Income Tax Appellate Tribunal - Delhi
Sh.Rakesh,Gurgaon vs Income Tax Officer, Gurgaon on 24 February, 2026
IN THE INCOME TAX APPELLATE TRIBUNAL,
DELHI BENCH: "F" NEW DELHI
BEFORE SHRI PAWAN SINGH, JUDICIAL MEMBER
AND
SHRI BRAJESH KUMAR SINGH, ACCOUNTANT MEMBER
ITA No. 918/Del/2024
Assessment Year: 2011-12
Sh. Rakesh, Vs. ITO,
C/o CAMR Sahu, Ward-3(4),
House No. 651, 1 Floor,
st Vanijya Nikunj, Udyog Vihar,
Sector-10A, Nr. G.D. Goenka Phase-V,
Public Schook, Gurugram- Gurgaon-122016, Haryana.
122001, Haryana.
PAN: AODPR7631B
(Appellant) (Respondent)
Assessee by Sh. M. R. Sahu, C.A.
Department by Ms. Harpreet Kaur Hansra, Sr. DR
Date of hearing 27.11.2025
Date of pronouncement 24.02.2026
ORDER
PER BRAJESH KUMAR SINGH, ACCOUNTANT MEMBER
This Appeal filed by the assessee is directed against the order dated 01.01.2024 of the Ld. Commissioner of Income-tax (Appeals), National Faceless Appeal Centre, Delhi (hereinafter referred to 'ld. CIT(A)/NFAC') pertaining to Assessment Year 2011-12, arising out of assessment order dated 13.12.2018 passed under Section 144 read with section 147 of the Income-tax Act, ITA No.918/Del/2024 Sh. Rakesh 1961(hereinafter referred to as 'the Act') passed by the ITO, Ward-3(4), Gurugram (hereinafter referred to as the 'Assessing Officer').
2. Brief facts of the case: -the AO had information that the assessee had made cash deposits amounting to Rs 78,25,000/- in his savings bank account with ICICI bank during financial year 2010-11 relevant to AY 2011-12. Further the AO noted that the assessee had not filed his return of income for the AY 2011-12. NMS Notice in this regard was issued to the assessee by the AO and the AO noted that no reply was filed by the assessee in response to the said NMS notice. Thereafter, the AO observed that the source of cash deposits of Rs. 78,25,000/- during the year remained unexplained by failure on the part of assessee by not filing his return of income for AY 2011-12. Accordingly notice under Section 148 of the Act was issued on 21.03.2018 to the assessee on the available address of the assessee with the department i.e. House No.36. Village Hayatpur, Gurgaon 12001 after duly recording reasons and with the prior approval of the Pr. Commissioner of Income Tax Gurugram. 2.1 The AO noted that the assessee did not file any return of income in response to the said notice under section 148 of the Act and further the AO noted that the Assessee did not respond to various notices under section 142(1) of the Act including the show cause notice dated 11.12.2018. In absence of any reply from the assessee the AO passed the assessment order under section 144 r.w.s. 147 of the Act on 13.12.2018 by treating the amount of Rs. 78,25,000/- as
2|Page ITA No.918/Del/2024 Sh. Rakesh unexplained and income from undisclosed sources and added it under section 68 of the Act.
3. Aggrieved with the said order the assessee, filed an appeal before the Ld. CIT (A). The Ld. CIT(A) by his order dated 01.01.2024 dismissed the appeal of the assessee by noting that despite various opportunities given, the assessee did not make any submission and thus upheld the findings of the AO.
4. Aggrieved with the said order the assessee filed the present appeal before the Tribunal on 28.02.2024 on the following grounds of appeal:-
"1. That based on facts of the case, and provisions of law, the CIT(A) erred in dismissing the appeal due to non prosecution ignoring adjournment of application and grant of more time petition filed before him, thus the Principles of Natural Justice Offended, accordingly CIT(A) order dated 01/01/2024 deserves to be set aside.
2. That based on facts of the case, and provisions of law, the CIT(A) erred in dismissing the appeal due to non prosecution without issuing the notices in the current EMAIL [email protected] reflected in the latest income tax returns, thus principles of natural justice offended, accordingly CIT(A) order dated 01/01/2024 not sustainable in the eye's of law.
3. That the assessee craves the right to amend, add, delete, replace, all or any of the grounds of appeal either during the course of hearing or at any time before hearing of this appeal."
5. Further during the course of hearing the assessee filed additional grounds of appeal vide letter dated 30.05.2024 with a request to admit it. 5.1. It may be mentioned that the Tribunal, vide an ex-parte order dated 06/02/2025, had remanded the matter back to AO for fresh adjudication. While passing the order dated 06/02/2025, the additional legal jurisdictional grounds of
3|Page ITA No.918/Del/2024 Sh. Rakesh appeal was neither considered nor adjudicating by the Tribunal. Vide MA No:45/Del./2025, order dated 26/09/2025, the Tribunal recalled the order dated 06/02/2025 for adjudication of the additional legal grounds of appeal. The relevant extracts of the additional grounds filed by the assessee are reproduced as under:
Sub: Application for admission of additional legal jurisdictional grounds of appeal under Rule 11 of the Income Tax (Appellate Tribunal) Rules, 1963 in the case of 'Rakesh Vs. ITO, Ward 2(4), Gurgaon ITA No: 918/DEL/2024, AY.2011-12. Scheduled for hearing on 18th June 2024 before "F" Bench.
Dear Sir, It is humbly prayed before your honour to admit the following additional legal jurisdictional grounds of appeal:
(A). Additional legal jurisdictional grounds of appeal:
1.That on facts, and in the circumstances of the case and in law, the CIT(A) erred in confirming the order of the AO dated 13/12/2018 passed u/s 144 r.w.s 147 without appreciating the fact that the mandatory jurisdictional notice u/s 148, dated 21/03/2018 issued by the AO quoting wrong postal address was not served upon the assessee and returned back lying in the file of the AO, accordingly jurisdiction assumed by the AO for initiation of reassessment proceedings u/s.147 without ensuring service of foundation jurisdictional notice u/s.148 is bad in law thus the consequential assessment order dated 13/12/2018 passed u/s: 144 r.w.s 147 deserves to be held as null and void.
2. The satisfaction recorded by the Principal Commissioner of Income Tax (PCIT).
Gurgaon dated 12.03.2018 is mechanical and without application of mind and such approval vitiates the reassessment. Such mechanical sanction cannot be considered as sanction satisfying the mandatory requirements as prescribed under Section 151 of the Act.
3. That on facts, and in the circumstances of the case and in law, the CIT(A) erred in confirming the addition of Rs.78,25,000/- being cash deposited in the bank account under section 68 made by the AO in the reassessment order dated 13/12/2018 passed u/s 144 r.w.s 147 without appreciating the fact that the assessee is not maintaining books of accounts and bank statement can not be held as books of accounts maintained by the assessee, thus the ingredients of section 68 is not satisfied, accordingly assessee prays for deletion of Rs.78,25,000/- made u/s.68 in full.
(B). Additional grounds raised above by the assessee are purely legal in nature goes to the root of the matter and are emanating out of the facts appearing in the impugned reassessment order dated 13/12/2018. The legal grounds do not require any investigation and all materials are already on record before the Tribunal.
4|Page ITA No.918/Del/2024 Sh. Rakesh C. The Appellant craves to add, alter, delete, modify, replace, withdraw either all or any of the above legal jurisdictional grounds of appeal during the course of hearing before the Tribunal.
(D).It is humbly prayed before your honour to admit and adjudicate the additional legal jurisdictional grounds of appeal raised above. Reliance in this regard is placed upon the decisions in the cases of "National Thermal Power Corporation vs. CIT (1998) 229 ITR 383 (SC)", "VMT Spinning Co. Ltd Vs. CIT (2016) 389 ITR 326 (P&H)", "Siksa O Anusadhan Vs. CIT (2011) 336 ITR 112) [Orissa.HC)", "CIT Vs. Mohd. Ayyub Agency (1992) 197 ITR '637 (All.HC)". "CIT Vs. Cellulose Products of India Ltd [1985] 151 ITR 499 (Guj.HC)-(FB)", "P.V.DoshiVs.CIT [ 1978] 113 ITR 22 (Guj.HC)","CIT Vs. Mahalaxmi Sugar Mills Co. Ltd [1993] 200 ITR 275 (Del.HC)", "Taylor Instrument Co. (India) Ltd Vs.CIT [1992] 198 ITR 1 (Del.HC)", 'Kiran Singh & Others Vs. Chaman Pawan & Ors.(1955) 1 SCR 117'(SC), 'Kanwar Singh Saini Vs. High Court of Delhi (2012) 4 SCC 307 (SC)'.
6. With regard to the above additional grounds filed by the assessee the AO submitted a report vide letter dated 24.11.2025. The relevant extracts of the same are reproduced as under:
Sub: Factual Report/Comments in the case of M/s Rakesh, PAN:
AODPR7631B, Α.Υ. 2011-12, ITA No. 918/D/2024-Reg-
Kindly refer to the subject cited above and email received in this regard from your good office on 18-11-2025 calling for detailed factual report on additional grounds of appeal on/ before 20-11-2025.
2. In this regard, it is submitted that the requisite assessment record has been called up from the relevant record keeping agency which has been pursued and the report on the additional grounds raised by assessee is submitted as under:Ground No. 1
(A) Additional legal jurisdictional grounds of appeal:
1.That on facts, and in the circumstances of the case and in law, the CIT(A) erred in confirming the order of the AO dated 13/12/2018 passed u/s.144 r.w.s 147 without appreciating the fact that the mandatory jurisdictional notice u/s.148, dated 21/03/2018 issued by the AO quoting wrong postal address was not served upon the assessee and returned back lying in the file of the AO, accordingly jurisdiction assumed by the AO for initiation of reassessment proceedings u/s.147 without ensuring service of foundation jurisdictional notice u/s.148 is bad in law thus the consequential assessment order dated 13/12/2018 passed u/s.144 r.w.s 147 deserves to be held as null and void.
The issue raised pertains to the scope and findings of the Ld. CIT(A) which is a matter beyond the scope and jurisdiction of this office. However, the assessee's
5|Page ITA No.918/Del/2024 Sh. Rakesh claim regarding the non-service of the jurisdictional notice under Section 148 lacks merit. The notice under Section 148 was duly issued to the address available in the department's records House No 36 Vill Hayatpur, Teh Gurgaon- 122050, which was the same address provided by the assessee to ICICI Bank. The department received AIR (Annual Information Return) information from ICICI Bank, and the address mentioned in the bank records matches the address where the notice was served. Further, as per the PAN data base the assessee has also given his Residence address -H.No. 36 Village Hayatapur Gurgaon. This indicates that the assessee was maintaining the same address for banking purposes, reinforcing the validity of the notice service. During the proceedings, the assessee has filed ITR us/148 of the Act, and disclosed the same address.
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During the proceedings, the assessee was also issued show cause notice at other address: GD7, Ground floor, Raheja Sec 2A IMT, Manesar, Gurgaon- 122050. The assessee has been issued notices u/s 142(1) on 24-07-2018 and 24-08-2018 which has not been received returned from postal services and therefore has been served on the assessee.
