PANKAJ KUMAR MADANLAL BAJPAI,THANE vs. INCOME TAX OFFICER 2(2), KALYAN

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ITA 3819/MUM/2026Status: DisposedITAT Mumbai07 October 2026AY 2015-168 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal decided to adjudicate the issue of limitation first, as it goes to the root of the matter and is a jurisdictional issue. The Tribunal noted that the merits of the case had not been argued by either party. The judgment does not record any findings on the merits of the case or any other grounds raised by the assessee, other than the preliminary issue of limitation. The Tribunal's decision on the limitation issue is not explicitly stated in the provided text, but the focus on this jurisdictional aspect indicates it was the primary point of contention. The operative directions are not specified as the judgment appears to be incomplete or focused solely on the preliminary issue.

What were the facts?

The assessee, Pankaj Kumar Madanlal Bajpai, filed an appeal against the order of the CIT(A), NFAC, Delhi, which upheld the reassessment order passed by the AO, Ward 2(2), Kalyan, under Section 147 read with Section 144 of the Income-tax Act, 1961, for Assessment Year 2015-16. The reassessment proceedings were initiated by issuing a notice under Section 148 on April 4, 2022, alleging escapement of income due to the purchase of immovable property for Rs. 65,88,000. The assessee contended that the reassessment proceedings and the consequential assessment order were bad in law and void for want of jurisdiction. The assessee also raised grounds related to natural justice, validity of reassessment, applicability of Section 69, and levying of interest under Sections 234A, 234B, and 234C.

What were the issues?

1. Whether the reassessment proceedings for AY 2015-16, initiated by issuing a notice under Section 148 dated April 4, 2022, are barred by limitation and therefore void, and if the CIT(A) erred in affirming the same? 2. Whether the reassessment proceedings and the consequential assessment order are bad in law and void for want of jurisdiction, particularly considering the assessee's alleged non-resident status for the relevant previous year? 3. Whether the notice under Section 148 dated April 4, 2022, was validly served on the assessee as per Section 282 of the Act? 4. Whether the reassessment proceedings were initiated and completed in contravention of Section 144B of the Act? 5. Whether the addition of Rs. 65,88,000/- under Section 69 of the Act is contrary to the provisions of the Act, and if the assessee is a non-resident, whether the addition falls within the scope of total income as per Section 5 of the Act? 6. Whether the AO erred in levying interest under Sections 234A, 234B, and 234C of the Act? Assessee's Contentions: - The reassessment proceedings are barred by limitation and void. - The reassessment proceedings are void for want of jurisdiction as the assessee was a non-resident. - The notice under Section 148 was not validly served. - The proceedings are in contravention of Section 144B. - There is no income escaping assessment. - The addition under Section 69 is incorrect and not applicable, and the property purchase was explained by salary earned in Saudi Arabia. - As a non-resident, the addition does not fall within the scope of total income. - The AO erred in treating the assessee as a resident without intimation. - Interest under Sections 234A, 234B, and 234C is wrongly levied. - The order passed by the CIT(A) is in gross violation of principles of natural justice. Revenue's Contentions: - Not recorded in the judgment.

Which sections of the Income-tax Act were involved?

Section 147,Section 144,Section 148,Section 148A,Section 149,Section 282,Section 251,Section 144B,Section 69,Section 5,Section 234A,Section 234B,Section 234C

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, MUMBAI

Before: SHRI SAKTIJIT DEY & SHRI GIRISH AGRAWAL

For Respondent: Shri Ajay Soneji, Sr. DR
Pronounced: 07.10.2026

INCOME TAX APPELLATE TRIBUNAL, MUMBAI BENCHES, MUMBAI BENCH: C BEFORE SHRI SAKTIJIT DEY, VICE PRESIDENT AND SHRI GIRISH AGRAWAL, ACCOUNTANT MEMBER

