DEPUTY CIT, CENTRAL CIRCLE-6, INCOME TAX DEPARTMENT V. SANTOSH HOSPITALS PRIVATE LIMITED , NO.

ITA 1534/DEL/2024

AI Insights

The case involves an appeal by the Revenue against the order of the Ld. Commissioner of Income Tax (Appeals)-24, New Delhi, which held that a notice issued under section 148 of the Income Tax Act for the assessment year 2015-16 was invalid. The notice, although digitally signed on 31.03.2021, was not considered validly issued until 01.04.2021, necessitating compliance with the procedural requirements set by the Supreme Court in the case of Ashish Agarwal. The reassessment was based on this invalid notice, leading to the CIT(A)'s decision to quash the reassessment order. The Revenue's appeal contested the validity of the CIT(A)'s decision, arguing that the notice was validly issued and that the assessee's participation in the reassessment proceedings constituted a waiver of any objection to the notice's validity.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 777174 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 5 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-09-2025
• Order Result: Dismissed
• Bench Allotted: G
• Assessment Year: 2015-2016
• Appeal Filed On: 04-04-2024
• Other Referred Cases: UOI vs. Ashish Agarwal, Sumanjeet Agarwal vs. ITO, UOI vs. Rajiv Bansal
• Laws Referred To: Income Tax Act
• Court: TRIBUNAL
• Department Lawyers: MANISH GUPTA
• Assessee Lawyers: SURESH GUPTA
• Keywords: Invalid notice; Reassessment proceedings; Reopening of assessment; Audit objection; Reason to believe; Revision of order; Liquidation; Borrowed satisfaction; CHAPTER IV
• Section: 147; 148; 143(3); 263; 32; 68; 15; 43B; 115JB; 40(a)(ia)

Judgement Text

"ITA No.1534/Del/2024 1 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH “G” NEW DELHI BEFORE SHRI CHALLA NAGENDRA PRASAD, JUDICIAL MEMBER AND SHRI BRAJESH KUMAR SINGH, ACCOUNTANT MEMBER आ.अ.सं/.I.T.A No.1534/Del/2024 िनधा रणवष /Assessment Year: 2015-16 DCIT, Central Circle-6, Income Tax Department, Room No.344, 3rd Floor, ARA Centre, Jhandewalan Extn., New Delhi. बनाम Vs. SANTOSH HOSPITALS PVT. LTD. 1, 7th Avenue Besant Nagar, S.O. Chennai, Tamil Nadu. PAN No.AABCS2244J अपीलाथ\u0014 Appellant \u0016\u0017यथ\u0014/Respondent Assessee by Shri Suresh Gupta, CA Revenue by Shri Manish Gupta, Sr. DR सुनवाईक\bतारीख/ Date of hearing: 12.09.2025 उ\u000eोषणाक\bतारीख/Pronouncement on 17.09.2025 आदेश /O R D E R PER C.N. PRASAD, J.M. This appeal is filed by the Revenue against the order of the Ld. Commissioner of Income Tax (Appeals)-24, New Delhi dated 18.01.2024 for the AY 2015-16 in holding that the notice dated 31.3.2021 issued u/s 148 of the Act after 1.4.2021 is invalid in the absence of its subsequent regularization through the procedure established by the Hon’ble Supreme Court in the case of Ashish Printed from counselvise.com ITA No.1534/Del/2024 2 Agarwal’s case and therefore the reassessment proceedings are invalid and consequently the assessment order is also invalid. 2. Brief facts are that the assessee e-filed its return of income on 23.12.2015 declaring loss of Rs.48,93,564/- under normal provisions of the Act and book profits u/s 115JB at Rs.88,55,247/-. The assessment was completed under limited scrutiny through CASS vide order dated 29.09.2017 accepting the loss/income declared by the assessee. Subsequently notice u/s 148 dated 31.03.2021 was issued for reopening the assessment and the reassessment was completed on 25.03.2022 u/s 147 r.w.s. 148 of the Act determining the income of the assessee at Rs.3,28,64,629/- under normal provisions of the Act. While completing the assessment the Assessing Officer made disallowance of share capital expenses u/s 37, disallowance u/s 36(1)(va) r.w.s. 43B of the Act in respect of employees contribution to PF & ESI, disallowance u/s 40(a)(ia) and addition under section 68 of the I.T. Act. 3. The assessee preferred an appeal before the Ld. CIT(Appeals) challenging the reassessment proceedings and consequent reassessment order as bad in law and void ab initio as the jurisdictional notice dated 31.03.2021 u/s 148 of the Act which was e-signed on 31.03.2021 was issued through e-mail on 08.04.2021 and Printed from counselvise.com ITA No.1534/Del/2024 3 therefore such notice is not in compliance with the provisions of section 148A of the Act which came to be inserted into the statute w.e.f. 01.04.2021. The assessee also challenged the reassessment proceedings on various other legal grounds and also on the merits of the additions/disallowances made. The Ld. CIT(Appeals) considering the submissions of the assessee and the reports of the Assessing Officer, concluded that the notice u/s 148 dated 31.03.2021 was digitally signed on 31.03.2021 and this notice was issued to an address which is not as per the address permissible as per Rule 127(2)(a) of Income Tax Rules and therefore the notice issued at an incorrect address cannot be considered as validly issued on 31.03.2021. The Ld. CIT(Appeals) also held that the notice sent through ITBA to an e-mail id from system on 31.03.2021 cannot be considered as a valid issuance since the e-mail id was not in accordance with permissible e-mail id mentioned in Rule 127(2)(b) of I.T. Rules. Ld. CIT(A) also concluded that notice u/s 148 dated 31.03.2021 was shared with the assessee on e-proceeding on 01.04.2021 at 02:04 pm and therefore the same was available to the assessee on or after 01.04.2021 only. The Ld. CIT(A) also concluded that notice u/s 148 was also issued to an e-mail id permissible under Rule 127(2)(b) on 08.04.2021 to which the assessee complied with Printed from counselvise.com ITA No.1534/Del/2024 4 and therefore notice was issued on or after 1.4.2021. The Ld. CIT(A) finally concluded that since the notice was validly issued after 01.04.2021 in view of the decision of the Hon’ble Supreme Court in the case of UOI vs. Ashish Agarwal (444 ITR 1) and the Hon’ble Delhi High Court in the case of Sumanjeet Agarwal vs. ITO (449 ITR 517) such notices will be construed as issued u/s 148A(b) of the Act and the AO was required to follow the procedure if the notice was issued u/s 148A(b) of the Act and moreover the Hon’ble Delhi High Court in the case of Sumanjeet Agarwal (supra) had held that the notice issued on or after 01.04.2021 would be time barred unless saved by the judgment of Hon’ble Supreme Court in Ashish Agarwal and since the AO did not validate the notice as per the decision of the Hon’ble Supreme Court in the case of Ashish Agarwal the notice dated 31.3.2021 u/s 148 which was issued after 01.04.2021 became invalid and consequently the reassessment made based on such invalid notice was also held to be bad in law and void ab initio. 4. Before us the Ld. DR strongly supported the order of the Assessing Officer contending that the notice u/s 148 was rightly issued on 31.03.2021 by digitally signing and sending through ITBA Portal from the system on 31.03.2021. Therefore, the Ld. DR contended that the notice was validly issued on 31.03.2021 and the Printed from counselvise.com ITA No.1534/Del/2024 5 decision of the Hon’ble Supreme Court in the case of Shri Ashish Agarwal is not applicable to the assessee’s case. The Ld. DR also contended that since the assessee has appeared and participated in the assessment proceedings and did not raise any objection with regard to the notice issuance/service of notice u/s 148 before the AO the same cannot be questioned in appeal proceedings by virtue of the provision of section 292BB of the Act. 5. The Ld. Counsel for the assessee submitted that the notice u/s 148 of the Act though digitally signed on 31.03.2021 was validly issued on the assessee on 08.04.2021 when the assessee viewed the e-mail in view of the decision of the Hon’ble Delhi High Court in the case of Sumanjeet Agarwal (supra). The Ld. Counsel for the assessee submitted that even as per the findings of the Ld. CIT(Appeals) after examining the reports of the Assessing Officer, systems reports the notice dated 31.03.2021 u/s 148 was shared with assessee on e- proceedings on 01.04.2021 at 02:04 pm and therefore the same was available to the appellant on or after 01.04.2021 only. Therefore, since the notice was shared with assessee on e-proceedings on 01.04.2021 which the assessee viewed on 08.04.2021 the notice was validly issued on 08.04.2021 and the AO should have followed the procedure laid down by the Hon’ble Supreme Court in the case of UOI Printed from counselvise.com ITA No.1534/Del/2024 6 vs. Rajiv Bansal (469 ITR 46) and should have validated the notice by virtue of the decision of the Hon’ble Supreme Court in the case of UOI vs. Ashish Agarwal (supra). Therefore, the Ld. Counsel for the assessee submits that since the AO issued notice after 01.04.2021 and since the said notice was not validated by virtue of the decision of the Hon’ble Supreme Court in the case of Ashish Agarwal the said notice and the consequential reassessment made by the AO was rightly held to be bad in law and void ab initio, by the Ld. CIT(A). 