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The assessee's failure to update his address with the department if any, cannot render the notice invalid. The notices were also duly served on the e-filing portal of the assessee. Therefore, the reassessment proceedings initiated are valid, and the order dated 21.03.2018 is sustainable in law.
2. Ground no-2,
2. The satisfaction recorded by the Principal Commissioner of Income Tax (PCIT). Gurgaon dated 12.03.2018 is mechanical and without application of mind and such approval vitiates the reassessment. Such mechanical sanction cannot be considered as sanction satisfying the mandatory requirements as prescribed under Section 151 of the Act.
The assessee's claim that the sanction by the PCIT under Section 151 was mechanical is devoid of substance. The PCIT reviewed the reasons recorded by the Assessing Officer (AO) in detail and granted approval after applying his mind. The satisfaction was not a mere formality but was based on specific information pointing to income escaping assessment. The process followed adheres to the principles laid down by law, and there is no evidence to substantiate the claim of mechanical approval. The assessee's assertion is speculative and unsupported by any factual or legal basis. As such, this argument does not invalidate the reassessment proceedings.
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3. Ground no- 3,
3. That on facts, and in the circumstances of the case and in law, the CIT(A) erred in confirming the addition of Rs.78,25,000/- being cash deposited in the
6|Page ITA No.918/Del/2024 Sh. Rakesh bank account under section 68 made by the AO in the reassessment order dated 13/12/2018 passed u/s.144 r.w.s 147 without appreciating the fact that the assessee is not maintaining books of accounts and bank statement cannot be held as books of accounts maintained by the assessee, thus the ingredients of section 68 is not satisfied, accordingly assessee prays for deletion of Rs.78,25,000/- made u/s 68 in full.
The assessee's claim that the ingredients of Section 68 are not satisfied is baseless. Section 68 of the Income Tax Act clearly stipulates that when an amount is credited to the books of accounts of the assessee, the burden of proof lies on the assessee to satisfactorily establish the identity, creditworthiness, and genuineness of the source of the cash credit in the bank account. The source of the cash credits remained unexplained source of the income. In this case, the assessee failed to proof the ingredients of section 68. Therefore, the addition u/s 68 is justified.
Further, in view of the provisions of section 292B of the Act, the proceedings are requested not be considered invalid merely by reason of any mistake or defect on account of assessment of income in incorrect section.
4. Ground No. B AND C: Being general in nature. No adjudication required.
5. Ground No. D:- The assessee has mentioned various case laws and the case laws facts are different from the assessee's case It is a well-established principle that judicial precedents are fact-specific. A case law cited by the assessee cannot be blindly applied unless the facts of the cited case and the current case are identical. The facts of the present case (eg, failure to establish the identity, creditworthiness, and genuineness of the source under Section 68) are materially different from the cases cited by the assessee in his favour. The report is being submitted for kind consideration and necessary action.
7. In response the Ld. AR submitted two rejoinders vide two separate letters both dated Nil in response to the above report of the AO. The relevant extracts of the same are reproduced as under:
Re: Admission of the addition grounds of appeal "1. Vide letter dated 30/05/2024, the assessee made an application before the Tribunal under Rule-11 to accept and adjudicate the three legal jurisdictional grounds of appeal raised first time before the Tribunal. Vide Ex-Party order dated 06/02/2025, the matter was remanded back to AO for fresh adjudication. While passing the Ex-Party order dated 06/02/2025, the additional legal jurisdictional grounds of appeal was neither considered nor adjudicating by the Tribunal. Vide MA No:45/Del./2025, order dated 26/09/2025, the Tribunal recalled the order dated
7|Page ITA No.918/Del/2024 Sh. Rakesh 06/02/2025 for adjudication of the additional legal grounds of appeal. [PB-II.Pg.
Nos.92 to 94].
A.2.Considering the judgment of the Hon'ble Apex Court in the case of National Thermal Power Co. Ltd. Vs. CIT (1998) 229 ITR 383 (SC)", the additional grounds filed by the assessee may kindly be accepted. The relevant portion of the judgment reads as under:
"5. Under Section 254 of the Income-tax Act, the Appellate Tribunal may, after giving both the parties to the appeal an opportunity of being heard, pass such orders thereon as it thinks fit. The power of the Tribunal in dealing with appeals is thus expressed in the widest possible terms. The purpose of the assessment proceedings before the taxing authorities is to assess correctly the tax liability of an assessee in accordance with law. If, for example, as a result of a judicial decision given while the appeal is pending before the Tribunal, it is found that a non-taxable item is taxed or a permissible deduction is denied, we do not see any reason why the assessee should be prevented from raising that question before the tribunal for the first time, so long as the relevant facts are on record in respect of that item. We do not see any reason to restrict the power of the Tribunal under Section 254 only to decide the grounds whicharise from the order of the Commissioner of Income-tax (Appeals). Both the assessee as well as the Department have a right to file an appeal/cross-objections before the Tribunal. We fail to see why the Tribunal should be prevented from considering questions of law arising in assessment proceedings although not raised earlier.
6.In the case of Jute Corporation of India Ltd. vs. C.I.T [1991] 187 ITR 688 (SC), this Court, while dealing with the powers of the Appellate Assistant Commissioner observed that an appellate authority has all the powers which the original authority may have in deciding the question before it subject to the restrictions or limitations, if any, prescribed by the statutory provisions. In the absence of any statutory provision, the appellate authority is vested with all the plenary powers which the subordinate authority may have in the matter. There is no good reason to justify curtailment of the power of the Appellate Assistant Commissioner in entertaining an additional ground raised by the assessee in seeking modification of the order of assessment passed by the Income-tax Officer. This Court further observed that there may be several factors justifying the raising of a new plea in an appeal and each case has to be considered on its own facts. The Appellate Assistant Commissioner must be satisfied that the ground raised was bona fide and that the same could not have been raised earlier for good reasons. The Appellate Assistant Commissioner should exercise his discretion in permitting or not permitting the assessee to raise an additional ground in accordance with law and reason. The same observations would apply to appeals before the Tribunal also.
8|Page ITA No.918/Del/2024 Sh. Rakesh
7. The view that the Tribunal is confined only to issues arising out of the appeal before the Commissioner of Income-tax (Appeals) takes too narrow a view of the powers of the Appellate Tribunal [vide, e.g., C.I. T. v. Anand Prasad (Delhi), C.I. T. v. Karamchand Premchand P. Ltd. and C.I.T. v. Cellulose Products of India Ltd. Undoubtedly, the Tribunal will have the discretion to allow or not allow a new ground to be raised. But where the Tribunal is only required to consider a question of law arising from the facts which are on record in the assessment proceedings we fail to see why such a question should not be allowed to be raised when it is necessary to consider that question in order to correctly assess the tax liability of an assessee.
8. The reframed question, therefore, is answered in the affirmative, i.e., the Tribunal has jurisdiction to examine a question of law which arises from the facts as found by the authorities below and having a bearing on the tax liability of the assessee. We remand the proceedings to the Tribunal for consideration of the new grounds raised by the assessee on the merits."
A3.Considering the above judgement of the Hon'ble Supreme Court in the case of National Thermal Power Co. Ltd. Vs. CIT (supra)", it is humbly prayed before the Tribunal to admit and adjudicate the three grounds of appeal raised before the Tribunal first time vide letter dated 30/05/2024. Re:Non-service of the impugned notice u/s 148 of the Act dated 21.03.2018 upon the assessee by post B.First additional jurisdictional grounds of appeal that non service of section 148 notice, dated 21/03/2018:
B.1.Section 148(1) specifies that before making the reassessment u/s.147, the AO shall serve on the assessee a notice u/s. 148. In the present case notice u/s.148,dated 21/03/2018 was send by speed post on 23/03/2018 and the same was returned on 27/03/2018 being undelivered because the WRONG POSTAL PIN CODE was quoted on the face of the notice wrongly.
Address as per Income Tax Profile Address as per section 148 /Return of Income Notice Rakesh, House no. 36, Vill: Rakesh, House no. 36, Vill: HayatpurGarhi. Hayatpur . GarhiHarsaru. Gurgaon-122505, The: Gurgaon, Gurgaon- Haryana. 122505, Haryana. India (PB page nos. 1 to 4) India (PB page nos. 18 to 19)
As Wrong Postal PIN Code was reflected on the face of the section 148 notice,dated 21/03/2018 was despatched on 23/03/2018 and the same was returned on
9|Page ITA No.918/Del/2024 Sh. Rakesh 27/03/2018 being undelivered and the original copy of the notice including the envelope was lying in the file of the AO Even though the section 148 notice was returned on 27/03/2018, however no further attempt was made by the AO for service of the notice either through Affixture or by deputing the Inspector for service of the notice upon the assessee.
8.2.Section 148 notice not served and returned including lying in the file of the AO is as good as non issuance of preliminary jurisdictional section 148 notice. Reliance is placed upon the decision of the Vijay Kumar Jain Vs. CIT [1975] 99 ITR 349 (P&H.HC) where it was held as under:
"The matter has been put beyond any doubt by the Supreme Court in Commissioner of Income-tax v. Kurban Hussain Ibrahimji Mithiborwala [1971] 82 ITR 821 (SC),where in it is observed:
"It is well settled that the Income-tax Officer's jurisdiction to reopen an assessment under section 34 (it is equivalent to section
147) depends upon the issuance of a valid notice (now section
148). If the notice issued by him is invalid for any reason the entire proceedings taken by him would become void for want of jurisdiction".
It is axiomatic that what is void is non est. In this situation, the assessee was not precluded from urging the grounds Nos. 2 to 5. By giving them up theassessee could not confer jurisdiction on the income-tax Officer where he had none. Therefore, the Tribunal was bound to hear the assessee and could not reject the appeal on the ground that grounds Nos. 2 to 5 were not agitated before the Appellate Assistant Commissioner and thus could not be permitted to be agitated before it. Mr. Awasthy fairly and frankly conceded that, in view of the decision of the Supreme Court in Kurban Hussain's case (supra), the question referred has to be answered in the negative, that is, in favour of the assessee and against the department. We return the said answer to the Tribunal. There will be no order as to costs. [PB.III.Pg.Nos.95 to 97].
8.3.In the case of "Chheda Lal Shukla Vs. ITO, ITA No:1573/Del/2020, dated 10/01/2025 (Del.Trib)", additional legal grounds of appeal regarding that section 148 notice was not served upon the assessee. The Tribunal admitted and adjudicated the additional grounds of appeal as service of section 148 notice is mandatory and jurisdictional requirement which can not be waived off and the same can be raised before the Tribunal first time even if not raised earlier. Tribunal after considering several judgments quashed the assessment. [PB-III.Pg.Nos.98 to 108). Vide the other letter dated Nil filed on 25.11.2025 MAY YOUR HONOUR PLEASE BE' consider the following in supplement to the oral presentation before the open Court:
10 | P a g e ITA No.918/Del/2024 Sh. Rakesh This appeal was recalled vide MA NO:45/Del/2025 because the appeal was disposed without adjudicating the additional legal jurisdictional grounds of appeal raised before the Tribunal vide letter dated 30/05/2024 A. Additional legal jurisdictional grounds of appeal No.1 raised before the Tribunal is relating to non service of preliminary section 148 notice, dated 21/03/2028 which was issued by the AO and returned due to non delivery and lying in the assessment records maintained by the AO certified copy of which is enclosed at Pg. Nos. 18 to 19 of the PB.
