LATE SHRI JITENDRA NAGAR THROUGH HIS L/R SMT. DEEPIKA NAGAR,BARAN vs. INCOME TAX OFFICER WARD BARAN, BARAN

That in law and circumstances of the case, the ld. CIT (A) grossly erred in confirming the addition of Rs. 16,90,000/- u/s 69A without considering the submission made by the assessee appellant.

The appellant craves leave to add, alter, modify or amend any ground on or before the date of hearing.”

The brief facts of the case are that the assessee was an agriculturist, expired on 15.10.2019 and has not filed his return of income for the assessment year 2016-17. As per information received from DIT (I&CI) Jaipur vide letter no. DIT(I&CI)/ITO(I&CI)-Kota/2018-19/3038 dated 10.01.2019, the assessee has deposited cash of Rs. 16,90,000/- in his bank account no. 913030046994758 on 24.11.2015 opened with Axis Bank, Baran. Consequently, after getting prior permission from the Principal CIT, Kota, information under section 133(6) was called for from the bank. On perusal of the bank account statements, it was found that the assessee deposited cash of Rs. 16,90,000/- in his bank account on 24.11.2015 relevant to A.Y. 2016-17. Therefore, the AO had reason to believe that income amounting to Rs. 16,90,000/- escaped assessment in the hands of the assessee for the AY 2016-17 in the light of the provisions of section 147 of the Income Tax Act, 1961. Therefore, a show cause notice was issued to the assessee under section 148A(b) of the Income Late Shri Jitendra Nagar through L/R Smt. Deepika Nagar, Baran. 3 Tax Act, 1961 on 23.05.2022 requiring the assessee to show cause as to why cash deposited of Rs. 16,90,000/- on 24.11.2015 in Axis Bank, Baran should not be treated as undisclosed cash credit in bank account during the year under consideration. The assessee was required to furnish reply on or before 10.06.2022, but the assessee had not furnished any reply. Therefore, considering the fact that income chargeable to tax amounting to Rs. 16,90,000/- escaped assessment, the AO invoked the provisions of section 147 of the IT Act, 1961. Accordingly, after taking necessary approval from the Competent Authority, notice under section 148 dated 25.07.2022 along with order under section 148A(d) of the I.T. Act, 1961 was issued to the assessee through ITBA Portal. The assessee had not filed any response to the show cause notice issued under section 148A(b) within the time allowed. Assessee had also not filed his return of income in response to notice under section 148 of the Act. Subsequently, notices under section 142(1) of the Act were issued to the assessee from time to time requesting to file details but no compliance was made by the assessee. As the assessee had not made compliance to the various notices issued through ITBA portal, a show cause notice under section 144 of the Act dated 01.02.2023 was issued to the assessee through ITBA portal proposing to assess the income of the assessee on the basis of material available on record along with proposed addition. No reply was Late Shri Jitendra Nagar through L/R Smt. Deepika Nagar, Baran. 4 received. Further, a letter dated 10.04.2023 was also sent to the assessee by the NEFAC through speed post (Tracking ID-JD399709476IN) but no reply was received. Since, the case was getting time barred on 31.05.2023, the AO completed the assessment ex-parte under section 144 treating the cash deposit of Rs. 16,90,000/- as unexplained income/credits of the assessee and added to the total income of the assessee as per provisions of section 69A of the Act for the year under consideration under section 147 read with section 144B of the IT Act, 1961. Aggrieved by the order of the AO, the assessee preferred an appeal before the ld. CIT (A). The ld. CIT (A) by sustaining the addition, confirmed the order of the AO.

Before us, the learned AR of the assessee submitted his written submission as under :-

