SUNBLAZE CONSTRUCTIONS PVT. LTD.,KOLKATA V. I.T.O., WARD - 9(1), KOLKATA

ITA 1788/KOL/2025

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Sunblaze Constructions Pvt. Ltd. appealed against the order of the National Faceless Appeal Centre, which had confirmed the reassessment made by the Income Tax Officer for the assessment year 2016-17. The primary contention was that the notice issued under section 148 of the Income Tax Act for reassessment was time-barred. The Tribunal considered the procedural history, including the issuance of a show cause notice under section 148A(b) and the subsequent actions taken by the assessee and the Assessing Officer. The Tribunal noted that the final notice under section 148 was issued beyond the extended deadline provided by the relevant laws and judicial precedents, leading to the decision to quash the notice and the reassessment order.

• Counselvise Citation: [2026] 140 COUNSELVISE.COM (IT) 827069 (ITAT-KOLKATA)
• Duration Of Justice: 4 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-01-2026
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Assessment Year: 2016-2017
• Appeal Filed On: 08-08-2025
• Other Referred Cases: Collector, Land Acquisition Vs Mst. Katiji & Others, Union of India and other Vs. Rajeev Bansal, Jute Corporation of India Ltd. Vs CIT, National Thermal Power Co. Ltd v. CIT, PCIT vs. Britannia Industries Ltd., Union of India & Ors. Vs. Ashish Agarwal, Communist Party of India (Marxist) Vs. Income-tax Department, Dhanraj Govindram Kella Vs. ITO, Ashitkumar Satischandra Patel Vs. ITO
• Laws Referred To: Income-tax Act 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S.B. CHAKRABORTHY
• Assessee Lawyers: S. K. TULSIYAN; PUJA SOMANI; ARS
• Keywords: Condonation of delay; Reasonable cause; Reassessment proceedings; Period of limitation
• Section: 148