Written Submission before the Tribunal:
A.1.In this case the preliminary section 148 notice, dated 21/03/2018 was issued on 23/03/2018 and the same was returned due to non delivery on 27/03/2018 due to wrong PIN Code noted in the address. The returned section 148 notice is lying in the assessment records maintained by the AO. Certified copy of the notice dated 21/03/2018 send on 23/03/2018 and returned on 27/03/2018 is enclosed at Pg. Nos. 18 to 19 of the PB.
Not only the section 148 notice was returned but also other notices issued by the AO were returned and lying in the assessment records at the Office of the AO.(PB.Pg. Nos.5 to 9).
As none of the notices are served upon the assessee, no reply was filed before the AO during the assessment proceedings, hence assessment was completed u/s.147 r.w.s
144. A.2.It is submitted that the notice prescribed in section 148 of the Act for the purpose of initiating reassessment proceedings is not a mere procedural requirement but is a condition precedent to the validity of any reassessment made. Mere issuance of notice for income escaping assessment is not sufficient but its service on the assessee, that too, within the time frame envisaged under section 149 of the Act is necessary for a valid reopening of assessment.
A.3. Reliance is placed upon the following judicial precedents where it was held that mere issuance of notice under section 148 is not enough for reassessment proceedings but its service upon the assesee is important for a valid reassessment proceeding:A.3.1. The observation of Hon'ble Supreme Court in the case of V.Narayan Chetty Vs. ITO (1959) 35 ITR 388 (SC) was as under:
"Para.5. The first point raised by Mr. Sastri is that the proceedings taken by respondent No. 1 under section 34 (Sec 148 under 1.T Act, 1961) of the Act are invalid because the notice required to be issued under the said section has not been issued against the assessees contemplated therein. In the present case the Income-tax Officer has purported to act under section 31(1)(a) against the three firms. The said sub-section provides inter alia that "if the Income-tax Officer has reason to believe that by reason of the omission or failure on the part of the 11 | P a g e ITA No.918/Del/2024 Sh. Rakesh assessee to make a return of his income under section 22 for any year or to disclose fully and truly all material facts necessary for his assessment for that year, income, profits or gains chargeable to income-tax has been under assessed", he may, within the time prescribed, "serve on the assessee a notice containing all or any of the requirements which may be included in the notice under sub-section (2) of section 22 and may proceed to re-assess such income, profits or gains.
The argument is that the service of the requisite notice on the assessee is a condition precedent to the validity of any re-assessment made under section 34; and if a valid notice is not issued as required, proceedings taken by the Income- tax Officer in pursuance of an invalid notice and consequent orders of reassessment passed by him would be void and inoperative. In our opinion, this contention is well-founded. The notice prescribed by section 34 cannot be regarded as a mere procedural requirement; it is only if the said notice is served on the assessee as required that the Income-tax Officer would be justified in taking proceedings against him. If no notice is issued or if the notice issued is shown to be invalid then the validity of the proceedings taken by the Income-tax Officer without a notice or in pursuance of an invalid notice would be illegal and void. That is the view taken by the Bombay and Calcutta High Courts in Commissioner of Income-tax v. NamsukhMolilal [1955] 27 ITR 54 and R.K. Das & Co. v. Commissioner of Income-tax (1956) 30 ITR 439 and we think that that view is right."
A.3.2. In the case of RK Upadhyaya Vs. Shanabhai P. Patel (1987) 166 ITR 173 (SC), the Hon'ble Supreme Court held that section 148(1) provides for service of notice as a condition precedent to make the assessment order. The Hon'ble Supreme Court held that once a notice is issued within the period of limitation jurisdiction becomes vested in the Assessing Officerto proceed to make reassessment. Further, it was held that the mandate of section 148(1) is that reassessment shall not be made until there has been service of notice. While holding so the Hon'ble Supreme Court held as under:
"Para.4. Section 34 (Parimateria to Section 148 of I.T Act, 1961), conferred jurisdiction on the ITO to reopen an assessment subject to service of notice within the prescribed period. Therefore, service of notice within limitation was the foundations of jurisdiction. The same view has been taken by this Court in J.P. Jani, ITO v. InduprasadDevshanker Bhatt [1969] 72 ITR 595 as also in CIT v. Robert J. Sas [1963] 48 ITR 177. The High Court, in our opinion went wrong in relying upon the ratio of Banarsi Debi's case (supro) in disposing of the case in hand. The scheme of the 1961 Act so far as notice for reassessment is concerned, is quite different. What used to be contained in section 34 of the 1922 Act has been spread out into three sections, being sections 147, 148 and 149. A clear distinction has been made out between 'issue of notice' and 'service of notice' under the 1961 Act. Section 149 prescribes the period of limitation. It categorically prescribes that no notice under section 148 shall be issued after the prescribed limitation has lapsed. Section 148(1) provides for 12 | P a g e ITA No.918/Del/2024 Sh. Rakesh service of notice as a condition precedent to making the order of assessment. Once a notice is issued within the period of limitations, jurisdiction becomes vested in the ITO to proceed to reassess. The mandate of section 148(1) is that reassessment shall not be made until there has been service. The requirement of issue of notice is satisfied when a notice is actually issued. In this case, admittedly, the notice was issued within the prescribed period of limitation as 31-3-1970, was the last day of that period. Service under the 1961 Act is not a condition precedent to conferment of jurisdiction in the ITO to deal with the matter but it is a condition precedent to making of the order of assessment. The High Court in our opinion lost sight of the distinction and under a wrong basis felt bound by the judgment in Banarsi Debi's case (supra). As the ITO had issued notice within limitations, the appeal is allowed and the order of the High Court is vacated. The ITO shall now proceed to complete the assessment after complying with the requirements of law. Since there has been no appearance on behalf of the respondents, we make no orders for costs".
A.3.3. The Hon'ble Punjab & Haryana High Court in the case of CIT v. Avtar Singh [2012] 304 ITR 333 (P&H.HC) held as under:
"Where no evidence in shape of postal receipt was produced by revenue to show that actually reassessment notice was sent by registered post and was served upon assessee, reassessment proceedings were not valid. [Head Note].
The operative paras of the said order reads as under:
"Counsel for the appellant-Revenue submits that in the instant case, notice under section 148 of the Act was sent to the assessee through registered post on March 30, 2001. Therefore, the same tantamount to a valid service as per section 27 of the General Clauses Act, 1897.
We are not inclined to accept the submission made by learned counsel for the appellant-Revenue, as in the present case, no evidence in the shape of postal receipt was produced by the Revenue before the authority that actually, the said notice was sent by registered post and was served upon the assessee. The Tribunal has affirmed the categoric finding recorded by the Commissioner of Income-tax (Appeals) that in the present case, the Revenue has not led any evidence to show that notice under section 148 of the Act was actually served upon the assessee. In our view, the Commissioner of Income-tax (Appeals) as well as the Tribunal have recorded a pure finding of fact, after considering the material available on record to the effect that notice under section 148 of the Act was actually not served upon the assessee, which was a condition precedent for making reassessment or recomputation under section 147 of the Act. We do not find any ground to interfere in the said finding of fact, and in our view no 13 | P a g e ITA No.918/Del/2024 Sh. Rakesh substantial question of law is arising from the order of the Tribunal".
[PB.Pg.No.56 to 57].
A.3.4. The Hon'ble Punjab & Haryana High Court in the case of CIT v. Laxmi Narain [2008] 168 Taxman 128 (P&H.HC) held as under:
"3. After hearing learned counsel for the revenue we find that one question which permits all the questions claimed by the revenue is whether notice under section 148 of the Act was issued and served on the assessee before framing assessment which is a condition precedent. Non-service of such a notice on the proper person would go to the roots and cannot be condoned. There are categorical findings of fact recorded by the Tribunal that the revenue has not been able to produce any material to show that any notices under section 148 of the Income-tax Act, 1961 (for brevity 'the Act') was served upon the assessee in respect of the assessment years under consideration. The Tribunal has also noticed that the matter was time and again sent back to the Assessing Officer by the CIT (Appeals) and no authority could record positive and categoric finding that notice under section 148 of the Act was served upon the assessee. It appears that there is no proof with regard to the service on the assessee under section 148 of the Act. The Tribunal has further noticed that proceedings in respect of assessment year under consideration were dropped on 31-9- 2002 with specific findings by the Assessing Officer that notice under section 148 could not be served. These are pure findings of fact which would not give rise to any question of law much less a substantive question of law. It is well-settled that issuance of a notice under section 148 of the Act is a condition precedent for framing assessment order under section 147 of the Act. It is equally well-settled that if no such notice is issued or notice issued is invalid and not in accordance with law or notice is not served on the proper person then assessment framed would be illegal and without jurisdiction. Therefore, we find that the Tribunal has taken correct view in these appeals. Accordingly, the appeals are dismissed". [PB.Pg.Nos. 20 to 21].
A.3.5. Hon'ble High Court of Punjab & Haryana in CIT Vs. Mani Kakkar [178 Taxman 315] has held that:
"3. We have heard the learned counsel for the appellant as well as the counsel for the respondent, who is present on advance notice. We find that the factual position is that no notice whatsoever was served on the assessee prior to the re-opening of the assessment proceedings. Proceedings under section147 of the said Act cannot be initiated without the service of notice as provided in section 148 of the said Act The service of notice is a pre-condition for framing an assessment order under section
147. The learned counsel for the appellant sought to place reliance on the provisions of section 292BB of the said Act which has been introduced with effect from 1-4-2008. However, we feel that no reliance on that provision can be placed for two reasons. The first reason being that the said provision is not applicable to the assessment year 2001-02. The 14 | P a g e ITA No.918/Del/2024 Sh. Rakesh second reason being that this argument was not at all being raised before the Tribunal. In fact, the argument could not have been raised before the Tribunal because the amendment itself was introduced subsequent to the passing of the order, which is impugned herein".
A.3.6.lt is well settled proposition of law that the onus is on the Revenue to establish that proper service of notice has been effected u/s 148 of the Act which is jurisdictional precondition to finalise the re-assessment. Hon'ble Delhi High Court in the case of "CIT Vs. Rajesh Kumar Sharma (2009) 311 ITR 235 (Del.HC)" has held as under:
"10. It was submitted by learned counsel for the revenue that the envelope did not return with any remark to the effect that it was undelivered and so it must be presumed that it was actually served upon the assessee.
11. We are not in position to make any such assumption because of the categorical stand of the assessee that he had not received the notice. The burden was entirely upon the revenue to show that the notice was despatched to the correct address. It is only then that such a presumption could have been made. But learned counsel for the revenue has not been able to show that the envelope containing the notice was correctly addressed. We are, therefore, not inclined to accept this contention of learned counsel for the revenue". [PB.Pg. Nos.22 to 23).
