VANDANA VIJAY KUMAR CHUDAMASA,BANGALORE vs. INCOME TAX OFFICER, THANE

The assessee did not file a return in response to the notice under section 148. Notices under section 142(1), dated 31.08.2023 and 20.11.2023, were issued. The Assessing Officer also issued a show-cause notice dated 22.12.2023 proposing to treat Rs.2,31,20,000/- as unexplained investment under section 69. In the absence of a response, the Assessing Officer completed the assessment under section 147 read with section 144 and brought the entire sum of Rs.2,31,20,000/- to tax under section 69.

The assessee preferred an appeal before the learned CIT(A). It was contended that she was a non-resident, residing and employed in Dubai, and that the property had been purchased jointly with her spouse. It was further contended that the investment was financed from a housing loan, foreign remittances and contributions from relatives. The learned CIT(A), however, found that the assessee had not furnished adequate evidence regarding her residential status, foreign remittances, housing loan and other sources of investment. The appeal was accordingly dismissed by order dated 11.09.2025.

The appeal before us is delayed by approximately 148 days. The learned AR submitted that the delay was neither deliberate nor attributable to any lack of bona fides on the part of the assessee. A detailed petition seeking condonation under section 253(5), supported by an affidavit sworn before the Consulate General of India, Dubai, was placed on record.

It was submitted that, upon receipt of notice under section 148A(b), the assessee engaged Shri Suhas Desai, Chartered Accountant, to represent her. Since the assessee and her spouse were residing outside India and were not conversant with the income-tax proceedings, the nature of evidence required to be filed or the remedies available under the Act, they remained dependent upon the professional adviser engaged by them.

According to the learned AR, the earlier counsel continued to assure the assessee that the proceedings were being attended to, but either no compliance or only partial compliance was made. This resulted in the ex parte assessment order dated 05.02.2024. The appeal before the learned CIT(A) was filed through the same counsel on 24.04.2024. Even in the first appellate proceedings, only part of the relevant evidence was furnished. The appeal was dismissed on 11.09.2025, but the earlier counsel neither filed an appeal before the Tribunal nor advised the assessee about the further remedy available to her.

The learned AR further submitted that reassessment proceedings had also been initiated in the case of the assessee’s spouse in relation to the same property. Owing to incomplete compliance in those proceedings, a draft assessment order under

The learned AR also referred to the revised affidavit in which the assessee clarified that before marriage her name was Vandana V. Chudasama, daughter of Shri Vijay Kumar Chudasama, as appearing in her PAN records, and that after marriage her name was changed to Vandana Ajitesh Tripathi, as appearing in her passport. Both names appearing in the record thus referred to the same person.

On these facts, the learned AR submitted that the assessee was prevented by sufficient cause from presenting the appeal within the prescribed period and prayed that the delay be condoned.

The learned DR opposed the prayer for condonation. He submitted that the assessee’s residence outside India did not constitute sufficient cause because the appeal could have been filed electronically from outside India. Physical presence in India was not necessary for filing the appeal before the Tribunal. It was further submitted that the assessee had not furnished the relevant evidence even before the learned CIT(A). The learned DR accordingly contended that the assessee had failed to establish sufficient cause for the delay.

In Collector, Land Acquisition, Anantnag v. Mst. Katiji [1987] 167 ITR 471 (SC), the Hon’ble Supreme Court observed that: “The expression ‘sufficient cause’ employed by the legislature is adequately elastic to enable the courts to apply the law in a meaningful manner...” 16. The governing principle is that the discretion must advance substantial justice, provided the explanation is bona fide and does not disclose deliberate inaction.

In Concord of India Insurance Co. Ltd. v. Nirmala Devi [1979] 118 ITR 507 (SC), the Hon’ble Supreme Court recognised that: “mistake of counsel may in certain circumstances be taken into account in condoning delay” 18. The Court, however, clarified that reliance upon counsel cannot operate as an automatic answer in every case and that the bona fides of the explanation must be examined.

In the present case, the explanation is not confined to the assessee’s physical residence outside India. The substance of the explanation is that the assessee, being employed and residing in

The grievance that only partial evidence was filed before the learned CIT(A) also forms part of the assessee’s allegation regarding the manner in which the earlier counsel handled the proceedings. The learned DR’s contention that no material was filed before the learned CIT(A) is relevant while considering the admissibility and evidentiary value of documents subsequently tendered before the Tribunal. It does not, by itself, disprove the explanation for the delay in filing the present appeal.