The above table indicates that the specified authority is directly co-related to the time when the notice is issued. This plays out as follows under the old regime: (i) If income escaping assessment was less than Rupees one lakh: (a) a reassessment notice could be issued under Section 148 within four years after obtaining the approval of the Joint Commissioner; and (b) no notice could be issued after the expiry of four years; and Late Shri Jitendra Nagar through L/R Smt. Deepika Nagar, Baran. 6 (ii) If income escaping was more than Rupees one lakh: (a) a reassessment notice could be issued within four years after obtaining the approval of the Joint Commissioner; and (b) after four years but within six years after obtaining the approval of the Principal Chief Commissioner or Chief Commissioner or Principal Commissioner or Commissioner. 75. After 1 April 2021, the new regime has specified different authorities for granting sanctions under Section 151. The new regime is beneficial to the assesse because it specifies a higher level of authority for the grant of sanctions in comparison to the old regime. Therefore, in terms of Ashish Agarwal (supra), after 1 April 2021, the prior approval must be obtained from the appropriate authorities specified under Section 151 of the new regime. The effect of Section 151 of the new regime is thus : (i) If income escaping assessment is less than Rupees fifty lakhs: (a) a reassessment notice could be issued within three years after obtaining the prior approval of the Principal Commissioner, or Principal Director or Commissioner or Director; and (b) no notice could be issued after the expiry of three years; and (ii) If income escaping assessment is more than Rupees fifty lakhs: (a) a reassessment notice could be issued within three years after obtaining the prior approval of the Principal Commissioner, or Principal Director or Commissioner or Director; and (b) after three years after obtaining the prior approval of the Principal Chief Commissioner or Principal Director General or Chief Commissioner or Director General. 76. Grant of sanction by the appropriate authority is a precondition for the assessing officer to assume juri iction under Section 148 to issue a reassessment notice. Section 151 of the new regime does not prescribe a time limit within which a specified authority has to grant sanction. Rather, it links up the time limits with the juri iction of the authority to grant sanction. Section 151(ii) of the new regime prescribes a higher level of authority if more than three years have elapsed from the end of the relevant assessment year. Thus, non-compliance by the assessing officer with the strict time limits prescribed under Section 151 affects their juri iction to issue a notice under Section 148. 77. Parliament enacted TOLA to ensure that the interests of the Revenue are not defeated because the assessing officer could not comply with the preconditions due to the difficulties that arose during the COVID-19 pandemic. Section 3(1) of TOLA relaxes the time limit for compliance with actions that fall for completion from 20 March 2020 to 31 March 2021. TOLA will accordingly extend the time limit for the grant of sanction by the authority specified under Section 151. The test to determine whether TOLA will apply to Section 151 of the new regime is this: if the time limit of three years from the end of an assessment year falls between 20 March 2020 and 31 March Late Shri Jitendra Nagar through L/R Smt. Deepika Nagar, Baran. 7 2021, then the specified authority under Section 151(i) has an extended time till 30 June 2021 to grant approval. In the case of Section 151 of the old regime, the test is: if the time limit of four years from the end of an assessment year falls between 20 March 2020 and 31 March 2021, then the specified authority under Section 151(2) has time till 31 March 2021 to grant approval. The time limit for Section 151 of the old regime expires on 31 March 2021 because the new regime comes into effect on 1 April 2021. 78. For example, the three year time limit for assessment year 2017-2018 falls for completion on 31 March 2021. It falls during the time period of 20 March 2020 and 31 March 2021, contemplated under Section 3(1) of TOLA. Resultantly, the authority specified under Section 151(i) of the new regime can grant sanction till 30 June 2021. 79. Under Finance Act 2021, the assessing officer was required to obtain prior approval or sanction of the specified authorities at four stages: a. Section 148A(a) – to conduct any enquiry, if required, with respect to the information which suggests that the income chargeable to tax has escaped assessment; b. Section 148A(b) – to provide an opportunity of hearing to the assessee by serving upon them a show cause notice as to why a notice under Section 148 should not be issued based on the information that suggests that income chargeable to tax has escaped assessment. It must be noted that this requirement has been deleted by the Finance Act 2022;129 c. Section 148A(d) – to pass an order deciding whether or not it is a fit case for issuing a notice under Section 148; and d. Section 148 – to issue a reassessment notice. 80. In Ashish Agarwal (supra), this Court directed that Section 148 notices which were challenged before various High Courts “shall be deemed to have been issued under Section 148-A of the Income Tax Act as substituted by the Finance Act, 2021 and construed or treated to be show-cause notices in terms of Section 148-A(b).” Further, this Court dispensed with the requirement of conducting any enquiry with the prior approval of the specified authority under Section 148A(a). Under Section 148A(b), an assessing officer was required to obtain prior approval from the specified authority before issuing a show cause notice. When this Court deemed the Section 148 notices under the old regime as Section 148A(b) notices under the new regime, it impliedly waived the requirement of obtaining prior approval from the specified authorities under Section 151 for Section 148A(b). It is well established that this Court while exercising its juri iction under Article 142, is not bound by the procedural requirements of law.130 81. This Court in Ashish Agarwal (supra) directed the assessing officers to “pass orders in terms of Section 148-A(d) in respect of each of the assesses concerned.” Further, it directed the assessing officers to issue a notice under Late Shri Jitendra Nagar through L/R Smt. Deepika Nagar, Baran. 8 Section 148 of the new regime “after following the procedure as required under Section 148-A.” Although this Court waived off the requirement of obtaining prior approval under Section 148A(a) and Section 148A(b), it did not waive the requirement for Section 148A(d) and Section 148. Therefore, the assessing officer was required to obtain prior approval of the specified authority according to Section 151 of the new regime before passing an order under Section 148A(d) or issuing a notice under Section 148. These notices ought to have been issued following the time limits specified under Section 151 of the new regime read with TOLA, where applicable. 114. Conclusions d. TOLA will extend the time limit for the grant of sanction by the authority specified under Section 151. The test to determine whether TOLA will apply to Section 151 of the new regime is this: if the time limit of three years from the end of an assessment year falls between 20 March 2020 and 31 March 2021, then the specified authority under Section 151(i) has extended time till 30 June 2021 to grant approval. e. In the case of Section 151 of the old regime, the test is: if the time limit of four years from the end of an assessment year falls between 20 March 2020 and 31 March 2021, then the specified authority under Section 151(2) has extended time till 31 March 2021 to grant approval. 3.1 Hon’ble ITAT, Mumbai Bench in the case of DCIT v. SS Jewellery[2025] 4 TMI 393 dated 24.03.2025 after considering the aforesaid judgment of Hon’ble Supreme Court in Rajeev Bansal (supra) has held: Reassessment proceedings - validity of approval granted u/s 151(i) - HELD THAT:- Admittedly the assessment was reopened after elapsing of three years from the end of the relevant assessment year and therefore the approval of either of specified authorities as specified in sub clause (ii) of section 151 was required to be taken, which admittedly has not been taken but the approval dated 28.07.2022 for issuing the notice u/s 148A of the Act infact had taken from the Ld. Pr. Commissioner of Income Tax, Mumbai, which cannot be termed as valid/legal approval. Thus, on the aforesaid analyzations, the notice issued u/s 148 of the Act and in consequence to the said notice, the assessment order u/s 147 of the Act, is quashed being void-ab-initio. Decided in favour of assessee. 3.2 Hon’ble ITAT, Hyderabad Bench in the case of Raziulla Syed v. ITO[2025] 3 TMI 651 dated 11.03.2025 after considering the aforesaidjudgment of Hon’ble Supreme Court in Rajeev Bansal (supra) has held: Reopening of assessment - validity of notice issued u/sec.148 Mandation to get approval must be obtained from the Principal Chief Commissioner or Principal Director General.HELD THAT:- Respectfully following the decision of Union of India vs. Rajeev Bansal [2024 (10) TMI 264 - SUPREME Late Shri Jitendra Nagar through L/R Smt. Deepika Nagar, Baran. 9 COURT (LB)] and also the decisions of Manish Financial [2024 (12) TMI 1539 - ITAT MUMBAI] and Manish Jagdish Joshi 2024 (9) TMI 347 - ITAT MUMBAI], we are of the considered view that the notice issued by the Assessing Officer u/sec.148 of the Act dated 30.07.2022 by obtaining prior approval from the Principal Commissioner of Income Tax-1, Hyderabad dated 27.07.2022 and consequential final assessment order dated 02.03.2024 passed by the Assessing Officer u/sec.147 r.w.s.144C(13) of the Act is illegal, void ab initio and thus, we quash the final assessment order dated 27.07.2022 passed by the Assessing Officer. Appeal of the Assessee is allowed. 3.3 Hon’ble ITAT, Mumbai Bench in the case of Addl. CIT v. Ramchand ThakurdasJhamtani[2025] 4 TMI 585 dated 28.02.2025 after considering the aforesaidjudgment of Hon’ble Supreme Court in Rajeev Bansal (supra) has held: Validity of reopening of assessment - juri ictional requirements of Sections 147 to 151 - whether approval obtained from the appropriate authority? - whether the Principal Commissioner of Income Tax or the Principal Chief Commissioner of Income Tax was the Specified Authority for seeking approval for passing order u/s 148A(d) of the Act and issuance of notice under Section 148 - HELD THAT:- In the present case the period of 3 years from the end of the Assessment Year 2017-2018 fell for completion on 31st March 2021. The expiry date fell during the time period of 20th March 2020 and 31st March 2021, contemplated under Section 3(1) of TOLA. Resultantly, the authority specified under Section 151(i) of the new regime could have granted sanction till 30th June 2021. On perusal of the order passed u/s 148A(d) of the Act we find that the aforesaid order was passed after taking approval from Principal Commissioner of Income Tax. Since the aforesaid order was passed after the expiry of 3 years from the end of the Assessment Year 2017- 2018, as per the new regime, the authority specified under Section 151(ii) of the Act (i.e. Principal Chief Commissioner or Chief Commissioner) was required to grant approval. We note that even the notice, dated 30/07/2022, was issued under Section 148 of the Act (new regime) after obtaining the prior approval of the Principal Commissioner of Income Tax. Accordingly, we conclude that in the present case the approval has been obtained by authority specified u/s 151(i) of the new regime instead of the authority specified under Section 151(ii) of the new regime. \The non-compliance by the AO with the provisions contained in Section 148A(d) read with Section 151(ii) of the new regime affects the juri iction of the AO to issue a notice under Section 148 of the Act. Accordingly, the order, dated 30/07/2022 passed under Section 148A(d) of the Act, the consequential reassessment proceedings and the order, dated 25/05/2023, passed under Section 147 read with Section 144B of the Act are quashed as bad in law being Late Shri Jitendra Nagar through L/R Smt. Deepika Nagar, Baran. 10 violative of the provisions contained in Section 148A(d), Section 148 and Section 151(ii) of the Act. Decided in favour of assessee. 3.4 Hon’ble ITAT, Raipur Bench in the case of Keshri Rice Industries v. DCIT [ITA: 410/RPR/2024] dated 23.12.2024 after considering the aforesaidjudgment of Hon’ble Supreme Court in Rajeev Bansal (supra) has held: 19. We have considered the rival submissions, perused the material available on record and the judicial pronouncements placed before us in support of the contentions. As per facts of the present case, the first notice u/s 148 (under old regime) was issued on the assessee on 30.06.2021. Subsequently, following the directions of Hon'ble Apex Court in the case of Ashish Agrawal (supra), the proceedings of reopening are reinstated under new regime by issuing a notice u/s 148A(b) on 23.05.2022. In furtherance, a notice u/s 148A(d) along with order was issued on 01.07.2022 and notice u/s 148 (under new regime) was issued on 02.07.2022. As the present case pertains to AY 2016-17 and the notice u/s 148 for initiation of reopening assessment proceedings was issued on 02.07.2022, beyond the period of 3 years, which were elapsed on 31.03.2020. Accordingly, as per provisions of section 151(ii) the sanctioning authority under the new regime are Principal Chief Commissioner or Principal Director General or Where there is no Principal Chief Commissioner or Principal Director General, Chief Commissioner or Director General, whereas in present case, the approval was granted by Ld. PCIT-1, Raipur, vide his approval letter F.No. Pr. CIT- 1/RPR/Tech/2022-23 dated 28.06.2022. The aforesaid facts are on records and are not disputed by the revenue. Since, the issue of sanctioning authority is no more res integra, as has been specifically deliberated upon and guided by the Hon'ble Apex Court in the case of Rajeev Bansal (supra), analyzing the order of Hon'ble Apex Court in the case of Ashish Agrawal (supra), wherein it is categorically held that, as per the provisions of new regime the sanctioning authority shall be decided as prescribed amended section 151(new regime). In the present case because the reopening has been initiated after 3 years therefore, clause(ii) of section 151 shall apply. We, thus, find substance in the contention of the Ld. AR that the approval granted u/s 151(ii) (new regime) was not by the Ld. PCIT, who do not have juri iction to do so in a case wherein the process of reopening has been triggered beyond 3 years from the end of the relevant assessment year. The contention of the revenue, placing reliance on the judgment in the case of Ashish Agrawal (supra), that in present case the prescribed authority is Principal CIT-1, Raipur found to be misplaced or misconstrued, as the directions by the Hon'ble Apex Court are clear, which are further clarified that the provisions of amended section 151 shall be applied in the cases in which the revenue has availed the benefit of extended life limit under TOLA and had proceeded for reopening assessment under the provisions of new regime. We, Late Shri Jitendra Nagar through L/R Smt. Deepika Nagar, Baran. 11 thus, are unable to persuade and concur with the response of the Ld. AO as per their report dated 12.12.2024. 20. Under such facts and circumstances, we are of the considered view that the impugned assessment order framed u/s 147 r.w.s. 144 r.w.s. 144B of the Act dated 24.03.2023 passed by the Ld. AO is liable to be struck down, being invalid for the want of valid assumption of juri iction on account of sanction u/s 151 by an authority, who is not vested with juri iction to grant such approval or other than the specified authority under clause (ii) of section 151(new regime). Consequently, the assessment u/s 147 r.w.s. 144 r.w.s. 144B of the Act dated 24.03.2023, stands quashed. 