FIRST INDIA ESTATES AND SERVICES PRIVATE LTD vs. INCOME TAX OFFICER & ANR.

The petitioner has filed the present petition, inter alia, praying as under: “a) Issue writ of certiorari or writ, order or direction in the nature of certiorari, or any other appropriate writ, order or direction under Article 226/227 of the Constitution of India, quashing notice dated 20.05.2022 issued under section 148A(b) of the Act. b) Issue writ of certiorari or writ, order or direction in the nature of certiorari, or any other appropriate writ, order or direction under Article 226 / 227 of the Constitution of India quashing impugned order dated 29.07.2022 passed under section 148A(d) and consequential notice of even date issued under section 148 of the Act, in the case of the petitioner for assessment year 2017-18, and any consequent proceedings thereto;”

The petitioner is a private limited company and is engaged in the business of real estate. The petitioner filed its return for the assessment year [AY] 2017-18 on 31.10.2017 declaring an income of ₹5,95,980/-. The Assessing Officer [AO] issued a notice dated 21.06.2021 under Section 148 This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 02/07/2025 at 00:21:45

Similar notices were also set aside by the various High Courts in India. The Revenue had assailed the orders passed by the High Courts before the Supreme Court in a batch of matters. In Union of India & Ors. v. Ashish Agarwal: (2023) 1 SCC 617 and other connected appeals, the Supreme Court issued directions under Article 142 of the Constitution of India directing that such notices be construed as notices under Section 148A(b) of the Act with a further direction to the AOs to provide the information as required to be accompanied by the said orders.

In compliance of the directions issued by the Supreme Court in Union of India & Ors. v. Ashish Agarwal (supra), the AO provided the information to the petitioner on 20.05.2022 and the petitioner responded to the said notice on 20.06.2022. 5. Thereafter, the AO passed the order under Section 148A(d) of the Act on 29.07.2022 and issued the notice under Section 148 of the Act [the impugned notice]. The AO had proceeded to issue notice after approval of Principal Commissioner of Income Tax [PCIT] who is not the competent authority to grant such approval. Concededly, the impugned notice was not issued with prior approval of the Principal Chief Commissioner of Income This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 02/07/2025 at 00:21:45

In Ganesh Dass Khanna v. Income Tax Officer & Anr.: Neutral Citation No.: 2023:DHC:8187-DB, this court considered the provisions of Section 149 of the Act and held that, since the income that had escaped assessment was less than ₹50,00,000/-, the time limit prescribed under Section 149(1)(a) of the Act would be applicable, as the question concerning the limitation and the competence of the specified authority to grant approval were intertwined.

In Twilight Infrastructure Pvt. Ltd. v. Income Tax Officer Ward 25 3 Delhi & Ors.: Neutral Citation No.: 2024:DHC:259-DB, this court referred to the stand of the Revenue in Ganesh Dass Khanna v. Income Tax Officer & Anr. (supra) and held as under:

In view of the above, the impugned notice is liable to be set aside.

Concededly, the said issue is covered by the earlier decision of this court in Abhinav Jindal HUF v. Income Tax Officer Ward 54(1) Delhi & Ors.: Neutral Citation No.:2024:DHC:7238-DB.

In view of the above, the petition is allowed and the impugned notice issued under Section 148 of the Act is set aside. All proceedings initiated pursuant to the impugned notice are also set aside. It is, however, clarified that this order will not preclude the Revenue from initiating any further proceedings afresh albeit in accordance with law.

The petition is disposed of in the aforesaid terms. VIBHU BAKHRU, J TEJAS KARIA, J APRIL 24, 2025 ‘gsr’ Click here to check corrigendum, if any This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 02/07/2025 at 00:21:45