PREMLATA BISHT BANDHARI,MAHARASHTRA V. ITO, PANVEL

ITA 2719/PUN/2025

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The case involves Premlata Bisht Bhandari, the appellant, contesting the validity of a reassessment notice issued by the Income Tax Officer, Ward-2, Panvel, for the Assessment Year 2016-17. The notice was based on information from seized material during a search in the case of Bhagvati Developers, leading to a belief that income had escaped assessment. The primary legal contention was the lack of proper approval under section 151 of the Income-tax Act, 1961, for issuing the notice under section 148, as the approval was obtained from the Principal Commissioner instead of the Principal Chief Commissioner.

• Counselvise Citation: [2026] 140 COUNSELVISE.COM (IT) 837837 (ITAT-PUNE)
• Duration Of Justice: 3 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-02-2026
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2016-2017
• Appeal Filed On: 19-11-2025
• Other Referred Cases: Santosh Jaynarayan Sharma Vs. ITO, Siddharth Raikumar Nahar vs. DCIT, Alag Property Construction Pvt. Ltd. Vs. ACIT, UOI vs. Rajeev Bansal
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: EKNATH ABHANG
• Assessee Lawyers: DHAVAL SHAH
• Keywords: Set aside; Reassessment proceedings; Reason to believe
• Section: 148