3.5 Hon’ble ITAT, Mumbai Bench in the case of ACIT v. Surya Ferrous Alloys Pvt. Ltd. [2025] 1 TMI 326 after considering the aforesaidjudgment of Hon’ble Supreme Court in Rajeev Bansal (supra) has held: Validity of reassessment proceedings - non-compliance of taking prior approval by the specified authority required u/s. 151 - Scope of “by whom” in procedural compliance for issuance of notice u/s.148 - amended provisions under the Act read with TOLA - notice u/s.148 has been issued beyond three years - HELD THAT:- In the present case, the relevant Assessment Year is 2017-18 and the time limit of three years lapsed on 31.03.2021 which falls between 20.03.2020 and 31.03.2021 during which provisions of Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020 (TOLA) would apply. Accordingly, the amended provisions under the Act read with TOLA extended the time limit for granting of approval till 30.06.2021 by the specified authority. Thus, in the present case, since the notice u/s. 148 and order u/s. 148A(b) have been issued beyond the period of three years from the end of the relevant Assessment Year, case of the assessee falls within the provisions of section 151(ii) of the amended law whereby the specified authority for grant of approval is specified as Principal Chief Commissioner or Principal Director General or Chief Commissioner or Director General. Contrary to this requirement, the approval obtained is by Principal Commissioner of Income Tax-17, Mumbai. Accordingly, since a proper sanction by the specified authority had not been obtained for issue of notice u/s.148 under the applicable provisions of law, said notice is invalid and bad in law. Referring to judicial precedent in the case of Ashish Agarwal [2022 (5) TMI 240 - SUPREME COURT] and Rajiv Bansal [2024 (10) TMI 264 - SUPREME COURT (LB)] we hold that sanction by specified authority has not been obtained by the Assessing Officer in accordance with the provisions contained in section 151 of the Act under the new regime, since notice u/s.148 has been issued beyond three years from the end of the relevant Assessment Year. Accordingly, the said notice issued is invalid and thus quashed. Decided in favour of assessee. Late Shri Jitendra Nagar through L/R Smt. Deepika Nagar, Baran. 12 3.6 Hon’ble ITAT, Mumbai Bench in the case of Abdul Saeed Issak Mulla v. International Tax [2025] 2 TMI 444 after considering the aforesaidjudgment of Hon’ble Supreme Court in Rajeev Bansal (supra) has held: Reopening of assessment u/s 147 - whether AO has not obtained the approval of the specified authority u/s. 151? - scope of section 151(ii) of the Act, under new regime - HELD THAT:- According to the notice u/s. 148 of the Act for A.Y. 2017-18, which is available on record, was issued on 29.07.2022 after obtaining the prior approval accorded by the of PCIT-27, Mumbai on 27.07.2022 of the said notice vide reference no. pr.CIT-27/148A(d) Approval/2022-23. Three years have elapsed from the end of the relevant assessment year 2017- 18 on 31.03.2021. According to section 151(ii) of the Act, under new regime, the approval should have been obtained either from the Principal Chief Commissioner of Income or Principal Director General or Chief Commissioner or Director General as specified authority which is not so obtained in the case in hand. We accordingly hold that the notice u/s. 148 of the Act is invalid hence the consequent assessment u/s. 147 of the Act is quashed -Assessee’s appeal is allowed. 3.7 Hon’ble ITAT, Raipur Bench in the case of Manoj Rajput v. DCIT [ITA No. 360/RPR/2023] dated 22.10.2024after considering the aforesaidjudgment of Hon’ble Supreme Court in Rajeev Bansal (supra) has held: 15. We, thus, in terms of our aforesaid observation concur with the Ld. AR that in the present case before us for A.Y.2017-18, wherein notice u/s.148 of the Act was issued on 30.06.2022, i.e. beyond a period of three years from the end of the assessment year, the A.O. was statutorily obligated to have obtained the approval from either of the authorities specified u/s. 151(ii) of the extant law, viz. Principal Chief Commissioner or Principal Director General or where there is no Principal Chief Commissioner or Principal Director General, Chief Commissioner or Director General. However, as the A.O. had obtained the approval from the Pr. Commissioner of Income Tax, i.e. an authority who was not vested with any juri iction as per the mandate of Section 151 of the Act (as made available on the statute w.e.f 01.04.2021), therefore, the assessment so framed by him u/s.147 r.w.s. 144 r.w.s. 144B of the Act, dated 11.05.2023 being devoid and bereft of valid assumption of juri iction is liable to be quashed. Accordingly, we quash the assessment framed by the A.O u/s.147 r.w.s. 144 r.w.s. 144B of the Act, dated 11.05.2023 in terms of our aforesaid observations. 3.8 Hon’ble ITAT, Mumbai Bench in the case of Ashok Amratlal Shah v. ITO [ITA 4287/Mum/2024] dated 31.12.2024 after considering the aforesaidjudgment of Hon’ble Supreme Court in Rajeev Bansal (supra) has held: Late Shri Jitendra Nagar through L/R Smt. Deepika Nagar, Baran. 13 10. As per the provisions of Section 151(ii) under the new procedural regime, for assessment years where the notice under Section 148 is issued after more than three years from the end of the relevant assessment year, the sanction must be obtained from the Principal Chief Commissioner or Principal Director General. The ITAT’s ruling in Manish Financials clarified that while the Hon’ble Supreme Court in Ashish Agarwal (supra) allowed certain procedural relaxations for notices issued during the transition period, post-01/04/2021, the amended provisions under Section 151 must be strictly adhered to. Specifically, for cases where more than three years have elapsed, the required sanction must come from the higher authorities mentioned under Section 151(ii) of the Act. 11. In Manish Financials, for AY 2016–17, the Bench found that the notice issued under Section 148 was approved by the Principal Commissioner of Income Tax (Pr.CIT) instead of the Principal Chief Commissioner, as mandated. Consequently, the notice and the subsequent assessment order were deemed invalid. Applying the same rationale here, it is evident that for both assessment years under consideration, the sanctioning authority failed to comply with the specific requirements of Section 151(ii) of the Act. Since the notices were issued under the new regime but lacked the necessary approval from the appropriate authority, the sanction process stands invalid. As a result, the notices under Section 148 are deemed to have no legal foundation. In light of this, the assessment orders passed by the Ld. AO under Sections 148/143(3) are quashed. This decision reinforces the principle that procedural compliance, particularly regarding approval from the correct authority, is a fundamental requirement under the Act 3.9 Hon’ble ITAT, Mumbai Bench in the case of ACIT v. Manish Financials [ITA 5055/Mum/2024] dated 02.12.2024 after considering the aforesaidjudgment of Hon’ble Supreme Court in Rajeev Bansal (supra) has held: “14. We heard the parties and perused the material on record. In assessee's case for AY 2016-17 pursuant to the directions of the Hon'ble Supreme Court in the case of Ashish Agrawal, the AO passed an order under section 148(d) of the Act and issued a notice under section 148 on 30.07.2022. From the above observations of the Hon'ble Supreme Court it is clear that the though the prior approval under section 148A(b) and 148(d) were waived in terms of the decision of Ashish Agarwal (supra), for issue of notice under section 148A(a) and under section 148 on or after 1 April 2021, the prior approval should be obtained from the appropriate authorities specified under Section 151 of the new regime. The provisions of section 151 of the Act under the new regime read as under: Sanction for issue of notice. 151. Specified authority for the Late Shri Jitendra Nagar through L/R Smt. Deepika Nagar, Baran. 14 purposes of section 148 and section 148A shall be, —(i) Principal Commissioner or Principal Director or Commissioner or Director, if three years or less than three years have elapsed from the end of the relevant assessment year; (ii) Principal Chief Commissioner or Principal Director General or where there is no Principal Chief Commissioner or Principal Director General, Chief Commissioner or Director General, if more than three years have elapsed from the end of the relevant assessment year. 15. In assessee's case from the perusal of para 3 of the notice issued under section 148 for AY 2016-17 we notice that the same is issued with the prior approval of Pr.CIT-19 Mumbai accorded on 29.07.2022 vide reference No.Pr.CIT19/148/2022-23 and this fact is not contravened by the ld DR. For AY 2016-17, the period of three years have elapsed as of 31.03.2020 and the notice is issued beyond three years on 30.07.2022. Therefore as per the decision of the Hon'ble Supreme Court, the approval should have been obtained under the amended provisions of section 151(ii) of the Act i.e. the approval should have been obtained from the Principal Chief Commissioner whereas the approval has been obtained from Pr.CIT as stated in the notice under section 148 itself. Therefore we see merit in the contention of the assessee that the notice under section 148 for AY 2016-17 is issued without obtaining the prior approval from the appropriate authority. Accordingly we hold that the notice under section 148 is invalid and the consequent assessment under section 147 is liable to be quashed.” 4. That it may also be noted that the notice dated 25.07.2022 issued u/s. 148 is also barred by limitation as per surviving time theory propounded by Hon’ble Supreme Court in the case of Union of India v. Rajeev Bansal (supra) wherein it is held: b. Interplay of Ashish Agarwal with TOLA 108. The Income Tax Act read with TOLA extended the time limit for issuing reassessment notices under Section 148, which fell for completion from 20 March 2020 to 31 March 2021, till 30 June 2021. All the reassessment notices under challenge in the present appeals were issued from 1 April 2021 to 30 June 2021 under the old regime. Ashish Agarwal (supra) deemed these reassessment notices under the old regime as show cause notices under the new regime with effect from the date of issuance of the reassessment notices. The effect of creating the legal fiction is that this Court has to imagine as real all the consequences and incidents that will inevitably flow from the fiction.163 Therefore, the logical effect of the creation of the legal fiction by Late Shri Jitendra Nagar through L/R Smt. Deepika Nagar, Baran. 15 Ashish Agarwal (supra) is that the time surviving under the Income Tax Act read with TOLA will be available to the Revenue to complete the remaining proceedings in furtherance of the deemed notices, including issuance of reassessment notices under Section 148 of the new regime. The surviving or balance time limit can be calculated by computing the number of days between the date of issuance of the deemed notice and 30 June 2021. 109. If this Court had not created the legal fiction and the original reassessment notices were validly issued according to the provisions of the new regime, the notices under Section 148 of the new regime would have to be issued within the time limits extended by TOLA. As a corollary, the reassessment notices to be issued in pursuance of the deemed notices must also be within the time limit surviving under the Income Tax Act read with TOLA. This construction gives full effect to the legal fiction created in Ashish Agarwal (supra) and enables both the assesses and the Revenue to obtain the benefit of all consequences flowing from the fiction.164 110. The effect of the creation of the legal fiction in Ashish Agarwal (supra) was that it stopped the clock of limitation with effect from the date of issuance of Section 148 notices under the old regime [which is also the date of issuance of the deemed notices]. As discussed in the preceding segments of this judgment, the period from the date of the issuance of the deemed notices till the supply of relevant information and material by the assessing officers to the assesses in terms of the directions issued by this Court in Ashish Agarwal (supra) has to be excluded from the computation of the period of limitation. Moreover, the period of two weeks granted to the assesses to reply to the show cause notices must also be excluded in terms of the third proviso to Section 149. 111. The clock started ticking for the Revenue only after it received the response of the assesses to the show causes notices. After the receipt of the reply, the assessing officer had to perform the following responsibilities: (i) consider the reply of the assessee under Section 149A(c); (ii) take a decision under Section 149A(d) based on the available material and the reply of the assessee; and (iii) issue a notice under Section 148 if it was a fit case for reassessment. Once the clock started ticking, the assessing officer was required to complete these procedures within the surviving time limit. The surviving time limit, as prescribed under the Income Tax Act read with TOLA, was available to the assessing officers to issue the reassessment notices under Section 148 of the new regime. 112. Let us take the instance of a notice issued on 1 May 2021 under the old regime for a relevant assessment year. Because of the legal fiction, the deemed show cause notices will also come into effect from 1 May 2021. After accounting for all the exclusions, the assessing officer will have sixty-one days [days between 1 May 2021 and 30 June 2021] to issue a notice under Section Late Shri Jitendra Nagar through L/R Smt. Deepika Nagar, Baran. 16 148 of the new regime. This time starts ticking for the assessing officer after receiving the response of the assessee. In this instance, if the assessee submits the response on 18 June 2022, the assessing officer will have sixty-one days from 18 June 2022 to issue a reassessment notice under Section 148 of the new regime. Thus, in this illustration, the time limit for issuance of a notice under Section 148 of the new regime will end on 18 August 2022. 113. In Ashish Agarwal (supra), this Court allowed the assesses to avail all the defences, including the defence of expiry of the time limit specified under Section 149(1). In the instant appeals, the reassessment notices pertain to the assessment years 2013-2014, 2014-2015, 2015-2016, 2016-2017, and 2017- 2018. To assume juri iction to issue notices under Section 148 with respect to the relevant assessment years, an assessing officer has to: (i) issue the notices within the period prescribed under Section 149(1) of the new regime read with TOLA; and (ii) obtain the previous approval of the authority specified under Section 151. A notice issued without complying with the preconditions is invalid as it affects the juri iction of the assessing officer. Therefore, the reassessment notices issued under Section 148 of the new regime, which are in pursuance of the deemed notices, ought to be issued within the time limit surviving under the Income Tax Act read with TOLA. A reassessment notice issued beyond the surviving time limit will be time barred. G. Conclusions 114. In view of the above discussion, we conclude that: g. The time during which the show cause notices were deemed to be stayed is from the date of issuance of the deemed notice between 1 April 2021 and 30 June 2021 till the supply of relevant information and material by the assessing officers to the assesses in terms of the directions issued by this Court in Ashish Agarwal (supra), and the period of two weeks allowed to the assesses to respond to the show cause notices; and h. The assessing officers were required to issue the reassessment notice under Section 148 of the new regime within the time limit surviving under the Income Tax Act read with TOLA. All notices issued beyond the surviving period are time barred and liable to be set aside; 4.1 Kindly see the following table in this regard: Event Date First Notice u/s 148 of the Act under old regime 24-06-2021 As per the order in Rajeev Bansal, the ld. AO had7 surviving days time to issue notice u/s 148 of the Act under new regime (day between 24-06-2021 and 30-06-2021) 7 days Notice u/s 148A(b) of the Act issued 23-05-2022 Time given to assessee file reply upto (since notice was issued to deceased assessee, he could not file reply) 10-06-2022 Late Shri Jitendra Nagar through L/R Smt. Deepika Nagar, Baran. 17 Surviving Time of 27 days expired on 17-06-2022 Notice u/s 148 of the Act under new regime issued on 25-07-2022