ITA 3819/MUM/2026 (िनधा�रण वष�/Assessment Year: 2015-16) Pankaj Kumar Madanlal Bajpai Income Tax Officer 2(2) Uma Row House 1 Phase 2, Income Tax Department, Mohan Ganesh Mandir Road, Behind Plaza, Near Poddar School, Reliance Smart Point, Vaile Nagar, Khadakpada, Vs. Titwala B.O, Kalyan, Kalyan, Thane-421301, Thane - 421605, Maharashtra Maharashtra अपीलाथ� Appellant ��थ� Respondent

Permanent Account Number of Assessee: AGVPB8663P

अपीलाथ� �ारा/Appellant represented by: Shri Nishit Gandhi, Advocate ��थ� �ारा/Respondent represented by: Shri Ajay Soneji, Sr. DR

सुनवाई की तारीख / Date of conclusion of hearing: 28.07.2026 घोषणा की तारीख / Date of pronouncement: 07.10.2026 O R D E R PER GIRISH AGRAWAL, ACCOUNTANT MEMBER: This appeal filed by assessee is against the order of the ld. CIT(A), National Faceless Appeal Centre (NFAC), Delhi, vide Order No. ITBA/NFAC/S/250/2025-26/1085316027(1) dated 29.01.2026 passed against the assessment order by Assessment Officer, Ward 2(2), Kalyan, u/s. 147 r.w.s 144 of the Income-tax Act, 1961 (‘the Act’) dated 14.12.2023, for Assessment Year 2015-16.

2.

Assessee has raised the following grounds of appeal:

“ON NATURAL JUSTICE: 1.1 In the facts and circumstances of the case and in law the order passed by the Learned Commissioner of Income Tax (Appeals) National Faceless Appeal Centre (NFAC) ["the Ld. CIT(A)"] deserves to be quashed since the same is passed in gross violation of principles of Natural Justice and also based on totally extraneous considerations while ignoring the relevant, material considerations and submissions made by the Appellant. ON VALIDITY OF REASSESSMENT: 2.1 In the facts and circumstances of the case and in law, re-assessment proceedings and the consequential assessment order passed by the Assessing Authority, National Faceless Assessment Centre [the Ld. AO] is bad in law and void for want of jurisdiction and the Ld. CIT(A) erred in affirming the same. 2.2 While passing the said order, the Ld. CIT(A) failed to appreciate that: (a) The re-assessment proceedings for AY 2015-16 initiated by issue of Notice u/s 148 dated 04/04/2022 are barred by limitation and therefore void; (b) The impugned re-assessment proceedings as well as the Notice u/s 148 and the proceedings prior thereto including the Notice u/s 148A(b) and the order u/s 148A(d) are bad in law since the same are issued in violation of section of section 148 of the Act read with first proviso to section 149(1); (c) None of the necessary pre-conditions for initiation as well as completion of re-assessment under the Act are fulfilled/complied with in the present case; (d) In any case, there is no income escaping assessment in the present case and therefore the entire exercise is bad in law even on this count; (e) Without prejudice to the above, the notice u/s 148 of the Act dated 04/04/2022 of the Act was not served to the Appellant either on email or through the post and non-serving of the notice u/s 148 of the Act to the Appellant is invalid as per the provision of section 282 of the Act and it is to be quashed. 2.3 In the facts and circumstances of the case and in law, the impugned re- assessment order deserves to be quashed and it is prayed accordingly. 2.1. Subsequently, assessee filed Revised Grounds of Appeal, which are as under: “ON VALIDITY OF REASSESSMENT: 1.1 In the facts and circumstances of the case and in law, re-assessment proceedings and the consequential assessment order passed by the Income Tax Officer - 2(2), Kalyan ["the Ld. AO" for short] is bad in law and void for want of jurisdiction and the Learned Commissioner of Income Tax (Appeals) National Faceless Appeal Centre (NFAC) ["the Ld. CIT(A)"] erred in affirming such a re- assessment. 1.2 While passing the said order, the Ld. CIT(A) failed to appreciate that: (a) The re-assessment proceedings for AY 2015-16 initiated by issue of Notice u/s 148 dated 04/04/2022 are barred by limitation and therefore void; (b) The Notice u/s 148 issued by the Income Tax Officer-2(2), Kalyan [the AO herein] is wholly without jurisdiction since the Assessee is a non-resident for the relevant previous year;

