PJP FOUNATION TRUST ,MUMBAI V. ITO WARD 30(1)(1), MUMBAI

ITA 5000/MUM/2025

AI Insights

The case involves the PJP Foundation Trust, which appealed against an order passed under section 250 of the Income Tax Act, 1961, by the National Faceless Appeal Centre (NFAC) / CIT(A) for the assessment year 2015-16. The revenue challenged the appeal's admission due to a delay of 133 days in filing. The ITAT admitted the appeal, condoning the delay based on substantial justice principles. The core issue was the legality of the notice issued under section 148A(d) of the Act, which was found to be beyond the prescribed time limit, leading to the quashing of the reassessment order.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 783671 (ITAT-MUMBAI)
• Duration Of Justice: 2 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-11-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Assessment Year: 2015-2016
• Appeal Filed On: 11-08-2025
• Other Referred Cases: Land Acquisition Collector Vs MST Katiji and others, Mukesh Kumar Bhawarlal Jain Vs. AO, Union of India vs Ashish Agarwal, ACIT, Circle 19(1) v. Manish Financial, Union of India v. Rajeev Bansal
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: VIRABHADRA MAHAJAN
• Assessee Lawyers: RAJEEV KESRWANI; AKHILESH BHARGAVA; JUSTIFIABLY; PROPERLY
• Keywords: Condonation of delay; Set aside
• Section: 147; 148; 144

Judgement Text

"1 IN THE INCOME TAX APPELLATE TRIBUNAL “C” BENCH, MUMBAI BEFORE SHRI SANDEEP GOSAIN, JUDICIAL MEMBER & SHRI GIRISH AGRAWAL, ACCOUNTANT MEMBER I.T.A. No. 5000/Mum/2025 Assessment Year: 2015-16 PJP Foundation Trust Mr. Vincent J Pereira Baby Lawns Nursery, Opp to Union Bank, IC Colony Borivalli (W), Mumbai – 400103 Vs ITO, Ward – 30(1)(1) Room No. 235, Koutilya Bhavan, BKC 400051. (Assessee) (Respondent) Assessee by Shri Rajeev Kesrwani & Shri Akhilesh Bhargava Revenue by Shri Virabhadra Mahajan, Sr. DR (Virtually Present) Date of Hearing 23.09.2025 Date of Pronouncement .11.2025 ORDER Per: SHRI. SANDEEP GOSAIN, J.M.: The present appeal has been filed by the revenue challenging the impugned order dt. 30.01.2025 passed under section 250 of the Income Tax Act, 1961 (‘the Act’), by the National Faceless Appeal Centre (NFAC) / CIT(A) for the assessment year 2015-16. 2. At the outset, we noticed that the present appeal filed by the assessee is time barred by 133 days and in this regard an affidavit for seeking condonation of delay has Printed from counselvise.com 2 ITA No. 5000/Mum/2025 PJP Foundation Trust, Mumbai. been filed by the assessee, wherein it has been mentioned as under: Mr. Vincent J Pereira, age 61 years, residing atBaby Lawns Nursery, Opp. to Union Bank, I C Colony, Borivali West, Mumbai 400103. state on solemn affirmation as a deponent as under: In the matter of PJP Foundation Trust - PAN No. AACТР1898В, А.У. 2015-16 Affidavit of Mr. Vincent Joseph Pereira, s/o Mr. Joseph Augustine Pereiraage 61 years, Settler and Trustee in PJP Foundation Trust. That I the above-named deponent, am well conversant with the facts deposed below: 1. That the deponent was issued an order u/s 250 of the IT Act 1961, dated 30-1-2025. This order was passed by CIT (Appeals) NFAC and was delivered through Income Tax e- portal only, which was handled by CA R. P.Sardar & Co. That the e-delivery of this order u/s 250 was actually informed to the deponent only on 07/06/2025 2. That the IT submission for appeals etc. in the matter of PJP Foundation Trust, Mumbai was assigned to CA R. P.Sardar & Co. Due to the negligence of the CA and his team and for the reasons best known to them, this was conveyed to deponent by the CA only on 07-06-2025. 3. That the delay in filing the Appeal to the Income Tax Appellate Tribunal (ITAT), Mumbaidue to the negligence of the CA R. P.Sardar & Co. should not be held against PJP Foundation Trust and its Trustees. That, this delay which was caused due to the negligence of CA R. P.Sardar & Co. may kindly be condoned and the assessee Trust may not be penalised for no fault on their part. That the delay in filing the appeal to the Hon'ble Income Tax Appellate Tribunal (ITAT), Mumbai be condoned and the assess Trust be allowed to seek justice from the Hon'ble Income Tax Appellate Tribunal (ITAT), Mumbai 3. On the other hand Ld. DR refuted the contents contained in the affidavit and requested for dismissal of Printed from counselvise.com 3 ITA No. 5000/Mum/2025 PJP Foundation Trust, Mumbai. the