6. The Ld. Counsel for the assessee further filed application under Rule 27 of the ITAT Rules supporting the impugned order of the Ld. CIT(Appeals) contending as under: - Before Income Tax Appellate Tribunal G-Bench New Delhi In the matter of M/s Santosh Hospital Private Limited PAN: AABCS2244J Department’s Appeal No ITA 1534 / DEL / 2024 Sub: Application u/r 27 of the ITAT Rules 1963 MAY YOUR HONOUR PLEASE BE The respondent herein seeks to support the impugned order of the Ld CIT(A) under rule 27 with the following grounds not been adjudicated the first appellate authority in favour of the respondent assessee applicant. Ground No.1 Challenge to the validity of reassessment proceedings and consequent reassessment order on the ground of lack of independent application of mind by the AO in initiating the reassessment proceedings. This ground has been duly discussed in the impugned appellate order on pages 10 to 13. Although the reassessment order has been quashed for failure in effective issue on or before 31.03.2021 of the notice u/s 148 under the pre-amended Act so impliedly the present ground is dismissed by Ld CIT(A) which is raised under above rule to support the Ld CIT(A) order. Printed from counselvise.com ITA No.1534/Del/2024 7 From the copy of reasons placed in paper book at page 89-90, it is evident that the Ld AO initiated reassessment proceedings on the basis of belief that the income to the extent of Rs.12,97,76,634/- has escaped assessment. The above belief is based on the report of internal audit (para 2 at page 89 back side). The above amount of income escaping assessment consists of following items mentioned and dealt in the Ld CIT(A) order in the table at pages 10-12. Printed from counselvise.com ITA No.1534/Del/2024 8 Printed from counselvise.com ITA No.1534/Del/2024 9 The above discrepancies in computing the income relevant for reopening of assessment, show that there was hardly any application of mind by the Ld AO on the audit objections reported by internal audit. The Ld AO while making the assessment found the explanation on the basis of the material already available on record to be acceptable for substantial amount of the income computed as the additional income of Rs.12,97,76,634/- in the reason as the additional income was computed at Rs.78,65,693/- and that too without reducing the loss of Rs.48,93,564/- with the result that the additional income computed in the assessment order based on the reason recorded was just Rs.29,27,129/- against the amount of Rs.12,97,76,634/-. The casual approach adopted by the Ld. AO in computing the income chargeable to tax escaping assessment has the substantial impact on the validity of the reassessment proceedings so initiated and the assessment order passed thereby. These incorrect facts, relied by the AO for assuming jurisdiction u/s 147, leads to the consequence of invalidation of reassessment proceedings for which reliance is placed in the decisions of M/s Synfonia Tradelinks P Ltd vs ITO 435 ITR 642 (Del), Shamshad Khan vs ACIT 395 ITR 265 (Del), Pr CIT vs M/S SNG Developers Ltd404 ITR 312 (Del) approved by Hon’ble Apex Court by dismissing SLP of revenue in SLP © 42379/2017 Dt: 09.02.2018, CIT vs Suren International Pvt Ltd 357 ITR 24 (Del), Pr. CIT vs. RMG Polyvinyl (0 Ltd (2017) 396 ITR 5 (Del), CIT vs.. Atlas Cycle industries (1989) 180 ITR 319 (P&H), Siemens Information System Ltd., vs. ACIT&Ors (2007) 293 ITR 548 (Bom.), Ankita A. Choksey vs. ITO &Ors (2019) 411 ITR 207 (Bom), Karan Khurana vs ITO 92 ITR (Trib) 0114 (Del), DCIT vs M/s KLA Foods (India) Ltd and Ors ITA No.2846/Del/2015 dt: Printed from counselvise.com ITA No.1534/Del/2024 10 08.04.2019, M/s Shiv Sai Infrastructure P Ltd ITA No.2527/Del/2017, ITO vs Randeep Investment (P) Ltd ITA No.4365 & 4005/Del/2015 dt: 26.03.2019 and Shree Balkrishan Aggarwal Glass Industries Ltd ITA No.5798/Del/2016 dt: 21.09.2020. The lack of independent application of mind is further supported by the discussion in para 5.1 of reason (PB 90 Back) where the Ld AO mentions the failure on the part of appellant to disclose fully and truly material facts for its assessment in the light of Explanation 1 of sec 147 of IT Act. The above statement highlights the fact that the Ld AO has not applied his minds to the facts of the case as the information which is taken for the basis of reassessment are the glaring disclosures in tax audit report and such disclosure in tax audit report cannot considered to be the evidences/books of account produced from which material evidence could not be discovered without due diligence. The information in the tax audit report is so explicit that the Ld AO could not have given that finding of the information is discoverable with due diligence only from the bulky records produced. The Ld AO's above observation underlines the casual approach of the AO while applying his mind. In the present case reopening of assessment is based on borrowed satisfaction relying on the information provided by audit objection and such reopening is held to be invalid, the case of Pr. CIT vs. Meenakshi Overseas Pvt. Ltd. 395 ITR 677 (Dei), it was held that reproduction of information without showing how the material referred in therein does not show application of mind by the AO in absence of any specific discussion on the material on the basis of which independent prima facie belief is reached that income has escaped assessment. To support the above proposition of law, reliance is also placed on the decisions of Pr. CIT vs. RMG Polyvinyl (I) Ltd., (2017) 396 ITR 5 (Del), Pr. CIT v. G & G Pharma India Ltd 384 ITR 147 (Del.),CIT vs Independent Media Pvt Ltd in ITA 108/2015 (Del), Signature Hotels P. Ltd. Vs. ITO [2011] 338 ITR 0051 (Del), CIT Vs. SFIL Stock Broking Ltd. 325 ITR 285 (Del), CIT vs. Multiplex Trading & Industrial Co. Ltd 378 ITR 351 (Del.), Sarthak Securities Co. P. Ltd. Vs. ITO 329 ITR 110 (Del) and CIT vs. Greenworld Corporation 314 ITR 81 (SC). Further, the Ld AO while reopening the assessment has merely acted on the dictates of the audit without independent mind as explained hereinbefore while initiating the reassessment proceedings. Any action of reopening solely at the behest of objection raised by audit party without any independent belief would surely make the very assumption of jurisdiction vulnerable, It is a settled law the trigger may have come from the audit party but the logical decision of initiating the proceedings of reassessment in the form of reason to believe has to be directly and invariably of that of the AO. Therefore, such proceedings are held to be invalid in view of decisions of PCIT vs Samsung Electronics P Ltd ITA No. 1445/2018 (Del), Indian and Eastern Newspaper Society v. CIT 119 Printed from counselvise.com ITA No.1534/Del/2024 11 ITR 996(SC), Adani Exports 240 ITR 224 (Guj),Jagat Jayantilal Parikh v. Dy CIT 355 ITR 400 (Guj), Mehsana District Central Co-op Bank Ltd vs. ACIT SC A No.8343 of 2013 dt 19.06.2017 (Guj), FIS Global Business Solutions India P Ltd vs Pr CIT 409 ITR 560 (Del), CIT vs Sh Rajan N Aswani ITA No.606 of 2015 dt 24.02.2018 (Bom) and N.K. Roadways P Ltd vs ITO (OSD) 362'ITR 522 (Guj). Ground No.2 Mechanical Approval by Pr CIT The Ld CIT(A) dealt with this ground on page 13 to 14 of the appellate order but since, the assessment has been quashed on other legal ground, the instant ground therefore is impliedly dismissed. To support the above ground, the appellant's contention is that Inconsistencies and omissions pointed out in support of ground on non-application of mind are in the nature of the glaring mistakes by the AO and non-pointing out of such omissions by the approving authority and resulting non-correction of the same, before the approval was accorded, shows that the said authority has acted mechanically in granting sanction u/s 151 of the Act. Such mechanical approval is fatal for validity of the reassessment proceedings as decided by the co-ordinate Hon’ble Delhi Bench in the RMP Holdings P Ltd ITA No.7243/Del/2019 dt: 31.07.2020 wherein it was held that both AO and approving authorities have acted mechanically ignoring the glaring mistakes in the reason recorded showing non application of mind by the reason recording authority. Reliance is also placed on the decision of M/s Synfonia Tradelinks P Ltd vs ITO (supra) (Del), Sanjay Kumar vs ACIT 458 ITR 0548 (Del), Chhugamal Rajpal vs. S.P. Chaliha & Ors. - 79 ITR 603 (SC), CITvs M/s S.Goyanka Lime and Chemicals Ltd 231 Taxman 0073 Dated 15.10.2014 (MP) approved by Hon'ble Supreme Court in 64 taxmann.com 313 (SC), Pr. CIT vs. N. C. Cables Ltd 391 ITR 11 (Del), United Electrical Company P Ltd. vs. CIT & Ors(2002) 258 ITR 317 (Del) and Central India electric Supply Co. Ltd. Vs .ITO, 333 ITR 