DCIT CENTRAL CIRCLE-16, NEW DELHI V. NITIN GUPTA, NEW DELHI

ITA 2195/DEL/2023

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The case involves cross-appeals by the assessee, Sh. Nitin Gupta, and the Revenue against the order of the Commissioner of Income Tax (Appeals)-31, New Delhi, concerning the assessment year 2017-18. The primary legal issues were the validity of the section 143(3) assessment due to the absence of a valid section 153D approval and the lack of initiation of section 148 or section 153C proceedings. The Tribunal examined whether the assessment was conducted in compliance with the procedural requirements of the Income-tax Act, 1961, particularly focusing on the approvals and proceedings necessary for a valid assessment following a search operation.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 717757 (ITAT-DELHI)
• Duration Of Justice: 2 year(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-08-2025
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: E
• Assessment Year: 2017-2018
• Appeal Filed On: 02-08-2023
• Other Referred Cases: ACIT Vs. Serajuddin and Co. [2024] 163 taxmann.com 118 (SC), PCIT Vs. Anuj Bansal [2024] 466 ITR 254 (SC), PCIT Vs. MDLR Hotels (P) Ltd. [2024] 166 taxmann.com 327 (Delhi), PCIT Vs. Shiv Kumar Nayyar [2024] 163 taxmann.com 9 (Delhi), PCIT Vs. Sapna Gupta [2023] 147 taxmann.com 288 (All.), PCIT Vs. Naveen Kumar Gupta (2024) 168 taxmann.com 574 (Del)
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: AMISHA S. GUPTA
• Assessee Lawyers: SAMEER MAHAJAN
• Section: 148; 143(3)

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL, DELHI BENCH: ‘E’ NEW DELHI BEFORE SHRI SATBEER SINGH GODARA, JUDICIAL MEMBER AND SHRI M. BALAGANESH, ACCOUNTANT MEMBER ITA No.1990 & 2195/Del/2023 Assessment Year: 2017-18 Sh. Nitin Gupta, 149, Banking Enclave, Laxmi Nagar, New Delhi Vs. ACIT/DCIT, Central Circle-16, New Delhi PAN: AIHPG6203E (Appellant) (Respondent/cross- appellant) ORDER PER SATBEER SINGH GODARA, JM These assessee’s and Revenue’s cross appeals ITA No.1990 & 2195/Del/2023 for assessment year 2017-18, arise against the Commissioner of Income Tax (Appeals)-31 [in short, the “CIT(A)”], New Delhi’s order dated 10.05.2023 passed in case no. 1121/21- 22, involving proceedings under section 143(3) of the Income-tax Act, 1961 (hereinafter referred to as ‘the Act’). Heard both the parties. Case files perused. Assessee by Sh. Sameer Mahajan, CA Department by Ms. Amisha S. Gupta, CIT(DR) Date of hearing 22.07.2025 Date of pronouncement 13.08.2025 Printed from counselvise.com ITA Nos.1990 & 2195/Del/2023 2 | P a g e 2. We note at the outset that there arise the twin legal issues of validity of the impugned section 143(3) assessment framed by the Assessing Officer dated 30th December, 2018 inter alia for want of a valid section 153D approval as well as on account of a fact that the learned lower authorities had neither initiated section 148 or section 153C proceedings herein, as the case may be. 3. We now advert to the basic relevant facts in the instant twin cross appeals. There is not dispute that the learned departmental authorities had carried out the search in question dated 25.11.2016 in Mr. Mohit Garg & Others’ cases wherein “certificates/documents belonging to the assessee were seized” as per the assessment order dated 30.12.2018. The assessee filed his return on 28.03.2018 declaring total income/loss of Rs.9,84,010/- . The Assessing Officer issued section 143(2) notice dated 28.09.2018; and, thereafter, he finalized his assessment in question inter alia making various additions which are not discussed herein since we are dealing with the above twin legal issues at this stage. The assessee appears to have challenged the Assessing Officer’s foregoing action before the CIT(A) who has partly accepted his lower appeal. Printed from counselvise.com ITA Nos.1990 & 2195/Del/2023 3 | P a g e This is what leaves both these parties aggrieved who have preferred their respective cross appeals herein. 4. We now come to the above former issue of validity of the impugned assessment for want of a section 153D approval. Learned counsel has invited our attention to page 10 in his paper- book indicating a common approval dated 29.12.2019 involving total eight persons including the assessee at serial no. 3 in assessment years 2011-12 to 2016-17. 4. It is in this factual backdrop that we sought to verify the clinching fact herein as to whether there is any separate approval for the impugned assessment year 2017-18 in the assessee’s case or not. No satisfactory reply has come from the Revenue side throwing sufficient light on the issue. We are thus constrained to hold that there was a common approval in the assessee’s and other seven persons’ cases which has already been held as not a substantive compliance to the provisions of the Act in ACIT Vs. Serajuddin and Co. [2024] 163 taxmann.com 118 (SC), PCIT Vs. Anuj Bansal [2024] 466 ITR 254 (SC), PCIT Vs. MDLR Hotels (P) Ltd. [2024] 166 taxmann.com 327 (Delhi), PCIT Vs. Shiv Kumar Nayyar [2024] 163 taxmann.com 9 (Delhi) and PCIT Vs. Sapna Printed from counselvise.com ITA Nos.1990 & 2195/Del/2023 4 | P a g e Gupta [2023] 147 taxmann.com 288 (All.) already deciding the very issue in assessee’s favour and against the department. Their lordships further hold that such a mechanical exercises of section 153D approval could not be mechanically finalized in absence of the prescribed authority having properly applied its mind. We thus decide the above former legal question in the assessee’s favour and against the department to conclude that the impugned assessment framed by the Assessing Officer on 30th December, 2018 is itself a non-est one in the eyes of law. 5. The outcome would be hardly any different qua the above latter legal issue as well wherein the learned departmental authorities appear to have proceeded against the assessee based on some seized document belonging to him (supra). That being the case, we are of the considered view that in absence of either section 148 reopening proceedings or section 153C proceedings; as the case may be, the learned departmental authorities could not have proceeded against the assessee in the assessment year 2017-18 which happens to be the year of a search. We further wish to quote PCIT Vs. Naveen Kumar Gupta (2024) 168 taxmann.com 574 (Del) that even section 148 proceedings could be initiated in such an Printed from counselvise.com ITA Nos.1990 & 2195/Del/2023 5 | P a g e instance. We are of the considered view in this backdrop that whether in section 148 or section 153C proceedings, learned Assessing Officer could not have simply proceeded against the assessee u/s 143(3) assessment, and, therefore, we quash his impugned assessment on this latter aspect as well. The Revenue’s corresponding vehement submissions on both these issues are hereby rejected in very terms. All other pleadings between the parties herein stand rendered academic. 6. This assessee’s appeal ITA No.1990/Del/2023 is allowed and Revenue’s cross appeal ITA No.2195/Del/2023 is dismissed, in above terms. A copy of this common order be placed in the respective case files. Order pronounced in the open court on 13th August, 2025 Sd/- Sd/- (M. BALAGANESH) (SATBEER SINGH GODARA) ACCOUNTANT MEMBER JUDICIAL MEMBER Dated: 13th August, 2025. RK/- Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(A) 5. DR Asst. Registrar, ITAT, New Delhi Printed from counselvise.com "