(c) The final assessment order passed by the Ld. AO bad in law and void for want of jurisdiction; (d) None of the necessary pre-conditions for initiation as well as completion of re-assessment under the Act are fulfilled/complied with in the present case; (e) In any case, there is no income escaping assessment in the present case and therefore the entire exercise is bad in law even on this count; (f) Without prejudice to the above, the notice u/s 148 of the Act dated 04/04/2022 of the Act was not served to the Appellant either on email or through the post and non-service of the notice u/s 148 of the Act to the Appellant is invalid as per the provision of section 282 of the Act and it is to be quashed. 1.3 In the facts and circumstances of the case and in law, the impugned re- assessment order deserves to be quashed and it is prayed accordingly. 1.4 In the facts and circumstances of the case and in law, the order passed by the Ld. CIT(A) in remanding the assessment back to the Assessing officer for a fresh assessment in terms of the proviso to section 251 (1) is bad in law and void since the same is passed without appreciating that the entire action of the Ld. AO was wholly without jurisdiction and therefore bad in law and void and deserved to be quashed. 1.5 In the facts and circumstances of the case and in law, the impugned assessment proceedings and the consequential assessment order are bad in law and void for want of Jurisdiction since the same are passed in contravention of section 144B of the Act. ON NATURAL JUSTICE: 2.1 In the facts and circumstances of the case and in law the order passed by the Ld. CIT(A) deserves to be quashed since the same is passed in gross violation of principles of Natural Justice and without considering the submissions made by the Appellant, especially those in respect of jurisdiction to make the impugned assessment. ON MERITS: 3.1 In the facts and circumstances of the case and in law, the Ld. AO erred in treating the Assessee as a Resident for the purpose of making assessment without appreciating that the Assessee is a non-resident in the relevant Assessment year and the Ld. AO further erred in not intimating the Assessee of his intention to treat the Assessee as a Resident, before making the impugned assessment. 3.2 In the facts and circumstances of the case and in law, the Ld. AO erred in making and the Ld. CIT(A) erred in confirming the addition of Rs. 65,88,000/- u/s 69 of the Act in the hands of the Assessee which is contrary to the provisions of the Act. 3.3 While doing so the Ld. AO as well as the Ld. CIT(A) failed to appreciate that: (i) The provisions of section 69 are not applicable in the present case and the addition is incorrectly made; and (ii) The property is purchased from the salary earned from his job in Saudi Arabia and for which all the relevant documents were furnished before the ld. CIT(A) and hence the purchase of the property stood duly explained;

(iii) Even Otherwise, the Assessee is a non-resident for the relevant year and therefore the addition could not have been made since the same does not fall in the scope of total income as per section 5 of the Act; 4. In the facts and circumstances of the case and in law, the Ld. AO erred in levying interest u/s 234A, 234B and 234C of the Act.

2.2. Assessee vide revised ground no. 1.2(a) before us, challenges the impugned reassessment proceedings, contesting that the notice u/s 148 issued on 04.04.2022 for AY 2015-16 is barred by limitation and void for want of jurisdiction. Since the said ground of appeal goes to the root of the matter, being a jurisdictional issue, the same is taken up for adjudication first. Merits of the case have not been argued upon by either party nor any submission made to that effect. Accordingly, we draw facts from the records relating to the said legal ground argued before the Bench.

3.

