AASHITA GARG, NABHA,PATIALA V. JAO THE INCOME TAX OFFICER WARD NABHA, PATIALA

ITA 539/CHANDI/2025

AI Insights

The case revolves around an appeal by Ashita Garg against the reassessment order for the Assessment Year 2019-20, issued by the ITO Ward, Nabha. The primary contention was the improper issuance of a notice under section 148 of the Income Tax Act by the Jurisdictional Assessing Officer instead of the Faceless Assessment Unit, as mandated by the recent amendments and notifications aimed at faceless assessments. The Tribunal admitted an additional ground of appeal concerning the legality of the reassessment proceedings and, after considering precedents and the specific legal framework, ruled in favor of the assessee, quashing the reassessment order.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 716730 (ITAT-CHANDIGARH)
• Duration Of Justice: 4 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-08-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: Not Allotted
• Assessment Year: 2019-2020
• Appeal Filed On: 14-04-2025
• Other Referred Cases: National Thermal Power Co. Ltd. Vs. CIT, Jatinder Singh Bhangu Vs. Union of India, DCIT Vs Shri Aman Batra, Shri Bagga Singh Vs DCIT
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: VIVEK VARDHAN
• Assessee Lawyers: MISS PALLAVI
• Keywords: Reassessment proceedings
• Section: 148