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL “D” BENCH, KOLKATA BEFORE SHRI RAJESH KUMAR, AM AND SHRIPRADIP KUMAR CHOUBEY, JM ITA No.1788/KOL/2025 (Assessment Year: 2016-17) Sunblaze Constructions Pvt. Ltd. 164/1, Maniktala Main Road, Kankurgachi, S.O. Kolkata- 700054, West Bengal Vs. ITO, Ward 9(1) Aaykar Bhawan, P-7, Chowringhee Square, Kolkata- 700069, West Bengal (Appellant) (Respondent) PAN No. AASCS7903D Assessee by : Shri S.K. Tulsiyan & Ms. Puja Somani, ARs Revenue by : Shri S.B. Chakraborthy, DR Date of hearing: 17.11.2025 Date of pronouncement: 06.01.2026 O R D E R Per Rajesh Kumar, AM: This is an appeal preferred by the assessee against the order of the National Faceless Appeal Centre, Delhi (hereinafter referred to as the “Ld. CIT(A)”] dated 25.01.2024 for the AY 2016-17. 2. At the outset, we note that the appeal of the assessee is barred by limitation by 498 days. At the time of hearing the counsel of the assessee explained that the erstwhile accountant of the assessee resigned without handing over the login credentials and information regarding pending proceedings to the management and the assessee only came to know about the CIT(A)’s order when the new accountant after recovering the e-mail and password linked to the company access from the ITBA portal for finalization of accounts. Due Printed from counselvise.com Page | 2 ITA No. 1788/KOL/2025 Sunblaze Constructions Pvt. Ltd.; A.Y. 2016-17 to this, there was an unavoidable delay of 498 days in filing the appeal. The ld. Authorized Representative requested to condone the delay emphasizing that the delay is due to genuine and reasonable cause beyond the control of the assessee and no mala fide intention was involved for delay in filing the appeal. The ld. Authorized Representative prayed that the delay be condoned in the interest of justice, so the assessee’s case can be heard on merits. The ld DR on the other hand opposed the condonation of delay for the unreasonable reasons and there being no justification for the same. 2.1. We after considering the submissions made by the ld. Authorized Representative and facts placed before us, we are of the view that the delay of 498 days in filing the appeal was due to reasonable cause as explained by the assessee. The delay was due to administrative reasons and there was no deliberate attempt by the assessee for delay in filing. The case of the assessee is squarely covered by the decision of the Hon’ble Apex Court in the case of Collector , Land Acquisition Vs Mst. Katiji & Others (1987) 167 ITR 471 (SC).Therefore in the interest of justice and fair play, we hereby condone the delay in fling the appeal. The appeal will now be heard on merits in the following paras. 3. The assessee has raised additional ground qua the notice u/s 148 of the Act being time barred by limitation in consonance with the decision of the Hon'ble Apex Court in the case of Union of India and other Vs. Rajeev Bansal [2024] 469 ITR 46 (SC), dated 03.10.2024, which read as under:- “That the ld. AO erred in passing an order was u/s 148A(d) of the Act dt.29.7.2022 and issuing the impugned notice under section 148 of the Income-tax Act 1961 and 29.07.2012 Assessment Year 2016-17 which is beyond the surviving period of limits of decision of the Hon'ble Supreme Court in Printed from counselvise.com Page | 3 ITA No. 1788/KOL/2025 Sunblaze Constructions Pvt. Ltd.; A.Y. 2016-17 Rajeev Bansal & Others s. Union of India [2024] 167 homann.com 20. 301 Taxman 238 469 ITR 46 (SC), the said notice having been issued beyond she permissible time limit is invalid and void ab initio, and consequently, the entire reassessment proceedings deserve to be quashed.\" 3.1. After hearing the rival contentions and perusing the material on record, we find that the assessee has raised an additional ground of appeal challenging the notice issued u/s 148 of the Act as barred by limitation. In our opinion the issued raised in the additional ground is a purely a legal issue qua which all the facts are available in the appeal folder and no further verification of facts is required from any quarter whatsoever. In our considered view the assessee is at liberty to raise any legal issue before any appellate authority for the first time even when the same has not been raised before the lower authorities. The case of the assessee is squarely covered by the decisions of the Apex court in the case of i) Jute Corporation of India Ltd. Vs CIT in 187 ITR 688 , ii) National Thermal Power Co. Ltd v. CIT [1998] 229 ITR 383 and also by the decision of Hon’ble Calcutta High Court in PCIT vs. Britannia Industries Ltd. [2017] 396 ITR 677 (Cal). Therefore, we are inclined to admit the same for adjudication. 4. The facts in brief are that the AO issued notice u/s 148 of the Act on 29.06.2021, for the impugned assessment year which is A.Y. 2016- 17, under the erstwhile reassessment regime. The extended period of limitation available by virtue of taxation and other laws (deduction and amendment of certain provisions) Act, 2020 (TOLA) expired on 30.06.2021 subsequent to the decision of the Hon'ble Apex Court in the case of Union of India & Ors. Vs. Ashish Agarwal (2022 SCC Online SC 543) vide order dated 04.05.2022. The said notice u/s 148 of the Act dated 29.06.2021, was treated as show cause notice u/s 148A(b) of the Act subsequent to the above decision. In compliance Printed from counselvise.com Page | 4 ITA No. 1788/KOL/2025 Sunblaze Constructions Pvt. Ltd.; A.Y. 2016-17 thereto, the ld. AO issued first show cause notice on 148A(b) of the Act on 24.05.2022, calling upon the assessee to respond. The assessee replied the said notice on 14.06.2022, wherein it was requested to the ld. AO to provide material for preparation of rebuttal and defense. Thereafter, as per the case of Union of India and other Vs. Rajeev Bansal [2024] 469 ITR 46 (SC), dated 03.10.2024, the ld. AO must issue a fresh notice u/s 148 of the Act within surviving time period available as on 30.06.2021, after excluding time permitted to the assessee to file reply to the notice issued u/s 148A(b) of the Act. In the present case, the surviving period available with the ld. AO as on 30.06.2021, was only two days and the same by virtue of proviso to Section 149(1) of the Act, stand extended to 7 days from the end of the period allowed to the assessee for furnishing its reply. The assessee was given time upto 22.06.2022, to submit its response and the response was filed on 14.06.2022. Therefore, even applying the statutory extension of 7 days, the outer limit for issuance of notice u/s 148 of the Act was expired on 29.06.2022 (i.e. 22.06.2022 + 7 days). However, the ld. AO passed the order u/s 148A(d) of the Act dated 29.07.2022, and issued notice u/s 148 of the Act on the same day, which is barred by limitation. Following chart make the position clear:- S. No. Particulars Dates Pgs of Paper Book-II 1. First Notice issued u/s 148 29.06.2021 01 2. Period of limitation as per TOLA 30.06.2021 3. Surviving Period 2 days 4. Information provided by AO as per direction in case of Ashish Agarwal 24.05.2022 1A-4 5. Assessee find reply on 14.06.2022 5 6. Letter was issued on 21.06.2022 wherein the assessee was requested to file the response on 22.06.2022 No further response was filled 6 7. Since surviving period is less than 7 days by virtue of the proviso to 29.06.2022 Printed from counselvise.com Page | 5 ITA No. 1788/KOL/2025 Sunblaze Constructions Pvt. Ltd.; A.Y. 2016-17 Section 149(1) it stands extended to 7 days 8. Order u/s 148A(d) passed on 29.07.2022 7-10 9. Notice issued u/s 148 on 29.07.2022 11-12 4.1. Considering the facts of the assessee’s case in the light of decision of the Hon’ble Apex Court in the case of Rajeev Bansal(supra) , we are of the considered opinion that the notice is barred by limitation. The case of the assessee find support from the following decisions:- i. Communist Party of India (Marxist) Vs. Income-tax Department reported in (2025) 174 taxmann.com 925 (Delhi) ii. Dhanraj Govindram Kella Vs. ITO, reported in (2025) 177 taxmann.com 194 (Gujarat) iii. Ashitkumar Satischandra Patel Vs. ITO reported in (2025) 179 taxmann.com 188 (Gujarat) 4.2. We therefore, respectfully following the decisions, quash the notice issued u/s 148 of the Act as barred by limitation and also consequent assessment framed by the ld. AO. The additional ground raised by the assessee is allowed. 5. In the result, the appeal of the assessee is allowed. Order pronounced in the open court on 06.01.2026. Sd/- Sd/- (PRADIP KUMAR CHOUBEY) (RAJESH KUMAR) (JUDICIAL MEMBER) (ACCOUNTANT MEMBER) Kolkata, Dated: 06.01..2026 Sudip Sarkar, Sr.PS Printed from counselvise.com Page | 6 ITA No. 1788/KOL/2025 Sunblaze Constructions Pvt. Ltd.; A.Y. 2016-17 Copy of the Order forwarded to: BY ORDER, True Copy// Sr. Private Secretary/ Asst. Registrar Income Tax Appellate Tribunal, Kolkata 1. The Appellant 2. The Respondent 3. CIT 4. DR, ITAT, 5. Guard file. Printed from counselvise.com "