A.3.7. Reliance is placed upon the decision of the Karnataka High Court in the case of "CIT Vs. ITC Hotels [2014] 50 taxmann.com 424 (Kar.HC)" where it was held as under:
"3. A notice under Section 148 of the Act was issued on 22.01.2001 for reopening the assessment. The assessee filed, his objections and contended that there was no prior approval of the Commissioner of Income Tax under Section 151 of the Act. When the same was noticed, the proceedings were dropped. After obtaining prior approval of the Commissioner, one more notice was issued on 28.03.2002. The case of the Revenue is that, the representative of the assessee was present in the office and declined to receive the said notice. Therefore, it was despatched on 28.03.2002, itself. However, there is nothing on record to show that this notice was duly served on the assessee. The material on record shows that the notice was despatched on 28.03.2002, but there is nothing on record to show that it was duly served on the assessee.
4. Section 148 (1) of the Act reads as under.
........................
5. Therefore, it is clear from the aforesaid Section that, before making the assessment or reassessment or re computation under Section 147 of the Act, the Assessing Officer shall serve notice on the assessee. Therefore, service of notice under Section 148 (1) of the Act is a condition precedent before initiating proceedings under Section 147 of the Act. In fact, the 15 | P a g e ITA No.918/Del/2024 Sh. Rakesh Apex Court in the case of S. Narayanappa v. CIT (1986) 63 ITR 219 (SC), has held that the proceedings for assessment or reassessment under Section 34(1)(a) of the Act which is in parimateria with Section 147 of the Act, which start with the issue of a notice and it is only after the service of notice, that the assessee whose income is sought to be assessed or reassessed becomes a party to the proceedings. Therefore, if such a service of notice is not affected, there cannot be any assessment or reassessment proceedings. The Delhi HighCourt in the case of CIT v. Mani Kakar [2009] 178 Taxman 315, has held that proceedings under Section 147 of the Act can not be initiated without the service of notice as mandated in Section 148 of the Act. Service of notice is a precondition for permitting assessment under Section 147 of the Act.
6. Therefore, in the instant case, admittedly, when notice under Section 148 of the Act is not duly served on the assessee, the proceedings under Section 147 of the Act is one without jurisdiction and the Tribunal has rightly set aside the order. We find no infirmity or irregularity committed by the Tribunal. Hence, the substantial question of law is answered in favour of the assesee and against the Revenue. There is no merit in the appeal and the same is accordingly dismissed". [PB.Pg. No.25to 26).
A.3.8. The Hon'ble Punjab & Haryana High Court in the case of CIT v. Cebon India Ltd. [2012] 347 ITR 583 (P&H.HC) held as under:
"The assessee's return for the assessment year 1996-97 on November 30, 1996, was processed under section 143(1)(a) of the Income-tax Act, 1961, on May 30,1997, and assessment was framed under section 144 of the Act and affirmed in appeal. The Tribunal remanded the matter to the Commissioner (Appeals). The Commissioner (Appeals) in the second round, allowed the appeal on the ground that there was no evidence to show that notice under section 143(2) of the Act had been served on the assessee before November 30, 1997, Le., within one year of the filing of the return. Therefore, he held the assessment void. This finding was affirmed by the Tribunal. On appeal before the High Court:
Held, dismissing the appeal, that a concurrent finding had been recorded by the Commissioner (Appeals) and the Tribunal on the question of date of service of notice. The notice was not served within the stipulated time. Mere giving of dispatch number would not render the finding perverse. In the absence of notice being served, the Assessing Officer had no jurisdiction to make assessment. Absence of notice was not curable under section 292BB of the Act." [PB.Pg.No.58 to 59).
A.3.9.Delhi Tribunal in the case of Chheda Lal Shukla Vs. ITO. ITA No:1573/Del/2020,dated 10/01/2025, accepting and adjudicating the additional grounds of appeal quashed the assessment order u/s 147 r.w.s 147 due to non service of section 148 notice 16 | P a g e ITA No.918/Del/2024 Sh. Rakesh A.4.HUMBLE PRAYER BEFORE THE TRIBUNAL TO QUASH THE REASSESSMENT ORDER, DATED 13/12/2018 PASSED U/S.144 R.W.S 147:
In view of above discussions and documentary evidences including that of judicial precedents and Affidavit [PB.Pg. Nos.54 to 55], in the present case section 148 notice dated 21/03/2018 issued on 23/03/2018 was returned on 27/03/2018 and lying in the assessment records, the preliminary section 148 including all notices were not served upon the assessee, thus it is prayed to quash the reassessment order dated 13/12/2018 passed u/s.144 r.w.s 147.
Re: Service of the impugned notice u/s 148 of the Act dated 21.03.2018 on the E- proceeding portal B.REGARDING SERVICE OF SECTION 148 NOTICE, DATED 21/03/2018 AND ALL OTHER NOTICES BY REFLECTING THE SAME IN THE E-PROCEEDING PORTAL:
B.1.In the present case section 148 notice dated 21/03/2018 and other notices issued during the assessment proceedings are reflecting in the E-Portal not transmitted to the assessee electronically by Email. [PB-III.Pg. Nos. 109 to 117).
8.2.Reliance is placed upon the decision of the jurisdictional Punjab & Haryana High Court in the case of "Munjal BCU Centre of Innovation and Entrepreneurship Vs. CIT('E), CWP NO:21028 of 2023, dated 04/03/2024, reported in [2024] 160 taxmann.com 629 (P&H.HC)") wherein, the Hon'ble P&H High Court had discussed the entire procedure regarding communication of notices by the department to the assessee under provisions of Section 282 of the IT Act read with rule 127 and observations and findings of the Hon'ble P&H High Court applicable in the present case of the assessee is culled out as under:
Where show cause notice for initiating proceedings under section 12A(1)(ac)(iii) was only reflected on e-portal of department and was not served upon assessee, he would be entitled to file his reply and revenue would be entitled to examine same and pass a fresh order. [Head Note].
The operative para's of the order reads as under:
"8. In view of the above, it is essential that before any action is taken, a communication of the notice must be in terms of the provisions as enumerated herein above. The provisions do not mention of communication to be "presumed" by placing notice on the e-portal. A pragmatic view has to be adopted always in these circumstances. An individual or a Company is not expected to keep the e-portal of the Department open all the time so as tohave knowledge of what the Department is supposed to be doing with regard to the submissions of forms etc.. The principles of natural justice are inherent in the income tax provisions and the same are required to be necessarily followed.
17 | P a g e ITA No.918/Del/2024 Sh. Rakesh
9. Having noticed as above, this Court is of the firm view that the petitioner has not been given sufficient opportunity to put up his pleas with regard to the proceedings under Section 12A(1)(ac)(iii) of the Act of 1961 and as he was not served with any notice. Therefore, he would be entitled to file his reply and the Department would of course be entitled to examine the same and pass a fresh order thereafter.
10. In view of the above, Writ Petition is allowed and the order dated 16.01.2023 (Annexure P-5) is quashed and set aside. The Department would provide an opportunity of hearing to the petitioner and they will also allow the petitioner to appear personally for the purpose and pass a speaking order independent of the order passed earlier by them on 16.01.2023. The same shall be done expeditiously provided the petitioner file his reply within a period of three weeks. [PB-III. Pg. Nos. 118 to 122].
B.3/Hon'ble Chandigarh Tribunal in the case of " ChheringTomdan Vs. The ITO, ITA No:170/Chd/2024, order dated 04/09/2024 (Chd.Trib)", following the order of the P&H High Court in the case of "Munjal BCU Centre of Innovation and Entrepreneurship Vs.CIT('E) (supra)",) quashed the reassessment order where notices are reflected in the Portal not transmitted electronically to any Email Id and the operative para's of the said order reads as under:
"6. We have considered the findings of the Id. CIT(A) and the arguments put forward by the Id. DR. We have also considered the written submissions of the Counsel of the Assessee during the proceedings before us. The Counsel has submitted that the notices issued of reopening u/s 147/148 of the Act could not be responded by the Assessee as the Assessee had not seen it because all the notices were uploaded on the ITBA portal only. The Counsel of the Assessee further submitted that notices were neither sent on email id nor through post. The Counsel further submitted that the Hon'ble jurisdictional Punjab and Haryana High Court in the case of 'Munjal BCU Centre of Innovation and Entrepreneurship Vs CIT(E) Chandigarh', CWP No. 21028/2023 dated 4.3.2024' has already given the finding that notice issued through portal may not be treated as a valid service of notice. Since in this case all notices were issued only on the portal, therefore, the very reopening of the case u/s 147/148 of the Act are invalid. Accordingly, the proceedings initiated u/s 147/148 should be quashed.
7. We have considered the arguments of the Id. DR and we find that as notices were issued on portal only, therefore, it is squarely covered by the ratio decided by the Hon'ble Punjab & Haryana High Court in the case of 'Munjal BCU Centre of Innovation and Entrepreneurship Vs CIT(E) Chandigarh' (supra)'. Accordingly, proceedings initiated u/s 147/148 is hereby quashed.
18 | P a g e ITA No.918/Del/2024 Sh. Rakesh
8. Since the proceedings u/s 147/148 have been quashed, therefore, there is no need of giving any findings on other grounds of appeal. Accordingly, the appeal of the Assessee stands allowed". [PB-III.Pg.Nos.123 to 129).
B.4. Further reliance is placed upon the decision of the Delhi High Court in the case of "Suman Jeet Agrawal & Ors. Vs. Income Tax Officer & Ors. passed in W.P.(C) No. 10/2022 and other connected matter, dated 27/10/2022 reported in [2022] 143 taxmann.com 11 (Del.HC)") wherein, the Hon'ble Delhi High Court had discussed the entire procedure regarding communication of notices by the department to the assessee under provisions of Section 282 of the IT Act from the said order, relevant Question, Observations and Findings of the Hon'ble Delhi High Court applicable in the present case of the assessee is culled out as under:
Where notices were only uploaded in E-filing portal of assessees without any real time alert, date and time when assessees viewed notices in E-filing portal, as recorded in ITBA portal will be construed as date of service of notice. [Head Note].
The operative para's of the order reads as under:
"28. Question (V): Whether upload of the Section 148 Notice on the "My Account" of the assessee on the E-filing portal is valid transmission under the Act of 19617-The Court has answered this in the negative, against the Department.
28.1 With respect to the Notices falling under the category 'D' dated 31st March 2021 and digitally signed on 31st March 2021 it has been stated that, they were not served on the assessees either by e-mail or post or by courier services as they were just uploaded on the E-filing portals of the assessees. It is the case of the petitioners that no real time alert was received by the assessee and the Department has not disputed this fact. ..................
28.8 However, since the assessees in the present case did become aware of the Notices later and the assessment proceedings in their cases are still pending, we are not inclined to quash these Notices.
28.9 It has come on record that the ITBA records the time and date when the E-filing portal is accessed by the assessee, so the first date on which the Notices were accessed by the assessees is duly available. This date will be considered by the JAOs as the date of issuance of Notices by the JAOS.
Illustratively, in W.P. (C) 13888 of 2021 the Notice dated 31st March 2021 was never served on the assessee, instead the assessee claims that he became aware of the same on 23rd November, 2021 while checking his E- filing portal, the JAO is directed to verify the date on which the Notice was first viewed by the assessee, and consider the same as the date of issuance."[PB-III.Pg. Nos. 130 to 134].