237 (Del). Ground No.3 Invalidity of the reassessment order without mention of system generated DIN Number thereon. The Ld CIT(A) dealt with this ground on page 8 to 10 of the appellate order but since, the assessment has been quashed on other legal ground, *he nstcr'- ground therefore is impliedly dismissed. In the present case, the assessment order and demand notice dated 25.03.2022 has been passed without mentioning the DIN on the said order and therefore, such notice is invalid and bad in law in view of the Circular No. 19 of 2019 dated 14th August 2019 issued by CBDT. The procedure prescribed in Circular No. 19 of 2019 dated 14th August 2019 for non-mention of DIN in case letter/notice/order has not been complied with. It is settled that if DIN is not mentioned in Printed from counselvise.com ITA No.1534/Del/2024 12 the letter/notice/order, the reason for not mentioning the DIN and the approval from specified authority for issuing such letter/notice/ order without DIN has to be obtained and mentioned in such letter/notice/order. In the present case, in the impugned order dated 25.03.2022, no such reference is made as per requirement of CBDT circular. The Hon'ble Bombay High Court in the case of Hexaware Technologies Limited Vs ACIT W.P. No.1778 of 2023 dated 03.05.2024 (Bom) relying on decisions of Ashok Commercial Enterprises (2023) 459 ITR 100 (Bom) and Tata Medical Center Trust (2023) 459 ITR 155 (Cal) has quashed the notice/order without mentioning of DIN on he said communication and therefore, as a consequent the impugned reassessment proceedings were also quashed. Further, reliance is placed in the decision of CIT vs Brandix Mauritius Holdings Ltd 149 Taxmann.com 238 (Del) and Dy CIT vs M/s Shreeji Biharji Colonisers and Builders P Ltd ITA No.57/ASR/2023 dated 22.07.2024. It is submitted that the above decision of jurisdictional Delhi High Court has been stayed by Hon’ble Apex Court on 11.01.2024 but not overruled. The decisions of Hon'ble Bombay High Court and Hon'ble ITAT Amritsar Bench are the decisions coming after the stay was granted by Hon’ble Apex Court in Brandix Mauritius Holding Ltd (supra)Decision. Ground No.4 Non-Compliance of First Proviso to sec 147 of IT Act In view of the fact that assessment in the present was completed u/s 143(3) dt: 29.07.2019 (PB 89 back) and the action u/s 147 has been initiated after expiry of four years from the end of assessment year, the appellant's case could not have been reopened unless the escapement of income occasioned due to failure of assessee to disclose truly & fully all material facts necessary for assessment. There is no specific allegation in reason recorded attributable to the assessee appellant. In the reason recorded in para 5.1 (PB 90), there is a bald assertion that the assessee has failed to disclosed truly and fairly material facts necessary for assessment without getting specific about the particular material facts not disclosed. From the facts on record, it is evident that reopening of assessment is based on the facts already disclosed in tax audit report and there is no mention of any new information coming to the possession of the Ld AO on the basis of which he could have supported the allegation of failure on the part of appellant as mentioned in above para. It is a case of bald assertion of the fact of non-disclosure of all material facts fully and truly which is the case as per reason recorded. Such bald assertion does not meet the mandatory requirement of above proviso in view of the following decisions: • BPTP Limited vs. PCIT 185 DTR 0372 (Del); Printed from counselvise.com ITA No.1534/Del/2024 13 • Anand Developers vs. ACIT (Bom) W P No. 17 of 2020 dt: 18.02.2020; • Best Cybercity (India) Pvt Ltd (2019) 414 ITR 0385 (Del); • M/s Swarovski India Pvt. Ltd v. Dy CIT, W.P.(C) 1909/2013 decided on 08.08.2014 (Del); • Global Signal Cables (India) Pvt. Ltd. vs. Dy. CIT 368 ITR 609 (Del); • HCL Technologies Ltd. v. Dy CIT W.P.(C) 8164/2020 (Del); • M/s Sabh Infrastructure Ltd vs ACIT 398 ITR 0198 (Del). If the case of the AO was that of the original assessment order passed on the basis of incomplete information provided or without taking into account the facts in the tax audit report available to the Ld AO, then only option for the department was action u/s 263 of the IT Act. The present case was the assessment completed as a limited scrutiny but where these glaring cases of possible additions were available to the then AO, the action of extending the scope of assessment could have been taken by him in view of CBDT Circulars. The absence of such action by the department shows that the information provided in the course of original proceeding were adequate and assessment proceeding were completed after due enquiry. In such a case, the action u/s 148 could not have been be taken in view of decision of Dushyant Kumar Jain vs Dy CIT 381 ITR 0428 (Del) (Para 16) and CIT vs Usha International Ltd 348 ITR 0485 (Del) (FB) (Para 14 & 15). The Co-ordinate Bench of ITAT in M/s A.S.T Pipes P Ltd ITA No.8312/Del/2019 dt: 27.10.2020 in para 13 pages 16-21 has quashed the reassessment proceedings accepting the above contention of the appellant.” 7. Heard rival submissions, perused the orders of the authorities below and the contentions raised before us. In the Revenue’s appeal the issue is to be decided is as to whether the notice u/s 148 dated 31.03.2021 was validly issued on the assessee on the very same day i.e. 31.03.2021 or was it issued validly on or after 01.04.2021 and if it was issued after 1.4.2021 whether it is a valid notice in view of the decision of the Hon’ble Supreme Court in the case of UOI vs. Rajeev Bansal (supra). Printed from counselvise.com ITA No.1534/Del/2024 14 8. On careful reading of the Ld. CIT(Appeals) order, we observed that based on the reports of the AO and systems and rejoinder of the assessee the Ld. CIT(A) concluded that notice u/s 148 though digitally signed on 31.03.2021 it was validly issued to the assessee on 01.04.2021 and therefore since the said notice was issued on 01.04.2021 amended provisions of section 148A inserted into the statute w.e.f. 01.04.2021 shall apply by virtue of the decision of the Hon’ble Supreme Court in the case of UOI vs. Ashish Agarwal (supra) and since the AO failed to validate the notice by issuing 148A(b) as per the decision of the Hon’ble Supreme Court in the case of Ashish Agarwal, the 148 notice which was issued after 01.04.2021 became invalid and consequently the reassessment framed by the AO based on such invalid notice was held to be bad in law observing as under: - “Findings/Determination are as hereinafter: 4.1 I have considered the material on record including written submission of the AR of the appellant filed in course of appellate proceedings. I have also perused the assessment order u/s 147 of the Income Tax Act, reports of the Assessing Officer and Systems and rejoinder of the appellant. In the present appeal the appellant has raised several grounds of appeals. However, Ground No. 2 raised the issue of legality and correctness of reassessment proceeding, hence the same is addressed in the beginning. 4.2.1 In Ground No. 2, the appellant has contended that the impugned reassessment proceedings and consequent reassessment order both are bad in law and void-ab-initio as the jurisdictional notice dt: 31.03.2021 issued u/s 148 and which was e-signed on 31.03.2021 was issued through email on 08.04.2021 and this issue of notice is not in compliance with the provisions of sec 148A of the Act which came to be inserted into the statute w.e.f 01.04.2021. 4.2.2 The appellant during the course of appellate proceedings specifically challenged the validity of notice issued u/s 148 of Income Tax Act dated 31.03.2021 and subsequent proceedings as the due process of law was not followed while issuing the notice Printed from counselvise.com ITA No.1534/Del/2024 15 u/s 148 of Income Tax Act. The relevant facts of this case are as under: 1. The notice u/s 148 of Income Tax Act was digitally signed by the Assessing Officer on 31.03.2021. 2. As enquired from Assessing Officer/ITBA/Systems, the details of issuance of notice are as under: \"It is submitted that document with DIN: JTBA/AST/S/148/2020-21/1032035348(1) issued on 3/31/2021 1:35:20 PM. Email triggers to email id “[e-mail]” from system successfully but delivery details not updated due to some technical issue. Document shared with assessee on e-proceeding at 01-APR- 21 02.04 PM.\" “In continuation to my earlier mail dated 28.11.2023, It is further submitted that document with DIN: ITBA/AST/S/I48/2020- 21/1032035348(l )was ' issued on 31/31/2021 1:35:20 PM. The E-mail triggered by ITBA software to assessee on 31/3/2021 at 6:55:30 PM.” 3. Subsequently, the Assessing Officer sent the said notice u/s 148 of Income Tax Act to the appellant at email [e-mail] from his official email [e-mail] on 08.04.2021 at 5:53 PM. Through the said mail the notice u/s 148 of Income Tax Act in the case of M/s. Santosh Hospitals Private Limited AY 2015-16 was sent to the appellant. 