appeal as there is no ‘sufficient cause’ for not filing the appeal within time. 4. After having heard the counsel for both the parties on the application for seeking condonation of delay and considering the entire factual position as explained before us and also keeping in view the principles laid down by Hon'ble Supreme Court in the case of Land Acquisition Collector Vs MST Katiji and others 1987 AIR 1353 Supreme Court, wherein it has been held that where substantial justice is pitted against technicalities of non deliberate delay, then in that eventuality substantial justice is to be preferred. However, considering the fact that delay in filing the present appeal had accrued on account of the fact that email Id registered on the income tax portal belong to an employee, who had subsequently resigned from the company and the said email ID was no longer in use. Thus in this way the company was not made aware of the order passed there under. In our view the principals of advancing substantial justice is of prime importance. Hence considering the explanation put forth by the Assessee by justifiably and properly explaining the delay which occurred in filing the appeal and construing the expression \"sufficient cause\" liberally we are inclined to condone the delay in filing the appeal before the Bench. Therefore we condone the delay and admit the appeal to be heard on merits. However, Ld. CIT(A) remitted back the case to the file of AO for a de- Printed from counselvise.com 4 ITA No. 5000/Mum/2025 PJP Foundation Trust, Mumbai. novo assessment order, without deciding the legal ground raised by the assessee. 5. As per the facts of the present case the order of assessment was passed u/s 147 r.w.s 144 of the Act, thereby making additions on account of short term capital gain. Aggrieved by the said order the assessee preferred appeal before Ld. CIT(A). 6. At the outset Ld. AR drawn our attention that the assessee has pressed Ground of appeal No. 3 which is legal in question and it goes to the roots of the case. Therefore we have decided to adjudicate this ground firstly. 3. Without prejudice to Ground No. 1 and 2 above, on the facts of the case, in the circumstances and in law, Ld. AO, has erred passing the order u/s 148A(d) of the Act, which is beyond the limit prescribed in the 1st proviso to Sec. 149(1). As a result, the order issued u/s 148A(d) of the Act may be treated as bed in law. 7. The said ground raised by the assessee relates to challenging the order of assessment passed u/s 148A(d) of the Act as the same was beyond the time limit prescribed in first proviso to Sec. 149 of the Act, and in this regard Ld. AR submitted that the limitation to issue notice for the year under consideration i.e A.Y 2015-16 was 31.03.2022. However, notice in this case was issued on 22.04.2022 which was time barred. And in this regard relied upon the decision of the Coordinate Bench of ITAT in the case of Mukesh Kumar Bhawarlal Jain Vs. AO in ITA No. 6695/Mum/2024, wherein the identical legal question was Printed from counselvise.com 5 ITA No. 5000/Mum/2025 PJP Foundation Trust, Mumbai. adjudicated, the operative portion of the same is reproduced herein below: 3. The Ld.AR argued and first took up the legal ground related to assumption of jurisdiction by the Ld.AO for reopening the assessment under section 147 of the Act. The Ld.AR submitted a chart related to issuance of notice under section 148 of the Act and finally, the order passed under section 148A(d) of the Act and the notice was issued under section 148 of the Act, the dates and events are tabulated as follows:- Sr.No. Particulars AY 2015-15 1 Original notice issued u/s 148 of the Act – Old provisions 28/04/2021 2 Last date to issue notice under amended provision of the Act as per the 1st Proviso to section 149 of the Act 31/03/2022 3 Order of the Hon’ble Supreme Court in the case of Union of India vs Ashish Agarwal 04/05/2022 4 Show cause notice was issued in accordance with the decision in the case of Union of India vs Ashish Agarwal reported in (2022) 444 ITR 1 (SC) and the appellant was granted time upto 10.06.2022 27/05/2022 5 Order passed by the Ld. JAO u/s 148A(d) of the Act 22/07/2022 6 Notice issued u/s 148 of the Act – New Provisions 22/07/2022 The Ld. AR, during the course of arguments, submitted that the notice issued by the Ld. AO for A.Y. 2015-16 has been quashed by the Hon’ble Supreme Court in the case