B.5. Raipur Tribunal in the case of 'Mamta Agrawal Vs. Pr.CIT.ITA No:39/RPR/2022, dated 21/06/2024 (Raipur Tribunal)' [PB-III.Pg. Nos. 135 to 151) 19 | P a g e ITA No.918/Del/2024 Sh. Rakesh and in the case of "Maa Sharda Corporation Vs.ITO.ITA No:135/RPR/2025, dated 21/07/2025" (PB-III.Pg.Nos.152 to 163),quashed the order replying upon the decision of the Delhi High in the case of "Suman Jeet Agrawal & Ors. Vs. Income Tax Officer & Ors (supra).
Re: Non applicability of section 292B in the present case C. Non applicability of section 292B in case of jurisdictional defects:
Hon'ble Punjab & Haryana High Court in the case of 'CIT Vs. Norton Motors [2005] 275 ITR 595 (P&H.HC)' held that section 2928 is not applicable in the case of jurisdictional defects The observation of the P&H High Court reads as under:
"12. Section 292B of the Act, on which reliance has been placed by learned counsel for the Revenue, reads as under:
"Return of income, etc., not to be invalid on certain grounds. No return of income, assessment, notice, summons or other proceeding furnished or made or issued, or taken or purported to have been furnished or made or issued or taken in pursuance of any of the provisions of this Act shall be invalid or shall be deemed to be invalid merely by reason of any mistake, defect or omission in such return of income, assessment, notice, summons or other proceeding if such return of income, assessment, notice, summons or other proceeding is in substance and effect in conformity with or according to the intent and purpose of this Act."
13. A reading of the above reproduced provision makes it clear that a mistake, defect or omission in the return of income, assessment, notice, summons or other proceeding is not sufficient to invalidate an action taken by the competent authority, provided that such return of income. assessment, notice, summons or other proceeding is in substance and effect in conformity with or according to the provisions of the Act. To put it differently, section 292B can be relied upon for resisting a challenge to the notice, etc., only if there is a technical defect or omission in it. However, there is nothing in the plain language of that section from which it can be inferred that the same can be relied upon for curing a jurisdictional defect in the assessment notice, summons or other proceeding. In other words, if the notice, summons or other proceeding taken by an authority suffers from an inherent lacuna affecting his/its jurisdiction, the same cannot be cured by having resort to section 292B". D.HUMBLE PRAYER BEFORE THE TRIBUNAL TO QUASH THE REASSESSMENT ORDER, DATED 13/12/2018 PASSED U/S.144 R.W.S 147:
In view of above discussions and documentary evidences including that of judicial precedents and the Affidavit, in the present case section 148 notice dated 21/03/2018 was not served upon the assessee and the notices are reflected in the E-Proceeding 20 | P a g e ITA No.918/Del/2024 Sh. Rakesh Portal, not transmitted by EMIAL can not be deemed as served upon the assessee, thus it is requested to quash the assessment order."
8. Regarding additional ground no. 2 - Mechanical Approval of the Ld. PCIT.
"B. Additional legal jurisdictional grounds of appeal No.2 raised before the Tribunal is relating to approval accorded by the Pr.CIT, Gurgaon in a mechanical manner with out application of mind.
In the present case a common approval u/s.151(1) was sanctioned by the Pr.CIT,Gurgaon for 82 different assessee's involving different issues. [PB.Pg.Nos. 10 to 17).
The approval u/s.151(1) accorded by the Pr.CIT, Gurgaon is just endorsement of the languages used in section 151 and that approval is fully silent regarding the records verified by the Pr.CIT, Gurgaon while granting such approval. [PB.Pg. Nos. 10 to 17].
B. 1. Delhi High Court, while following the Supreme Court decision in the case of Chhugamal Rajpal (1971) S.P. Chaliha [1971] 79 ITR 603 (SC) in the case of Ess Advertising (Mauritius) S. N. C. Et Compagnie v. Asstt. CIT (International Taxation) (2021) 437 ITR 1 (Del.HC), wherein, while granting the approval, the ACIT has written- "This is fit case for issue of notice under section 148 of the Income tax Act, 1961. Approved", had held that the said approval would only amount to endorsement of language used in Section 151 of the Act and would not reflect any independent application of mind. Thus, the same was considered to be flawed in law. [PB.Pg.
No.30].
B.2. Further reliance is placed upon the decision of the Delhi High Court in the case of " Vinod Kumar Solanki Vs.ACIT [2024] 166 taxmann.com 71 (Del.HC)", where it was held as under:
Where approval granted by Principal Commissioner for reopening assessment was a general order of approval for 111 cases and there was not even a whisper as to what material had weighed in grant of approval in present case, approval granted by Principal Commissioner for action under section 147/148 was not valid. [Head Note].
The operative paras of the said judgment reads as under
"17. It is evident that the approval dated 28.03.2021 is in respect of 111 cases of reassessment. It is a general order of approval for all the 111 cases. There is not even a whisper as to what material had weighed in the grant of approval in the present case. While the PCIT is not required to record elaborate reasons, he has to 21 | P a g e ITA No.918/Del/2024 Sh. Rakesh record satisfaction after application of mind. The approval is a safeguard and has to be meaningful and not merely ritualistic or formal. The sanction order does not refer to the material of any of the 111 cases. The grant of approval in such a manner does not fulfil the requirement of section 151 of the Act.
18. We note that dealing with an identical challenge of approval having been accorded mechanically and without due application of mind had arisen for our consideration in the case of The Pr. CIT v. Pioneer Town Planners (P.) Ltd. (2024) SCC OnLine Del 1685/[2024] 160 taxmann.com 652/465 ITR 356 (Del.HC), wherein, we had held as follows:-
"13. The primary grievance raised in the instant appeal relates to the manner of recording the approval granted by the prescribed authority under Section 151 of the Act for reopening of assessment proceedings as per Section 148 of the Act.
xxxxxxxx
17. Thus, the incidental question which emanates at this juncture is whether simply penning down "Yes" would suffice requisite satisfaction as per Section 151 of the Act. Reference can be drawn from the decision of this Court in N. C. Cables Ltd., wherein, the usage of the expression "approved" was considered to be merely ritualistic and formal rather than meaningful. The relevant paragraph of the said decision reads as under:-
11. Section 151 of the Act clearly stipulates that the Commissioner of Income-tax (Appeals), who is the competent authority to authorize the reassessment notice, has to apply his mind and form an opinion. The mere appending of the expression "approved" says nothing. It is not as if the Commissioner of Income-tax (Appeals) has to record elaborate reasons for agreeing with the noting put up. At the same time, satisfaction has to be recorded of the given case which can be reflected in the briefest possible manner. In the present case, the exercise appears to have been ritualistic and formal rather than meaningful, which is the rationale for the safeguard of an approval by a higher ranking officer. For these reasons, the court is satisfied that the findings by the Income-tax Appellate Tribunal cannot be disturbed."
18. Further, this Court in the case of Central India Electric Supply Co. Ltd. v. ΙΤΟ [2011 SCC Online Del 472] has taken a view that merely rubber stamping of "Yes" would suggest that the decision was taken in a mechanical manner. Paragraph 19 of the said decision is reproduced as under: -
"19. In respect of the first plea, if the judgments in Chhugamal Rajpal [1971] 79 ITR 603 (SC), Chanchal Kumar Chatterjee (1974) 93 ITR 130 (Cal.HC) and Govinda Choudhury and Sons case 22 | P a g e ITA No.918/Del/2024 Sh. Rakesh [1977] 109 ITR 370 (Orissa. HC) are examined, the absence of reasons by the Assessing Officer does not exist. This is so as along with the proforma, reasons set out by the Assessing Officer were, in fact, given. However, in the instant case, the manner in which the proforma was stamped amounting to approval by the Board leaves much to be desired. It is a case where literally a mere stamp is affixed. It is signed by an Under Secretary underneath a stamped Yes against the column which queried as to whether the approval of the Board had been taken. Rubber stamping of underlying material is hardly a process which can get the imprimatur of this court as it suggests that the decision has been taken in a mechanical manner. Even if the reasoning set out by the Income-tax Officer was to be agreed upon, the least which is expected is that an appropriate endorsement is made in this behalf setting out brief reasons. Reasons are the link between the material placed on record and the conclusion reached by an authority in respect of an issue, since they help in discerning the manner in which conclusion is reached by the concerned authority. Our opinion is fortified by the decision of the apex court in Union of India v. M. L. Capoor, AIR 1974 SC 87, 97 wherein it was observed as under:
..............
27. We find considerable force in the submission made on behalf of the respondents that the 'rubber stamp' reason given mechanically for the supersession of each officer does not amount to 'reasons for the proposed supersession'. The most that could be said for the stock reason is that it is a general description of the process adopted in arriving at a conclusion.
28.... If that had been done, facts on service records of officers considered by the Selection Committee would have been correlated to the conclusions reached. Reasons are the links between the materials on which certain conclusions are based and the actual conclusions. They disclose how the mind is applied to the subject-matter for a decision whether it is purely administrative or quasi-judicial. They should reveal a rational nexus between the facts considered and the conclusions reached. Only in this way can opinions or decisions recorded be shown to be manifestly just and reasonable. "(emphasis supplied)."
19. In the case of Chhugamal Rajpal, the Hon'ble Supreme Court refused to consider the affixing of signature along with the noting "Yes" as valid approval and had held as under:-
"5.- Further the report submitted by him under Section 151(2) does not mention any reason for coming to the conclusion that it is a fit case for the
23 | P a g e ITA No.918/Del/2024 Sh. Rakesh issue of a notice under Section 148. We are also of the opinion that the Commissioner has mechanically accorded permission. He did not himself record that he was satisfied that this was a fit case for the issue of a notice under Section 148. To Question 8 in the report which reads "whether the Commissioner is satisfied that it is a fit case for the issue of notice under Section 148", he just noted the word "yes" and affixed his signatures thereunder. We are of the opinion that if only he had read the report carefully, he could never have come to the conclusion on the material before him that this is a fit case to issue notice under Section 148. The important safeguards provided in Sections 147 and 151 were lightly treated by the Income Tax Officer as well as by the Commissioner. Both of them appear to have taken the duty imposed on them under those provisions as of little importance. They have substituted the form for the substance."
20. This Court, while following Chhugamal Rajpal in the case of Ess Adv. (Mauritius) S. N. C. Et Compagnie v. ACIT [2021 SCC OnLine Del 3613), wherein, while granting the approval, the ACIT "This is fit case for issue of notice under section 148 of-has written the Income tax Act, 1961.
Approved", had held that the said approval would only amount to endorsement of language used in Section 151 of the Act and would not reflect any independent application of mind. Thus, the same was considered to be flawed in law.
21. The salient aspect which emerges out of the foregoing discussion is that the satisfaction arrived at by the prescribed authority under Section 151 of the Act must be clearly discernible from the expression used at the time of affixing its signature while according approval for reassessment under Section 148 of the Act. The said approval cannot be granted in a mechanical manner as it acts as a linkage between the facts considered and conclusion reached. In the instant case, merely appending the phrase "Yes" does not appropriately align with the mandate of Section 151 of the Act as it fails to set out any degree of satisfaction, much less an unassailable satisfaction, for the said purpose
22. So far as the decision relied upon the Revenue in the case of Meenakshi Overseas Pvt. Ltd. is concerned, the same was a case where the satisfaction was specifically appended in the proforma in "Yes, I am satisfied".