Judgement Text

"आयकर अपीलीय अिधकरण,च᭛डीगढ़ ᭠यायपीठ “एस.एम.सी” , च᭛डीगढ़ IN THE INCOME TAX APPELLATE TRIBUNAL, CHANDIGARH BENCHES, “SMC” CHANDIGARH HEARING THROUGH: HYBRID MODE ᮰ी िवᮓम ᳲसह यादव, लेखा सद᭭य BEFORE: SHRI. VIKRAM SINGH YADAV, AM आयकर अपील सं./ ITA No. 539/Chd/2025 िनधाᭅरण वषᭅ / Assessment Year : 2019-20 Ashita Garg 06, Preet Vihar, Mehs Gate Nabha, Punjab-147201 बनाम JAO The ITO Ward, Nabha ˕ायी लेखा सं./PAN NO: ANAPG6827A अपीलाथᱮ/Appellant ᮧ᭜यथᱮ/Respondent िनधाᭅᳯरती कᳱ ओर से/Assessee by : Miss Pallavi, Advocate and Shri Sudhir Sehgal, Advocate (Virtual) राज᭭व कᳱ ओर से/ Revenue by : Shri Vivek Vardhan, Addl. CIT, Sr. DR सुनवाई कᳱ तारीख/Date of Hearing : 13/08/2025 उदघोषणा कᳱ तारीख/Date of Pronouncement : 18/08/2025 आदेश/Order PER VIKRAM SINGH YADAV, AM This is an appeal filed by the Assessee against the order of the Ld. CIT(A)/NFAC, Delhi dt. 18/03/2025 pertaining to A.Y 2019-20. 2. At the outset, the Ld. AR submitted that the assessee has moved a prayer for admission of the following additional ground of appeal: “Notwithstanding the original grounds of appeal, the reassessment proceedings initiated under section 148 of the Income Tax Act, 1961 are bad in law and void ab initio, as the notice under section 148 was issued by the Jurisdictional Assessing Officer (JAO) instead of the National Faceless Assessment Centre (NFAC), which is in violation of the mandatory procedure prescribed under Section 144B and Section 151A of the Act, vide notification No. CBDT Notification No. 18/2022/F. No. 370142/16/2022-TPL Part1 dated 29/03/2022 and as clarified by the Hon’ble Punjab & Haryana High Court in the case of Jatinder Singh Bhangu Singh Vs. Union of India (W.P. No. 15745 of 2024 dt. 19/07/2024.” Printed from counselvise.com 2 3. It was submitted that all the facts are borne out from the order of the AO and no fresh facts are to be investigated and the additional ground being purely legal ground, the same may be admitted in light of the decision of Hon’ble Supreme Court in case of National Thermal Power Co. Ltd. Vs. CIT reported in 229 ITR 383. 4. The Ld. DR has been heard who has not raised any specific objection for admission of the additional ground of appeal. 5. The additional ground so sought to be raised being purely legal in nature, the same is hereby admitted for necessary adjudication following the decision of Hon’ble Supreme Court in case of National Thermal Power Co. Ltd. 6. In this regard, the Ld. AR further submitted that basis certain information that the assessee has purchased certain immovable property and has made cash payment of Rs. 40,00,000/-, a show cause was issued under section 148A(b) of the Act by ITO Ward-1, Nabha on 02/03/2023 as to why notice under section 148 should not be issued on the basis of information that income chargeable to tax has escaped assessment. In response, the assessee filed her submission and thereafter, order under section 148A(d) was passed on 30/03/2023 and on the same date i.e, 30/03/2022, notice under section 148 was issued by ITO, Ward, Nabha being the jurisdictional AO. 7. It was submitted that the notice so issued under section 148 was in clear contravention of the mandatory requirement of faceless proceedings stipulated under the Income Tax Act post issuance of Notification by the Ministry of Finance, Government of India dt. 29/03/2022 under Section 144B of the Act. It was submitted that after issuance of the said notification on 29/03/2022, the notice under section 148 ought to have been issued by the Faceless Assessment Unit and not by the Jurisdictional AO. It was accordingly submitted that the notice so issued under section 148 has clearly been issued without jurisdiction. In Printed from counselvise.com 3 this regard, our reference was drawn to the decision of Coordinate Bench in case of DCIT Vs Shri Aman Batra (in ITA No. 1040/Chd/2024 and C.O. No. 41/Chd/2024 dt. 13/05/2025) wherein the Coordinate Bench following the decision of Hon’ble Punjab & Haryana High Court has held that the notice issued under section 148 is bad in the eyes of law. In this regard, the relevant finding of the Coordinate Bench read as under: “6. We have duly considered the rival contentions and gone through the record carefully. Admittedly, notice under Section 148 was issued after the Notification issued by the Ministry of Finance, Government of India on 29.03.2022. The notice under Section 148 has been issued on 29.03.2023 i.e. almost one year from the Notification. Thus, facts of other year are squarely applicable. The issue in dispute is covered by the judgement of Hon'ble jurisdictional High Court which read as under : “1. Challenge made through the instant petition is to the notice dated 01.03.2025 (Annexure P-l) issued to the petitioner by the respondents tinder Section 148 of the Income Tax Act, 1961. The primary ground of challenge raised by the petitioner is that the impugned notice has been issued by the Jurisdictional Assessing Officer which could not have been done because in terms of the notification dated 29.03.2022 (Annexure P-2), issued by the Ministry of Finance. Government of India, the impugned notice could have been issued only by way of faceless assessment. 