Ankit Singhal Vs ITO (ITAT Jodhpur)
Reopening for ₹3 Lakh Political Donation After Three Years Invalid: Jodhpur ITAT
Summary:x The Jodhpur Bench of the Income Tax Appellate Tribunal (ITAT) has quashed reassessment proceedings concerning a ₹3 lakh political donation, holding that the notice under Section 148 was issued beyond the prescribed three-year period while the alleged escaped income was below ₹50 lakh.
In Ankit Singhal v. ITO, Ward-1, Bhilwara, ITA No. 236/Jodh/2026, pronounced on 4 November 2026, the Tribunal allowed the assessee’s appeal for Assessment Year 2019-20.
The decision rested on the validity of reopening. The Tribunal did not adjudicate whether the donation was genuine or whether the deduction claimed under Section 80GGC was otherwise allowable.
Background: Political Donation Deduction Questioned
The assessee filed his return for AY 2019-20 on 27 December 2019, declaring total income of ₹31,97,780.
He had donated ₹3 lakh to Rashtriya Samajwadi Party (Secular) and claimed a 100% deduction under Section 80GGC.
The Department subsequently received information alleging that donations to the political party were routed through bank accounts of dummy concerns and ultimately returned to the original donors, mainly in cash.
This information formed the basis for reopening the assessee’s assessment under Sections 147 and 148.
A notice under Section 148 was issued on 17 April 2023.
Reassessment Increased Income by ₹3 Lakh
In response to the reopening notice, the assessee filed a return on 18 May 2023, declaring the same income as in the original return.
The Assessing Officer completed reassessment under Section 147 read with Section 144B, disallowing the ₹3 lakh deduction.
The resulting assessed income was ₹34,97,780, against the returned income of ₹31,97,780.
The assessee challenged the addition and the reassessment before the CIT(A), National Faceless Appeal Centre. However, the appeal was dismissed through an order dated 10 September 2025.
The assessee then approached the Tribunal.
Assessee Challenged Initiation of Reassessment
Before the ITAT, the assessee questioned whether the statutory conditions necessary for reopening had been satisfied.
His representative also argued that notices under Sections 148A and 148 should have been issued through the faceless mechanism contemplated by Section 151A read with Section 144B, rather than by the jurisdictional Assessing Officer.
According to the assessee, an invalid initiation would render the consequential assessment unsustainable.
He requested disposal of the appeal on the legal challenge to reopening.
The Departmental Representative relied on the orders passed by the lower authorities.
Section 149 Restricted Reopening Beyond Three Years
The Tribunal examined Section 149(1), as applicable to the proceedings.
It noted that the ordinary limitation provision barred issuance of a Section 148 notice after three years from the end of the relevant assessment year unless the case satisfied the conditions governing the extended period.
For reopening beyond three years, the statutory framework required books, documents or evidence revealing escaped income of ₹50 lakh or more, represented in the forms specified in the provision.
The Tribunal also referred to the requirement for information suggesting escapement and prior approval from the specified authority.
These requirements governed the authority to reopen, independently of whether the underlying deduction was considered doubtful.
Notice Issued After Ordinary Limitation Expired
For AY 2019-20, the Tribunal identified 31 March 2023 as the end of the ordinary three-year period.
The notice in the assessee’s case was issued on 17 April 2023, after that date.
The alleged escaped income was ₹3 lakh, substantially below the ₹50 lakh threshold considered necessary for invoking the extended reopening period.
The Tribunal therefore concluded that the notice had been issued beyond the period permitted by law.
The decisive combination was the date of notice and quantum of alleged escapement, rather than the nature of the political donation alone.
Earlier Tribunal Decisions Followed
The assessee relied on ITO v. Mayank Khandelwal, ITA No. 381/JPR/2026, decided by the Jaipur Bench on 25 August 2026.
As discussed in the order, that decision addressed reopening for AY 2019-20 beyond three years where the alleged escaped income was below ₹50 lakh.
The assessee also cited Sachin Madhukar Fegde v. DCIT, ITA No. 4596/MUM/2026, decided on 21 August 2026, concerning approval requirements for reopening beyond three years.