4.2.3 As discussed above and as per the information submitted by the appellant and as obtained from Assessing Officer/Systems, the notice u/s 148 of Income Tax Act was issued by the Assessing Officer/Systems on 31.03.2021 at 6:55:30 PM. The delivery details of the said email are not known to the department. Subsequently, the Assessing Officer sent this notice to the appellant at email id [e-mail] from his official email id [e-mail] on 08.04.2021. There is no reason mentioned on record as to why the email dated 08.04.2021 was sent to the correct email id [e-mail]; but as per records it is certain that the Assessing Officer issued notice u/s 148 of Income Tax Act on 08.04.2021 through email. This certainly indicates that Assessing Officer believed that a service of notice u/s 148 of the Income Tax Act was required to be made at this email id. The appellant attended the assessment proceedings and complied with the assessment in response to the notice dated 08.04.2021. Both the Assessing Officer and the appellant had not disputed the facts mentioned above. Printed from counselvise.com ITA No.1534/Del/2024 16 4.2.4 It is undisputed fact that the Assessing Officer digitally signed the notice on 31.03.2021 and the same was processed through ITBA for service to the appellant. As informed by the Systems, an email was subsequently triggered to email id [e-mail] from system successfully on 31.03.2021 at 6:55 PM. Therefore, the notice was issued by the department to the appellant on 31.03.2021 at email id [e-mail]. As per the Section 149 of Income Tax Act the limitation for notice u/s 148 of Income Tax Act is based on ‘issuance’ of such notice by the department. 4.2.5 In this connection Section 282 of Income Tax Act and Rule reproduced as under: “Service of notice generally. 282. (1) The service of a notice or summon or requisition or order or any other communication under this Act (hereafter in this section referred to as \"communication”) may be made by delivering or transmitting a copy thereof to the person therein named— (a) by post or by such courier services as may be approved by the Board; or (b) in such manner as provided under the Code of Civil Procedure, 1908 (5 of 1908) for the purposes of service of summons; or (c) in the form of any electronic record as provided in Chapter IV of the Information Technology Act, 2000 (21 of2000); or (d) by any other means of transmission of documents as provided by rules made by the Board in this behalf. (2) The Board may make rules~ providing for the addresses (including the address for electronic mail or electronic mail message) to which the communication referred to in sub-section (1) may be delivered or transmitted to the person therein named. Explanation.—For the purposes of this section, the expressions \"electronic mail\" and \"electronic mail message\" shall have the meanings as assigned to them in Explanation to section 66A of the Information Technology Act, 2020 (21 of 2000).” “[Service of notice, summons, requisition, order and other communication. 127.(1) For the purposes of sub-section (1) of section 282, the addresses (including the address for electronic mail or electronic mail message) to which a notice or summons or requisition or order or any other communication under the Act (hereafter in this rule Printed from counselvise.com ITA No.1534/Del/2024 17 referred to as \"communication\") may be delivered or transmitted shall be as per sub-rule (2). (2) The addresses referred to in sub-rule (1) shall be— (a) for communications delivered or transmitted in the manner provided in clause (a) or clause (b) of sub-section (1) of section 282— (i) the address available in the PAN database of the addressee; or (ii) the address available in the income-tax return to which the communication relates; or (iii) the address available in the last income-tax return furnished by the addressee; or (iv) in the case of addressee being a company, address of registered office as available on the website of Ministry of Corporate Affairs: Provided that the communication shall not be delivered or transmitted to the address mentioned in item (i) to (iv) where the addressee furnishes in writing any other address for the purposes of communication to the income-tax authority or any person authorised by such authority issuing the communication: Provided further that where the communication cannot be delivered or transmitted to the address mentioned in item (i) to (iv) or any other address furnished by the addressee as referred to in first proviso, the communication shall be delivered or transmitted to the following address:— … (b) for communications delivered or transmitted electronically— (i) e-mail address available in the income-tax return furnished by the addressee to which the communication relates; or (ii) the e-mail address available in the last income-tax return furnished by the addressee; or (iii) in the case of addressee being a company, e-mail address of the company as available on the website of Ministry of Corporate Affairs; or (iv) any e-mail address made available by the addressee to the income-tax authority or any person authorised by such income-tax authority. (3) The Principal Director General of Income-tax (Systems) or the Director General of Income-tax (Systems) shall specify the procedure, formats and standards for ensuring secure transmission Printed from counselvise.com ITA No.1534/Del/2024 18 of electronic communication and shall also be responsible for formulating and implementing appropriate security, archival and retrieval policies in relation to such communication.]” 4.2.6 Therefore, for a valid issuance of notice, the notice u/s 148 of Income Tax Act was required to be sent by email to one of the following addresses: 4.2.7 As per the table above, it is clear that for the valid issuance of notice, the notice was required to be sent to the appellant on the email ids specified in Rule 127 of Income Tax Rules. These email ids were [e-mail] and [e-mail] . However, it is noted that the email communicating the notice u/s 148 of Income Tax Act was sent to the Printed from counselvise.com ITA No.1534/Del/2024 19 appellant to another email id si~[e-mail] on 31.03.2021. Since, [e-mail] is not a valid email id of the appellant for the purposes of Rule 127 of Income Tax Rules; the communication of notice u/s 148 of Income Tax Act on this email id cannot be considered a valid issuance of notice to the appellant. Therefore, the notice u/s 148 of Income Tax Act although digitally signed on 31.03.2021 was not validly issued to the appellant on 31.03.2021. 4.2.8 However, the notice u/s 148 of Income Tax Act digitally signed by the Assessing Officer was subsequently issued to the appellant at [e-mail] on 08.04.2021. This is a valid issuance of notice and both the appellant and the Assessing Officer have not disputed the fact that the email enclosing notice was sent by the Assessing Officer from [e-mail] to the appellant at [e-mail] on 08.04.2021. Therefore, it is held that the notice u/s148 of Income Tax Act was issued by the AO only on 08.04.2021. 4.2.9 Another issue which is required to be considered while deciding the validity of notice u/s 148 of Income Tax Act is its service by post. As per the records of the case the notice was issued by speed post on 31.3.2021 at the address No.61, Poorvi Marg, Vasant Vihar, New Delhi-110057. The appellant had contended that this is not the valid address of the appellant and therefore such service of notice by speed post cannot be considered valid issuance of notice u/s 148 of Income Tax Act. According to the appellant “For the communication made through physical delivery effected by speed post, the various sub-clauses (i) to (iv) of Rule 127(2)(a) applies which lays down that such communication has to be on either of the addresses such as: a. the address of the assessee available on the PAN database (sub clause (i) or b. address on the ITR for the AY 2015-16 (sub clause (ii), the assessment year to which the notice pertains or; c. the address on the last ITR filed i.e. AY 2020-21 (sub clause (iii) or the address on the website of MCA, if the assessee is a company (sub clause (iv). However, there is an overriding concession given in proviso to rule 127(2)(a) which lays down that where the assessee has given a particular address to the AO for communication, in that case AO needs to send the notice on that particular address and other addresses are not relevant for him for compliance of the conditions of the rule 127(2)(a).” Printed from counselvise.com ITA No.1534/Del/2024 20 4.2.10 To find the address with the PAN database of the appellant, an email was sent to ADG(Systems)-1 with a request to provide the