2. In support of his afore submission, learned counsel for the petitioner places reliance on the following two judgments of this Court:- i. CWP-15745-2024, titled Jatinder Singh Bhangu Vs. Union of India and others, decided on 19.07.2024; and ii. CWP-21509-2023, titled Jasjit Singh Vs. Union of India and others, decided on 29.07.2024. 3. Learned counsel for the respondents does not dispute the fact that the case of the petitioner is covered in his favour by the law laid down through the aforesaid two judgments rendered by two different co- ordinate Benches of this Court in Jatinder Singh Bhangu and Jasjit Singh’s case (supra). 4. In the light of the above, in terms of the law laid down in Jatinder Singh Bhangu's and Jasjit Singh's cases (supra) the impugned notice dated 01.03.2025 (Annexure P-1) issued by the Jurisdictional Assessing Officer, is hereby quashed with liberty to the respondents to proceed against the petitioner in accordance with law. 5. The petition is allowed in the above terms.” 7. Respectfully following the judgement of the Hon'ble High Court, we allow the ground of appeal of Cross Objection and hold that notice issued under Section Printed from counselvise.com 4 148 of the Income Tax Act in assessment year 2019-20 is bad in the eyes of law. It was without jurisdiction. Accordingly, re-assessment order is quashed. 8. Though the Revenue has raised a number of issues on merits in its appeal, but we have quashed the re-assessment order, therefore, all the issues become academic in nature at this stage. We have quashed the assessment order on the strength of number of judgements rendered by Hon'ble jurisdictional High Court, which is a view unanimously taken by other Hon'ble High Courts also. Therefore, we do not deem it necessary to consider other issues on merit.” 8. Further, reference was drawn to another decision of Coordinate Bench in case of Shri Bagga Singh Vs DCIT (in ITA No. 2318/Chd/2024 dt. 13/05/2025) wherein similar view has been taken by the Coordinate Chandigarh Benches. 9. The Ld. Sr. DR is heard who has fairly submitted that though there are decisions of the Hon’ble Punjab and Haryana High Court, however, the Revenue is in appeal before the Hon’ble Supreme Court against such decisions rendered by the Hon’ble High Court. However, the ld Sr. DR has fairly submitted that there is no stay which has been granted by the Hon’ble Supreme Court against the decision rendered by the Hon’ble Punjab and Haryana High Court. Further, he has relied on the order of the lower authorities. 10. I have heard the rival contentions and perused the material available on the record. In the instant case, it is noted that the notice under section 148 has been issued on 30/03/2023 by ITO Ward, Nabha who is the Jurisdictional AO and not by the Faceless Assessment Unit. The said notice has been issued almost after an year from the issuance of notification by Ministry of Finance, Government of India on 29/03/2022 requiring issuance of notice and conduct of assessment proceedings by the Faceless Assessment Unit. There is thus a clear breach of the binding notification so issued u/s 144B requiring issuance of notices and conduct of proceedings through the Faceless Assessment Unit. The Coordinate Bench in case of Aman Batra (supra) and thereafter in case of Bagga Singh (supra) has referred to the decision of the Hon’ble Jurisdictional High Court wherein the notice issued by the Jurisdictional AO has been quashed Printed from counselvise.com 5 by the Hon’ble Punjab & Haryana High Court and by following the same, it has been held that the notice so issued is bad in law. Nothing has been brought on record to deviate from the view so taken by the Coordinate Benches which in turn is guided by the decision of the Hon’ble Jurisdictional High Court. Respectfully following the decision of Hon’ble Jurisdictional High Court which has been followed by the Coordinate Benches in decisions referred supra, the notice so issued on 30/03/2023 by the jurisdictional AO i.e; ITO, Ward Nabha is clearly without jurisdiction and bad in law. In light of the same, the additional ground of appeal so taken by the assessee is hereby allowed. 11. In light of the aforesaid, other grounds of appeal have become academic in nature and the same are left open and not adjudicated upon. 12. In the result, appeal of the assessee is allowed. (Order pronounced in the open Court on 18/08/2025 ) Sd/- िवᮓम ᳲसह यादव (VIKRAM SINGH YADAV) लेखा सद᭭य / ACCOUNTANT MEMBER AG Date: 18/08/2025 आदेश कᳱ ᮧितिलिप अᮕेिषत/ Copy of the order forwarded to : 1. अपीलाथᱮ/ The Appellant 2. ᮧ᭜यथᱮ/ The Respondent 3. आयकर आयुᲦ/ CIT 4. आयकर आयुᲦ (अपील)/ The CIT(A) 5. िवभागीय ᮧितिनिध, आयकर अपीलीय आिधकरण, च᭛डीगढ़/ DR, ITAT, CHANDIGARH 6. गाडᭅ फाईल/ Guard File Printed from counselvise.com "