ITO Vs Kanha Grain Process (ITAT Raipur)
Notices for AY 2015-16 Issued After 01-04-2021 Must Fall: ITAT Raipur Upholds Quashing of Reassessment Despite Fresh 148 in July 2022
The Raipur Bench of the ITAT in ITO vs. Kanha Grain Process [ITA No.260/RPR/2025, AY 2015-16, order dt. 01-01-2026] dismissed the Revenue’s appeal and upheld the order of the CIT(A)/NFAC quashing the reassessment proceedings. The Assessee, a partnership firm engaged in rice milling and trading, had originally been assessed u/s 143(3). Subsequently, reassessment was initiated on the basis of alleged bogus purchases and additions of ₹1.19 crore were made u/s 69C.
The Tribunal noted that the first notice u/s 148 was issued on 30-06-2021 under the old regime and, following Union of India vs. Ashish Agarwal (SC), a fresh procedure was undertaken culminating in notice u/s 148 dt. 23-07-2022 under the new regime. Relying on the binding concession recorded by the Supreme Court in Union of India vs. Rajeev Bansal (SC), and following Veena Jain vs. ITO (Del HC) and Cherian Nallathu Abraham Annamma vs. ITO (Bom HC), the Tribunal held that for AY 2015-16 all notices issued u/s 148 on or after 01-04-2021 are liable to be dropped, as they would not fall for completion within the period prescribed under TOLA.
Since the jurisdiction itself was bad in law, the subsequent notice dt. 23-07-2022 and the consequential reassessment order could not survive. The ITAT, therefore, upheld the CIT(A)’s order and dismissed the Revenue’s appeal, without entering into the merits of the additions
FULL TEXT OF THE ORDER OF ITAT RAIPUR