address of the appellant available in the PAN database as on 31.3.2021, ADG(Systems)-1 vide her email dated 22.12.2023 informed the following: “The address of the PAN: AABCS2244J as on 31.3.2021 is as below: SANTOSH HOSPITALS PRIVATE LIMITED NO. 1 7TH AVENUE, BESANT NAGAR, ANNAIVELANKANNICHRCH, CHENNAI, TAMILNADU, 600090 4.2.11 Therefore, for a valid issuance of notice, the notice u/s 148 of Income Tax Act was required to be sent by post to one of the following addresses: Printed from counselvise.com ITA No.1534/Del/2024 21 4.2.12. This office vide email dated 28.12.2023 have asked the Assessing Officer as under: As per the communication received from ADG-1, Systems, the address available in the PAN database of the appellant was the following: Santosh Hospitals Private Limited No 17th Avenue Besant Nagar, Chennal. Tamilnadu, 600090 However, it is noted that the notice u/s 148 dated 31.03.2021 was issued by post to the address No 61, Poorvi Marg Vasant Vihar, New Delhi, Delhi, India-110057 In this connection, you are requested to inform as to whether the appellant had furnished in writing the above address for the purposes of communication or not. In case the appellant had made a communication with the AO for informing the above address for the purposes of communication, a copy of the letter may be provided to the undersigned. The Assessing Officer vide his reply dated 02.01.2024 has submitted an under: \"The notice u/s 148 for A.Y. 2015-16 was sent to the address No 61, Poorvi Marg, Vasant Vihar, New Delhi, Delhi, India 110057 on 31.03.2021. However, on perusal it is seen that no communication with the AO is available on the Assessment Folder informing the address for the purpose of communication Further, since the assessee has not raised objection before the completion of reassessment order and has co-operated in inquiry relating to re- assessment. Therefore, as per provisions of section 292BB of the Income Tax Act, 1961 the notice is valid and assessee shall be precluded from taking any objection in any proceeding or inquiry under this Act that the notice was- (a) not served upon him: or (b) not served upon him in time; or (c) served upon him in an improper manner.\" Printed from counselvise.com ITA No.1534/Del/2024 22 Therefore, the Assessing Officer had confirmed that no communication is available with the Assessing Officer as per records wherein the appellant had informed the Assessing Officer about the Vasant Vihar, New Delhi address as the address for communication. 4.2.13 Moreover, the appellant in its submission dated 22.12.2023 had pointed out that the Vasant Vihar address used by the Assessing Officer pertains to a premise, which was taken on rent by the appellant for three years starting from 23.12.2016 to 22.12.2019. However, the premises were vacated in January 2018 and after which no rent was paid. Therefore, the address mentioned at the notice sent by post was not a correct address as on 31.03.2021. 4.2.14 The issue of issuance and service of notice to an incorrect address has been addressed in d following case lows: 1. In a recent judgment by the Delhi High Court in the case of PCIT vs. Madhu Gupta the Hon'ble Delhi High court had emphasizes the pivotal role of a validly served notice under Section 148 for initiating reassessment. The court upheld the findings of the CIT(A) and ITAT, asserting that reassessment proceedings hinge on a validly served notice under Section 148. The failure of the AO to serve the notice at the correct address, despite being aware of the discrepancy, was deemed fatal to the reassessment process. The relevant part of the order are as under: “…. 9. The reassessment proceedings can be triggered only when a notice under Section 148 has been issued and served on the concerned assessee. This is a finding of fact. Both the CIT(A) as well as the Tribunal have come to a definitive conclusion that the service of notice under Section 148 was not effected on the respondent/assessee.... 3 Further, in another recent judgment of November 2023, Hon'ble Delhi High Court in the case M/s Dart Infrabuild (P) Ltd. had upheld the findings of ITAT Delhi and held the following: “…. 2. Two issues arise for consideration by this Court. 2.1 First, whether the notice dated 30.03.2015 issued under Section 148 of the Income-tax Act, 1961 [hereafter referred to as \"the Act\"] was served at the correct address of the respondent/assessee. 2.2 Second, whether the appellant/revenue was obliged, in the facts and circumstances of the case, to mandatorily serve a notice Printed from counselvise.com ITA No.1534/Del/2024 23 under Section 143(2) of the Act before passing the assessment order dated 28.03.2016 under Section 147/144 of the Act. 3. Thus, before we proceed further, insofar as the first issue is concerned, what is required to be ascertained is whether the appellant/revenue had the correct address available in its record when it triggered the reassessment proceedings qua the respondent/assessee, as the controversy centres on the availability of the new address in the database of the appellant/revenue. …. 17. Thus, for the foregoing reasons, which are i) that notice under Section 148 of the Act was improperly served, and ii) that notice under Section 143(2) should have been issued before framing of assessment order u/s 147/144 of the Act, we are not inclined to interfere with the impugned order passed by the Tribunal. 4. In the case of Chetan Gupta, [2015] 62 taxmann.com 249 (Delhi), Hon’ble Delhi High Court held that in order to complete reassessment, notice u/s 148 has to be mandatorily served upon assessee in accordance with section 282(1) of Income Tax Act. The relevant directions as per the order are summarized as under: 2. For the Assessing Officer to exercise jurisdiction to reopen an assessment, notice under section 148(1) has to be mandatorily issued to the assessee. Further the AO cannot complete the reassessment without service of the notice so issued upon the assessee in accordance with section 282(1) of the Act, read with Order V Rule 12 CPC and Order III Rule 6 CPC. 3. Although there is change in the scheme of sections 147, 148 and 149 of the Act from the corresponding section 34 of the 1922 Act, the legal requirement of service of notice upon the assessee in terms of section 148, read with section 282(1) and section 153(2) of the Act Is a jurisdictional pre-condition to finalizing the reassessment. 4. The onus is on the revenue to show that proper service of notice has been effected under section 148 of the Act on the assessee or an agent duly empowered by him to accept notices on his behalf. 5. The mere fact that an assessee or some other person on his behalf not duly authorized has participated in the reassessment proceedings after coming to know of it will not constitute a waiver of the requirement of effecting proper service of notice on the assessee under section 148. 6. Reassessment proceedings finalised by an Assessing Officer without effecting proper service of notice on the assessee under section 148 (1) of the Act are invalid and liable to be quashed. Printed from counselvise.com ITA No.1534/Del/2024 24 4.2.14 Therefore, as per Rule 127(2)(a) of Income Tax Rules the notice u/s 148 of Income Tax Act was required to be issued at the Chennai address but the same was issued at the Delhi address, which is not the address mentioned in Rule 127(2)(a). Therefore, the issuance of notice by post on 31.03.2021 cannot be considered in compliance to the Rule 127(2)(a) of Income Tax Rules. The Notice is 'issued' validly for the purpose of section 149 of the Act of 1961 only if it is issued to the correct address of the appellant. Accordingly, it is held that the notice issued by post on 31.03.2021 to an incorrect address is not in accordance to the Rule 127(2)(a) of Income Tax Rules and therefore the notice u/s 148 of Income Tax Act dated 31.03.2021 issued by post on an incorrect address cannot be considered a valid notice. 4.2.15 However, at this stage, this matter is also required to be evaluated in accordance with the provisions of Section 292BB of Income Tax Act. The Assessing Officer had submitted that since the assessee has not raised objection before the completion of reassessment order and has cooperated in inquiry relating to reassessment. Therefore, as per provisions of sec. 292Bb of the Act the notice is valid and assessee shall be precluded from taking any objection in any proceeding or inquiry under this Act that the notice was either not served upon him or not served upon him in time or served upon him in an improper manner. It is observed that the appellant is not disputing the fact that the notice was served upon it and it is only mentioning that the notice was served upon him only subsequent to 01.04.2021. There is no dispute is only about the procedure to be followed for reassessment subsequent to the Ashish Agarwal judgment. Therefore, sec. 292BB cannot be considered as effective in this case. 4.2.16 As per the sec. 149 of the Act the limitation for notice u/s 148 of the Act is based on ‘issuance’ of such notice by the department. The issue of issuance of notice u/s 148 of the Act has been dealt in detail by Hon’ble Delhi High Court in the case of Suman Jeet Agarwal [2022] 143 taxmann.com 11 (Delhi). The relevant extracts of the judgment are as under: “…. 