2. Hon’ble Delhi High Court in the case of Pratishtha Garg v. ACIT (2025) 4 TMI 295 order dated 25.03.2025after considering the aforesaidjudgment of Hon’ble Supreme Court in Rajeev Bansal (supra)has held: 14. Mr. Gupta, learned counsel appearing for the Revenue advanced submissions, which we find are intrinsically inconsistent. First, he contended that the second section 148 notice should be considered as non est as it was issued after the notice under Section 153C of the Act was issued. However, he also submitted that the proceedings pursuant to the second section 148 notice would continue as in terms of Section 153A of the Act, all proceedings, which stood abated on account of commencement of proceedings would stand automatically revived, if the proceedings under Section 153A of the Act were dropped. Although, Mr Gupta contended that his submissions are in the alternative, we are not persuaded to accept that the Revenue can be permitted to take alternate stands. The impugned order states in unambiguous terms that the abated proceedings under Section 148 of the Act are revived. However, the said proceedings were ex-facie illegal as initiation of the same would amount to initiating parallel assessment proceedings, which is impermissible. 15. Mr Gupta also submitted that the second Section 148 notice was not beyond the period of limitation as the period of limitation was six years from the end of the relevant assessment year (AY 2016-17) and the Section 148 of the Act notice was issued one year prior to the expiry of the limitation period. However, subsequently on a pointed query of this court, Mr. Gupta conceded that the period of limitation for issuing a notice under Section 148 of the Act in this case is required to be construed as four year from the end of the relevant assessment year as per the statutory regime which was in force prior to 31.03.2021. We must note that this was also in the context of alternate submissions made by the learned counsel for the Assessee that if the period of limitation is considered as six years from the end of the relevant assessment year than the second section 148 notice was issued without the approval of the competent authority as required under Section 151 of the Act. 16. Considering the definite stand taken on behalf of the Revenue is that the period of limitation for issuance of notice under Section 148 of the Act in the present case is four years from the end of the relevant assessment year, that is AY 2016-17, we find that the second section 148 notice has been issued beyond the period of limitation. Thus, without going into the question whether the second section 148 notice is invalid as it was issued when the proceedings Late Shri Jitendra Nagar through L/R Smt. Deepika Nagar, Baran. 18 for reassessment of income for the relevant assessment year had commenced pursuant to the notice issued under Section 153C of the Act, all proceedings continued pursuant thereto are required to be set aside. We say this for the reason that the first section 148 notice – which was directed to be considered as a notice under Section 148A (b) of the Act in terms of the decision of the Supreme Court in Union of India & Ors. v. Ashish Agarwal (supra) – was issued on 23.06.2021 as the last date for issuing a notice under Section 148 of the Act in this case had expired on 31.03.2021. However, the period of limitation was extended by virtue of Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020 [TOLA] and the time period for issuance of such notice was extended till 30.06.2021. 17. In the present case, the first section 148 notice was issued on 23.06.2021, which is six days prior to the expiry of the period of limitation. The time period for issuing a notice under Section 148 of the Act was extended by following the directions issued by the Supreme Court in Union of India & Ors. v. Ashish Agarwal (supra) and as explained by the Supreme Court in the latter decision in Union of India & Others v. Rajeev Bansal: 2024 SCC OnLine SC 2693. As noted above, the Assessee had responded to the first section 148 notice (which was required to be construed as a notice under Section 148A (b) of the Act) on 07.06.2022 and therefore the order under Section 148A (d) of the Act and the second notice under Section 148A of the Act was required to be issued within the period of seven days thereafter. In the present case the second 148 notice was issued beyond the period of limitation. The said issue is squarely covered by the decision of this Court in Ram Balram Buildhome Pvt. Ltd. v. Income Tax Officer & Anr.: Neutral Citation: 2025:DHC:547-DB. 18. In view of the above, we do not consider it apposite to examine the question as to whether the notice issued has been approved by the competent authority as stipulated under Section 151 of the Act or whether the second section 148 notice was valid. 19. The impugned order holding that the said proceedings would continue is set aside. The proceedings commenced pursuant to the second section 148 notice are also set aside. 4.3 Hon’ble ITAT, Mumbai Bench in the case of ITO v. Sumitra Rajeshbhai Jain(2025) 3 TMI 454 order dated 06.03.2025after considering the aforesaidjudgment of Hon’ble Supreme Court in Rajeev Bansal (supra)has held: 22. Therefore, the surviving/balance time limit can be calculated by computing the number of days between the date of issuance of deemed notice and 30.06.2021. Since, in the present case, we find that the period of 4 years from the end of the relevant assessment year expires on 30.04.2020, which falls within the time period from 20.03.2020 to 31.03.2021, in order to compute the Late Shri Jitendra Nagar through L/R Smt. Deepika Nagar, Baran. 19 surviving/balance time as per the decision of the Hon’ble Supreme Court in paragraph 108, it is relevant to note the following dates: - S. No. Particulars Page No. a) 1st Notice u/s. 148 16/06/2021 b) Notice u/s. 148A(b) 30/05/2022 c) Reply of the assessee 10/06/2022 d) Order passed u/s. 148A(d) 29/07/2022 e) Notice u/s. 148 29/07/2022 23. Therefore, computing the surviving/balance time limit, as per the decision of the Hon’ble Supreme Court in Rajeev Bansal (supra), we find that the Revenue had only 15 days (i.e., between 16.06.2021 to 30.06.2021) to issue notice under section 148 of the Act of the new regime in the present case, i.e. till 25.06.2022, after receipt of the response from the assessee to the show cause notice under section 148A(b) of the Act on 10.06.2022. However, undisputedly, in the present case, the notice under section 148 of the Act was issued on 29.07.2022, i.e., 34 days after the surviving/balance time period as per the directions of the Hon’ble Supreme Court in Rajeev Bansal (supra). Therefore, having considered the provisions of the Act, pre as well as post the amendment by the Finance Act, 2021, and the TOLA, in the light of the decision of the Hon’ble Supreme Court in Ashish Agarwal (supra) and Rajeev Bansal (supra), we are of the considered view that the notice under section 148 of the Act in the present case was issued beyond the time period provided under the Act. Thus, de hors the concession of the Revenue before the Hon’ble Supreme Court in Rajeev Bansal (supra), which has been objected to by the learned DR in the present case, we are of the considered view that in the facts and circumstances of the present case, as considered in-detail in the foregoing paragraphs, the notice issued under section 148 of the Act on 29.07.2022 is barred by limitation period specified under section 149 of the Act. Accordingly, we are of the considered view that notice issued under section 148 of the Act on 29.07.2022 is void ab initio and bad in law. Therefore, the same is quashed. Consequently, the entire re-assessment proceedings and assessment order passed under section 147 r.w. section 144B of the Act are also quashed. 4.4 Hon’ble ITAT, Patna Bench in the case of GD Mother Educational Society v. PCIT (2024) 11 TMI 1029 order dated 20.11.2024 after considering the aforesaidjudgment of Hon’ble Supreme Court in Rajeev Bansal (supra)has held: In the meantime the Hon’ble Apex Court delivered the judgment in the case of Rajeev Bansal and Others dated 03.10.2024 (supra), wherein it was held that “the time during which the show cause notices were deemed to be stayed is from the date of issuance of the deemed notice between 1st April, 2021 and 30th June, 2021 till the supply of relevant information and material by the Assessing Officers to the assessee in terms of the directions issued by this Late Shri Jitendra Nagar through L/R Smt. Deepika Nagar, Baran. 20 Court in Ashish Agarwal (supra) and the period of two weeks was to be allowed to the assessee to respond to the show cause notices”. Thereafter in terms of the said decision, the ld. Assessing Officer was required to issue the reassessment notice under section 148 of the new regime within the time limit surviving under the Income Tax Act read with TOLA. In this context, the assessee’s contentions is worth merit that the notices issued under section 148 of the Act under the new regime dated 21.07.2022 for A.Y. 2018-19, on 22.07.2022 for A.Y. 2019-20 and dated 26.07.2022 for A.Y. 2020-21 were clearly barred by limitation. In other words, on the date of reference, there was no valid proceeding pending before the ld. Assessing Officer, whereas for making any reference to the ld. PCIT by the ld. Assessing Officer during a pending proceeding is sine quo non, which were not there in the instant cases as these notices were clearly time barred by limitation. Therefore, on this count, we are inclined to quash the orders passed by the ld. PCIT withdrawing the approval under section 10(23C)(vi) of the Act. 4.5 Hon’ble ITAT, Raipur Bench in the case of Kachrulal Jitendra Kumar v. ITO[2025] 2 TMI 865 order dated 05.02.2025after considering the aforesaidjudgment of Hon’ble Supreme Court in Rajeev Bansal (supra) has held: 23. We have thoughtfully considered the contentions advanced by the Ld. Authorized Representatives of both the parties. Admittedly, the following facts are discernible from the record:- ● Notice u/s. 148 of the Act under the old regime (deemed notice u/s. 148A) was issued by the A.O to the assessee firm on 30.06.2021; ● show-cause notice u/s 148A(b) of the Act was issued by the A.O to the assessee firm on 25.05.2022; ● the time period of two weeks (14 days) from the date of issuing of notice u/s. 148A(b) dated 25.05.2022 [as per the judgment of the Hon’ble Apex Court in the case of Union of India & Ors Vs. Ashish Agrawal (supra)] lapsed on 07.06.2022; ● the balance/surviving period available with the A.O to issue notice u/s. 148 of the Act (under new regime) was 1 day [time between 30.06.2021 (the date of issuance of notice u/s. 148A of the Act) AND 30.06.2021 i.e. (extended time period under TOLA, 2020); ● as the balance/surviving period available with the A.O for passing an order under clause (d) of 148A of the Act was 1 day i.e. less than 7 days, therefore, as per the “fourth proviso” to Section 148A of the Act, the period of limitation so available would stand extended to 7 days; ● the A.O could have validly issued notice u/s. 148 of the Act (under the new regime) latest by 13.06.2022; 24. As the A.O in the present case had issued notice u/s. 148 of the Act, dated 25.07.2022 i.e. much subsequent to lapse of the period of limitation as was available with him upto 13.06.2022, therefore, as stated by the Ld. AR (subject Late Shri Jitendra Nagar through L/R Smt. Deepika Nagar, Baran. 21 to correction of the date by the Ld. AR as 16.06.2022), and rightly so, the same is found to be barred by limitation. Accordingly, the assessment order passed by the A.O u/s. 147 r.w.s. 144B of the Act, dated 29.04.2013 in absence of a valid notice issued u/s. 148 of the Act cannot be sustained and, is quashed. 25. As we have quashed the assessment for want of valid assumption of juri iction by the A.O, therefore, we refrain from adverting to and dealing with the other contentions, based on which, the impugned addition has been assailed before us which, thus, are left open. 4.6 Hon’ble ITAT, Mumbai Bench in the case of Ashok Amratlal Shah v. ITO [ITA 4286/Mum/2024] orderdated 31.12.2024 after considering the aforesaidjudgment of Hon’ble Supreme Court in Rajeev Bansal (supra) has held: 8. Upon review, we find merit in the Ld. AR’s argument. The ruling in Rajeev Bansal (supra) explicitly addresses the issue of limitation for notices issued under the new regime. The relevant observations from paragraphs 112 and 113 of the judgment clarify that any reassessment notice issued beyond the surviving time limit is invalid. For AY 2015-16, the surviving time limit was exceeded, and the notice issued on 30/06/2022 is therefore barred by limitation. The Ld. DR could not present any contrary facts or rulings to refute the submissions of the Ld. AR. Respectfully following the decisions in Ashish Agarwal (supra) and Rajeev Bansal (supra), we hold that the notice issued under Section 148 for AY 2015-16 is invalid, rendering the subsequent assessment proceedings null and void. 4.7 Hon’ble ITAT, Raipur Bench in the case of DCIT v. Vinay Agrawal[2025] 2 TMI 891 order dated 17.02.2025after considering theaforesaid judgment of Hon’ble Supreme Court in Rajeev Bansal (supra) has held: Reopening of assessment - Period of limitation - Bogus purchases - HELD THAT:- Admittedly, as per facts of the case, dates of the notices issued and the decision in the case of Kachrulal Jitendra Kuma [2025 (2) TMI 865 - ITAT RAIPUR] we find that the issue in the present case is squarely covered in favour of the assessee. Evidently, under the facts and circumstances of the present case, the notice u/s 148 (under new regime) was issued on 29.06.2022, whereas the same was required to be issued on or before 23.06.2022, therefore, it can be safely held that the notice u/s 148 (new regime) was issued belatedly beyond the limitation provided in the Act, which was further extended in terms of judgment of Ashish Agrawal [2022 (5) TMI 240 - SUPREME COURT] In view of such facts, the assessment framed on the basis of a notice u/s 148 (new regime) dated 29.06.2022, which is barred by limitation, thus, is rendered as bad in law, therefore, stands quashed. Late Shri Jitendra Nagar through L/R Smt. Deepika Nagar, Baran. 22 As the impugned assessment for AY 2014-15 in the instant case has been rendered as quashed for the want of valid assumption of juri iction by the Ld. AO, therefore, we refrain to deliberate upon and to deal with the other contentions raised by the assessee qua the impugned addition made by the Ld. AO and to the extent sustained by the Ld. CIT(A), thus, the same is left open. Assessment for the want of valid assumption of juri iction by the Ld. AO quashed, therefore, the issues raised by the revenue become infructuous, accordingly, the appeal of the revenue stands dismissed. We hope that it shall be to your entire satisfaction and shall enable to drop the impugned notice issued u/s. 148 of the Act and consequential assessment proceedings. We thus see no logic in issuing the notice u/s. 142(1) of the Act to the assessee. The Hon’ble Court has remitted the matter to decide the preliminary objection with regards to maintainability of notice issued u/s. 148 of the Act. Kindly do the needful and oblige.”

