CHENNAM RANGASWAMY,HYDERABAD vs. ITO, WARD-11(1), HYDERABAD

ITA 738/HYD/2026Status: DisposedITAT Hyderabad09 October 2026AY 2015-1634 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the notice issued under Section 148 of the Income Tax Act, 1961, dated 26.04.2022, was barred by limitation. This was based on the fact that the notice was issued beyond the period of six years from the end of the Assessment Year 2015-2016. The Tribunal followed the ratio laid down by the Hon'ble Jurisdictional High Court in Cyberabad Citizens Health Services Private Limited vs. DCIT and this Tribunal's decision in Sudheer Parimala vs. ITO, as well as the Supreme Court's judgment in ITO vs. Sai Kumar Mateti. The ratio is that a notice issued under Section 148 after the expiry of six years from the end of the assessment year is not valid and is liable to be quashed. Consequently, the reassessment order passed by the Assessing Officer was also vitiated and quashed. The other grounds raised by the assessee were rendered infructuous. The appeal filed by the assessee was allowed.

What were the facts?

The assessee, Chennam Rangaswamy, filed an appeal against the order of the CIT(A)-NFAC, Delhi, for Assessment Year 2015-2016. The assessee's grounds of appeal challenged the validity of notices issued under Section 148A(b), 148A(d), and 148 of the Income Tax Act, 1961, arguing they were not issued by the appropriate authority and were beyond the limitation period. The assessee also contended that deposits in the bank account were business receipts and income was admitted on a presumptive basis, and that the addition made under Section 69A by the Assessing Officer was incorrect. The assessee later filed additional grounds of appeal, reiterating the invalidity of the Section 148 notice due to lack of jurisdiction and being barred by limitation, particularly after the expiry of six years from the end of AY 2015-16.

What were the issues?

1. Whether the notice issued under Section 148 of the Income Tax Act, 1961, dated 26.04.2022, is invalid and barred by limitation, considering it was issued beyond six years from the end of Assessment Year 2015-2016? (Question of law, turning on Section 149(1)(b) of the IT Act). Assessee's contentions: The notice under Section 148 was issued by the jurisdictional Assessing Officer who lacked authority. The notice was issued after the expiry of six years from the end of AY 2015-16, making it barred by limitation and void ab initio. Reliance was placed on the judgments in Sri Light Chit Fund P Ltd. vs. ITO and Namireddy Kondal Reddy vs. ITO, and the Supreme Court decision in ITO vs. Sai Kumar Mateti. Revenue's contentions: The time limit extended under the 5th and 6th provisos to Section 149(1) was available to the Assessing Officer, making the notice within the period of limitation. Reliance was placed on the orders of the authorities below.

Which sections of the Income-tax Act were involved?

Section 148,Section 148A,Section 149,Section 69A,Section 147,Section 144

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, HYDERABAD

Before: SHRI VIJAY PAL RAO & SHRI MANJUNATHA G.

Pronounced: 09.10.2026

PER VIJAY PAL RAO, VICE PRESIDENT:

This appeal by the Assessee is directed against the Order dated 29.01.2026 of the learned CIT(A)-National Faceless Appeal Centre [in short "NFAC"], Delhi, for the assessment year 2015-2016. 2. The Assessee has raised the following grounds of appeal:

1.

“The order of the learned CIT (A) is erroneous both on facts and in law;

2.

The learned CIT (A) ought to have considered the fact that the notice u/s 148A(b)

The order continues below.

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