MAA SHARDA ENDEAVOR PRIVATE LIMITED,NARKELDANGA vs. ACIT/DCIT, CENTRAL CIR

ITA 226/RAN/2026Status: DisposedITAT Ranchi30 September 2026AY 2018-196 pages
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What did the Tribunal hold?

The Tribunal admitted the additional grounds raised by the assessee, considering them purely legal and capable of being raised at any stage, citing the decision in NTPC Vs CIT. The Tribunal noted that the notice under Section 148A(b) was issued on March 22, 2022, requiring a response by March 29, 2022, which provided only seven days, falling short of the mandatory minimum seven clear days stipulated by law. Relying on the jurisdictional High Court's decision in Satish Kumar Vs PCIT and a coordinate bench's decision in Agarwal Metcom Private Limited vs ACIT/DCIT, the Tribunal held that the notice under Section 148A(b) was invalid. Consequently, the reassessment order passed under Section 147 and the subsequent revisionary proceedings under Section 263 were also deemed void. The Tribunal quashed the notice under Section 148A(b) and all subsequent proceedings. The appeal was allowed on this ground, and other issues were not adjudicated.

What were the facts?

The assessee, Maa Sharda Endeavor Private Limited, filed an appeal against the order of the Principal Commissioner of Income Tax (PCIT), Patna at Ranchi, dated March 31, 2026, for Assessment Year 2018-19. The PCIT had set aside the assessment order passed by the Assessing Officer (AO) under Section 143(3) read with Section 147 of the Income Tax Act, 1961. The AO had initially accepted the assessee's return of income after reassessment proceedings initiated based on information regarding alleged bogus sales and purchases. The PCIT found the AO's order erroneous and prejudicial to the revenue as it accepted the assessee's contentions without further verification. The assessee challenged the PCIT's order, raising grounds related to the sustainability of revision proceedings and the validity of the original assessment.

What were the issues?

1. Whether a revision under Section 263 of the Income Tax Act, 1961, is sustainable when a scrutiny assessment under Section 143(3) is followed by reassessment proceedings under Section 147, and the AO makes no additions in the final reassessment order after examining specific issues? 2. Whether revision proceedings under Section 263 are invalid if the show-cause notice fails to specify the exact documents or inquiries required, and the proceedings are initiated without considering the assessee's submissions? 3. Whether the PCIT failed to discuss and dispose of all grounds raised by the assessee in the order under Section 263, thereby violating the principles of natural justice? Assessee's Contentions: - The revision under Section 263 is not sustainable as the AO examined issues but made no additions in the reassessment order. - The revision proceeding under Section 263 is invalid due to a failure to specify required documents in the show-cause notice and not considering assessee's submissions. - The PCIT violated natural justice by not disposing of all grounds raised by the assessee. - The original assessment order passed under Section 147 is void because the notice under Section 148A(b) was issued with less than the mandatory seven clear days for compliance, relying on the decision in Satish Kumar Vs PCIT. Revenue's Contentions: - The additional ground raised by the assessee regarding the invalidity of the Section 148A(b) notice should not be entertained as it was not raised before any revenue authority.

Which sections of the Income-tax Act were involved?

Section 143(3),Section 147,Section 148,Section 148A(b),Section 263

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, RANCHI BENCH, RANCHI

Before: SHRI RATNESH NANDAN SAHAY & SMT. RAJANI GUDURI

For Appellant: Shri Sharwan Kumar Jha, Advocate
For Respondent: Smt. Rohini Diwakar, CIT-DR
Hearing: 30/09/2026Pronounced: 30/09/2026

PER: BENCH

1.

This appeal by the assessee is directed against the order of the ld. PCIT (Central), Patna at Ranchi [in short, the ld. PCIT] dated 31/03/2026 for the Assessment Year (AY) 2018-19, wherein the assessee has raised following grounds of appeal:

"

1.

Whether, a scrutiny assessment under Section 143(3) is passed, followed by reassessment proceedings under Section 147 (read with Section 148), and the Assessing Officer (AO) specifically examines issues but makes no additions in the final reassessment order, the revision under Section 263 is not sustainable in the eyes of law and f

The order continues below.

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