The Income Tax Appellate Tribunal, Delhi, has invalidated three reassessments initiated under the pre-amendment provisions of Section 148 of the Income-tax Act, 1961, after the introduction of the new procedural regime under Section 148A effective 01.04.2021. The ruling underscores that procedural compliance is not optional but jurisdictional, and any reopening initiated under the old framework after the cut-off date is void ab initio.
Background & Facts
The Dispute
The appellant, Avadh Projects Private Limited, faced reassessment proceedings for assessment years 2013-14, 2014-15, and 2017-18 under Section 147 read with Section 143(3) of the Income-tax Act, 1961. The Assessing Officer issued notices under Section 148 for all three years, purportedly on 31.03.2021. However, the assessee challenged the validity of these notices, asserting that the actual date of issuance was 01.04.2021 or later, thereby falling squarely within the new procedural regime introduced under Section 148A.
Key Facts
- The reassessment notices for A.Y. 2013-14, 2014-15, and 2017-18 were recorded as issued on 31.03.2021 in the assessment orders dated 31.03.2021.
- The assessee’s paperbook, at page "43A", contains documentary evidence proving the actual date of issuance of the Section 148 notice was 01.04.2021.
- The revenue department did not dispute or rebut this evidence during hearings.
- The approvals under Section 151 for A.Y. 2013-14 and 2014-15 were dated 31.03.2021 and 26.03.2021 respectively, and were found to be mechanically recorded without application of mind.
- The new procedural framework under Section 148A came into force on 01.04.2021, replacing the prior regime.
Procedural History
- 31.03.2021: Assessment orders issued for A.Y. 2013-14, recording Section 148 notice date as 31.03.2021.
- 01.04.2021: New provisions under Section 148A came into effect.
- 25.09.2025 & 24.09.2025: Orders of the Commissioner of Income Tax (Appeals)-24 upholding the reassessments.
- 15.04.2026: Hearing before ITAT Delhi.
- 29.04.2026: Judgment pronounced.
Relief Sought
The assessee sought quashing of the reassessment orders for all three assessment years on the grounds that the notices were issued after 01.04.2021 under the repealed regime, and the Section 151 approvals were mechanically granted without due application of mind.
The Legal Issue
The central question was whether a notice under Section 148 of the Income-tax Act, issued on or after 01.04.2021, but under the pre-amendment procedural framework, is legally valid, or whether such notices are rendered void by virtue of the statutory transition to the new regime under Section 148A.
Arguments Presented
For the Appellant
Counsel for the assessee relied on Sumanjeet Aggarwal v. ITO (2022) 143 taxmann.com 11 to argue that any notice issued under Section 148 after 01.04.2021 must comply with the new procedural requirements under Section 148A. He submitted that the actual date of issuance was 01.04.2021, as evidenced by the paperbook, and that the revenue’s claim of 31.03.2021 was a post-hoc fabrication. He further contended that the Section 151 approvals were mechanical and lacked reasoned application, rendering them invalid under CIT v. S. Goyanka Lime and Chemical Ltd. (2023) 453 ITR 242 (SC).
For the Respondent
The Department did not contest the date of issuance of the notice or the mechanical nature of the Section 151 approvals. No rebuttal evidence or legal argument was presented to challenge the assessee’s documentary proof or the precedents cited.
The Court's Analysis
The Tribunal observed that the assessee had adduced concrete documentary evidence - page "43A" of the paperbook - establishing that the Section 148 notice was issued on 01.04.2021. The revenue failed to rebut this fact, despite having full opportunity to do so. The Tribunal held that the issuance of a notice under Section 148 after 01.04.2021, under the old regime, is not merely a procedural irregularity but a jurisdictional defect.
"This clinching fact has gone unrebutted from the revenue side. We thus quote Sumanjeet Aggarwal vs. ITO (2022) 143 taxmann.com 11 to quash the impugned reopening under the 'old' scheme indicated 'on or after 01.04.2021' in very terms."
The Tribunal further held that the Section 151 approvals dated 31.03.2021 and 26.03.2021 were not only issued prior to the cut-off but were also devoid of any reasoning, amounting to a mechanical exercise. The Supreme Court in CIT v. S. Goyanka Lime and Chemical Ltd. had unequivocally held that such approvals are invalid. Since the approvals were not compliant with the new regime either, they could not cure the jurisdictional defect.
The Tribunal concluded that the entire reassessment proceedings were vitiated by non-compliance with the statutory transition framework. The legal ground raised by the assessee was therefore sustainable and meritorious.
The Verdict
The appeals were allowed. The reassessment orders for A.Y. 2013-14, 2014-15, and 2017-18 are quashed in their entirety. The notices issued under Section 148 are declared void ab initio. The Section 151 approvals dated 31.03.2021 and 26.03.2021 are set aside. All proceedings initiated pursuant to these invalid notices are cancelled. No further action can be taken under the old regime for these assessment years.
What This Means For Similar Cases
Reopening Notices Must Align with Effective Regime
- Practitioners must verify the actual date of issuance of Section 148 notices - not the date recorded in the order - using postal records, electronic logs, or acknowledgment receipts.
- Any notice issued on or after 01.04.2021 under the old Section 148 regime is void, regardless of whether the case was pending or the notice was issued in good faith.
Section 151 Approvals Require Reasoned Application
- Approvals under Section 151 must reflect independent application of mind; mechanical or boilerplate approvals are invalid.
- Even if issued before 01.04.2021, approvals lacking reasoning cannot validate a reopening if the notice itself is issued after the cut-off date.
Procedural Compliance Is Jurisdictional
- The transition from Section 148 to Section 148A is not a mere technicality but a statutory boundary.
- Courts and tribunals will not permit revenue authorities to circumvent the new regime by backdating notices. Documentary proof of actual issuance date trumps official records.
