THE CHIKHLI TALUKA PRATHMIK SHIKSHAK SAHAKARI PAT SANSTHA MARYA,CHIKHLI vs. ITO WARD-2, KHAMGAON

ITA 46/NAG/2026Status: DisposedITAT Nagpur23 September 2026AY 2018-1913 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the Assessing Officer had travelled beyond the reasons for reopening the assessment. The reassessment proceedings were initiated to examine cash deposits and withdrawals. However, the AO eventually made a disallowance under Section 80P of the Act, which was not part of the original reasons recorded for reopening. The Tribunal relied on the ratio laid down by the jurisdictional Bombay High Court in CIT Vs. Jet Airways (I) Ltd., which states that if an AO accepts the assessee's contention regarding the escaped income that formed the basis for reopening, it is not open for the AO to independently assess some other income without issuing a fresh notice under Section 148. The Tribunal also referred to the Gujarat High Court's approval of the Jet Airways decision and other High Court decisions, emphasizing that the AO cannot conduct a roving inquiry into unrelated items of income. Consequently, the reassessment proceedings were quashed as invalid and bad in law, and the findings of the CIT(A) were set aside. The remaining grounds on merit were deemed academic. The same decision was applied mutatis mutandis to AY 2019-20.

What were the facts?

The assessee, The Chikhli Taluka Prathmik Shikshak Sahakari Pat Sanstha Marya, filed appeals before the Income Tax Appellate Tribunal (ITAT), Nagpur Bench, for Assessment Years (AY) 2018-19 and 2019-20. These appeals challenged orders passed by the National Faceless Appeal Centre (NFAC), Delhi, which arose from assessment orders passed under Section 147 read with Section 144B of the Income Tax Act, 1961. The appeal for AY 2018-19 was filed with a delay of 51 days, which the Tribunal condoned. The core of the dispute involves the disallowance of deduction under Section 80P of the Act, despite the reassessment proceedings being initiated for unexplained cash deposits and withdrawals.

What were the issues?

1. Whether the reassessment proceedings initiated under Section 147 of the Income Tax Act, 1961, are valid when the Assessing Officer (AO) made a disallowance under Section 80P of the Act, which was not part of the reasons recorded for reopening the assessment, thereby travelling beyond the scope of the original notice under Section 148 of the Act? Assessee's Contention: The assessee argued that the AO exceeded his jurisdiction. The reassessment was initiated based on reasons to believe concerning cash deposits and withdrawals. However, no addition was made on these grounds. Instead, a disallowance under Section 80P was made, which was not included in the reasons for reopening. The assessee relied on the jurisdictional Bombay High Court's decision in CIT Vs. Jet Airways (1) Ltd. and other precedents. The assessee also contended that no fresh notice under Section 148 was issued for the disallowance under Section 80P. Revenue's Contention: The Departmental Representative (DR) supported the order of the CIT(A). The judgment does not record specific arguments made by the revenue regarding the validity of the reassessment proceedings or the scope of the AO's powers beyond the reasons recorded for reopening.

Which sections of the Income-tax Act were involved?

Section 80P,Section 147,Section 144B,Section 148,Section 139(1),Section 139(4),Section 142(1),Section 148A(d),Section 148A(b),Section 250,Section 234A,Section 234B,Section 234C

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, NAGPUR ‘SMC’ BENCH, NAGPUR

Before: DR.MANISH BORAD

For Appellant: Shri Himesh Demble, CA
For Respondent: Shri Shiv Shankar Yadav, DR (through virtual)
Pronounced: 23.09.2026

The captioned appeals at the instance of assessee pertaining to A.Ys. 2018-19 and 2019-20 are directed against the separate orders dated 24.09.2025 and 23.03.2026 framed by National Faceless Appeal Centre, Delhi (NFAC) arising out of Assessment orders passed u/s. 147 r.w.s.144B of the Income Tax Act, 1961 (in short ‘the Act’).

2.

Registry has pointed out that the appeal ITA No.46/Nag/2026 for A.Y. 2018-19 filed by the assessee is barred by limitation as the appeal is filed before this Tribunal with a delay of 51 days. Assessee has filed an affidavit explaining the delay. After hea

The order continues below.

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