RAMDEV MUNADHDA,WARANGAL vs. INCOME TAX OFFICE WARD -1, WARANGAL

ITA 1837/HYD/2025Status: DisposedITAT Hyderabad26 February 2026AY 2017-201813 pages
AI SummaryDismissed

What did the Tribunal hold?

The Tribunal held that the validity of the assumption of jurisdiction must be tested based on the material available with the AO at the time of issuing the notice under Section 148, not on the ultimately assessed income. The substantial cash withdrawals constituted tangible material indicating potential escapement of income exceeding the Rs. 50 lakhs threshold.

What were the facts?

The Assessing Officer (AO) initiated reassessment proceedings under Section 147 against an individual engaged in wholesale dal trading, based on substantial cash withdrawals of Rs. 1,57,85,000/- and non-filing of return for AY 2017-18. The AO issued notices under Section 148A and subsequently under Section 148, beyond the three-year period.

What were the issues?

Whether the reassessment notice issued beyond three years was valid when the AO had material indicating substantial cash withdrawals, even if the ultimately assessed income was less than Rs. 50 lakhs.

Which sections of the Income-tax Act were involved?

Section 147,Section 144B,Section 148A,Section 148,Section 149(1)(b)

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Cases cited in this judgment(2)Show list

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Cause title — parties, addresses and appearances
2

प्रति रवीश सूद, जे.एम./PER RAVISH SOOD, J.M. The present appeal filed by the assessee is directed against the order passed by the CIT(Appeals), National Faceless Appeal Centre, dated 24.01.2025, which in turn arises from the order passed by the AO under Section 147 r.w.s. 144B of the Income-tax Act, 1961, (for short, “Act”) dated 24.01.2025, for the Assessment Year 2017-18. The assessee has assailed the impugned order of the CIT(Appeals) on the following grounds of appeal before us:

“1. The order of the National Faceless Appeal Centre (‘The CIT(A)') in sustaining the addition of ₹ 8,53,660 as income from profits and gains from business and profession and other income, having escaped assessment is beyond juri iction of the Revenue since it is barred under section 149(1)(b) of the Income Tax Act 1961 ('the Act') is unsustainable both on facts and in law.

2.

The Ld. CIT(A) failed to appreciate the fact that the net taxable income is less than 50 lakhs, which is time barred under section 149(1)(b). Therefore, the addition of 8,53,660 in the assessment framed under section 147 of the Act is invalid, bad in law and to be quashed.

3.

The Ld. CIT(A) failed to appreciate the

The order continues below.

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