MANORAMA PATWA,HOWRAH vs. I.T.O., WARD - 47(1), KOLKATA

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ITA 493/KOL/2025Status: DisposedITAT Kolkata24 October 2025AY 2015-2016Bench: Shri Pradip Kumar Choubey, Judicial Member Shri Rakesh Mishra (Accountant Member)5 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal found that the Section 148 notice was issued on 01.04.2021, not 31.03.2021, and without complying with the statutory formalities of Section 148A as mandated by the Finance Act, 2021, effective from 01.04.2021. Relying on Calcutta High Court precedents, the Tribunal held that the notice was issued beyond the limitation period, rendering all subsequent assessment proceedings invalid.

What were the facts?

The assessee filed an income tax return for AY 2015-16. The Assessing Officer issued a notice under Section 148 of the Act on 01.04.2021, which led to an assessment under Section 144 r.w. Section 147, making an addition of Rs. 56,84,675/- under Section 68 as unexplained cash credit. The CIT(A) dismissed the assessee's appeal.

What were the issues?

Whether a Section 148 notice issued on 01.04.2021 without adhering to the newly inserted Section 148A provisions of the Income Tax Act is valid, thereby impacting the legality of subsequent assessment proceedings.

Which sections of the Income-tax Act were involved?

Section 148,Section 148A,Section 147,Section 144,Section 68,Section 250

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Income Tax Appellate Tribunal, “C” BENCH KOLKATA

Before: Shri Pradip Kumar ChoubeyShri Rakesh Mishraand

order

: October 24, 2025 ORDER

Per Pradip Kumar Choubey, Judicial Member:

1.

The present appeal has been preferred by the assessee against the order dated 04.02.2025 of the National Faceless Appeal Centre [hereinafter referred to as ‘CIT(A)’] passed u/s 250 of the Income Tax Act (hereinafter referred to as the ‘Act’).

2.

Brief facts of the case of the assessee are that the assessee filed its return of income declaring total income of Rs.23,34,930/- for the assessment year under consideration. A notice u/s 148 of the Act was issued on 01.04.2021 and the Assessing Officer has completed the assessment u/s 144 r.w.s. 147 of the Act by assessing total income of Rs.83,03,840/- thereby making an addition of Rs.56,84,675/- u/s 68 of the Act as unexplained cash credit in the hands of the assessee.

Manorama Patwa 3. Aggrieved by the said order, the assessee preferred an appeal before the ld. CIT(A) wherein the appeal of the assessee has been dismissed.

4.

Being aggrieved and dissatisfied the assessee is before us. The ld. AR challenges that impugned order on the legal ground that the Assessing Officer had issued notice u/s 148 of the Act on 01.04.2021 without adhering to the newly inserted provisions of section 148 r.w.s 148A hence the entire assessment proceedings are bad-in-law and the same liable to be quashed. He contended that notice was issued u/s 148 on 01.04.2021 without complying the statutory formalities under section 148A of the Act as prescribed by the Finance Act, 2021 which are applicable w.e.f 01.04.2021 before issuance of notices under section 148 of the Act. The ld. AR further states that the Assessing Officer though has noted down the date of issuance of Notice u/s 148 of the Act as 31.03.2021 but the same has been uploaded on 01.04.2021 and even in the said notice appears to be no signature or digital signature. He submits that since the notice has been issued beyond the limitation time and therefore, the consequent assessment proceedings u/s 148 of the Act become void ab initio and the same be quashed. The ld. AR relied on the decision of Hon’ble Calcutta High Court Calcutta High Court in the case of Marudhar Vintrade Pvt. Ltd. vs. Union of India & Ors.

5.

Contrary to that, the ld. DR supports the impugned order thereby submitting that the notice u/s 148 was digitally signed by the Assessing Officer on 31.03.2021 and it was issued within time.

6.

Upon hearing the submissions of the counsels of the respective parties, we have perused the orders of lower authorities and find that notice u/s 148 was issued in fact on 01.04.2021 and not on or before 31.03.2021 for the assessment year in question and the screen shot as provided by the ld. AR is as under:

Manorama Patwa 6.1 We note that the Assessing Officer had issued notice u/s 148 of the Act on 01.04.2021 without complying the statutory formalities under section 148A of the Act as prescribed by the Finance Act, 2021 which are applicable w.e.f 01.04.2021 before issuance of notices under section 148 of the Act. We have gone through the order passed by the Hon’ble Calcutta High Court in the case of Marudhar Vintrade Pvt. Ltd. vs. Union of India & Ors. in which the Hon’ble Calcutta High Court has held as under:

“Heard learned advocates appearing for the respective parties. Petitioner in this writ petition is aggrieved by the issuance of impugned notice under section 148 of the Income Tax Act, 1961 on the grounds that the same is barred by limitation and that the respondent-income tax authority concerned, before issuing the impugned notices under section 148 of the 1961 Act, has not observed the statutory formalities under section 148A of the 1961 Act as prescribed by the Finance Act, 2021 which are applicable with effect from 1st April 2021 before issuance of notices under section 148 of the 1961 Act on or after 1st April 2021. Learned advocate for the respondent was asked as to whether final assessment order has already been passed or not in this case to which he submits that final assessment order has already been passed. He further submits on the basis of record that the impugned notice under section 148 of the 1961 Act, though it bears date and signature of the authority showing that it was singed on March 31, 2021, but it was actually uploaded for communication on April 1, 2021 at 3 a.m. which has to be treated as date of issuance of the impugned notice. Considering these facts, I am of the considered view that this case clearly falls under the amended Act relating to proceedings under section 147 of the Act under which issuance of notice under section 148A of the Act is mandatory before issuing any notice under section 148 of the amended Act which has not been complied with in this case. Considering the above facts and circumstances of the case and in view of the order of this court in the case of Bagaria Properties and Investment Private Limited & Anr. v. Union of India & Ors. reported in (2022) 134 taxman.com 196 (Calcutta) and also in the case of Monoj Jain v. Union of India reported in (2022) 134 taxman.com 173 (Calcutta), the impugned notice under section 148 of the Act and all subsequent proceedings are not sustainable in law and the same are quashed. However, quashing of the impugned notice and proceeding will not debar the respondent authority concerned to issue any fresh notice in future in accordance with law. With the above observations, WPA No.4382 of 2022 stands disposed of.”

Manorama Patwa 6.2 Going over the order passed by the lower authorities and considering the judgment of the Hon’ble Calcutta High Court, we hold that notice dated 01.04.2021 has been issued beyond the limitation time and all subsequent proceedings are therefore invalid and the appeal of the assessee is allowed.

7.

In the result, the appeal of the assessee is allowed.

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