Brief facts of the case are that notice u/s 148 of the Act was issued on 04.04.2022 alleging that there is an escapement of income from assessment on account of purchase of immovable property for a consideration of Rs. 65,88,000/- registered at the office of Joint Sub Registrar, Kalyan-4. Assessee was a non-filer for the year under consideration. Order u/s 148A(d) was passed on 04.04.2022 after obtaining necessary approval from the specified authority. Thereafter, ld. Assessing Officer completed the best judgment assessment u/s 147 r.w.s. 144 of the Act on 14.12.2023 by treating the entire investment of Rs. 65,88,000/- as unexplained investment in the hands of assessee u/s 69. Aggrieved, assessee went in appeal before the ld. CIT(A) who set aside the assessment order and remitted the matter back to the file of ld. Assessing Officer to frame a fresh assessment. Aggrieved by the order of ld. CIT(A), assessee is in appeal before the Tribunal.

4.

On the fact that notice u/s 148 was issued on 04.04.2022 under the new regime of reassessments, we find that this issue has been settled in the case of Union of India vs. Rajeev Bansal [2024] 167 taxmann.com 70 (SC), wherein reference is made to the submissions made on behalf of the Revenue vide para 19, which is relevant and the same is reproduced hereunder: “19. Mr N Venkataraman, learned Additional Solicitor General of India, made the following submissions on behalf of the Revenue: a. Parliament enacted TOLA as a free-standing legislation to provide relief and relaxation to both the assessees and the Revenue during the time of COVID- 19. TOLA seeks to relax actions and proceedings that could not be completed or complied with within the original time limits specified under the Income Tax Act, b. Section 149 of the new regime provides three crucial benefits to the assesses: (i) the four-year time limit for all situations has been reduced to three years, (ii) the first proviso to Section 149 ensures that re-assessment for previous assessment years cannot be undertaken beyond six years, and (iii) the monetary threshold of Rupees fifty lakhs will apply to the re- assessment for previous assessment years, c. The relaxations provided under Section 3(1) of TOLA apply "notwithstanding anything contained in the specified Act." Section 3(1), therefore, overrides the time limits for issuing a notice under Section 148 read with Section 149 of the Income Tax Act; d. TOLA does not extend the life of the old regime. It merely provides a relaxation for the completion or compliance of actions following the procedure laid down under the new regime; e. The Finance Act 2021 substituted the old regime for re-assessment with a new regime. The first proviso to Section 149 does not expressly bar the application of TOLA. Section 3 of TOLA applies to the entire Income Tax Act including Sections 149 and 151 of the new regime. Once the first proviso to Section 149(1)(b) is read with TOLA, then all the notices issued between 1 April 2021 and 30 June 2021 pertaining to assessment years 2013- 2014, 2014-2015, 2015-2016, 2016-2017 and 2017-2018 will be within the period of limitation as explained in the tabulation below; Assessm Within 3 Expiry of Within six Expiry of ent Year Years Limitation Years Limitation read (1) (2) read with (4) with TOLA for TOLA for (2) (4) (3) (5)

2013- 31.03.2017 TOLA not 31.03.2020 30.06.2021 2014 applicable 2014- 31.03.2018 TOLA not 31.03.2021 30.06.2021 2015 applicable 2015- 3103.2019 TOLA not 31.03.2022 TOLA not 2016 applicable applicable 2016- 31.03.2020 30.06.2021 31.03.2023 TOLA not 2017 applicable 2017- 31.03.2021 30.06.2021 31.03.2024 TOLA not 2018 applicable f. The Revenue concedes that for the assessment year 2015-16, all notices issued on or after 1 April 2021 will have to be dropped as they will not fall for completion during the period prescribed under TOLA; g. Section 2 of TOLA defines "specified Act" to mean and include the Income Tax Act. The new regime, which came into effect on 1 April 2021, is now part of the Income Tax Act. Therefore, TOLA continues to apply to the Income Tax Act even after 1 April 2021; and h. Ashish Agarwal (supra) treated Section 148 notices issued by the Revenue between 1 April 2021 and 30 June 2021 as show-cause notices in terms of Section 148A(b). Thereafter, the Revenue issued notices under Section 148 of the new regime between July and August 2022. Invalidation of the Section 148 notices issued under the new regime on the ground that they were issued beyond the time limit specified under the Income Tax Act read with TOLA will completely frustrate the judicial exercise undertaken by this Court in Ashish Agarwal (supra).”

