ITAT Cuttack Judgments — October 2026

The Tribunal held that the notice under Section 148 was issued beyond three years from the end of the relevant assessment year (2016-17). As per Section 151(ii) of the Income Tax Act, 1961, for reassessments initiated after the expiry of three years from the end of the relevant assessment year, the sanction for the issue of notice under Section 148 ought to have been granted by authorities of the rank of Pr. CCIT. However, in this case, the approval was granted by the Pr. CIT-1, Bhubaneswar, which is an authority of a lower rank. Respectfully following the decision of the Hon'ble Supreme Court in ITO vs. Prakash Pandurang Patil, the Tribunal found the notice issued under Section 148 to be invalid. Consequently, the consequential assessments were also held to be invalid and quashed. The appeal of the assessee was allowed.

The Tribunal condoned the delay of 1372 days in filing the appeal before the CIT(A). The Tribunal noted that the CIT(A)'s order was ex-parte and that the assessee had explained the reason for the delay. In the interest of justice, the issues in the quantum appeal (ITA No. 900/2026) were restored to the file of the CIT(A) for deciding the case on merits after providing an adequate opportunity of being heard to the assessee. Consequently, the penalty appeal (ITA No. 899/2026) was also restored to the file of the CIT(A) to be decided on merits. The Tribunal did not decide any specific addition or penalty on merits, as the matter was remitted back to the CIT(A).

The Tribunal dismissed the appeal filed by the assessee. This decision was based on the non-compliance with the dress code by the assessee's representative during the hearing.