25.23 We therefore answer question no. (1) in negative against the Department and hold that the impugned Notices dated 31.3.2021, which were dispatched on 1.4.2021, or thereafter, would not meet the test of ‘issues’ u/s 149 of the Act and would be time barred, unless saved by the judgment of the SC in Ashish Agarwal (supra). … Printed from counselvise.com ITA No.1534/Del/2024 25 26.23 We also take judicial notice of the fact that the Department from May, 2022, for Notices issued on or after 1.4.21, has considered the date and time of dispatch of the notices as recorded by the ITBA portal as the date of issuance and disregarded the date of generation of notice i.e. 31.3.21. For notices dispatched on or after 1.4.21, the Department, following the SC’s order in Ashish Agarwal (supra) considered the notices as issued u/s 148A of the Act. This shows that the Department itself acknowledges and admits that the date of generation is distinct from date of issuance and the Department considers the dispatch by ITBA Portal as the date of issue for the purpose of section 149 of the Act. Finding for Notices falling under category ‘C’ Since the time taken by the ITBA email software system in triggering the e-mails is attributable to the Department, the AO is directed to determine the date and time on which the emails were triggered by the ITBA system server as per the ITBA records and consider the same as the date of issuance. Illustratively, in W.P.(C) 8994 of 2021 for the Notice dated 31.3.2021 and digitally signed on 31.3.21 the AO is directed to determine the date and time of dispatch as recorded by ITBA portal and consider the same as the date of issuance. … 28.7 We hold that, in order for this mode of transmission i.e. uploading of the Notices in the e-filing portal of the assessee, to be considered valid service, the Department should have issued a real time alert as provisioned in the aforementioned Section 144B(6)(ii)(a) of the Act. Since, the prescribed mode of service is not followed it is akin to no due dispatch of Notices, therefore it cannot be said that the Notices were validly issued. … 31.3 Category ‘C’: The petitions challenging Notices falling under category ‘C’ which were digitally signed on 31.3.21 are disposed of with the direction to the JAOs to verify and determine the date and time of dispatch as recorded in the ITBA portal in accordance with the law laid down in this judgment as the date of issuance. If the date and time of dispatch recorded is on or after 1.4.21, the Notices are to be considered as show- cause-notices u/s 148A(b) as per the directions of the apex Court in the Ashish Agarwal (supra) judgment. ….. Printed from counselvise.com ITA No.1534/Del/2024 26 31.6 Notices sent to unrelated e-mail addresses: The petitions challenging notices which were sent to unrelated mail addresses are disposed of with the direction the JAOs to verify the date on which the Notice was first viewed by the assessee on the e filing portal and consider the same as the date of issuance. If such date of issuance is determined to be on or after 1.4.21, the Notices will be construed as issued u/s 148A(b) of the Act as per judgment in Ashish Agarwal (supra). … 31.9 The Notices which in accordance with the law laid down in this judgment has been verified by the JAOs to have been issued on or after 1.4.21 and until 30.6.21 shall be deemed to have been issued u/s 148A of the Act, 1961 as substituted by the Finance Act, 2021 and construed to be show cause notices in terms of section 148A(b) as per the judgment of the apex court in Ashish Agarwal (supra) and the JAOs shall thereafter follow the procedure set down by the Supreme Court in the said judgment which read as follows: “26. In view of the above and for the reasons stated above, the present Appeals are ALLOWED IN PART. The impugned common judgments and orders passed by the High Court of Judicature at Allahabad in W.T. No.524/2021 and other allied tax appeals/petitions, is/are hereby modified and substituted as under: - (i) The impugned section 148 notices issued to the respective assesses which were issued under un- amended section 148 of the Act, which were the subject matter of writ petitions before the various respective High Courts shall be deemed to have been issued u/s 148A of the Act as substituted by the Finance Act, 2021 and construed or treated to be show cause notices in terms of section 148A(b). The AO shall, within thirty days from today provide to the respective assessees information and material relied upon by the Revenue, so that the assesses can reply to the show cause notices within two weeks thereafter; (ii) The requirement of conducting any enquiry if required, with the prior approval of specified authority u/s 148A(a) is hereby dispensed with as a one time measure vis a vis those notices which have been issued u/s 148 of the unamended Act from 1.4.21 till date, including those which have been quashed by the High Courts. Printed from counselvise.com ITA No.1534/Del/2024 27 Even otherwise as observed hereinabove holding any enquiry with the prior approval of specified authority is not mandatory but it is for the concerned Assessing Officer to hold any enquiry if required; (iii) The Assessing Officers shall thereafter pass orders in terms of sec. 148A(d) in respect of each of the concerned assessees; Thereafter following the procedure as required u/s 148A may issue notice u/s 148 (as substituted); (iv) All defences which may be available to the assesses including those available u/s 149 of the Act and all rights and contentions which may be available to the concerned assessees and Revenue under the Finance Act, 2021 and in law shall continue to be available.” (emphasis provided on heighted portions by undersigned)….. 4.2.17 In view of the discussion above, all the relevant issues are summed up as under: 1. The notice u/s 148 of the Act dated 31.3.21 was digitally signed on 31.3.21. 2. The notice u/s 148 of the Act dated 31.3.21 was issued to an address which is not as per the address permissible as per Rule 127(2)(a) of Income Tax Rules and therefore the notice issued at an incorrect address cannot be considered as validly issued on 31.3.21. 3. This notice was sent through ITBA to an email id [e-mail] from system on 31.3.21 at 6:55:30 pm but this email id was not in accordance with the permissible email id mentioned in Rule 127(2)(b) of Income Tax Rules. Therefore, this email cannot be considered as a valid issuance of notice u/s 148 of the Act. 4. This notice u/s 148 of the Act dated 31.3.21 was shared with assessee on e-proceeding at 1.4.21 at 02.04 pm and therefore the same was available to the appellant on or after 01.4.21 only. It is noteworthy that this was the first valid issuance of notice u/s 148 of the Act in this case. As per the directions of Hon’ble Delhi High Court as discussed above “The petitions challenging notices which were sent to unrelated e-mail addresses are disposed of with the direction the JAOs to verify the date on which the notice Printed from counselvise.com ITA No.1534/Del/2024 28 was first viewed by the assessee on the e-filing portal and consider the same as the date of issuance. If such date of issuance is determined to be on or after 1.4.21, the notices will be construed as issued u/s 148A(b) of the Act as per judgment in Ashish Agarwal”. Therefore, the notice was issued only on 1.4.21. 5. Subsequently, a notice u/s 148 of the Act was also issued to an email id permissible under Rule 127(2)(b) on 8.4.21. The appellant complied with this notice as this was a valid notice u/s 148 of the Act and the reassessment was completed accordingly. 6. The appellant challenged the issuance of notice u/s 148 of the Act only in view of the Hon’ble SC order in the case of Ashish Agarwal and Hon’ble Delhi High Court order in the case of Suman Jeet Agarwal. 4.2.18 Thus, on the basis of facts of the case and the decisions of Hon’ble Jurisdictional High Court it has been concluded that a notice for reassessment can only be considered as validly issued if, it is issued at the address and/or at the email as mentioned in Rule 127 of I.T. Rules. Further, the date of issuance of such notice shall either be the date when the notice is issued at the correct address and/or correct email id of the appellant or the date on which the Notice was first viewed by the assessee on the e-filing portal. Therefore, there are two occasions of valid issuance of notice u/s 148 of the Act; first on or after 1.4.21, when the notice was uploaded on e-filing website of the department and when it was first viewed by the appellant and second on 8.4.21, when the notice was issued to a valid email id in accordance to Rule 127(2)(b) of Income Tax Rules. Further, this issue of issuance of notice was taken up by the assessee during the appellate proceedings in view of the subsequent judgment of Hon’ble SC in the case of Ashish Agarwal and of Hon’ble Delhi High Court order in the case of Suman Jeet Agarwal. 