of Union of India v. Rajeev Bansal [2024] 167 taxmann.com 70 (SC). Printed from counselvise.com 6 ITA No. 5000/Mum/2025 PJP Foundation Trust, Mumbai. The issue stands squarely covered by the decision of the Co- ordinate Bench of the ITAT, Mumbai Bench 'B', in the case of ACIT, Circle 19(1) v. Manish Financial, in ITA Nos. 5055 & 5050/Mum/2024, order dated 02.12.2024. The relevant portion of the said order is reproduced below: “6. We heard the parties and perused the material on record. In assessee's case, the AO issued the original notice under section 148 dated 29.06.2021 for AY 2015- 16 and consequent to the directions given by the Hon'ble Supreme Court in the case of Ashish Agrawal (supra), the said notice was deemed as notice issued under section 148A(b). The AO after passing the order under section 148A(d) issued the notice under section 148 dated 29.07.2022. The contention of the assessee is that the said notice is barred by limitation as per the first proviso to the un-amended provisions of section 149(1) as has been confirmed by the decision of the Hon'ble Supreme Court in the case of Rajeev Bansal (Supra). The relevant observations of the Hon'ble Supreme Court reads as under – 19. Mr N Venkataraman, learned Additional Solicitor General of India, made the following submissions on behalf of the Revenue: (a) to (e)**** (f). The Revenue concedes that for the assessment year 2015- 16, all notices issued on or after 1 April 2021 will have to be dropped as they will not fall for completion during the period prescribed under TOLA; 46. The ingredients of the proviso could be broken down for analysis as follows: (i) no notice under section 148 of the new regime can be issued at any time for an assessment year beginning on or before 1 April 2021; (ii) if it is barred at the time when the notice is sought to be issued because of the \"time limits specified under the provisions of\" 149(1)(b) of the old regime. Thus, a notice could be issued under section 148 of the new regime for assessment year 2021-2022 and before only if the time limit for issuance of such notice Printed from counselvise.com 7 ITA No. 5000/Mum/2025 PJP Foundation Trust, Mumbai. continued to exist under section 149(1)(b) of the old regime. 49. The first proviso to Section 149(1)(b) requires the determination of whether the time limit prescribed under section 149(1)(b) of the old regime continues to exist for the assessment year 2021-2022 and before. Resultantly, a notice under Section 148 of the new regime cannot be issued if the period of six years from the end of the relevant assessment year has expired at the time of issuance of the notice. This also ensures that the new time limit of ten years prescribed under section 149(1)(b) of the new regime applies prospectively. For example, for the assessment year 2012-2013, the ten year period would have expired on 31 March 2023, while the six year period expired on 31 March 2019. Without the proviso to Section 149(1)(b) of the new regime, the Revenue could have had the power to reopen assessments for the year 2012-2013 if the escaped assessment amounted to Rupees fifty lakhs or more. The proviso limits the retrospective operation of Section 149(1)(b) to protect the interests of the assesses. 7. This issue of notice under section 148 issued for 2015-16 being time barred is considered by the coordinate bench in the case of Pushpak Realities Pvt. Ltd.(supra) and it is held that ****** For the A.Y.2015-16, the Revenue itself has contended before the Hon’ble Supreme Court as noted above, all the notices issued on or after 01/04/2021 will have to be dropped as they will not fall for completion during the period prescribed under TOLA. Here notice u/s. 148 for the A.Y. 2015-16 has been issued on 28/07/2022 which is admittedly barred by limitation under the new provision of Section 149(1) and it is not covered under TOLA. Accordingly, all the notices are quashed being barred by limitation on the reasons given above and we are not going on the reasons given by the ld. CIT (A) for quashing the notice.” 