ANIL KUMAR MANRAI ,MUMBAI vs. ASSISTANT COMMISSIONER OF INCOME TAX CIRCLE 22(1), MUMBAI

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ITA 1419/MUM/2025Status: DisposedITAT Mumbai07 July 2025AY 2012-133 pages

In favour of the Revenue: the assessee's appeal was dismissed. From the AI summary of this appeal.

AI SummaryDismissed

What did the Tribunal hold?

The Tribunal held that the NFAC, Delhi (ld. CIT(A)), had set aside the assessment order passed by the AO under Section 144 read with Section 147 and referred it back to the AO for a fresh assessment. The ld. CIT(A) was convinced that the ex-parte assessment was made without affording adequate opportunity to the assessee, especially considering the amendment by the Finance (No. 2) Act, 2024, effective from 01/10/2024. The Tribunal found no reason to interfere with the ld. CIT(A)'s finding. The reasoning was that once the assessment order is set aside for a fresh assessment by the AO, any grievance related to the notices issued, including the Section 148 notice, should be taken up with the AO in the first instance as he is the primary authority. Therefore, the appeal of the assessee was dismissed. The issue of interest under Sections 234B and 234C was implicitly not decided by the Tribunal as the entire assessment was set aside.

What were the facts?

The assessee, Anil Kumar Manrai, for Assessment Year 2012-13, did not file his return of income. The Assessing Officer (AO) reopened the assessment by issuing a notice under Section 148 of the Income Tax Act, 1961, on 30/03/2019, after obtaining approval. The assessee filed a return on 09/04/2019, declaring an income of Rs. 3,22,340/-. Statutory notices were issued, and an assessment order under Section 144 read with Section 147 was passed on 21/12/2019, assessing total income at Rs. 2,41,73,650/-. The assessee challenged this assessment before the NFAC, Delhi (referred to as the ld. CIT(A)), primarily questioning the validity of the Section 148 notice.

What were the issues?

1. Whether the order passed under Section 144 read with Section 147 is void ab initio due to non-issuance of notice under Section 148 within the time prescribed by Section 149 and non-issuance of valid notices under Sections 143(2) and 142(1) as per Rule 127? (Mixed question of law and fact, concerning Sections 143(2), 142(1), 144, 147, 148, 149, and Rule 127). 2. Whether interest under Sections 234B and 234C was leviable? Assessee's contentions: The assessee argued that the assessment order was void ab initio due to the AO's failure to issue the Section 148 notice within the time limit stipulated by Section 149 and the absence of valid notices under Sections 143(2) and 142(1) as per Rule 127. The assessee also challenged the levy of interest under Sections 234B and 234C. Revenue's contentions: The judgment does not record specific contentions from the revenue regarding these issues.

Which sections of the Income-tax Act were involved?

Section 143(2),Section 142(1),Section 144,Section 147,Section 148,Section 149,Section 234B,Section 234C

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “A” BENCH, MUMBAI

Before: SHRI NARENDRA KUMAR BILLAIYA, HONBLE & SHRI SANDEEP SINGH KARHAIL, HONBLE

For Appellant: Shri Nikhil Porwal, A/Rs
For Respondent: Shri Aditya M. Rai, Sr. D/R
Hearing: 03/07/2025Pronounced: 07/07/2025

आदेश/O R D E R

PER NARENDRA KUMAR BILLAIYA, AM:

1.

This appeal by the assessee is preferred against the order dated 27/01/2025 by NFAC, Delhi [hereinafter “the ld. CIT(A)”] pertaining to AY 2012-13.

2.

The substantial grievance raised by the assessee is as under:- “1. The Learned Appellant Officer erred in ignoring the ground of appeal

to treat the order passed u/s 144 r.w.s. 147 as void ab initio for non-issuance of notice u/s 148 within the time limit prescribed u/s 149 and also non issuance of valid notice u/s 143(2) and 142(1) as per Rule 127.

2. The Learned Appellant Officer erred in levying interest u/s 234B & 234C.

3. The Appellant craves leave to alter, amend or add to any of the above grounds.”

3.

Briefly stated, the facts of the case are that the assessee did not file his return of income and the assessment was reopened by issuing notice u/s 148 of the Act dated 30/03/2019 after taking approval from Competent Authority.

2 4. In response to the said notice, the assessee filed return of income on 09/04/2019 declaring the income at Rs. 3,22,340/-. Statutory notices were issued and served upon the assessee and the assessment order was framed on 21/12/2019 u/s 144 r.w.s. 147 of the Act assessing total income at Rs. 2,41,73,650/-. The assessee challenged the assessment before the ld. CIT(A) specifically questioning the validity of the notice u/s 148 of the Act.

5.

Taking a leaf out of the amendment by the Finance (No. 2) Act, 2024 w.e.f. 01/10/2024, the ld. CIT(A) was convinced that the assessment made by the AO u/s 144 r.w.s. 147 of the Act being ex-parte assessment made without affording adequate opportunity to the assessee and accordingly, it found it to be a fit case to be set aside and referred back to the AO for making a fresh assessment.

6.

We are of the considered view that once the assessment order has been set aside back to the file of the AO for fresh assessment, then any grievance relating to the notice issued u/s 148 of the Act should be taken before the AO himself as he is the primary officer. Therefore, we do not find any reason to interfere with the findings of the ld. CIT(A).

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