4.2.19 Having established above that the notice u/s 148 of the Act dated 31.3.21 was issued on or after 1.4.21, the directions of Hon’ble Delhi High Court in the case of Suman Jeet Agarwal and Hon’ble SC in the case of Ashish Agarwal becomes applicable. Hon’ble Delhi High Court observed that if such date of issuance is determined to be on or after 1.4.21, the notices will be construed as issued u/s 148A(b) of the Act as per judgment in Ashish Agarwal. Therefore, in the present case the AO was required to follow the procedure as if the notice was issued u/s 148A(b) of the Act. Moreover, the CBDT vide its Instruction No.01/2022 dated 11.5.22 had clarified that the judgment in Ashish Agarwal applies to al cases, where extended reassessment notices hav been issued irrespective of the fact whether such notices have been challenged Printed from counselvise.com ITA No.1534/Del/2024 29 or not. Moreover, the Delhi High Court in the case of Suman Jeet Agarwal have observed that the notice issued on or after1.4.21 would be time barred unless saved by the judgment of the SC in Ashish Agarwal. In the present case, as per the assessment order, no such procedure as establish in Ashish Agarwal’s case was followed and therefore the reassessment proceedings and consequent reassessment order cannot be considered as valid and legal. Since the notice issued u/s 148 is subsequent to 1.4.21, the same was required to be validated by the procedure established by Hon’ble SC in Ashish Agarwal’s case. In the opinion of Hon’ble Jurisdictional High Court as discussed in the above paragraphs, this is a fatal error and the reassessment carried out by following incorrect procedure cannot be considered as valid and as per law. Accordingly, the reassessment proceedings in this case are invalid and are therefore liable to be quashed. Not following the procedure establish by the judgment of Hon’ble SC would be fatal to the reassessment proceedings. The assessment order passed by the AO subsequent to an invalid notice u/s 148 of the Act and in the absence of its subsequent regularization through the procedure established in the Ashish Agarwal’s case is therefore not in accordance with law and the reassessment proceedings are accordingly considered invalid. The reassessment order is accordingly treated as invalid and the same cannot be sustained. Ground no.2 of appeal is allowed.” 9. In the course of further hearing on a query from the Bench as to when the e-mail id [e-mail], which was the email id available in the PAN data base of the assessee is validly triggered at 6.55 pm on 31.03.2021 and why the same should not be treated as valid service of notice u/s 148 under Rule 127(2)(b)(iv) of I.T. Rules, the Ld. Counsel for the assessee submitted that the communication address provided in PAN data is only for Rule 127(2)(a) i.e. for communications delivered or transmitted in the manner provided in clause (a) or clause (b) of sub-section (1) of section 282 of the Act. The Ld. Counsel for the assessee submits that clause (a) and (b) of section 282(1) refers to communication by post or by courier services Printed from counselvise.com ITA No.1534/Del/2024 30 or in such manner as provided under the code of Civil Procedure for the purpose of service of summons. 9.1 Ld. Counsel for the assessee further submitted that for affecting service through electronic mode Rule 127(2)(b) is applicable. Ld. Counsel for the assessee referring to this rule submitted that for communications delivered or transmitted electronically clause (b) of Rule 127(2) specify the following: i) e-mail address available in the Income Tax return furnished by the assessee to which the communication relates to or; ii) the e-mail address available in the last income tax return furnished by the assessee or; iii) in the case of addressee being a company, e-mail address of the company as available on the web site of Ministry of Corporate Office or; iv) any e-mail address made available by the addressee to the Income tax authority or any person authorized by such Income tax authority. 9.2 Ld. Counsel for the assessee further submitted that the e-mail id i.e. [e-mail] on which communication of notice u/s 148 was made is the mail id neither provided by the assessee in the ITR for AY 2015-16 nor in the latest ITR i.e. ITR for AY 2020-21. Ld. Counsel submitted that this fact can be verified from the e-mail address of the assessee for the purpose of Rule 127(2)(b) including Printed from counselvise.com ITA No.1534/Del/2024 31 sub-clause (iv) thereof in the Ld. CIT(A) order as per table in para 4.2.6 on pages 27 & 28. Ld. Counsel submitted that the Ld. CIT(A) has given a specific finding that the mail id [e-mail] was not available to the Assessing Officer for communication of the notices as per Rule 127(2)(b) r.w.s. 282 of the Act. 9.3 The Ld. Counsel for the assessee further inviting our attention to pages 176 & 177 of the Paper Book submitted that as a matter of fact the assessee on 12.12.2020 intimated the Assessing Officer on commencement of liquidation proceedings and appointment of liquidators in the case of the assessee and thereafter the Department is duly informed the change of dispensation of the management and therefore the Department could not have ignored this information for communication of notices. The Ld. Counsel further referring to page 146 of the Paper Book submitted that the above intimation to the Department was on record even prior to 12.12.2020 gets substantiated from the processing of intimation dated 02.08.2020 for the AY 2019-20 sent by the CPC on the e-mail id of the liquidator i.e. [e-mail] which is placed at page 145 of the Paper Book. Ld. Counsel further submitted that as is evident from the finding of the Ld. CIT(Appeals) in para 4.2.3 at page 26 of the Ld. CIT(A) order that the Assessing Officer on 08.04.2021 has sent notice Printed from counselvise.com ITA No.1534/Del/2024 32 u/s 148 on the e-mail address of the liquidator i.e. [e-mail] after 8 days or the transitions of the above notice on the incorrect e-mail id. Therefore, the Ld. Counsel for the assessee submitted that even though the e-mail id of the liquidators was available with the AO the AO issued notice to a wrong e-mail id which is not as per Rule 127(2)(b)(iv). Ld. Counsel for the assessee further made the following submissions: “The query of the Hon'ble Bench is that when the email at email id: [e-mail], which was the mail id available in the PAN data base of the assessee, is validly triggered at 6.55 on 31.03.2021, why the same should not be treated as valid service of notice u/s 148 as the same is permissible under rule 127(2) (b) (iv) of IT Rules. The respondent assessee has carefully gone through the above query raised by the Hon’ble Bench and seeks to respond thereto as under: 1. The availability of address at PAN database of the assessee is only relevant, as provided in clause (a) of rule 127(2) of IT rules, where the / notice is sought to be communicated or transmitted in the manner provided in clause (a) or (b) of sec 282( 1) of IT Act. The clauses (a) or (b) of sec 282(1) specifically deals with sending or transmitting a communication either under clause (a) or by post/by courier service or under (b) in the manner provided in Code of Civil Procedures 1908 dealing with service like personal delivery, delivery through registered address or on the adult member of the family or business service or immovable property of the assessee. The rule 127(2) (a) provides that where delivery of notices is made in either of above manners, only under such circumstances, the address available in PAN data will be relevant address and not in other circumstances. 