Moreover, paragraph 16 of-terms of the phrase the said decision distinguishes the approval granted using the expression "Yes" by citing Central India Electric Supply, which has already been discussed above. The decision in the case of Experion Developers P. Ltd. would also not come to the rescue of the Revenue as the same does not deal with the 24 | P a g e ITA No.918/Del/2024 Sh. Rakesh expression used in the instant appeal at the time of granting of approval.
23. Therefore, it is seen that the PCIT has failed to satisfactorily record its concurrence. By no prudent stretch of imagination, the expression "Yes" could be considered to be a valid approval. In fact, the approval in the instant case is apparently akin to the rubber stamping of "Yes" in the case of Central India Electric Supply."
19. The decision in "Pioneer" case was followed by us in the case of Pr. CIT v. MDLR Hotels (P.) Ltd. (IT Appeal No. 593 of 2023], wherein, the Competent Authority had granted approval in terms of Section 153-D of the Act to as many as 246 proposed assessments by way of a single letter of approval and we had affirmed the finding of the ITAT that such approval has been granted mechanically without application of mind.
20. As noticed aforesaid, we are of the firm opinion that the PCIT has failed to satisfactorily record its concurrence and by no stretch of imagination, the approval granted by common order, could be considered to be a valid approval.
21. Hence for the reasons stated above, we are of the view that the approval granted by PCIT for action under Section 147/148 of the Act is not valid. Consequently, the impugned notice issued by respondent No. 1 under Section 148 of the Act for the AY 2015-16 and the proceedings emanating therefrom are set aside and quashed.
The writ petition along with pending applications stand disposed of accordingly [PB.Pg.Nos.60 to 66]. 22.
B.3.Delhi Tribunal in the case of "Sunita Bhadwaj Vs. ACIT. ITA Nos. 1432-1433- 1434-1435/Del/2024, Order dated 29/08/2025" quashed the assessment order on the ground that the approval u/s 151 granted by the Pr.CIT for 111 different and multiple assessee's in a single day without application of mind and in a mechanical manner. The observation of the Tribunal at the concluding Paras. 20 & 22 reads as under:
"20.It is seen that for these years, Ld. Pr.CIT has granted the approval for reopening the assessment which could be seen from the copy of order sheet entry and the approval memo available at Paper Book for AY 2012-13 at page 405 to 407 that common approval is given by Ld. Pr. CIT for as many as 111 cases where name of the assessee is appearing at Sl. No.62 for AY 2014-15, Sl. No.68 for AY 2013-14 and again at Sl.No. 79 for AY 2014-15. It is further seen that while granting approval in the order sheet, Ld. Pr. CIT observed that "on careful perusal of information received, relevant details/evidences submitted and reasons recorded by the AO, the cases from Sl.No.1 to 111 as listed in the Annexure enclosed appear prima-facie to be fit case for action u/s 147 r.w.s. 148 of the Income Tax Act, 1961". Further in all the 111 cases, the letter for approval were sent by the 25 | P a g e ITA No.918/Del/2024 Sh. Rakesh respective AOs to Ld. Pr. CIT on 27 & 28.03.2021 and on the very same day, the approvals were granted for all the cases for AY 2013-14 and AY 2014-15. ................
22. It is further seen from the copy of order sheet available at pages 405 to 407 of the paper book for AY 2012-13 as reproduced above, in the case of assessee, the approval for AY 2014-15 was granted twice at S.No. 62 & 79 and for AY 2013-14 at 5.No. 68 however, no approval was available for AY 2015-16 by Ld. Pr.CIT. This further established the fact that the approval in the case of the assessee was given in a mechanical manner and approval for multiple assesses was given by a single order thus, Ld. Pr. CIT has not applied his mind while granting the approval for re-opening of the assessment. In view of these facts and placing reliance on the judgement of Hon'ble Supreme Court in the case of CIT vs. S. Goyanka Lime & Chemical Ltd. (supra) and further Hon'ble Jurisdictional High Court as referred above in assessee's appeal for AY 2012-13 in ITA No 1434/Del/2024, we have no hesitation in holding that the approval granted by Ld. Pr. CIT is without application of mind and was granted in mechanical manner therefore, the reassessment proceedings initiated u/s 147 of the Act and the consequent re-assessment order passed u/s 147 r.w.s. 143(3) for all the three assessment years i.e. for AY 2013-14, AY 2014-15 and AY 2015-16 are hereby, quashed. The grounds of appeals Nos. 1 & 2 for all these three years are thus allowed" [PB.Pg.Nos.67 to 91).
B.4.Reliance is placed upon the decision of the Hon'ble Jaipur Tribunal in the case of "Shri Satya Narayan Bairwa Vs. ITO, ITA No:867 & 869/JP/2018,dated 15/09/2021 [Jaipur. Trib]", where it was held as under:
"20. The Id. A/R has also drawn our attention on the approval of the Pr.CIT placed at page Nos. 7-8 of the paper book and also from the assessment record placed before us, we found that he has given one consolidated approval of 56 different assessee's in one shot through one letter dated 29.03.2016 which is even not signed by him but signed by ITO (T&J), who is not a competent authority to give and signed the approval letter, which shows how the PR. CIT has acted in very formal way. When we examined of the assessment record, it is gathered that the approval was in photocopy and not in original or there was no original letter or documents of approval. Further the name of the assessee was at Sr. 46 out of 56 assessee's and even there was no tick on the name of the assessee in the approval list, which creates a doubt that the approval has been received before the issue of notice u/s 148 of the Act as the approval letter lying on the file after issuance of the notice u/s 148 or not before or attached with the notice u/s 148 and may reach in the office of the AO after 31.03.2016. Thus, in our view, approval u/s 151 can not be given of all the 56 assessee's in a single documents, as all assessee's are the independent and separate also the reason recorded are different in each case and it is not possible that there shall be same reasons. Looking to these facts and record it is also held that the procedures and way of approval and satisfaction is not proper. Here AO initiated proceedings u/s. 147 r.w.s.
26 | P a g e ITA No.918/Del/2024 Sh. Rakesh 148 on basis of information furnished and CIT gave approval without applying his mind in slipshod manner. As approval/sanction given by CIT was without recording his own independent satisfaction as noted above, therefore the reopening was not sustainable as per above judicial pronouncements and irregularities noted. There were clear irregularities and violation of the provision of Sec. 151 of the Act and very foundation of the issuance of the notice u/s 148 was not as per law. Then in that eventuality, we are of the view that the issuance notice 148 of the Act and all the consequent proceedings and assessment order passed was not in accordance with law. The case laws relied upon by the Id. DR are not tenable in the facts and circumstances of present case, therefore, considering the totality of facts and circumstances of the case as well as the judicial pronouncements qua the issue under consideration, we find merit in the contention of the ld AR, therefore, we quash the proceedings u/s 147 of the Act.
21.Once, we quash the proceeding u/s. 147 of the Act, therefore, there is no need to adjudicate the other grounds raised in this appeal". [PB.Pg.Nos.31 to 38].
B.5.HUMBLE PRAYER BEFORE THE TRIBUNAL TO QUASH THE REASSESSMENT ORDER, DATED 13/12/2018 PASSED U/S.144 R.W.S 147:
In view of above discussions and documentary evidences including that of judicial precedents, in the present case common approval was given for eighty two different assessee's for different subject of reassessment in one shot in a day, thus the approval given by the Pr.CIT, Gurgaon u/s.151 is purely mechanical and without application of mind, accordingly the reassessment proceeding initiated by issuing section 148 notice,dated 21/03/2018 is not sustainable in the eye's of law. It is requested that the reassessment order dated 13/12/2018 passed u/s.144 r.w.s 147 may kindly be quashed."
9. Prior to the report dated 24.11.2025 filed by the AO, the AO had filed a report vide email dated 21.11.2025 submitting that the case history of the assessment proceedings have been perused and stated that as the assessee had been a non -filer till 2018 and that there was no digital footprint and therefore, the relevant notices could not be emailed but were duly sent to the assessee's e- filing portal and attached the screenshot, which is reproduced as below:
27 | P a g e ITA No.918/Del/2024 Sh. Rakesh 28 | P a g e ITA No.918/Del/2024 Sh. Rakesh
10. During the course of hearing, the Ld. AR supported the grounds of appeal and more particularly the additional grounds of appeal. The Ld. AR in view of the submissions made in the additional grounds of appeal as reproduced earlier in this order in para no. 5.1 and 7 of this order, requested for the admission of the additional grounds of appeal on the ground that the same was purely legal in 29 | P a g e ITA No.918/Del/2024 Sh. Rakesh nature and all the facts required to decide the additional grounds of appeal were available on record.
10.1. Further, relying upon the submissions made in the additional grounds of appeal as reproduced earlier in this order in para no. 7 of this order, the Ld. AR submitted that the assessment order framed in this case vide the impugned notice under section 148 of the Act dated 21.03.2018 was bad in law due to the fact that the said notice was never served upon the assessee and it came back unserved in the office of the AO on 27.03.2018 (necessary photocopy of the said notice and its return are placed at page no 18-19 of the paper book) and in absence of the service of the said notice the assessment framed was bad in law. In support of this contention, the assessee relied upon various case laws as detailed in its two rejoinders as reproduced in para 7 of this order. It was further submitted that the said notice was only served on e-filing portal of the assessee and relied upon the decision of Hon'ble Punjab & Haryana High Court in the case of "Munjal BCU Centre of Innovation and Entrepreneurship Vs. CIT('E), CWP NO:21028 of 2023, dated 04/03/2024, reported in [2024] 160 taxmann.com 629 (P&H.HC) and submitted that the Hon'ble High Court quashed the order dated 16.01.2023 of the Ld. CIT(E) Chandigarh. Further, the Ld. AR relying upon the decision of Chandigarh Tribunal in the case of "
Chhering Tomdan Vs. The ITO, ITA No:170/Chd/2024, order dated 04/09/2024 (Chd. Trib)", which following the order of the P&H High Court in the case of 30 | P a g e ITA No.918/Del/2024 Sh. Rakesh "Munjal BCU Centre of Innovation and Entrepreneurship Vs. CIT(E) (supra), quashed the impugned assessment order (referred in detail in the rejoinder) and submitted that the impugned assessment order may be quashed. The Ld. AR also referred to decision of the Delhi High Court in the case of "Suman Jeet Agrawal & Ors. Vs. Income Tax Officer & Ors. passed in W.P.(C) No. 10/2022 and other connected matter, dated 27/10/2022 reported in [2022] 143 taxmann.com 11 (Del. HC) in support of its claim.
10.2 The Ld. AR also relied upon the decision of the Hon'ble Punjab & Haryana High Court in the case of 'CIT Vs. Norton Motors [2005] 275 ITR 595 (P&H.HC) which held that section 292B was not applicable in the case of jurisdictional defects.