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCHES “SMC”, PUNE BEFORE DR.MANISH BORAD, ACCOUNTANT MEMBER आयकर अपील सं. / ITA No.2719/PUN/2025 Assessment Year : 2016-17 Premlata Bisht Bhandari, A-1202, Bay Bliss, Sector-9, Ulwe, Navi Mumbai – 410206 Maharashtra PAN : BBZPB5039F Vs. Income Tax Officer, Ward-2, Panvel Appellant Respondent आदेश / ORDER The captioned appeal at the instance of assessee pertaining to the Assessment Year 2016-17 is directed against the order dated 10.09.2025 of National Faceless Appeal Centre, Delhi passed u/s.250 of the Income-tax Act, 1961 (hereinafter also called ‘the Act’) arising out of the Assessment Order dated 31.05.2023 passed u/s.147 r.w.s.144 of the Act. 2. Assessee has raised various ground on merit as well legal in the revised grounds of appeal. However, at the outset, ld. Counsel for the assessee submitted that the reassessment proceedings for A.Y. 2016-17 deserves to be quashed as proper approval u/s.151 of the Act has not been taken from the prescribed authority prior to issuance of notice u/s.148 of the Act. He submitted that for issuing notice u/s.148 of the Act Assessee by : Shri Dhaval Shah (Through Virtual Revenue by : Shri Eknath Abhang (Through Virtual) Date of hearing : 04.02.2026 Date of pronouncement : 20.02.2026 Printed from counselvise.com ITA No.2179/PUN/2025 Premlata Bisht Bhandari 2 beyond three years from the end of the assessment year in the instant case ld. Assessing Officer was required to get approval u/s.151 of the Act from Principal Chief Commissioner of Income Tax, however, ld. Assessing Officer has issued notice u/s.148 of the Act dated 14.07.2022 with the approval of Principal Commissioner of Income Tax-3, Pune which is not in accordance with the provisions of section 151 of the Act. In support, he placed reliance on various decisions mentioned in the case law paper book along with making specific reference to the decisions of this Tribunal in the case of Santosh Jaynarayan Sharma Vs. ITO – ITA No.2324/PUN/2025 order dated 06.01.2026 and in the case of Siddharth Raikumar Nahar vs. DCIT – ITA No.2062/Pun/2025 order dated 29.10.2025. 3. On the other hand, ld. Departmental Representative supported the order of ld.CIT(A). 4. I have heard the rival contentions and perused the records placed before me. I observe that the assessee is an individual and did not file the return of income for A.Y. 2016- 17. On account of information from the seized material found during the course of search in the case of Bhagvati Developers, ld. Assessing Officer had reason to believe that income has escaped assessment. The assessment proceedings in question has been initiated by issuing notice u/s.148 of the Act dated 14.07.2022 in response to which the assessee filed the return on 08.08.2022 declaring income of Rs.98,740/-. 5. Now the validity of the said show cause notice u/s.148 of the Act is in challenge before me. Ld. Counsel for the assessee has referred to the notice placed at pages 8 to 10 of the paper Printed from counselvise.com ITA No.2179/PUN/2025 Premlata Bisht Bhandari 3 book stating that the said notice has been issued with the prior approval of Principal Commissioner of Income Tax-3, Pune. He has referred to the provisions of section 151 of the Act and has contended that for issuing notice u/s.148 of the Act beyond three years from the date of relevant assessment, ld. Assessing Officer is required to take approval from the Principal Chief commissioner of Income Tax. 6. I find that under similar set of facts this Tribunal in the case of Santosh Jaynarayan Sharma Vs. ITO (supra) has dealt on the very same issue observing as follows : “5. We have heard the rival contentions and perused the record placed before us. We observe that the assessee is an individual and the return of income for A.Y. 2017-18 filed on 17.03.2018 declaring income of ₹20,31,900. Ld. Assessing Officer based on the information about explained cash credit/investment amounting to ₹45,76,025 had reason to believe that income to this extent has escaped assessment and has issued notice u/s.148 of the Act on 26.07.2022 after taking approval from the Principal Commissioner, Nashik. Now the issue raised by the assessee in Ground No.1 of the Cross Objection that since the escapement of income is less than ₹50.00 lakh and notice has been issued after three years, ld. Assessing Officer ought to have taken approval from Principal Chief Commissioner of Income Tax in place of Principal Commissioner of Income Tax. We observe that similar issue came for adjudication before the Hon’ble Jurisdictional High Court in the case of Alag Property Construction Pvt. Ltd. Vs. ACIT wherein also for A.Y. 2017- 18 notice u/s.148A(d) and section 148 of the Act were issued on 18.08.2022 and 23.08.2022 and Hon’ble Court has dealt with the issue of grant of approval u/s.151 of the Act for issuing notice u/s.148 of the Act beyond three years observing as follows : “10. On perusal of the order dated 18.08.2022, passed under Section 148A(d) of the Act we find that the aforesaid order was passed after taking approval from Principal Commissioner of Income Tax (Respondent No.2). Since the aforesaid order was passed, as well as the notice under section 148 was issued, after the expiry of three years from the end of A.Y. 2017-18, as per the substituted provisions of re-assessment, the authority specified under Section 151(ii) of the Act (i.e. Principal Chief Commissioner or Chief Commissioner) was required to grant approval. Accordingly, we conclude that in the present case, the approval has been obtained from the Printed from counselvise.com ITA No.2179/PUN/2025 Premlata Bisht Bhandari 4 authority specified under Section 151(1) of the new regime instead of the authority specified under Section 151(ii) of the new regime. 11. The Hon'ble Supreme Court in the above case has drawn an illustration in para 78 of its order in the context of A.Y. 2017-18 (which is also the relevant Assessment year in the present Writ Petition) wherein it is categorically held that the authority specified under section 151(1) can accord sanction only upto 30.06.2021. This illustration makes it absolutely clear that when the period of three years from end of relevant Assessment Year expired between 20.03.2020 and 31.03.2021, the extension by virtue of TOLA was upto 30.06.2021 and not beyond. Thus, it can be said that the period of three years from the end of the relevant Assessment Year (in the present case A.Y. 2017-18) expired on 30.06.2021, whereas Respondent No.1, despite passing order under section 148A(d) on 18.08.2022, and issuing notice under section 148 on 23.08.2022 [in respect of Assessment Year 2017-18], has obtained approval of Respondent No.2 who is not the authority as prescribed under section 151(ii). 12. Non-compliance by Respondent No.1 with the provisions contained in Section 148A(d) read with Section 151(ii) vitiates the jurisdiction of Respondent No.1 to issue a notice under Section 148 of the Act. 13. We are clearly of the view that the present matter stands covered by the decision of Hon'ble Supreme Court in the case of UOI vs. Rajeev Bansal (supra) and we are bound by it. Accordingly, we hold that the order dated 18.08.2022 passed under Section 148A(d) of the Act and the consequential notice issued under section 148 dated and 23.08.2022 are bad in law, and hence, are required to be quashed and set aside. 14. We accordingly set aside the impugned order dated 18.08.2022 passed under Section 148A(d) of the Act and the consequential notice issued under section 148 dated 23.08.2022, and all other proceedings/orders emanating therefrom.” 6. On examining the facts of the instant case in light of the above judgment, we find that in the assessee’s case also notice u/s.148 of the Act has been issued after three years and the proper course of action for issuing valid notice u/s.148 of the Act was to get approval from the Principal Chief Commissioner of Income Tax. However, in the instant case, the approval has been taken from the Principal Commissioner of Income Tax. Respectfully following the above judicial binding precedent, we are inclined to hold that proper approval u/s.151 of the Act has not been taken and therefore the notice u/s.148 of the Act is invalid and liable to be quashed. Printed from counselvise.com ITA No.2179/PUN/2025 Premlata Bisht Bhandari 5 Accordingly, Ground No.1 raised by the assessee in the Cross Objection is allowed.” 7. In light of above decision, I hold that the notice u/s.148 of the Act is invalid and deserves to be quashed as in the instant case on hand also, ld. Assessing Officer had issued notice u/s.148 of the Act after obtaining the approval from the prescribed authority, i.e.Principal Commissioner of Income Tax and not from the Principal Chief Commissioner of Income Tax as mandated u/s.151 of the Act. Grounds of appeal challenging the validity of notice issued u/s.148 of the Act is allowed. 8. Since the assessee succeeds on the legal issue and reassessment proceedings are held to be illegal, dealing with grounds raised on merit would be merely academic in nature and therefore dismissed as infructuous. 9. In the result, the appeal of the assessee is allowed as per terms indicated hereinabove. Order pronounced on this 20th day of February, 2026. Sd/- (MANISH BORAD) ACCOUNTANT MEMBER पुणे / Pune; दिन ंक / Dated : 20th February, 2026. Satish Printed from counselvise.com ITA No.2179/PUN/2025 Premlata Bisht Bhandari 6 आदेश की प्रतिलिपि अग्रेपिि / Copy of the Order forwarded to : 1. अपील र्थी / The Appellant. 2. प्रत्यर्थी / The Respondent. 3. The Pr. CIT concerned. 4. विभ गीय प्रतितनधि, आयकर अपीलीय अधिकरण, “SMC” बेंच, पुणे / DR, ITAT, “SMC” Bench, Pune. 5. ग र्ड फ़ इल / Guard File. आिेश नुस र / BY ORDER, // True Copy // Assistant Registrar आयकर अपीलीय अधिकरण, पुणे / ITAT, Pune Printed from counselvise.com "