2. The address on PAN database of the assessee is, therefore, not relevant factor when the service of notice is made through electronic transmission under rule 127(2)(b). For electronic communication, rule 127(2)(b) and its sub-clauses (i) to (iv) are applicable which clearly define the modes and manner of electronic communication on the email id available on the ITR for the year for which proceeding is initiated or email id available on last ITR or the email id available on the Printed from counselvise.com ITA No.1534/Del/2024 33 website of MCA (if addressee is a company) or email id made available by the addressee himself or any person authorized by him. 3. In the present case, the email id i.e. [e-mail] on which communication of the notice u/s 148 was made is the mail id neither provided by the respondent assessee in the ITR for AY 2015-16 nor in the latest ITR i.e. ITR for AY 2020-21. This fact can be verified from the E mail addresses of the appellant for the purpose of Rule 127(2) (b) including sub clause (iv) thereof in the Id CIT (A) order as per table in para 4.2.6 on pages 27/28. It is specifically mentioned by the Ld CIT(A) that the mail id [e-mail] was not available to the AO for communication of the notice as per rule 127(2)(b) r.w.s. 282 of the Act. It appears that the Hon’ble Bench has assumed that above email id is as per PAN data of the assessee and on that basis the assumption is drawn that this email id might have been provided by the assessee as provided in rule 127(2)(b)(iv) of IT Rules. The above assumption is not based on correct appreciation of the following facts: A. The assessee company came under the fire of liquidation proceedings w.e.f 17.12.2019 (PB 177) and after the initiation of liquidation proceedings, the management of the company came under the control of liquidators of the company namely Ms Deepa Venkat Ramani. It is a settled position of law under the Companies Act that once the liquidation proceedings commence, the directors of the company get suspended and the official liquidator takes charge of all the matters relating to the company including legal and tax matters. B. The intimation of commencement of liquidation proceedings and appointment of liquidators of the Company was given to the department through communication dated 12.12.2020 which is placed in paper book at pages 176-177. After the Department is duly informed of the change of dispensation of the management and suspension of directors, the department could not have ignored this information for communication of notices. The fact that the above intimation was on record even prior to 12.12.2020 gets substantiated from the processing intimation dated 02.08.2020sent by the CPC on the email id of liquidator i.e. [e-mail] (PB 146). The copy of the ITR for AY 2020- 21 (PB 147) also shows the email address of the liquidator which address was relevant for communication of the notice under reference. Printed from counselvise.com ITA No.1534/Del/2024 34 C. From the discussion in para 4.2.3 page 26 of the Ld CIT(A), it is evident that the Ld AO on 08.04.2021 has sent the jurisdictional notice under section 148 on the E-mail address of the liquidator ie [e-mail] on his own just after eight days from the transmission of the above notice on the incorrect e mail id. The fact of subsequent transmission of the notice under reference at the correct mail id, undisputedly shows that information of correct mail id was very much in the records of the Ld. AO and this information of the correct e- mail id has been ignored by the Ld AO. This also shows that the Ld AO has himself realised the mistake of making earlier communication at incorrect e mail id. This mistake, in any case, is not a curable mistake as it involves limitation issue. D. If the above facts are taken on record and even if earlier email id is accepted as correct id for communication, for sake of argument, such mail id which was provided by the old directors could not hold good as those directors ceased to have locus standii on the company post initiation of liquidation proceedings. Nevertheless and even otherwise, the department is unable to bring on record evidence of any intimation of above email id made either on behalf of the company so as to bring into play the benefit of rule 127(2) (b) (iv). The department has also not come out with any evidence showing some communication from the assessee that the above email id is as per PAN database. Had it been so, there could not have been any reason for communication of processing intimation for AY. 2019-20 on 27.05.2020 (PB 146) and for AY 2020-21 dated 01.02.2021 (PB 149), both, on email id of liquidator. The above communication, by CPC on email id of the liquidator, displaces the assumption the email id used by the department for communication of notice u/s 148 was the email id either provided by the assessee company or is appearing on the PAN database. The assessee hopes that the above clarification shall be found to be satisfying the Hon’ble Bench that the communication of the notice u/s 148 on 31.03.2021 through e- mail id in the present case was not in accordance with section 282 read with Rule 127 of the Act.” Printed from counselvise.com ITA No.1534/Del/2024 35 9.4 We find considerable force in the submission of the Ld. Counsel for the assessee. Perusal of page 176 of the Paper Book suggests that the assessee on 12.12.2020 itself intimated the AO about the liquidation of the assessee and appointment of liquidator of the assessee company. Page 178 of the Paper Book suggests that the assessee on 04.01.2021 through the liquidator Deepa Venkaraman submitted to the AO the requisite information called for in the assessment proceedings for AY 2018-19. Page 146 of the Paper Book which is the acknowledgement for processing the return for the AY 2019-20 dated 02.08.2020 clearly show that the return was processed and the liquidator was intimated through their mail id namely [e-mail]. All these goes to show that the AO was intimated much prior to issue of notice u/s 148 about the liquidation proceedings, appointment of liquidator and also the e-mail id of the liquidator provided by the assessee and the liquidator also furnished information on behalf of the assessee in the assessment proceedings for AY 2018-19 before the Assessing Officer much prior to issue of notice u/s 148 dated 31.03.2021 for assessment year under consideration i.e. 2015-16. Therefore, the notice u/s 148 dated Printed from counselvise.com ITA No.1534/Del/2024 36 31.03.2021 delivered or transmitted electronically to the assessee was after 31.03.2021 and not on or before 31.03.2021. 10. Thus, on careful perusal of the findings of the Ld. CIT(Appeals), we agree with the view of the Ld. CIT(A) that the notice u/s 148 dated 31.03.2021 was issued on 01.04.2021 and by virtue of the decision of the Hon’ble Supreme Court in the case of UOI vs. Ashish Agarwal (supra) and the decision of the Hon’ble Supreme Court in the case of UOI vs. Rajiv Bansal (supra) the AO ought to have issued notice u/s 148A(b) validating the earlier notice dated 31.3.2021 issued u/s 148 (pre-amended provisions) and followed the due process for completion of reassessment which the AO failed to do so and therefore the Ld. CIT(A) has rightly held that the notice which was issued on 01.04.2021 and not validated as per the decision of the Hon’ble Supreme Court in the case of UOI vs. Ashish Agarwal (supra) became invalid and consequently the reassessment framed based on such invalid notice was bad in law. 11. In so far as the contention of the Ld. DR that since the assessee has participated in the proceedings and therefore should not have questioned the notice u/s 148, in our view the provisions of section 292BB have no application since the issue here is when was the notice officially issued and communicated to Assessee and not Printed from counselvise.com ITA No.1534/Del/2024 37 the question of valid service of notice issued by the Department. Therefore, in our view the provisions of section 292BB have no application to the facts of the assessee’s case and the case law relied on by the Ld. DR has no application to the present situation. The notice which was issued to the assessee on 01.04.2021 became invalid by virtue of operation of law by the Hon’ble Supreme Court in the case of Ashish Agarwal and Rajiv Bansal as the AO did not follow the procedure laid down by the Hon’ble Supreme Court for completion of reassessment. Thus, we sustain the order of the Ld. CIT(A) and reject the grounds raised by the Revenue. 12. Since we have upheld the order of the Ld. CIT(A) in holding that the notice was issued on 01.04.2021 and the said notice became invalid by virtue of operation of law by the decision of the Hon’ble Supreme Court as the said notice was not validated pursuant to the judgment of the Hon’ble Supreme Court in the case of Ashish Agarwal and therefore the notice is invalid and consequently the reassessment proceedings are bad in law, the contentions of the assessee in the application filed under Rule 27 of the ITAT Rules are left open at this stage and need not be adjudicated. Printed from counselvise.com ITA No.1534/Del/2024 38 13. In the result, appeal of the Revenue is dismissed. Order pronounced in the open court on 17.09.2025 Sd/- Sd/- (BRAJESH KUMAR SINGH) (C.N. PRASAD) ACCOUNTANT MEMBER JUDICIAL MEMBER Dated: 17.09.2025 *Kavita Arora, Sr. P.S. Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals) 5. DR: ITAT ASSISTANT REGISTRAR ITAT, NEW DELHI Printed from counselvise.com "