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Judgment
PER KRINWANT SAHAY AM
Appeal in this case has been filed by the assessee against the order dated 28.11.2025 passed by the Ld. CIT(A)-26, Delhi for the 2023-24. Grounds of appeal are as under :-
1, On the facts and circumstances of the case and in law, the assessment order passed by the assessing officer is erroneous as the assessing officer has not complied with the provisions of section 148 of the Act.
2.On the facts and circumstances of the case and in law, the order passed by the learned assessing officer and the addition made therein is bad-in-law and CIT(A) erred in not holding so.
3.On the facts and circumstances of the case and in law, the CIT(A) erred in confirming the addition made by the Ld. Assessing Officer to the extent of Rs. 42,84,000/- on account of rent income under the head of income from house property.
4.On the facts and circumstances of the case and in law, the CIT(A) erred in confirming the addition made by the Ld. Assessing Officer of Rs. 29,96,418/-on account of alleged bogus expenses u/s 28 of the Act.
5.On the facts and circumstances of the case and in law, the CIT(A) erred in confirming the addition made by the Ld. Assessing Officer of Rs. 2,15,00,000/- on account of alleged unexplained expenditure u/s 69C of the Act. 1,67,70,000/-
6.On the facts and circumstances of the case and in law, the assessment order passed by the assessing officer is contrary to the provisions of section 148B of the Income Tax Act, 1961.
During proceedings before us the Ld. Counsel of the assessee has filed a brief synopsis on the grounds of appeal which is reproduced as under :-
Before Hon'ble Members
Tax Appellate Tribunal Bench Delhi
In the Income Tax Appeal Rajiv Gupta A.Y. 2023-24 876/DEL/2026
Synopsis
In the present search u/s 132 conducted 15.02.2024 i.e., F.Y. 2023-24 relevant A.Y. 2024-25. The present year, i.e., A.Y. 2023-24, is the year immediately preceding the year of search. For the year under considerationthe assessing officer issued notice u/s 143(2) 28/06/2024 and completed the assessment u/s 143(3). is humbly submitted that the assessment order passed by the assessingofficer without complying with the provisions of section 148/148B of the Act is bad-in-law. For the year under consideration (i.e., A.Y. 2023-24) the assessing officer mandatorily required follow the procedures per 148 of the Act for initiating the proceedings and to the assessment annroval of specified authority under section 148B of Act. The assessing officer has neither complied with the provisions of section 148 the provisions of section 148B ofthe 2 section 1148 Hence, it will be relevant refer to the provisions of Explanation of the Act. Explanation 2 to section 148 is under: where.— books (i) search initiated section 132 Ist day April. 132A, after any requisitioned under section 2021, in the of the of than under sub-section (2A) under 133A, other (ii)a survey is conducted the ofthe assessee; Ist day ofApril, 2021, thatsection, after the
Principal or other jewellery 132 section 132the Bution (iii)the or that any moncey, secun 2021,belongs or thormissioner, Valumisionervaluablearticle eized orreguisitioned under any other per asseseof approval of Principalseized with the documents, Officer satisfied, other v)the Assessing thatany bogks fnny inform day April, suggests deemed have formation which Assessing Officershall the assesseewherethesearch is chargeabletotax hae ahallbe tohave informatir requisitioned or survey any assets initiated books ofaccount, other docunents other valuable conducted the caccount, otherdocumentey bullion,eized jewelleryrequisitioned case of article thing books ofaccount Act 148B. this Commissioner, in shall be by Assessing Officer below the rank ofJoint (iii) respect clause (i) (ii) of clause (iv) of Explanation to 148 apply except the approval Additional Commissioner Additional Director Commissioner Director.] Clause in relating prior approval for recomputation in proposed section provide of recomputation the shall be passed by Assessing Officer below rank of Joint Commissioner, except with prior approval of Additional Commissioner Additional Director Joint Director, respect of year which (1), (11), 148 apply. clause (iii) clause (iv) of the Explanation April, 2022. This amendment will effect for course available to AO the only permissible statutory Thus, for A. Y.2023-24, the notice u/s148 and to complete proceedings was to issue initiatingthe assessment
In support of his submission he cited number of case laws which is reproduced as under :-
1.Jagdeep Singh Gill Vs. DCIT /ACIT, Central Circle-1 Noida 2026 TMI 461 – ITAT Delhi
2.Pradeep Kumar Agarwalla Vs. DCIT Central Circle 25 Delhi (Vice-Versa) 2026 (5) TMI 314 ITAT Delhi
3.Gas Supply Co. Pvt. Ltd. Vs. ACIT, Central Circle -31, Delhi
4.DCIT, Central Circle, Ghaziabad Vs. Vijay Kumar Agarwal 2026 (4) TMI 557 ITAT Delhi
5.Ramesh Zalpuri, Harvinder Singh Matharu Vs. DCIT / KACIAT Central Circle – II, Uttar Pradesh
Per contra the Ld. DR has relied on the order of the authorities below.
We have considered the findings given by the ld. CIT(A) in the appellate order and we have also considered the arguments made by the Ld. DR as well as by the ld. Counsel of the assessee. We have also perused the submission filed by the ld. Counsel of the assessee. We find that this issue is squarely covered by the various orders of the coordinate Benches of the Delhi Tribunal as well as many other Tribunal’s. It has been categorically held in the coordinate Bench order of Homelife Buildcom (P) Ltd. Vs. DCIT (2025) 176 taxmnna.com 614 in which Hon’ble Bench has given following findings on the same issue which is as under :-
"11.4In conclusion, it was submitted that since the year under appeal formed part of the three assessment years immediately preceding the year in which search was conducted, the assessment ought to have been framed under section 148 with approval u/s 148B. The framing of the assessment u/s 143(3) and approval taken only for the purposes of section 143(3) was thus asserted to be fundamentally defective, non-compliant with statutory mandate, and consequently void ab initio. On these grounds,” it was prayed that the impugned assessment be quashed.”
Keeping in view the order pronounced by coordinate Benches on this issue we are of this considered view that the assessment order passed by the Assessing Officer u/s.143(3) of the Act is not as per the scheme of law amended by the Finance Act w.e.f. 01-04-2021 in the year under consideration i.e. assessment year 2023-24. The AO was mandatorily required to follow the procedure as per section 148 of the Act for initiating the assessment proceedings and to pass the assessment order obtaining approval of higher authority u/s.148B of the Act. Since it has not been done in the present case, therefore, in our considered view the order passed by the AO and sustained by the Ld. CIT(A) cannot be confirmed. Accordingly, the assessment order is quashed, therefore, assessee’s appeal on this issue is allowed.
Since we have given our findings on the jurisdictional issue quashing the assessment order, other issues on merit becomes academic in nature. So we are not inclined to give our findings on other issues.
In the result, the appeal filed by the assessee on this issue is allowed.