DURGA AGENCIES PVT. LTD.,DELHI V. ITO, WARD 7(1), DELHI

ITA 4923/DEL/2024

AI Insights

The case involves Durga Agencies Pvt. Ltd., the appellant, contesting a notice issued by the ITO, Ward 7 (1), Delhi, under section 148 of the Income-tax Act, 1961 for the Assessment Year 2017-18. The primary contention was the validity of the notice, which was argued to be invalid due to the absence of requisite approval from the Principal Chief Commissioner of Income Tax, as required by section 151(ii) of the Act. The Tribunal, referencing decisions from the Delhi High Court and other ITAT benches, agreed with the appellant, leading to the quashing of the notice and the subsequent assessment order.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 772452 (ITAT-DELHI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-08-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Assessment Year: 2017-2018
• Other Referred Cases: Communist Party of India (Marxist) vs. IT Department, Bhagwan Sahai Sharma vs DCIT, Manish Jaqdish Joshi vs CIT (DRP-3), ACIT vs Surya Ferrous Alloys Pvt Ltd
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RAJESH KUMAR DHANESTA
• Assessee Lawyers: C. S. ANAND
• Keywords: Set aside
• Section: 148

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCHES ‘A’, NEW DELHI. BEFORE SHRI SATBEER SINGH GODARA, JUDICIAL MEMBER and SHRI S.RIFAUR RAHMAN, ACCOUNTANT MEMBER ITA No.4923/DEL/2024 (Assessment Year: 2017-18) Durga Agencies Pvt. Ltd., vs. ITO, Ward 7 (1), C/o C.S. Anand, Advocate Delhi. B-81, First Floor (Part B), Defence Colony, Bhishma Pitamah Marg, New Delhi – 110 024. (PAN : AAACD4709Q) (APPELLANT) (RESPONDENT) ASSESSEE BY : Shri C.S. Anand, Advocate Ms. Vaishnavi Yadav, Advocate REVENUE BY : Shri Rajesh Kumar Dhanesta, Sr. DR Date of Hearing : 25.06.2025 Date of Order : 27.08.2025 O R D E R PER S.RIFAUR RAHMAN,AM: 1. The assessee has filed appeal against the order of the Learned Commissioner of Income-Tax (Appeals)/National Faceless Appeal Centre (NFAC), Delhi [“Ld. CIT(A)”, for short] dated 27.09.2024 for the Assessment Year 2017-18. 2. At the time of hearing, ld. AR of the assessee pressed the Ground No.1 which read as under :- Printed from counselvise.com 2 ITA No.4923/DEL/2024 “1. On the peculiar facts of the case and in law, the letter-cum- notice dt. 19.05.2022 issued by the ITO, Ward 7 (1), Delhi u/s 148A(b) is liable to be quashed.” 3. Ld. AR for the assessee brought to our notice the written submissions submitted by him before the Bench and submitted that the Notice dated 29.07.2022 issued u/s 148 of the Income-tax Act, 1961 (for short) is not a valid notice, as the approval was not granted by the specified authority i.e. Principal Chief Commissioner of Income Tax as mandated u/s 151(ii) He submitted that the impugned notice u/s 148 for AY 2017-18 was issued on 29.07.2022, after obtaining the approval Pr.CIT, Delhi i.e. beyond the period of three years from the end of the relevant assessment year and thus, in terms of sec.151(ii) of the Act, the same was required to be approved by the Principal Chief Commissioner or Principal Director General or where there is no such authority, by Chief Commissioner or Director General. He submitted that in the case of the assessee, it is apparent that the said notice u/s 148 was not issued with the prior approval of the Principal Chief Commissioner or any other authority specified u/s 151(ii) of the Act. In this regard, he placed reliance on the following decisions and prayed to allow the appeal of the assessee :- (i) Hon’ble Delhi High Court in the case of Communist Party of India (Marxist) vs. IT Department - W.P.(C) 9031/2023, [reported in 2025 SCC Online Del 3233] Printed from counselvise.com 3 ITA No.4923/DEL/2024 (ii) Hon’ble Delhi High Court in the case of Bhagwan Sahai Sharma vs DCIT - W.P.(C) 3220/2023 [reported in 2025 SCC Online Del 3443] (iii) ITAT, Mumbai Bench in the case of Manish Jaqdish Joshi vs CIT (DRP-3) - ITA No.1617/Mum/2024 (iv) ITAT, Mumbai Bench in the case of ACIT vs Surya Ferrous Alloys Pvt Ltd - ITA No.1406/Mum/2024. 4. On the other hand, ld. DR of the Revenue relied on the orders of the authorities below. 5. Considered the rival submissions and the material placed on record. We observed that the Notice dated 29.07.2022 issued u/s 148 of the Act is not a valid notice, as the approval was not granted by the specified authority i.e. Principal Chief Commissioner of Income Tax as mandated u/s 151(ii) We further observe that the impugned notice u/s 148 for AY 2017-18 was issued on 29.07.2022, after obtaining the approval Pr.CIT, Delhi i.e. beyond the period of three years from the end of the relevant assessment year and thus, in terms of sec.151(ii) of the Act, the same was required to be approved by the Principal Chief Commissioner or Principal Director General or where there is no such authority, by Chief Commissioner or Director General. We further observe that in the case of the assessee, the said notice u/s 148 was not issued with the prior approval of the Principal Chief Commissioner or any other authority specified u/s 151(ii) of the Act. In this regard, we find force from the judgment of Hon’ble Delhi Printed from counselvise.com 4 ITA No.4923/DEL/2024 High Court in the case of Communist Party of India (Marxist) (supra) wherein Hon’ble Delhi High Court relying on various judgments decided the issue in favour of the assessee as under :- “18. In view of the above, the order dated 29.07.2022 passed under section 148A(d) of the Act is not sustainable. Consequently, the subsequent proceedings, including the assessment order dated 23.05.2023, cannot be sustained. Accordingly, the impugned order passed under section 148A(d) of the Act, the notice issued under section 13 48 of the Act as well as the assessment order dated 23.05.2023 and the demand raised pursuant thereto, are hereby set aside.” 6. Respectfully following the aforesaid decision of the Hon’ble jurisdictional High Court, we quash the impugned assessment in this case and allow the appeal of the assessee. 7. Since we have quashed the assessment order on the legal issue, the other grounds raised by the assessee were not adjudicated at this stage. These are kept open. 8. In the result, the appeal filed by the assessee is allowed. Order pronounced in the open court on this 27th day of August, 2025 Sd/- sd/- (SATBEER SINGH GODARA) (S.RIFAUR RAHMAN) JUDICIAL MEMBER ACCOUNTANT MEMBER Dated: 27.08.2025 TS Printed from counselvise.com 5 ITA No.4923/DEL/2024 Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals). 5. DR: ITAT ASSISTANT REGISTRAR ITAT, NEW DELHI Printed from counselvise.com "