8. A combined reading of the above observations of the Hon'ble Supreme Court and the findings of coordinate bench makes it clear that the test for checking the validity of notices issued under section 148 under new regime for AYs 2021-22 or prior years is whether the period of six years has expired at the time of issue of such notice and in that case the notice under section 148 becomes invalid. These observations also makes it Printed from counselvise.com 8 ITA No. 5000/Mum/2025 PJP Foundation Trust, Mumbai. clear that the time limit of ten years as per the amended provisions of section 149(1)(b) can be applied only prospectively. In assessee's case when we apply this test for AY 2015-16, the period of six years has expired on 31.03.2022 and therefore the notice dated 29.07.2022 under section 148 of the Act for AY 2015-16 is invalid since it is barred by limitation. Accordingly the assessment completed under section 147 of the Act is liable to be quashed. 9. Since we have already quashed the order under section 147 based on the legal contention of notice being time barred the other legal contentions raised by the assessee in the CO have become academic not warranting any adjudication. Accordingly the CO is partly allowed. 10. We have quashed the order of re-assessment for AY 2015- 16 considering the legal contentions raised by the assessee in the C.O. therefore the appeals of the revenue for AY 2015-16 contending the relief granted by the CIT(A) on the merits of the issues have become infructuous. Accordingly, the appeals of the revenue are dismissed.” 4. The Ld. DR advanced arguments and filed written submission, which is taken on record. The Ld. DR placed reliance on paragraph 112 of the judgment in Rajeev Bansal (supra) and supported the orders passed by the revenue authorities. 5. We have heard the rival submissions and perused the material available on record. We find that the facts of the assessee’s case are identical to those in the judgment of the Hon’ble Supreme Court in UOI v. Rajeev Bansal (supra). The Co-ordinate Bench of the ITAT, Mumbai, in the case of Manish Financial (supra), has also followed the said judgment. Although the Ld. DR has relied upon paragraph 112 of the judgment in Rajeev Bansal (supra), we find that the said observation is not applicable to A.Y. 2015–16. Accordingly, the ratio laid down by the Hon’ble Supreme Court is applicable to the present case. In view of the above, the appellate order is hereby set aside, and the addition of Rs. 2,02,90,700/- made by the Ld. AO is deleted. 6. The Ld. AR had raised an additional ground concerning the non-issuance of a Document Identification Number (DIN); Printed from counselvise.com 9 ITA No. 5000/Mum/2025 PJP Foundation Trust, Mumbai. however, the said ground was not pressed during the course of hearing. Accordingly, the appeal of the assessee is allowed, and all other grounds are kept open for academic purposes. 7. In the result, the appeal of the assessee bearing ITA No.6695/Mum/2024is allowed. 8. After having heard the counsels for both the parties and examining the facts of the present case and also the decision relied upon by the parties, we find that the facts of the assessee’s present case are identical with those in the decision of the Coordinate Bench of ITAT in the case of Mukesh Kumar Jain (supra), wherein the Coordinate Bench after considering the decision of Hon’ble Supreme Court in the case of Union of India Vs. Rajeev Bansal (supra) and Coordinate Bench in the case of Manish Finance (supra) had held the order of assessment to be time barred. Since the facts of the present case for deciding the legal issue are identical to the facts containing in the case of Mukesh Kumar B Jain (supra). Respectfully following the decision of the coordinate Bench we also held that the noticed dated 22.04.2022 u/s 148 of the Act for the year under consideration was invalid and barred by limitation and accordingly assessment completed u/s 147 of the Act is also liable to be quashed. Hence this ground raised by the assessee stands allowed. 9. Since we have already quashed the order u/s 147 of the Act based on the legal contentions of notice being time barred, therefore the other legal contentions raised by the assessee becomes academic. Printed from counselvise.com 10 ITA No. 5000/Mum/2025 PJP Foundation Trust, Mumbai. 10. In the result the appeal filed by the assessee stands partly allowed. Order pronounced in the open court on 03/11/2025 Sd/- Sd/- (GIRISH AGRAWAL) (SANDEEP GOSAIN) (ACCOUNTANT MEMBER) (JUDICIAL MEMBER) Mumbai: Dated: 03/11/2025 KRK, Sr. PS. Copy of the order forwarded to: (1)The Assessee (2) The Respondent (3) The CIT (4) The CIT (Appeals) (5) The DR, I.T.A.T. True Copy By order (Asstt. Registrar) ITAT, Mumbai Printed from counselvise.com "