THE GREAT GETSBY CLUB OF INDIA,DELHI vs. ITO WARD 2(3), DELHI

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ITA 7144/DEL/2025Status: DisposedITAT Delhi31 December 2025AY 2014-15Bench: the First Appellate Authority. The CIT(A) sought remand report from the AO but no finding was given by the CIT(A) on the issue. The fact that the notice u/s.148 of the Act dated 19.01.2016 was issued prior to seeking approval from the Competent Authority and recording of reasons is unrebutted. Thus, it is evident that on the date of issuance of notice u/s.148 of the Act, the AO had no subjective satisfaction or reasons to reopen assessment. The assessment cannot be reopened without there be3 pages

AI SummaryAllowed

Facts

The assessee challenged the validity of a notice issued under Section 148 of the Income Tax Act, 1961, for Assessment Year 2014-15. The notice was issued on 19.01.2016, but the reasons for reopening the assessment were recorded, and approval from the Competent Authority was obtained much later, on 17.03.2016.

Held

The Tribunal held that the Section 148 notice was issued without jurisdiction because the Assessing Officer had not recorded reasons or obtained subjective satisfaction before issuing the notice. Citing the Supreme Court's decision in PCIT vs. Tata Sons Ltd., it was ruled that when reasons are recorded after the notice, there is no subjective satisfaction, rendering the notice and subsequent proceedings unsustainable and vitiated.

Key Issues

Whether a notice issued under Section 148 of the Income Tax Act, 1961, is valid if the reasons for reopening the assessment are recorded and the competent authority's approval is obtained after the notice is issued.

Sections Cited

148, 147

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI BENCH “SMC”, DELHI

Hearing: 16/12/2025Pronounced: 16/12/2025

ORDER

PER VIKAS AWASTHY, JM:

This appeal by the assessee is directed against the order of Commissioner of Income Tax (Appeals)-29, New Delhi [in short ‘the CIT(A)’] dated 16.10.2025, for the Assessment Year 2014-15.

The assessee in appeal has assailed validity of the notice issued u/s.148 of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’) on the ground that the reasons recorded for issuing notice u/s.148 of the Act and approval from the Competent Authority is after issuance of notice u/s.148 of the Act. The ld. Counsel pointed that notice u/s. 148 of the Act was issued on 19.01.2016 whereas, the reasons were recorded on 17.03.2016 and the approval of same was received from the JCIT on same date i.e. 17.03.2016.

Submissions made by rival sides heard. A perusal of impugned order reveals that the assessee had raised this issue before the First Appellate Authority. The CIT(A) sought remand report from the AO but no finding was given by the CIT(A) on the issue. The fact that the notice u/s.148 of the Act dated 19.01.2016 was issued prior to seeking approval from the Competent Authority and recording of reasons is unrebutted. Thus, it is evident that on the date of issuance of notice u/s.148 of the Act, the AO had no subjective satisfaction or reasons to reopen assessment. The assessment cannot be reopened without there being any reasons or material satisfaction of the AO to invoke the provisions of section 148/147 of the Act. It is a well settled legal principle that reopening of assessment cannot be done in a causal routine manner. The AO has to record satisfaction/reasons before initiating reopening of assessment. The Hon’ble Supreme Court of India in the case of PCIT vs. Tata Sons Ltd. 449 ITR 166, upholding the view of High Court where reasons to reopen the assessment were recorded after issuance of the reassessment notice held that, when the notice for reassessment was issued, there was no subjective satisfaction, hence, unsustainable.