NAVEEN CHANDRAKAR,HYDERABAD vs. THE INCOME TAX OFFICER WARD 5(3)(1), BANGALORE, KARNATAKA

ITA 2751/BANG/2025Status: DisposedITAT Bangalore29 September 2026AY 2019-2012 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the order passed under section 148A(d) and the notice issued under section 148, both dated April 17, 2023, were bad in law. The reasoning was based on the fact that for Assessment Year 2019-20, more than three years had elapsed from the end of the relevant assessment year by March 31, 2023. According to section 151(ii) of the Act, if more than three years have elapsed, the specified authority for granting approval to issue notice under section 148 and 148A must be the Principal Chief Commissioner or Chief Commissioner. In this case, the approval was granted by the Principal CIT, Bengaluru-3, which is only authorized under section 151(i) when three years or less have elapsed. The Tribunal found force in the assessee's argument that the approval was not accorded by the prescribed authority as per the law applicable at the time of issuing the notice. The Tribunal also referred to the Supreme Court's decision in Chhugamal Rajpal (supra) emphasizing that satisfaction/approval must be applied with application of mind and not mechanically. Consequently, the Tribunal quashed and set aside the order dated April 17, 2023, passed under section 148A(d), the notice issued under section 148, and all consequential proceedings and orders emanating therefrom. The ratio decidendi is that the approval for reassessment proceedings under section 148/148A must be obtained from the authority prescribed under section 151, based on the time elapsed from the end of the relevant assessment year, and failure to do so renders the proceedings void ab initio.

What were the facts?

The assessee, Naveen Chandrakar, filed his return of income for Assessment Year 2019-20 on August 31, 2019, declaring a total income of Rs. 44,13,050. The Assessing Officer (AO) received information suggesting the assessee had claimed a bogus donation of Rs. 4,00,000 to Rashtriya Samajwadi Party (Secular). A show cause notice under section 148A(b) was issued on March 31, 2023. The assessee responded, claiming to have supporting documents. The AO, relying on investigation wing reports and statements from the party president and her husband, concluded the donation was not genuine. An order under section 148A(d) was passed on April 17, 2023, holding it a fit case for issuing a notice under section 148. A notice under section 148 was also issued on the same day. The assessee did not file a return, and the AO completed the assessment under section 144 read with section 147, making additions totaling Rs. 51,73,250. The assessee appealed to the CIT(A)/NFAC, which upheld the AO's order. The present appeal is against the CIT(A)'s order.

What were the issues?

1. Whether the notice issued under section 148A(d) and the consequential notice under section 148 of the Income Tax Act, 1961, dated April 17, 2023, are bad in law for being violative of the provisions of section 151(ii) of the Act, read with CBDT notification and the scheme for E-Assessment of Income Escaping Assessment, 2022. Assessee's contentions: The assessee argued that since more than three years had elapsed from the end of the relevant assessment year (AY 2019-20), the approval for issuing the notice under section 148 should have been obtained from the Principal Chief Commissioner or Chief Commissioner, as stipulated in section 151(ii) of the Act. However, the approval was obtained from the Principal CIT, Bengaluru-3, which is only empowered under section 151(i) when three years or less have elapsed. The assessee relied on the Telangana High Court's decision in Kankanala Ravindra Reddy, stating that reassessment under the post-2021 regime must follow the faceless procedure and non-adherence vitiates the action. Revenue's contentions: The judgment does not record specific contentions from the revenue regarding this issue.

Which sections of the Income-tax Act were involved?

Section 148A,Section 148,Section 147,Section 144,Section 151,Section 151A,Section 250,Section 139(1),Section 80G,Section 132(4)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “B’’ BENCH: BANGALORE

Before: SHRI BALAKRISHNAN S. & SHRI KESHAV DUBEY

For Appellant: CA Bhuvan M., A.R
Hearing: 02.07.2026Pronounced: 29.09.2026

PER KESHAV DUBEY, JUDICIAL MEMBER:

This appeal at the instance of the assessee is directed against the order of the ld. CIT(A)/NFAC dated 14.08.2025 vide DIN & Order No. ITBA/NFAC/S/250/2025-26/1079640448(1) passed u/s 250 of the Income Tax Act, 1961 (in short “the Act”) for the assessment year 2019-20. 2. The assessee has raised the following grounds of appeal: -

1.

The learned Commissioner of Income-tax (Appeals) order is erroneous in facts and law.

2.

The CIT (Appeals) erred in upholding the order of the assessing officer without properly considering the facts and circumstances of the case and further erred in confirming the action of the assessing officer w

The order continues below.

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