1 The ld. AR of the assessee further filed the sequence of events took place which is being reproduced as under :- S.No. Date Remarks Page No. 01 15.10.2019 Assessee, Shri Jitendra Kumar Nagar who was an agriculturist expired. 30 (PB) 02 24.06.2021 Notice u/s 148 issued to the deceased assessee through Legal Heir for AY 2016-17 25 (PB) 03 04.05.2022 Judgment of Hon’ble Supreme Court passed in Union of India v. Ashish Agarwal (2022) 5 TMI 240

23.05.2022 Notice u/s 148A(b) issued to the deceased assessee through Legal Heir in compliance of judgment of Hon’ble Supreme Court inAshish Agarwal (supra) 2 (AO Order) 05. 10.06.2022  Time granted to assessee appellant to file reply to notice dated 23.05.2022  NO reply filed by the Legal Heir 3 (AO Order) 06. 25.07.2022 Order passed u/s 148A(d) & Notice issued u/s 148 to deceased assessee through Legal Heir after taking sanction from Principal Commissioner of Income Tax, Udaipur. 26-27 (PB) 28-29 (PB) 07. 22.04.2023  Ex-Parte Assessment Order passed  Addition of Rs. 16,90,000/- made on account of cash deposited in KCC Bank Account of the deceased assessee AO Order Late Shri Jitendra Nagar through L/R Smt. Deepika Nagar, Baran. 23 08 03.10.2024 Judgment of Hon’ble Supreme Court passed in Union of India v. Rajeev Bansal (2024) 10 TMI 264 1-27 (Compilation) 09. 25.09.2024 Notice issued by CIT (A) granting time till 03.10.2024 to file submissions. 24 (PB) 10. 04.10.2024 Written Submission filed by the appellant before ld. CIT (A). Reliance placed upon Hon’ble Supreme Court in Rajeev Bansal (Supra) to submit that 148A(d) order & 148 notice dated 25.07.2022 are bad in law since sanction as per 151(ii) not obtained. 30-35 (PB) 11. 23.10.2024  Order passed by CIT (A)  Appeal of assessee dismissed on legal as well as merits.  Legal submission made by the assessee appellant with regards to initiation being bad in law due to improper sanction obtained NOT DISCUSSED at all. (Part of Memo of Appeal)

