Income Tax Appellate Tribunal - Kolkata
M/S. Bls Infotech Limited,Kolkata vs Ito, Ward 7(1),, Kolkata on 30 July, 2025
IN THE INCOME TAX APPELLATE TRIBUNAL " A" BENCH, KOLKATA
BEFORE SHRI RAJESH KUMAR, AM
AND
SHRI PRADIP KUMAR CHOUBEY, JM
ITA No.264/KOL/2025
( Assessment Year:2016-17)
Income Tax Officer -Ward 7(1)
M/s BLS Infotech Limited
Aaykar Bhavan, P -7,
1/1A, Upper Wood Street,
Kolkata-700107, West Bengal Vs. Chowringhee Square, Kolkata -
700069, West Bengal
(Appellant) (Respondent)
PAN No. AACCA7999P
Assessee by : Shri Sunil Surana, FCA
Revenue by : Shri Raj a Sengupta, DR
Date of hearing: 19.05.2025
Date of pronouncement : 30.07.2025
ORDER
Per Rajesh Kumar, AM:
This is an appeal preferred by the assessee against the order of the National Faceless Appeal Centre, Delhi (hereinafter referred to as the "Ld. CIT(A)"] dated 16.12.2024 for the AY 2016-17.
02. The issue raised in ground no.1 is against the invalid reopening of assessment by the ld. AO as the same is based upon the sanction granted by an authority which is not competent authority u/s 151 of the Act.
03. The facts in brief are that the assessee filed the return of income u/s 139(1) of the Act on 15.10.2016, declaring total loss of ₹22,58,000/-. Therefore, the case of the assessee was reopened u/s 147 of the Act by issuing notice u/s 148 of the Act on 01.07.2022, which was not complied with by the assessee and thereafter the notice u/s 142(1) of Page | 2 ITA No.264/KOL/2025 M/s BLS Infotech Limited; A.Y. 2016-17 the Act along with the questionnaire was issued. However, there was no compliance from the assessee. Finally, the income of the assessee was assessed by making an addition of ₹40,61,74,114/- u/s 68 of the Act. The appeal of the assessee was also dismissed by the ld. CIT (A) on the ground of non-compliance by the assessee during the appellate proceedings despite numerous opportunities given to the assessee.
04. At the outset, the ld. Counsel for the assessee stated that the reopening of assessment is bad in law as the same is based upon invalid approval granted u/s 151 of the Act. The ld. AR argued that the case of the assessee was initially reopened on 12.04.2021, under the old regime. The ld. AR submitted that after the decision of the Hon'ble Apex Court in the case of Union of India Vs Ashish Agarwal in Civil Appeal No. 3005/2022 , notice u/s 148A(b) of the Act was issued on 19.05.2022 and finally, the assessment was reopened on 01.07.2022, by issuing notice u/s 148 of the Act, a copy of which is available at page no. 11 to 13 of the Paper Book, which is beyond the three years from the relevant assessment year. The ld. AR submitted that in case of reopening beyond three years from the end of relevant assessment year, the sanction has to be obtained from PCCIT, whereas sanctioned was actually obtained from PCIT-1, Kolkata and therefore, the entire assessment proceedings including the assessment is liable to be quashed. The ld. AR submitted that the issue is no more res integra as the Hon'ble Court in the case of Union of India and other Vs. Rajeev Bansal [2024] 469 ITR 46 (SC), dated 03.10.2024 has clearly concluded vide Para no.114(d) that it is the Pr. CCIT who should grant sanction u/s 151 of the Act since the reopening is after three years from the end of the relevant assessment year. The ld. AR submitted that the said decision of the Hon'ble Apex Court has been followed in series of decision namely; (i) Shri Devang Ajit Jhaveri by ITAT Page | 3 ITA No.264/KOL/2025 M/s BLS Infotech Limited; A.Y. 2016-17 Mumbai Bench in ITA No. 3509/MUM/2024 vide order dated 29.01.2025 (ii) Sakshi Ratneshchand Jain by ITAT Mumbai Bench in ITA No. 1741/Mum/2024 vide order dated 10.02.2025, (iii) Hon'ble Delhi High Courtin case of Kusum Healthcare P. Ltd. Vs. Dy. CIT, in WP(C) No. 383/2023 vide order dated 05.03.2025. The ld. AR therefore prayed that the assessment may kindly be quashed as on the ground being based upon the reassessment proceedings which were invalidly initiated.
05. The ld. DR on the other hand relied on the order of the lower authorities by submitting that the approval was rightly obtained from the PCIT-1, Kolkata and therefore appeal of the assessee may kindly be dismissed.
06. After hearing the rival contentions and perusing the materials available on record, we find that the case of the assessee was reopened under old regime by initially issuing notice u/s 148 of the Act on 12.04.2021. Thereafter, in view of the Hon'ble Apex Court decision in the case of Union of India Vs Ashish Agarwal in Civil Appeal No. 3005/2022, the notice was finally issued on 01.07.2022, u/s 148 of the Act, a copy of which is available in page no.11 to 13 of the Paper Book. We find that the reopening has been made after a period of three years from the end of relevant assessment year. We also note that for initiating reassessment proceedings u/s 147 read with section 148 of the Act, the AO has obtained the approval of ld. PCIT-1, Kolkata, whereas as per Section 151 of the Act, the approval of PCCIT is required to be obtained. Therefore, the reopening of assessment is invalid and cannot be sustained. The case of the assessee find force from the decision of Hon'ble Apex court in the case of Union of Inida & Ors Vs Rajeev Bansal (2024) 167 taxmann.com 70(SC). Besides we note that the above decision of the Hon'ble Apex court has been Page | 4 ITA No.264/KOL/2025 M/s BLS Infotech Limited; A.Y. 2016-17 followed by Hon'ble Delhi High Court in the case of Kusum Healthcare P. Ltd. (supra), decisions of the coordinate Benches in Chandrakant Viththal Bhopi in ITA No. 2405/PUN/2024 vide order dated 07.05.2025, Sakshi Ratneshchand Jain (supra).Even though the assessee was not compliant before either of the authorities below, however since the legal issue raised before us is open and shut and do not require any verification of facts, therefore we are not restoring the same to the file of either of the authorities below.
07. Considering the facts of the case in the light of the above decisions, we are inclined to hold that the reassessment proceedings were initiated on the basis of invalid approval and accordingly quashed.
08. In the result, the appeal of the assessee is allowed.
Order pronounced in the open court on 30.07.2025.
Sd/- Sd/-
(PRADIP KUMAR CHOUBEY ) (RAJESH KUMAR)
(JUDICIAL MEMBER) ( ACCOUNTANT MEMBER )
Kolkata, Dated: 30.07.2025
Sudip Sarkar, Sr.PS
Copy of the Order forwarded to :
1. The Appellant
2. The Respondent
3. CIT
4. DR, ITAT,
5. Guard file.
BY ORDER,
True Copy//
Sr. Private Secretary/ Asst. Registrar
Income Tax Appellate Tribunal, Kolkata