We agree with the learned DR that an appeal can be filed electronically from outside India and that residence abroad, standing alone, would not constitute sufficient cause. However, electronic availability of the filing facility presupposes that the litigant is aware of the adverse order, has been properly advised regarding the appellate remedy, and has taken steps for preparation of the appeal. The explanation before us is that the assessee continued to rely upon the earlier counsel, who neither instituted the appeal nor advised her about the remedy available after the order of the learned CIT(A).

The chronology further shows that when a draft assessment order was passed in the connected proceedings of the assessee’s spouse on 06.03.2026, another counsel was consulted. Upon discovery of the alleged defaults, objections were filed before the Dispute Resolution Panel on 04.04.2026 and steps were taken to

The explanation is supported by a sworn affidavit attested by the Consulate General of India, Dubai. No material has been placed before us to demonstrate that the material averments in the affidavit are false or that the delay was occasioned by any mala fide design. The delay of 148 days is also not so excessive that the explanation should be rejected merely on its length.

Considering the cumulative effect of the assessee’s residence outside India, her dependence upon the professional adviser, the earlier counsel’s admitted involvement in the first appellate proceedings, the subsequent discovery of the omission through the connected proceedings of her spouse, and the steps taken thereafter, we are satisfied that the assessee was prevented by sufficient cause from filing the appeal within time. The delay of 148 days is accordingly condoned, and the appeal is admitted for adjudication.

On Grounds Nos. 1 and 2 challenging the validity of the reassessment proceedings, the learned AR submitted that ground No. 2 had two limbs. The first and principal limb was that notice under section 148 had been issued after more than three years had elapsed from the end of assessment year 2018-19, but approval was obtained from the Principal Commissioner of Income-tax under section 151(i), instead of the authority specified under section 151(ii).

The learned AR submitted that notice under section 148A(b) was issued on 22.03.2022. The order under section 148A(d) was

It was contended that three years from the end of assessment year 2018-19 expired on 31.03.2022. Therefore, on 02.04.2022, the authority competent to accord approval was the authority specified under section 151(ii), namely, the Principal Chief Commissioner or Principal Director General or, where there was no Principal Chief Commissioner or Principal Director General, the Chief Commissioner or Director General. Approval by the Principal Commissioner was consequently without statutory authority.

In support of the first limb, the learned AR principally relied upon Skypak Travels (P.) Ltd. v. ITO [2026] 185 taxmann.com 963 (Bombay), Prakash Pandurang Patil v. ITO [2025] 177 taxmann.com 552/[2025] 481 ITR 325 (Bombay), and the order of the Hon’ble Supreme Court dismissing the Revenue’s Special Leave Petition in ITO v. Prakash Pandurang Patil [2025] 178 taxmann.com 8/[2025] 481 ITR 332 (SC).

The learned DR relied upon the orders of the authorities below and opposed the legal grounds raised by the assessee. He submitted that the reassessment had been initiated on the basis of information regarding a high-value property transaction and that the assessee had not participated in the assessment proceedings or furnished the relevant explanation before the lower authorities.

We have considered the rival submissions and perused the material placed on record. The material dates and events relevant to the first jurisdictional objection are not in dispute:

Section 151, as applicable on the date of the approval and notice, distinguished between cases where three years or less had elapsed and cases where more than three years had elapsed from the end of the relevant assessment year. In the first category, the specified authority included the Principal Commissioner or Principal Director, Commissioner or Director. In the second category, the specified authority was the Principal Chief Commissioner or Principal Director General or, where there was no such authority, the Chief Commissioner or Director General.

Assessment year 2018-19 ended on 31.03.2019. The period of three years expired on 31.03.2022. The order under section 148A(d) and notice under section 148 were issued on 02.04.2022. Therefore, on the date when jurisdiction was assumed, more than three years had elapsed from the end of the relevant assessment year. The approval was consequently required to be granted by the authority specified in section 151(ii). The approval admittedly obtained from the Principal Commissioner of Income-tax was approval by an authority falling within section 151(i).

The controversy is directly covered by the decision of the Hon’ble Bombay High Court in Skypak Travels (P.) Ltd. v. ITO