4.1. Thus, it can be seen that Revenue conceded before the Hon’ble Supreme Court in para 19(f) for dropping all the notices issued on or after 01.04.2021 for A.Y. 2015-16 as they will not fall for completion during the period prescribed under TOLA.

4.2. This issue had come up before the Hon'ble Delhi High Court in the case of IBIBO Group Pvt. Ltd. vs. ACIT, WP(C)17639 of 2022, dated 13.12.2024, wherein re-assessment action for Assessment Year 2015- 16 was held to be not sustainable. Hon'ble Court quashed the notice issued u/s 148 as well as order passed u/s 148A(d) for Assessment Year 2015-16 by following the decision in the case of Rajeev Bansal (supra).

4.3. In the case of present assessee, since notice issued u/s 148 is dated 04.04.2022, the outer time limit of six years for Assessment Year 2015- 16 expired on 31.03.2022 and is, thus, barred by limitation. Accordingly, notice so issued and re-assessment completed thereafter u/s 147 is liable to be quashed, in view of the decision of Hon'ble Supreme Court in the case of Rajeev Bansal (supra) which was followed by Hon'ble Delhi High Court in the case of IBIBO (supra).

4.4. Hon'ble Supreme Court while dismissing the SLP filed by Revenue in the case of ACIT vs. Nehal Ashit Shah in SLP (Civil) Diary No(s). 57209/2024, dated 04.04.2025 held that it does not survive for further consideration. While holding so, Hon'ble Court noted in para 7 as under: “5. In this regard, reference could also be made to paragraph 19(e) and (f) in the case of Union of India vs. Rajeev Bansal, Civil Appeal No.8629 of 2024 on 03.10.2024 (2024 SCC ONLINE 754) under which the learned Additional Solicitor General for India has made a concession insofar as the assessment year 2015- 16 is concerned.”

4.5. In another decision also, Hon'ble Supreme Court dismissed the SLP filed by the Revenue in the case of Income Tax Officer vs. Sri Sai Kumar Mateti in SLP (Civil) No. 8682 of 2024, wherein Hon'ble Court held as under: “Consequently, keeping in mind the reasons set out in order dated 10.04.2026, the impugned judgment in each appeal is set aside and the instant appeals are disposed of by remitting the matters to the jurisdictional High Courts for redetermination of the issues. As observed above, the High Courts shall firstly determine whether the matters pertain to Assessment Year 2015-16. If it is found to be so, no further adjudicatory exercise shall be required to be undertaken by the High Court, except to declare the notices as being time-barred in light of Rajeev Bansal (supra). However, if it is found that the case does not pertain to Assessment Year 2015-16, then all the issues shall be resolved in terms of the order dated 10.04.2026 passed in Civil Appeal No. 4716 of 2026.”

5.

In view of above stated deliberation, both on facts and law including the applicable jurisprudence, we hold that notice for A.Y. 2015-16 issued on 04.04.2022 u/s 148 of the new regime is barred by limitation and hence bad in law, liable to be quashed, resulting in impugned reassessment proceedings as well as the impugned reassessment order bad in law. Accordingly, ground raised by assessee in this respect is allowed. All the other grounds of appeal are thus, rendered academic in nature.

6.

In the result, appeal filed by the assessee is allowed.

Order is pronounced in the open court on 07 October, 2026

Sd/- Sd/- (Saktijit Dey) (Girish Agrawal) Vice President Accountant Member Dated: 07 October, 2026 MP, Sr.P.S. Copy to : 1 The Appellant 2 The Respondent 3 DR, ITAT, Mumbai 4 Guard File 5 CIT BY ORDER, Digitally signed by ABHINAV ABHINAV ANANT ANANT GAVANDE GAVANDE Date: 2026.10.16 10:22:31 +05'30' (Dy./Asstt.Registrar) ITAT, Mumbai

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