determined at Rs.17,45,79,628/- as against returned income of Rs. Nil. In the aforesaid assessment order, addition of Rs.17,45,79,628/- was made. The assesse’s appeal was allowed by the Ld. CIT(A) holding as under: -

“In my considered view, the assessment stands void on the sole issue that it was initiated and drawn to completion in respect of a Permanent Account Number that does not belong to the appellant trust. If an assessment order is not passed against the Permanent Account Number as allotted to an assessee by the IT department, the assessment order does not hold to an assessee cannot be prime issue and without on procedural lapses in the assessment order is ejected to vacate the statistical purposes. sanctity in the eyes of law because PANs simultaneously. On this of the other technical grounds raised by the appellant trust, law. Consequently, the AO is directed to vacate the demand and the appeal of the appellant trust is allowed for statistical purposes.”

I.T.A. Nos.753 & 754/Lkw/2025 CO. Nos. 67 & 68/Lkw/2025 6 Assessment Years:2013-14 & 2014-15 (C.1) At the time of hearing, there was no representation from the assessee’s side. In the absence of any representation from the assessee’s side, the Ld. Departmental Representative was heard who relied on the assessment order. On perusal of the assessment order, it is found that the Assessing Officer received the case on transfer on 12.05.2023, and as per the ITBA portal, the time-barring date was reflected as 31.05.2023. However, subsequently the Assessing Officer, under advice, took the view that time barring date for completion of the assessment was 31.05.2023 instead of 31.03.2024. Accordingly, the Assessing Officer issued a notice dated 27.05.2023, fixing the compliance on 29.05.2023. The assessee contended as under: -

“That the notice was issued on 27/05/2023 on Saturday fixing the date of compliance on 29.05.2023 by 12.15 p.m. That the Bank office was closed on Saturday and Sunday i.e. 27/05/2023 and 28/05/2023 due to weekly off. It is justified and legal as not to provide any time to assessee for preparation and filing of the reply/documents.” (C.2) However, the Assessing Officer went ahead to pass assessment order in order to avoid the bar of limitation. There was only one intervening date (28.05.2023) between date of issue of notice (27.05.2023) and the prescribed compliance date (29.05.2023). Further, 28.05.2023 was a holiday on account of being Sunday. It is obvious that the Assessing Officer did not give reasonable opportunity to the assessee before passing the assessment order. In the impugned appellate order, the Ld. CIT(A) did not decide the issues as raised in grounds of appeal, on merits. Instead, he allowed the assessee’s appeal stating the reasons already referred to in foregoing paragraph (B.1) of this order. However, the basis on which the Ld. CIT(A) allowed the assessee’s appeal was not taken by the assessee before the Assessing Officer, and therefore the Assessing Officer had no opportunity to examine this matter. In view of the foregoing, it is found that neither the assessee nor the Assessing Officer got reasonable opportunity during

I.T.A. Nos.753 & 754/Lkw/2025 CO. Nos. 67 & 68/Lkw/2025 7 Assessment Years:2013-14 & 2014-15 assessment proceedings. Therefore, the impugned order of the Ld. CIT(A) is set aside and all the issues in dispute in Revenue’s appeal and assessee’s cross objection are restored back to the file of the Assessing Officer, with the direction to pass de novo order in accordance with law, after providing reasonable opportunity to the assessee. (D) The facts in respect of appeal and cross objection in I.T.A. No. 754/Lkw/2025 and C.O. No. 68/Lkw/2025 respectively, for A.Y. 204-15; are similar to the facts of aforesaid appeal I.T.A. No.753/Lkw/2025 and CO. No.67/Lkw/2025. The facts being same in pari materia, our decision for A.Y. 2013-14 (in ITA. No. 753/LKW/2025 and CO. No.67/LKW/2025) will apply mutatis mutandis in AY. 2014-15 also (in ITA. No.754/LKW/2025 and CO. No. 68/LKW/2025). Accordingly, the impugned appellate order for A.Y. 2014-15 is also set aside, and all the issues in dispute in the appeal vide I.T.A. No.754/Lkw/2025 and the cross objection of C.O. No.68/Lkw/2025 are also restored back to the file of Assessing Officer, with the direction to pass de novo assessment order in accordance with law, after providing reasonable opportunity to the assessee. All the grounds taken in these appeals and cross objections are treated as disposed of in accordance with aforesaid directions. (E) In the result, both appeals of the Revenue and both cross objections of the assessee are partly allowed for statistical purposes. (Order pronounced in the open court on 21/04/2026)

Sd/. Sd/. (KUL BHARAT) (ANADEE NATH MISSHRA) Vice President Accountant Member Dated: 21/04/2026 Vijay Pal Singh, (Sr. PS)

I.T.A. Nos.753 & 754/Lkw/2025 CO. Nos. 67 & 68/Lkw/2025 8 Assessment Years:2013-14 & 2014-15

Copy of the order forwarded to : 1. The Appellant 2. The Respondent 3. Concerned CIT 4. D.R. ITAT, Lucknow