In paragraphs 13 and 14, the Hon’ble High Court held: 13. The foundational facts are not in dispute. The present case pertains to Assessment Year 2018-19. The impugned order under Section 148A(d) is dated 06 April 2022 and the impugned notice under Section 148 is dated 07 April 2022. Both these actions are, therefore, beyond a period of three years from the end of the relevant Assessment Year. 14. Once this position is accepted, the consequence in law is clear. As Section 151 stood at the relevant time, where more than three years had elapsed from the end of the relevant assessment year, the specified authority was the authority contemplated by Section 151(ii), and not the authority mentioned in Section 151(i). Three years are to be counted from the end of the relevant assessment year. In the present case, the impugned order and notice themselves indicate that the approval was granted by the Principal Commissioner of Income Tax. This fact is also admitted in the Reply Affidavit. He was not the competent authority in law for a case falling beyond the three-year period from the end of the relevant assessment year.” 35. After considering the statutory safeguard underlying section 151 and the decision of the Hon’ble Supreme Court in Union of India v. Rajeev Bansal [2024] 167 taxmann.com 70/[2024] 469 ITR 46 (SC), the Hon’ble Bombay High Court observed: “17. We are also in respectful agreement with the submission based on the decision of the Hon’ble Supreme Court in Rajeev Bansal (supra). The Hon’ble Supreme Court has clearly explained the importance of sanction under Section 151 and has held that grant of sanction by the appropriate authority is a pre-condition for the Assessing Officer to assume jurisdiction under Section 148. Section 151 is not an empty formality. It is a statutory safeguard and check against arbitrary reopening. Non-compliance with that requirement strikes at jurisdiction itself.”

The learned AR also relied upon Prakash Pandurang Patil v. ITO [2025] 177 taxmann.com 552. That case similarly concerned assessment year 2018-19, and the order under section 148A(d) and notice under section 148 were issued on 05.04.2022. While referring to its earlier decision in Siemens Financial Services (P.) Ltd. v. DCIT [2023] 154 taxmann.com 159/[2023] 457 ITR 647 (Bombay), the Hon’ble Bombay High Court observed in paragraph 7:

The Special Leave Petition preferred by the Revenue against the decision in Prakash Pandurang Patil was dismissed by the Hon’ble Supreme Court on 18.08.2025 in ITO v. Prakash Pandurang Patil [2025] 178 taxmann.com 8/[2025] 481 ITR 332 (SC).

The aforesaid dismissal does not contain an independent exposition of the law by the Hon’ble Supreme Court. It nevertheless leaves the judgment of the Hon’ble Bombay High Court undisturbed. More importantly, the precise controversy before us now stands directly concluded by the subsequent and reasoned decision in Skypak Travels (P.) Ltd.

Approval under section 151 is a statutory condition precedent to the assumption of jurisdiction under section 148. It is not sufficient that approval was obtained from some superior income-

In the present case, more than three years had elapsed from the end of assessment year 2018-19 when the order under section 148A(d) and notice under section 148 were issued on 02.04.2022. Approval was, therefore, required from the authority specified under section 151(ii). The Principal Commissioner of Income-tax, Bengaluru-3, who granted approval, was not the specified authority under that clause. The defect goes to the root of the assumption of jurisdiction and is not a mere procedural irregularity.

The fact that the reassessment was initiated on the basis of information concerning a property transaction of Rs.2,31,20,000/- cannot dispense with the mandatory jurisdictional requirement. The possible existence of information suggesting escapement of income and the competence of the authority granting statutory approval are separate requirements. Information regarding escapement cannot cure approval granted by an authority not empowered by section 151(ii).

We accordingly hold that the order under section 148A(d) and notice under section 148, both dated 02.04.2022, were issued without obtaining approval from the competent specified authority. The notice under section 148 is therefore invalid. The assessment order dated 05.02.2024 passed under section 147 read with section 144 and the impugned appellate order, being consequential to an invalid assumption of jurisdiction, cannot be sustained and are hereby quashed.

On the merits, the learned AR submitted that the Assessing Officer had erroneously treated the entire agreed consideration of Rs.2,31,20,000/- as investment made during financial year 2017- 18. According to him, the actual payments during the year aggregated to Rs.1,85,14,527/-, comprising Rs.1,73,28,527/- paid to the builder and Rs.11,86,000/- towards registration charges and legal expenses.

It was further submitted that the above amount was funded by a housing loan of Rs.1,60,83,807/-, contribution of Rs.1,00,000/- by the assessee’s spouse and contribution of Rs.23,30,720/- by the assessee. The assessee tendered the builder’s statement, housing-loan sanction letter, loan account, bank statements and confirmations from relatives as additional evidence before the Tribunal.

The learned DR submitted that these documents had not been furnished before the learned CIT(A) and had not been examined by the authorities below.

Since the reassessment proceedings have been quashed for want of valid approval under section 151(ii), adjudication of the addition under section 69 would be purely academic. We therefore refrain from expressing any opinion on the admissibility, genuineness or evidentiary value of the additional material, or on the explanation offered regarding the sources of investment.

Grounds Nos. 6 and 7 are general in nature and require no separate adjudication.

In the result, the appeal of the assessee is allowed.