2 The ld. AR of the assessee submitted compilation of case laws relied on in support of the assessee’s cases are as under :-

On the other hand, the ld. DR submitted the report of the ITO Ward Baran dated 05.05.2025 as under :- “ Kindly refer to your office letter no. Addl.CIT (Sr.DR.-III/ITAT/JPR/2025- 26/143 dated 24.04.2025 on the above mentioned subject. In this regard, the point-wise comments on the written submission of 21 pages and sequence of events annexure-A filed by the A/R of the assessee in the above case are submitted as under :- Issue No. 1 : That assessee appellant is deceased and preferred the instant appeal through his legal heir Smt. Deepika Nagar. That ld. CIT (A) passed the ex-parte order dated 23.10.2024 ignoring the submission submit by the assessee appellant. Comments of AO :The ld. CIT (A) passed order u/s 250 of the IT Act, 1961 on l23.10.2024 after disposing all the grounds in his order raised by the assessee during appeal which is mentioned in the appellate order. The CIT (A) also mentioned all the objections/submission in his order submitted by the assessee. Further, CIT (A) also allowed assessee to file reply in delayed filed appeal, filed Late Shri Jitendra Nagar through L/R Smt. Deepika Nagar, Baran. 25 on 15.12.2023 after seven month of passing the assessment order dated 22.04.2023. Hence it cannot be said that CIT (A) passed the order ex-parte order ignoring the submission of the assessee is not found correct. Issue No. 2 : That assessee appellant had filed the written submission on 04.10.2024 before the ld. CIT (A). Copy of acknowledgement is enclosed herewith. That ld. CIT (A) without considering the submission dismissed the appeal of the assessee vide ex-parte order dated 23.101.2024. Comments of AO :The assessee again mentioned that CIT (A) passed order ex- parte and dismissed his appeal, but ld. CIT (A) passed his appellate order in details after considering all the grounds/submissions raised and after providing sufficient opportunity to the assessee as mentioned in the appellate order.