10.3 The Ld. AR also submitted that the approval accorded by the Pr. CIT, Gurgaon in a mechanical manner without application of mind and in the present case a common approval u/s.151(1) was sanctioned by the Pr. CIT, Gurgaon for 82 different assessee's involving different issues. [PB. Pg. Nos. 10 to 17). It was further submitted by the Ld. AR that the approval u/s.151(1) accorded by the Pr.
CIT, Gurgaon was just endorsement of the languages used in section 151 and that approval is fully silent regarding the records verified by the Pr. CIT, Gurgaon while granting such approval. [PB. Pg. Nos. 10 to 17].
31 | P a g e ITA No.918/Del/2024 Sh. Rakesh 10.4. In the additional ground no. 3 of the appeal the assessee submitted that the addition of Rs. 78,25,000/- made u/s 68 of the Act was wrong on the ground that the assessee did not maintain any books of accounts in the bank statement reflecting the cash deposits of Rs. 78,25,000/- cannot be held as books of accounts maintained by the assessee and thus the ingredients of section 68 of the Act were not satisfied and therefore, the said addition should be deleted.
11. On the other hand, the Ld. Sr DR supported the order of the authorities below and the report of the AO vide email dated 21.11.25 and vide letter dated 24.11.2025. The Ld. Sr DR also referred to the facts stated by the AO in its report the case history of the assessment proceedings wherein the AO had filed a report vide email dated 21.11.2025 submitting that the case history of the assessment proceedings have been perused and stated that as the assessee had been a non -filer till 2018 and that there was no digital footprint and therefore, the relevant notices could not be emailed but were duly sent to the assessee's e-
filing portal and attached the screenshot. The Ld. AR further submitted that the impugned notice u/s 148 of the Act dated 21.03.2018 was served on the e-filing portal of the assessee and submitted that in view of the decision of the jurisdictional High Court in the case of Munjal BCU Centre of Innovation and Entrepreneurship Vs. CIT('E), the assessment order be set aside to the file of the AO for de-novo assessment.
32 | P a g e ITA No.918/Del/2024 Sh. Rakesh
12. We have heard both the parties and perused the material available on record. We find that all the facts relevant for adjudication of the aforesaid additional ground are already on record. The above additional grounds raised by the assessee are purely legal in nature. Hence, in view of the decision of the Hon'ble Supreme Court in the case of NTPC Limited vs CIT 229 ITR 383(SC), the additional grounds raised by the assessee are hereby admitted and taken up for adjudication.
13. The assessee submits that the notice u/s 148 of the Act, dated 21.03.2018, as evident from the tabular chart submitted by the assessee as reproduced earlier on page no. 9 of this order, submits that in the impugned notice dated 21.03.2018, the AO has mentioned the wrong Pin Code 122505 instead of correct Pin Code of 122050 and, therefore, the impugned notice dated 21.03.2018 u/s 148 of the Act was not served upon the assessee and it came back unserved in the office of the AO. However, upon verification of the photocopy of the notice u/s 148 of the Act dated 21.03.2018 placed by the assessee on page no. 18of the paper book, it is found that in the impugned notice u/s 148 of the Act, dated 21.03.2018, the correct Pin Code of the assessee i.e. 122050 is mentioned. The assessee has also placed the photocopy of the envelope but the address details of the same are not very legible. The document placed at page no. 18 and 19 are reproduced as under:
33 | P a g e ITA No.918/Del/2024 Sh. Rakesh 13.1 The Ld. AR apparently referred to para no. 1 of the assessment order wherein the AO states that "Therefore, recourse to action under section 147 of 34 | P a g e ITA No.918/Del/2024 Sh. Rakesh the Income Tax Act was taken and notice u/s 148 of the Act was issued on 21.03.2018 to the assessee on the available address of the assessee with the department i.e. House No.36. Village Hayatpur, Gurgaon 12001 after duly recording reasons and with the prior approval of the Pr. Commissioner of Income Tax Gurugram." Referring to the address as Hayatpur as mentioned in the assessment order, the assessee placed on record the Pin Code of Hayatpur as
-122505 (placed at page no. 3 of the paper book) and makes his claim that the address on the envelope was wrongly mentioned as 122505 instead of the correct Pin Code 122050 and, therefore, it came back unserved in the Office of the AO and not served upon the assessee.
13.2 However, upon perusal of the documents at page no. 18-19 of the paper book showing that the said impugned notice u/s 148 of the Act came back returned to the office of the AO on 27.03.2018, the claim of the assessee that the impugned notice u/s 148 of the Act dated 21.03.2018 was not served upon the assessee is accepted but the reasons that it was not served due to wrong Pin Code does not emerge out from the documents files by the assessee as discussed above. However, for this reason, the assessment in this case cannot be quashed in view of the facts being discussed subsequently in this order.
14. As, regards the service of notice under section 148 of the Act, dated 21.03.2018 and all other notices reflected in the e-proceedings portal the reliance placed by the assessee on the decision of the P&H High Court in the case of 35 | P a g e ITA No.918/Del/2024 Sh. Rakesh "Munjal BCU Centre of Innovation and Entrepreneurship Vs. CIT(E) (supra), has been considered but only partly accepted. In this case, it is seen that in this order, the Hon'ble P & H High Court quashed the order dated 16.01.2023 of the Ld. CIT(E) Chandigarh and set aside the same for the reason that the show cause notice of the Ld. CIT(E), Chandigarh was reflected only on the e-filing portal of the assessee. However, at the same time the Hon'ble Court directed the Department to provide an opportunity of hearing to the petitioner and the department will also allow the petitioner to appear personally for the purpose and the Ld. CIT(E) will pass a speaking order independent of the order passed earlier by him on 16.01.2023. Therefore, even though the Hon'ble Court quashed the order dated 16.01.2023 of the Ld. CIT(E) Chandigarh due to the fact that the show cause notice of the CIT(E), Chandigarh was appearing only on the e-filing portal of the assessee, but at the same time, directed the Department to provide an opportunity of hearing to the petitioner and the Revenue will also allow the petitioner to appear personally for the purpose and the Ld. CIT(E), Chandigarh will pass a speaking order independent of the order passed earlier by him on 16.01.2023. Therefore, we are of the considered view that the non-
viewing of the impugned u/s 148 of the Act notice dated 21.03.2018 by the assessee even though will make the impugned assessment order dated 13.12.2018 not legally valid but at the same time an opportunity will be given to 36 | P a g e ITA No.918/Del/2024 Sh. Rakesh the AO to pass the assessment afresh after giving reasonable opportunity of being heard to the assessee and in accordance with law. 14.1 Similarly, the order dated 04.09.2024 of the Tribunal, Chandigarh in the case of " Chhering Tomdan Vs. The ITO, ITA No:170/Chd/2024, (supra) following the order of the P&H High Court in the case of "Munjal BCU Centre of Innovation and Entrepreneurship Vs. CIT('E) (supra) quashing the impugned assessment proceedings on the ground that the notices were served only on the e-filing portal of the assessee, which were not seen by the assessee and no notices were issued on the email of the assessee or through speed post has been carefully perused but not found applicable to the appeal of the assessee due to distinguishable facts as discussed below.
14.2 In the aforesaid case, the assessee submitted before the Tribunal that the assessee had not seen the impugned notice because it was uploaded only on the ITBA portal, and the notices were neither sent on email or through speed post. 14.3 However, in the present case, the assessee has not contested the finding of the AO in its email dated 21.11.2025 submitting that the case history of the assessment proceedings have been perused and who stated that as the assessee had been a non -filer till 2018 and that there was no digital footprint and therefore, the relevant notices could not be emailed but were duly sent to the assessee's e-filing portal. Therefore, the case law relied upon by the assessee of the Tribunal Chandigarh Bench in the case of "Chhering Tomdan Vs. The ITO"
37 | P a g e ITA No.918/Del/2024 Sh. Rakesh (supra) is distinguishable as in the present case the assessee had not uploaded its e-mail id on the ITBA of the department and therefore, no notice could be served upon the assessee on his email as was the case in Chhering Tomdan Vs. The ITO, ITA No:170/Chd/2024, (supra). Further, we also note that the impugned notice u/s 148 of the act dated 21.03.2018 as claimed by the assessee that it could not be served upon the assessee and came back unserved due to typographical error in the Pin Code noted as wrongly 122505 instead of the correct Pin Code being 122050 does not also emerge from the documents placed on record by the assessee as discussed earlier in this order.
14.4 Further in the given facts of the case, we are of the considered view that the non-service of the impugned notice u/s 148 of the Act dated 21.03.2018, on the email id of the assessee will be protected by the provision of section 292 B of the Act, as the assessee has not challenged the ITO, Ward 3(4) , Gurugram, who had issued the impugned notice u/s 148 of the Act dated 21.03.2018 had no jurisdiction to issue the said notice and thus said notice does not suffer from an inherent lacuna affecting the jurisdiction of the AO / ITO, ward 3(4) Gurugram to issue the said impugned notice. Moreover, the assessee has not challenged the finding of the AO that the assessee did not have his email id registered on the ITBA portal of the Department and therefore, the impugned notice u/s 148 of the Act could not have been served upon the email id of the assessee.
38 | P a g e ITA No.918/Del/2024 Sh. Rakesh 14.5 Further, in this case, the submission of the assessee relying upon the decision of the Hon'ble Supreme Court in the case of R.K. Upadhyay (supra) and supported with an affidavit of the assessee dated 29.08.2024 (placed at page no. 54 to 55 of the Paper Book, even though it is observed that the date of signing of the said affidavit by the deponent is kept 'blank' ) that the impugned notice u/s 148 of the Act and any of the notices including letters issued by the ITO, Ward 3(4), Gurugram were not served upon him and therefore, the re- assessment proceedings initiated by the impugned notice may kindly be held as not sustainable in the eyes of the law may be acceptable to the extent of the service of the impugned notices / letters through the postal department but in the present case, the notice u/s 148 of the Act dated 21.03.2018 was served upon the assessee on his e-filing portal and hence, the decision of Hon'ble P & H High Court in the case of Munjal BCU Centre of Innovation and Entrepreneurship Vs. CIT(E) (supra), will be applicable to deal with the situation arising in the present case where the Hon'ble Court, even though the Hon'ble Court quashed the order dated 16.01.2023 of the Ld. CIT(E) Chandigarh due to the fact that the show cause notice of the CIT(E), Chandigarh was appearing only on the e-filing portal of the assessee, but at the same time, directed the Department to provide an opportunity of hearing to the petitioner and the Revenue will also allow the petitioner to appear personally for the purpose and the Ld. CIT(E), Chandigarh 39 | P a g e ITA No.918/Del/2024 Sh. Rakesh will pass a speaking order independent of the order passed earlier by them on 16.01.2023.
14.6 For the aforesaid reasons, the reliance by the assessee on various other decisions in support of his contention that the non-service of the impugned notice u/s 148 of the Act was not served upon by the assessee by post and, therefore, the proceedings were invalid in the case of the assessee, will not be applicable as in the present case as the impugned notice was served upon the e- filing portal of the assessee.
14.7 Similarly, in the given facts of the case, the decision of the Hon'ble Delhi High Court in the case of Sumanjeet Agarwal will not be applicable as the facts of the present case are more akin to the facts of the case of the jurisdictional Punjab & Haryana High Court in the case of "Munjal BCU Centre of Innovation and Entrepreneurship Vs. CIT('E).
