Tewatia Construction Private Limited Vs DCIT ( ITAT Delhi)
Delhi ITAT: Second Section 148 Notice During Pendency of Earlier Reassessment Is Invalid; Reassessment Quashed
The Delhi ITAT dealt with a jurisdictional challenge to reassessment proceedings. The assessee had already been issued a notice u/s 148 dated 13.04.2023, pursuant to which reassessment proceedings remained pending. While those proceedings were still alive, the Department issued another notice u/s 148 on 21.03.2024 for the very same assessment year.
The assessee contended that two reassessment proceedings for the same assessment year cannot simultaneously subsist, and that a fresh reassessment could not be initiated without first bringing the earlier proceedings to a valid end.
The Tribunal relied upon the Delhi High Court decision in CIT v. Sanjay Kumar Garg, which held that where assessment or reassessment proceedings are already pending, the AO cannot issue another notice u/s 148. A fresh reassessment can be initiated only when no assessment/reassessment proceeding is pending. The Tribunal also noted reliance on the Gujarat High Court ruling in Marwadi Shares and Finance Ltd. v. DCIT (2018) 304 CTR 899.
Significantly, the Departmental Representative could not dispute either the factual position or the legal proposition. The ITAT therefore sustained the assessee’s additional jurisdictional ground, allowed the appeal and quashed the impugned reassessment order.
Key takeaway: A second reassessment cannot be initiated for the same assessment year while an earlier reassessment proceeding remains pending. The Department must first validly conclude the existing proceedings before issuing a fresh section 148 notice.
Cases Discussed
- Marwadi Shares and Finance Ltd. Vs. DCIT (Gujarat High Court), Special Civil Application No. 17698/2017 order dated 07.03.2018 (2018) 304 CTR 899
- CIT Vs. Sanjay Kumar Garg (Delhi High Court), ITA No. 92/2012 order dated 02.09.2015
- Nilofer Hameed v. Income Tax Officer (Kerala High Court), [1999] 235 ITR 161 (Ker)
FULL TEXT OF THE ORDER OF ITAT DELHI
This appeal preferred by the assessee against the order dated 13.11.2025 of Ld. Commissioner of Income Tax (Appeals)-30, New Delhi (hereinafter referred to as the First Appellate Authority or ‘the ld. FAA’ for short) in DIN & Order No: ITBA/APL/M/250/2025-26/1082601160(1) arising out of the assessment order dated 31.03.2025 u/s 147 the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’) passed by ACIT, CC-32, for AY: 2019-20.
2. On hearing both sides we find that assesse has taken recourse to Rule 11 of the ITAT Rules and has raised additional legal and jurisdictional ground on which ground No. C has been pressed for disposal and the same reproduced below:
“C. That the reassessment proceedings initiated vide issue of notice u/s 148 dated 21.03.2024 from ACIT Circle 25(1) Delhi is without jurisdiction as initiated in multiplication and duplication of already continuing reassessment proceedings u/s 148 of same subject year before faceless assessment unit without valid termination of the same before start of another proceedings under same section by issue of reassessment notice.”
2.1 As the said ground is a legal ground and can be decided on the basis of facts before us, the same is admitted for hearing.
3. During hearing ld. Counsel has drawn our attention to the paper book wherein at page No. 42 copy of a notice dated 21.03.2024 u/s 148 of the Act has been provided and at page No. 13 copy of another notice u/s 148 dated 13.04.2023 is provided and it is submitted that while the reassessment proceedings by virtue of notice dated 13.04.2023 were pending fresh notice u/s 148 has been issued on 21.03.2024. In this context, our attention has also been drawn to notice dated 09.08.2024 u/s 142(1) of the Act and dated 29.01.2025 which according to ld. Counsel are part of the on going reassessment proceedings, arising out of notice dated 13.04.2023. It was thus, contended that during pendency of earlier reassessment proceedings the impugned reassessment proceedings have been initiated by notice dated 21.03.2024 and same are not sustainable in law. In this context, ld. Counsel has relied Hon’ble jurisdictional High Court decision in case of CIT Vs. Sanjay Kumar Garg in ITA No. 92/2012 order dated 02.9.2015 wherein Hon’ble High Court has laid down as follows:
“11. In Nilofer Hameed v. Income Tax Officer (1999] 235 ITR 161 (Ker) after referring to a number of judgments of the High Courts, it was held by the Kerala High Court that ‘if an assessment is pending either by way of original assessment or by way of reassessment proceedings, the Assessing Officer cannot issue a notice under Section 148 but i f no proceedings are pending either by way of original assessment or by way of reassessment, he can issue a notice under Section 148 within the time mentioned.
12. In the present case, the time limit for completing the reassessment proceedings pursuant to the notice issued on 23rd September 2005 was 31st December 2006. As is evident from the narration hereinabove, the reassessment proceedings were in progress and were being adjourned from time to time. Without those proceedings having come to an end a fresh reassessment could not have been initiated by the AO by issuing a notice under Section 148 of the Act on 24th November 2006. The proceedings initiated by the notice dated 23rd September 2005 ought to have been completed within the time stipulated and till such time there was no occasion to initiate fresh reassessment proceedings by issuing notice under Section 148 of the Act. “
4. In this context, he also relied Hon’ble Gujarat High Court decision in case of Marwadi Shares and Finance Ltd. Vs. DCIT in Special Civil Application No. 17698/2017 order dated 07.03.2018 (2018) 304 CTR 899.
5. Ld. DR could not dispute aforesaid facts and proposition of law leading to only consequence, that the additional ground as raised deserves to be sustained and accordingly ordered. The appeal is allowed and the impugned order is quashed.
Order pronounced in the open court on 07.08.2026