0 Scope of the judgment :

1 Taking into account the decision of the Hon'ble Supreme Court in various paragraphs, it is clarified that the judgment applies to all cases where extended reassessment notices have been issued. This is irrespective of the fact whether such notices have been challenged or not. 6.0 Operation of the new section 149 of the Act to identify cases where fresh notice under section 148 of the Act can be issued: Late Shri Jitendra Nagar through L/R Smt. Deepika Nagar, Baran. 29 6.1 With respect of operation of new section 149 of the Act, the following may be seen:

2 Based on above, the extended reassessment notices are to be dealt with as under :

0 Cases where the Assessing Officer is required to provide the information and material relied upon within 30 days :

1 Hon’ble Supreme Court has directed that information and material is required to be provided in all cases within 30 days. However, it has also been noticed that notices cannot be issued in a case for AY 2013-14, AY 2014-15 and ATY 2015- 16, if the income escaping assessment, in that case for that year, amounts to or is likely to amount to less than fifty lakh rupees. Hence, in order to reduce the compliance burden of assessees, it is clarified that information and material may not be provided in a case for AY 2013-14, AY 2014-15 and AY 2015-16, if the income escaping assessment, in that case for that year, amounts to or is likely to amount to less than fifty lakh rupees. Separate instruction shall be issued regarding procedure for disposing these cases.

0 Procedure required to be followed by the Assessing Officers to comply with the Supreme Court judgment: 8.1 The procedure required to be followed by the Juri ictional Assessing Officer/Assessing Officer, in compliance with the order of the Hon’ble Supreme Court, is as under :  The extended reassessment notices are deemed to be show cause notices under clause (b) of 148A of the Act in accordance with the judgment of Hon’ble Supreme Court. Therefore, all requirement of new law prior to that show cause notice shall be deemed to have been complied with.  The assessing Officer shall exclude cases as per clarification in paragraph 7.1 above.  Within 30 days i.e. by 2nd June 2022, the Assessing Officer shall provide to the assessees, in remaining cases, the information and material relied upon for issuance of extended reassessment notices.  The assessee has two weeks to reply as to why a notice under section 148 of the Act should not be issued, on the basis of information which suggests that income chargeable to tax has escaped assessment in his case for the relevant assessment year. The time period of two weeks shall be counted from the date of last communication of information and material by the Assessing Officer to the assessee.  In view of the observation of Hon’ble Supreme Court that all the defences of the new law are available to the assessee, if assessee makes a request by making an application that more time be given to him to file reply to the show cause notice, then such a request shall be considered by the Assessing Officer on merit Late Shri Jitendra Nagar through L/R Smt. Deepika Nagar, Baran. 31 and time may be extended by the Assessing Officer as provided in clause (b) of new section 148A of the Act.  After receiving the reply, the Assessing Officer shall decide on the basis of material available on record including reply of the assessee, whether or not it is a fit case to issue a notice under section 148 of the Act. The Assessing Officer is required to pass an order under clause (d) of section 148A of the Act to that effect, with the prior approval of the specified authority of the new law. This order is required to be passed within one month from the end of the month in which the reply is received by him from the assessee. In case no such reply is furnished by the assessee, then the order is required to be passed within one month from the end of the month in which time or extended time allowed to furnish a reply expires.  If it is a fit case to issue a notice under section 148 of the Act, the Assessing Officer shall serve on the assessee a notice under section 148 after obtaining the approval of the specified authority under section 151 of the new law. The copy of the order passed under clause (d) of section 148A of the Act shall also be served with the notice u/s 148.  If it is not a fit case to issue a notice under section 148 of the Act, the order passed under clause (d) of section 148 to that effect shall be served on the assessee.

We have heard the rival contentions, perused the material on record and gone through the orders of the lower authorities. The assessee has challenged the legal grounds viz. (i) the ex-parte assessment order passed under section 147 read with section 144B and (ii) notice issued Late Shri Jitendra Nagar through L/R Smt. Deepika Nagar, Baran. 36 u/s 148 by the ld. Assessing officer is without proper approval and satisfaction of higher authority u/s 151 of the Act and entire proceeding is void-ab-initio. Both these grounds are inter-related, inter-connected, therefore, these grounds are being adjudicated together. It will be expedient to examine the second limb of the argument of the ld. AR that the order u/s 148A(d) and notice u/s 148 were issued without sanction of proper authority. We have gone through the judgment of the Hon’ble Supreme Court in the case of Rajeev Bansal (469 ITR 46) wherein the Hon’ble Court opined in para no. 81 as under :- 81. This Court in Ashish Agarwal (supra) directed the assessing officers to “pass orders in terms of Section 148-A(d) in respect of each of the assesses concerned.” Further, it directed the assessing officers to issue a notice under section 148 of the new regime “after following the procedure as required under Section 148-A.” Although this Court waived off the requirement of obtaining prior approval under Section 148A(a) and Section 148A(b), it did not waive the requirement for Section 148A(d) and Section 148. Therefore, the assessing officer was required to obtain prior approval of the specified authority according to Section 151 of the new regime before passing an order under Section 148A(d) or issuing a notice under Section 148. These notices ought to have been issued following the time limits specified under Section 151 of the new regime read with TOLA, where applicable.” It is the opinion of the Hon’ble Supreme Court that the Supreme Court did not waive the requirement of section 148A(d) and section 148 and the AO was required to obtain prior approval of the specified authority according to section 151 of the new regime. Section 151 of the New regime is as under :- Late Shri Jitendra Nagar through L/R Smt. Deepika Nagar, Baran. 37 [Sanction for issue of notice. 151. Specified authority for the purposes of section 148 and section 148A shall be,— (i) Principal Commissioner or Principal Director or Commissioner or Director, if three years or less than three years have elapsed from the end of the relevant assessment year; (ii) Principal Chief Commissioner or Principal Director General or where there is no Principal Chief Commissioner or Principal Director General, Chief Commissioner or Director General, if more than three years have elapsed from the end of the relevant assessment year.] Therefore, under new regime the order u/s 148A(d) and notice u/s 148 after expiry of three years was required to be issued with the sanction obtained from PCCI/ PDGIT/ CCIT/ DGIT as against which the same has been issued with the sanction of PCIT and the same is not in accordance with the provisions of section 151 of the new regime. Further, we have also gone through the judgement of the Hon`ble Delhi High Court in the case of Kusum Healthcare P Ltd. v/s DCIT (W.P. (C) No. 383/2023 vide order dated 05.03.2025) wherein the issue was also about sanctioning authority for issuing notice u/s 148. In this judgment the Hon`ble Court has stated as under :- “38. It would therefore be wholly incorrect to read the Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act as intending to amend the distribution of power or the categorization envisaged and prescribed by section 151. The additional time that the said statute provided to an authority cannot possibly be construed as altering or modifying the hierarchy or the structure set up by section 151 of the Act. The issue of approval would still be liable to be answered based on whether the reassessment was commenced after or within a period of four years from the end of the relevant assessment year or Late Shri Jitendra Nagar through L/R Smt. Deepika Nagar, Baran. 38 as per the amended regime dependent upon whether action was being proposed within three years of the end of the relevant assessment year or thereafter. The bifurcation of those powers would continue unaltered and unaffected by the Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act. 40. What we seek to emphasize is that the Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act authorization merely enables the competent authority to take action within the extended time period and irrespective of the closure which would have ordinarily come about by virtue of the provisions contained in the Act. It does not alter or amend the structure for approval and sanction which stands erected by virtue of section 151. The Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act merely extended the period within which action could have been initiated and which would have otherwise and ordinarily been governed and regulated by sections 148 and 149 of the Act. If the contention of the respondents were to be accepted it would amount to us virtually ignoring the date when reassessment is proposed to be initiated and the same being indelibly tied to the end of the relevant assessment year. Once it is conceded that the notice came to be issued four or three years after the end of the relevant assessment year, the approval granted by the Joint Commissioner of Income-tax would not be compliant with the scheme of section 151. We thus find ourselves unable to sustain the grant of approval by the Joint Commissioner of Income-tax.”