14.8 Therefore, the additional ground no. 1 of the assessee is disposed with the above observations and as per the decision in para no. 18 of this order.
15. Similarly, on the issue of mechanical approval by the Ld. PCIT in the present case, it is seen that the Ld. PCIT had granted an approval by making the following noting:
Whether the Pr. Commissioner of Income Tax is satisfied on the reasons recorded by the ITO that it is a fit case for the issue of notice u/s 148jof the Income Tax Act, 1961.
On consideration of the reasons recorded by the Assessing Officer, I am satisfied that it is a fit case for the issue of notice u/s 148 of the Income Tax Act, 1961 for the A.Y. 2011-12.
40 | P a g e ITA No.918/Del/2024 Sh. Rakesh 15.1 In this case, the AO had information that the assessee had made cash deposits amounting to Rs 78,25,000/- in his savings bank account with ICICI bank during financial year 2010-11 relevant to AY 2011-12 and further, the assesseehad not filed his return of income. This fact has not been disputed by the assessee, whereas in the case of Vinod Kumar Solanki vs. ACIT (supra) as noted by the Hon'ble Court, the assessee had disputed about the facts noted by the AO for re-opening of the assessment which according to the assessee was based on wrong facts. The relevant facts noted by the Hon'ble Court in the said order are reproduced as under:
"2. The necessary facts are being set out hereinafter. Petitioner filed the original return of income for the Assessment Year ["AY"] 2015-16, declaring an income of Rs. 23,14,930/- Revised return was filed on 28.01.2017, declaring an income of Rs. 26,64,930/-. The return was processed under Section 143(1) of the Income Tax Act, 1961 ["Act"].
3. Respondent No. I issued a notice dated 30.03.2021 under Section 148 of the Act for the AY 2015-16.
4. To comply with the impugned notice, petitioner filed his return of income on 03.12.2021, declaring income amounting to Rs. 26,64,930/-.
5. On 12.01.2022, notice under Section 143(2) of the Act was issued by respondent No. 3 on the basis of information received by respondent No. I from Insight portal. Petitioner was identified as one of the parties/entities who made financial transactions with BKR Capitals Pvt. Ltd. He had made a transaction of Rs. 31,07,963/- with BKR Capitals Pvt. Ltd to bring his unaccounted money/cash into his books of accounts to avoid tax during the relevant AY 2015-16.
6. Vide letter dated 09.02.2022, petitioner filed detailed objections to the reasons recorded, specifically objecting to the re-opening without there being valid reasons to believe. According to him, the reasons recorded for issuing the impugned notices were based on incorrect facts. He pointed out that respondent No. 1 has overlooked the fact that petitioner had obtained a loan of Rs. 45 lakhs from BKR Capitals Pvt. Ltd in the AY 2014-15 for which interest amounting to Rs. 1 19.959/-was also paid during the AY 2014-15 and the assessment for the said AY 2014-15 was completed under Section 143(3) after scrutiny. He also 41 | P a g e ITA No.918/Del/2024 Sh. Rakesh submitted that the said loan to the tune of Rs. 31.07.963/- was repaid in the year under consideration along with interest on which TDS was deducted and therefore the reasons given were completely illegal, bad in law and baseless."
15.2 Therefore, the facts are distinguishable in this case, and we are of the considered view that in the present case the re-opening was justified by the AO. Further, the assessee has not challenged the re-opening on the merits of the reasons recorded. Recently, the Hon'ble Delhi High Court order dated 06.10.2025 in the case of PCIT vs. M/s Agroha Fincap Ltd. in ITA No. 60/2024 after discussing about the facts stated in the reasons recorded had upheld similar approval given by the Ld. PCIT wherein the Ld. PCIT had given his approval vide his noting "Yes I am convinced it is a fit case for re-opening of the assessment u/s 147 by issuing notice u/s 148" .
15.3 Further, the reliance by the assessee on the decisions of the Co-ordinate Bench and Jaipur Bench and other case laws as per the details in the rejoinders as reproduced in para no. 7 of this order, wherein the approval was quashed on the ground that the approval by the PCIT was given in multiple cases and the approval letter was signed by ITO (T&J), who is not a competent authority to sign which shows how the PR. CIT has acted in very casual way. However, the said case laws are distinguishable in the present facts of the case as the assessee has not challenged the re-opening on the merits of the reasons recorded. The approval granted by the Ld. PCIT in this case is reproduced as under:
42 | P a g e ITA No.918/Del/2024 Sh. Rakesh 15.4 On similar facts, when the merits of the reasons for reopening of the assessment have not been challenged by the assessee, the Hon'ble Delhi High Court in the case of PCIT vs. M/s Agroha Fincap Ltd. (supra) has held similar approval by the Ld. PCIT as a valid approval as discussed above.
15.5 Therefore, in view of the above facts, the additional ground no. 2 of the appeal is not acceptable and the same is dismissed.
43 | P a g e ITA No.918/Del/2024 Sh. Rakesh
16. As regards, the additional ground no. 3 of the appeal that the addition of Rs. 78,25,000/- made u/s 68 of the Act was wrong on the ground that the assessee did not maintain any books of accounts in the bank statement reflecting the cash deposits of Rs. 78,25,000/- cannot be held as books of accounts maintained by the assessee and thus the ingredients of section 68 of the Act was not satisfied.
16.1 The above submission of the assessee has been carefully considered but not found acceptable in view of the decision of Hon'ble Punjab and Haryana High Court in the case of Namdev Arora vs. CIT, Jalandhar (2016) 72 taxmann.com124. The head note of the said order is reproduced as under:
"Income-Tax Act, 1961 - Ss.68, 69A, 133, 142, 143 & 292-B - Unexplained money - Loans - Assessment year 2008-09 - In respect of Rs.30 lakh deposited in bank account, assessee failed to furnish confirmation of lender Dhruv Parti or to produce him for examination - Assessing Officer made addition while mentioning section 69A as relevant Section - Commissioner (Appeals) affirmed said addition -Tribunal also affirmed addition under Section 68 - Assessee challenged factual findings - He also raised legal issue that Tribunal was wrong in holding that Assessing Officer/Commissioner (Appeals) meant addition under section 68, when specifically addition was made by them under section 69A and furthermore, Tribunal erred in holding that such situation is covered under section 292-B - Held, that there was no document evidencing said loan though there was no special relationship between parties - Said loan was not repaid - Assessee had not tried to trace lender nor lender contacted assessee - Non has lender demanded interest - Thus, assessee had failed to establish that he received impugned amount as a loan - Addition was well founded - Further held, that Assessing Officer after considering facts and circumstances of case and assessee's response, made a justified addition but inadvertently or wrongly mentioned wrong provision - Simply for this reason assessment order could not be set aside - Appellate Authority could uphold addition under appropriate section since error had not prejudiced assessee in any manner 44 | P a g e ITA No.918/Del/2024 Sh. Rakesh 16.2 Similar view has been taken in the case of Shri Manoj Aggarwal, Bemco Jewellers vs DCIT [2008] 113 ITD 377 (Delhi) (SB), and the relevant extract of the said order is reproduced as under:
26. The argument advanced on behalf of the assessee before us was that the assessee was nut maintaining any books of account and the deposits were found only in the assessee's bank statement which cannot be considered as the books of account of the assessee and, therefore, Section 68 was not applicable. Our attention was drawn to the confirmation letters placed at pages 159 and 160 of the paperbook. We are however unable to accept the argument. Though Section 68 of the Act may not be strictly applicable since the assessee was not maintaining any books of accounts and the bank statement cannot be considered as the assessee's books of account on the basis of the judgment of the Supreme Court in the case of A. Govindrajulu Mudaliar 34 ITR 807, it is the onus of the assessee to explain the cash received by him and if there is no explanation or acceptable evidence to prove the nature and source of the receipt, the amount may be added as the assessee's income on general principles and it is not necessary to invoke Section 68, nor is it necessary for the income-tax authorities to point out the source of the monies received. Even if Section 68 is not applicable, the cash deposit in the bank can be asked to be explained by the assessee under Section 69 or Section 69B of the Act. No doubt the assessee had tried to file additional evidence before the CIT (Appeals) in the form of confirmation letters and income-tax returns but these were not admitted by the CIT (Appeals) and no reasons have been shown before us as to why they should have been admitted.
In the absence of any clinching evidence to show the nature and source of the monies deposited into the bank account which belongs to the assessee, the Assessing Officer was justified in adding the amount of Rs. 15 lacs as the assessee's unexplained income. We confirm the addition and dismiss the ground. 16.3 Therefore, in view of the above facts and the legal position, the additional ground no. 3 of the appeal is dismissed.
17. Further, we note that the assessee had filed his return of income for A.Y. 2011-12 in response to the impugned notice u/s 148 of the Act dated 21.03.2018 on 05.02.2019 (page no. 4 of the paper book) is which declaring total income of Rs. 1,58,518/-. Further, in the grounds of appeal in Form No.- 35 before the Ld. CIT(A), the assessee had submitted as under:
45 | P a g e ITA No.918/Del/2024 Sh. Rakesh " The ld. AO is not justified in treating cash deposit Rs. 7825000/- as unexplained cash credit u/s 68 merely on the basis of surmises and conjectures without application of mind. These transactions represents received from various parties on account of sales conducted by the assessee, ......"
17.1. The above claims of the assessee could not be verified by the AO as the assessment was passed u/s 144 r.w.s. 147 of the Act and no submissions of were made before the AO by the assessee. Similarly, the order of the Ld. CIT(A) was also passed ex-parte by the Ld. CIT(A) as no submissions were made by the assessee before the Ld. CIT(A) and the adjournment petition as claimed to have been filed by the assessee before the Ld. CIT(A) was not granted and the notices were not issued at the email id [email protected] even though in form no.
35 in the appeal filed before the Ld. CIIT(A) , the email id is mentioned as RAVINDER ARYAN @ YAHOO.COM.
18. We, therefore, in the given facts of the case as discussed above and keeping in view the decision of the Hon'ble Punjab & Haryana High Court in the case of "Munjal BCU Centre of Innovation and Entrepreneurship Vs. CIT('E), CWP 160 taxmann.com 629 (P&H.HC), set aside the order of the Ld. CIT(A) and of the AO and restore the matter to the file of the AO for de novo assessment after giving reasonable opportunity of being heard to the assessee.
19. The AO is directed to send the notices / letters to the assessee at email-id msahu.fca@ gamil.com.
46 | P a g e ITA No.918/Del/2024 Sh. Rakesh
20. The assessee will be at liberty to submit any documents/ evidence/ details in support of his claim before the AO.
21. In the result, the appeal of the assessee is partly allowed for statistical purposes.
Order pronounced in the open court on 24th February, 2026 Sd/- Sd/-
(PAWAN SINGH) (BRAJESH KUMAR SINGH )
JUDICIAL MEMBER ACCOUNTANT MEMBER
Dated: 24th February, 2026.
Santosh/-
Copy forwarded to:
1. Appellant
2. Respondent
3. CIT
4. CIT(A)
5. DR
Asst. Registrar, ITAT, New Delhi
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