SMITA SATISH RAHATE,SATARA vs. WARD 4 SATARA, SATARA

ITA 2870/PUN/2026Status: DisposedITAT Pune09 October 2026AY 2017-187 pages
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What did the Tribunal hold?

The Tribunal held that the notice issued under section 148 of the Income Tax Act, 1961, for AY 2017-18 is bad in law on two grounds. Firstly, concerning section 149(1), the Tribunal noted that the alleged escapement of income was Rs. 20,79,463/-, which is less than Rs. 50 lakh. Since more than three years had elapsed from the end of the assessment year, and the escapement did not fall under the exceptions requiring Rs. 50 lakh or more, the notice could not be issued under section 148. Secondly, regarding section 151, the notice dated 20.07.2022 for AY 2017-18 was approved by the Principal Commissioner of Income Tax on 14.07.2022. However, as more than three years had elapsed from the end of the assessment year, the approval should have been obtained from the Principal Chief Commissioner of Income Tax or Chief Commissioner of Income Tax. The Tribunal found support from the ITAT, Pune's decision in Mahesh Gokuldas Fulwani Vs. ITO. Consequently, the reassessment order was held to be void-ab-initio. The legal ground raised by the assessee was allowed. The grounds related to additions were dismissed as academic. The appeal was partly allowed.

What were the facts?

The assessee, Smita Satish Rahate, filed an appeal against the order of the Learned Commissioner of Income Tax (Appeals), NFAC, Delhi, for Assessment Year (AY) 2017-18. This appeal stemmed from an Assessment Order passed under sections 147, 144, and 144B of the Income Tax Act, 1961. There was a delay of 380 days in filing the appeal before the Tribunal, which was condoned. The core of the dispute revolves around the validity of the notice issued under section 148 of the Act. The assessee contended that the notice and the order under section 148A(d) were bad in law. The alleged escapement of income, as per the order under section 148A(d), was Rs. 20,79,463/-.

What were the issues?

1. Whether the notice issued under section 148 of the Income Tax Act, 1961, for AY 2017-18 is bad in law, considering the alleged escapement of income is less than Rs. 50 lakh and more than three years have elapsed from the end of the assessment year, as per section 149(1) of the Act? 2. Whether the notice issued under section 148 of the Act is bad in law due to improper sanction, as it was approved by the Principal Commissioner of Income Tax instead of the Principal Chief Commissioner of Income Tax or Chief Commissioner of Income Tax, as required by section 151 of the Act after a lapse of three years from the end of the assessment year? Assessee's Contentions: - The notice under section 148 and the order under section 148A(d) are bad in law. - As per section 149 of the Act, if the escapement of income is less than Rs. 50 lakh after a lapse of 3 years from the end of the assessment year, no notice can be issued. - The notice was approved by the Principal Commissioner of Income Tax, whereas section 151 requires approval from the Principal Chief Commissioner of Income Tax after 3 years from the end of the assessment year. - The notice was issued beyond the "surviving time period". - Relied on decisions filed in the paper book. Revenue's Contentions: - The Revenue's representative (Ld. DR) did not present any arguments to rebut the assessee's submissions.

Which sections of the Income-tax Act were involved?

Section 147,Section 144,Section 144B,Section 148,Section 148A,Section 149,Section 151,Section 250

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, PUNE BENCH “SMC”, PUNE

Before: SHRI Dr. DIPAK P. RIPOTE & SHRI VINAY BHAMORE

For Appellant: Shri Suhas Kulkarni
For Respondent: Smt. Deepa Hiray, Addl. CIT

PER Dr. DIPAK P. RIPOTE, A.M : This is an appeal filed by the assessee against the order of the Learned Commissioner of Income Tax (Appeals), NFAC, Delhi [Ld.CIT(A)], passed u/s. 250 of the Income Tax Act, 1961 („the Act‟) for AY 2017-18 on 18.03.2025, emanating from the Assessment Order u/s 147 r.w.s. 144 r.w.s 144B of the Act, dated 20.03.2023. 2. There was a delay of 380 days in filing of the appeal before this Tribunal. The assessee filed an affidavit explaining the reasons for delay. We have perused the affidavit and convinced that there was sufficient cause for delay. Substantial justice is more important than procedural delay. No assessee is going to gain by filing the appeal belatedly. Accordingly, d

The order continues below.

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