The above table indicates that the specified authority is directly co-related to the time when the notice is issued. This plays out as follows under the old regime: 37 ITA No. 1320/JP/2024 R Containers Pvt Ltd. vs ITO (i) If income escaping assessment was less than Rupees one lakh: (a) a reassessment notice could be issued under Section 148 within four years after obtaining the approval of the Joint Commissioner, and (b) no notice could be issued after the expiry of four years; and (ii) If income escaping was more than Rupees one lakh: (a) a reassessment notice could be issued within four years after obtaining the approval of the Joint Commissioner; and (b) after four years but within six years after obtaining the approval of the Principal Chief Commissioner or Chief Commissioner or Principal Commissioner or Commissioner. 75. After 1 April 2021, the new regime has specified different authorities for granting sanctions under Section 151. The new regime is beneficial to the assessee because it specifies a higher level of authority for the grant of sanctions in comparison to the old regime. Therefore, in terms of Ashish Agarwal (supra), Late Shri Jitendra Nagar through L/R Smt. Deepika Nagar, Baran. 41 after 1 April 2021, the prior approval must be obtained from the appropriate authorities specified under Section 151 of the new regime. The effect of Section 151 of the new regime is thus: (i) If income escaping assessment is less than Rupees fifty lakha: (a) reassessment notice could be issued within three years after obtaining the prior approval of the Principal Commissioner, or Principal Director or Commissioner or Director; and (b) no notice could be issued after the expiry of three years; and (ii) If income escaping assessment is more than Rupees fifty lakhs: (a) a reassessment notice could be issued within three years after obtaining the prior approval of the Principal Commissioner, or Principal Director or Commissioner or Director, and (h) after three years after obtaining the prior approval of the Principal Chief Commissioner or Principal Director General or Chief Commissioner or Director General. 76. Grant of sanction by the appropriate authority is a precondition for the assessing officer to assume juri iction under Section 148 to issue a reassessment notice. Section 151 of the new regime does not prescribe a time limit within which a specified authority has to grant sanction. Rather, it links up the time limits with the juri iction of the authority to grant sanction. Section 151(ii) of the new regime prescribes a higher level of authority if more than three years have elapsed from the end of the relevant assessment year. Thus, non-compliance by the assessing officer with the strict time limita prescribed under Section 151 affects their juri iction to issue a notice under Section 148. 77. Parliament enacted TOLA to ensure that the interests of the Revenue are not defeated because the assessing officer could not comply with the preconditions due to the difficulties that arose during the COVID-19 pandemic Section 3(1) of TOLA relaxes the time limit for compliance with actions that fall for completion from 20 March 2020 to 31 March 2021. TOLA willaccordingly extend the time limit for the grant of sanction by the authority specified under Section 151. The test to determine whether TOLA will apply to Section 151 of the new regime is this: if the time limit of three years from the end of an assessment year falls between 20 March 2020 and 31 March 2021, then the specified authority under. Section 151(1) has an extended time till 30 June 2021 to grant approval In the case of Section 151 of the old regime, the test is: if the time limit of four years from the end of an assessment year falls between 20 March 2020 and 31 March 2021, then the specified authority under Section 151(2) has time till 31 March 2021 to grant approval. The time limit for Section 151 of the old regime expires on 31 March 2021 because the new regime comes into effect on 1 April 2021. Late Shri Jitendra Nagar through L/R Smt. Deepika Nagar, Baran. 42 78. For example, the three years time limit for assessment year 2017-2018 falls for completion on 31 March 2021. It falls during the time period of 20 March 2020 and 31 March 2021, contemplated under Section 3(1) of TOLA Resultantly, the authority specified under Section 151(i) of the new regime can grant sanction till 30 June 2021...... 81. This quote in Ashish Agrawal (supra) directed the Assessing Officers to "pass orders in terms of Section 148-A(d) in respect of each of the assessee concerned. Further, it directed the Assessing Officers to issue a notice u/s. 148 of the new regime "after following the procedure as required u/s. 148-A Although this quote waived off the requirement of obtaining prior approval u/s.1484(a) and section 148A(b), it did not waive the requirement for section 148A) and section 148. Therefore, the Assessing Officer was required to obtain prior approval of the specified authority according to section 151 of the new regime before passing an order us. 148Aldi or Issuing a notice u/s 148 These notices ought to have been issued following the time limits specified u/s.151 of the new regime r.w. TOLA, where applicable..... 114 ....... TOLA will extend the time limit for the grant of sanction by the authority specified u/s 151. The test to determine whether TOLA will apply to section 151 of the new regime is this: if the time limit of three years from the end of an Assessment Year falls between 20 March 2020 and 31 March 2021, then the specified authority u/s 151() has extended time till 30 June 2021 to grant approval;....” 8.1. From the above, we note that in para 73, in the table last two rows relate to provisions of Section 151(i) (ii) of the new regime prescribing the time limit as well as the specified authority. In para 75, it is very categorically mentioned by the Hon'ble Court that after 01.04.2021, in terms of Ashish Agrawal (supra) the prior approval must be obtained from the appropriate authorities specified u/s.151 of the new regime. This abundantly brings clarity on the aspect of obtaining approval for issue of notice u/s. 148 which are fall out of the decision in Ashish Agrawal (supra). In para 77, objective of section 3(1) of TOLA is mentioned which is to relax the time limit for compliance with actions that fall for completion from 20.03.2020 to 31.03.2021. Thus, the objective is specific for providing temporalflexibility. In para 78, the same has been explained by an example taking Assessment Year 2017-18 which also in specific terms mentions that the authority specified u/s.151 (i) of the new regime can grant sanction till 30.06.2021. Thus, while concluding in para 81 on the issue obtaining approval, Hon'ble Court has specifically stated that the Assessing Officer is required to obtain prior approval of the specified authority according to section 151 of the new regime before passing an order u/s.148A(d) or issuing a notice u/s.148. According to the Hon'ble Court, though it had waived off the requirement Late Shri Jitendra Nagar through L/R Smt. Deepika Nagar, Baran. 43 obtaining prior approval u/s.148A(a) and Section 148Ab, it did not waive the requirement for section 148A(d) and Section 148. 8.2. Taking into consideration the submissions made by the Id. Sr. DR and keeping the same in juxtaposition with the above observations and findings of the Hon'ble Court, we note that the issue we are presently addressing raised before us is not on the aspect of "when" for the procedural compliance for issuance of notice u/s.148 but on the aspect of "by whom" it ought to have been issued. Ld. Sr. DR has contended that there is hierarchical escalation vis-à-vis obtaining approval for issuing notice u/s. 148. In this respect, Hon'ble Court has very categorically held in para 75 that the prior approval must be obtained from the appropriate authorities specified u/s.151 of the new regime for the notices issued in terms of Ashish Agrawal (supra) after 01.04.2021. Reference by ld. Sr. DR to Section 149(1)(a) deals with time limit for issuing notice u/s. 148. Contention of the Id. Sr. DR that there is no hierarchical escalation for obtaining prior approval for issuing notice u/s.148 is not in coherence with the guidelines mandated by the Hon'ble Apex Court as enunciated above. Repeatedly, Hon'ble Court has stated including by way of illustration that TOLA extends time line from the old regime which survives making the notice validly issued subject to the approval requirements of Section 151 under the new regime. Accordingly, the prior approval requirement is mandated under the section 151 of new regime. 8.3. In the present case, the relevant Assessment Year is 2017-18 and the time limit of three years lapsed on 31.03.2021 which falls between 20.03.2020 and 31.03.2021 during which provisions of Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020 (TOLA) would apply. Accordingly, the amended provisions under the Act read with TOLA extended the time limit for granting of approval till 30.06.2021 by the specified authority. Thus, on the above stated facts and law, in the present case, three years had lapsed from the end of the Assessment Year when the order u/s.148A(d) and notice u/s.148 was issued on 30.07.2022. In the present case, since the notice u/s. 148 and order u/s. 148A(b) have been issued beyond the period of three years from the end of the relevant Assessment Year, case of the assessee falls within the provisions of section 151 (ii) of the amended law whereby the specified authority for grant of approval is specified as Principal Chief Commissioner or Principal Director General or Chief Commissioner or Director General. Contrary to this requirement, the approval obtained is by Principal Commissioner of Income Tax-17, Mumbai. Accordingly, since a proper sanction by the specified authority had not beenobtained for issue of notice u/s. 148 under the applicable provisions of law, said notice is invalid and bad in law. Late Shri Jitendra Nagar through L/R Smt. Deepika Nagar, Baran. 44 8.4. Keeping in juxtaposition the undisputed and the uncontroverted facts as stated above and the judicial precedent of the Hon'ble Supreme Court in the case of Ashish Agarwal and Rajiv Bansal (supra), we hold that sanction by specified authority has not been obtained by the ld. Assessing Officer in accordance with the provisions contained in section 151 of the Act under the new regime, since notice u/s.148 has been issued beyond three years from the end of the relevant Assessment Year. Accordingly, the said notice issued is invalid and thus quashed. Resultantly, the impugned re-opening proceedings so initiated and the impugned re-assessment order passed thereafter are also quashed.”