Following the cited precedents and maintaining judicial consistency, the Tribunal held the reassessment invalid and unsustainable.
Reassessment Quashed; Donation Merits Left Undecided
The ITAT quashed the reassessment under Section 147 read with Section 144B and allowed the appeal.
The remaining grounds became academic and were not adjudicated.
The ruling reinforces that allegations of a bogus donation cannot replace compliance with mandatory limitation and jurisdictional conditions.
It does not establish that the donation was genuine. Nor does its operative conclusion independently resolve every objection concerning faceless issuance of notices. The relief followed from the Tribunal’s finding that the reopening notice was belated and the alleged escaped income did not meet the extended-period threshold.
Cases Discussed
1. ITO Vs Mayank Khandelwal (ITAT Jaipur); ITA No. 381/JPR/2026; 25/08/2026; AY 2019-20. The Tribunal relied upon the coordinate-bench decision concerning reassessment initiated beyond three years from the end of the relevant assessment year where the alleged escaped income was below ₹50 lakh. The decision addressed the effect of the procedure followed under Section 148A and the limitation applicable to the Section 148 notice.
2. Sachin Madhukar Fegde Vs DCIT, Circle-1 (ITAT Mumbai); ITA No. 4596/MUM/2026; 21/08/2026; AY 2019-20. Cited concerning the requirement of approval from the competent specified authority under Section 151(ii) where reassessment proceedings were initiated beyond three years from the end of the relevant assessment year.
FULL TEXT OF THE ORIGINAL ORDER OF ITAT JODHPUR
The instant appeal, at the instance of the assessee, impugns the order dated 10.09.2025, u/s 250 of the Income Tax Act, 1961 (in short referred as ‘the Act’), of the National Faceless Appeal Centre, Delhi [for the sake of convenience, hereinafter referred to as CIT(A)], whereby, appeal filed by the assessee/appellant was dismissed.
2. Facts of the case may be chronologically narrated as that the appellant, an individual, filed his return of income for the Assessment Year under consideration 2019-20 on 27.12.2019, by declaring total income of Rs. 31,97,780/-, which was processed u/s 143(3) of the Act. As per return as aforesaid, the appellant had made donation Rs. 3,00,000/- to a political party namely Rashtriya Samajwadi Party (Secular) and claimed 100% deduction u/s 80GGC of the Act, which was later revealed as bogus donation and layered by routing through bank accounts of various dummy concerns and finally returned to the original donor mainly in the form of cash, formed main reason for reopen the assessment u/s 147 of the Act and accordingly, notice u/s 148 of the Act was issued on 17-04-2023.. Thereafter, the appellant refiled the return of income on 18.05.2023, at the same income as earlier. The Learned AO, passed assessment order u/s 147 read with section 144B of the Act at the assessed income of Rs. 34,97,780/- and made addition of Rs. 3,00,000/- as disallowance of deduction claimed u/s 80GGC of the Act, which was assailed by way of appeal and the Learned CIT(A), dismissed the same and so, the appellant before us.
3. Heard rival submissions and carefully scanned the material available on record.
4. Reiterating the grounds of appeal, the Learned AR submitted that the Learned CIT(A) erroneously declined to appreciate that the issuance of notice u/s 148 of the Act and reopening of assessment, quite invalid as not being satisfying the statutory condition precedent and also notice u/s 148A and 148 of the Act were required to be issued through the faceless assessment centre as per the provisions of Section 144B read with section 151A of Act, but were issued by the jurisdictional Assessing Officer (JAO), which is procedurally invalid as held by various established judicial precedents and as such when the initiation itself is procedurally invalid, all consequential orders including assessment order remains void ab initio and also submitted that appeal may be disposed of only this issue.
5. Per Contra, the Learned DR relied upon orders passed by both lower authorities,
6. As per the provisions of Section 149(1) of the Act, no notice u/s 148 of the Act shall be issued for the relevant assessment year, (a) if three years have elapsed from the end of the relevant assessment year, unless the case falls under clause (b) and in clause (b), if three years, but not more than 10 years, have elapsed from the end of the relevant assessment year unless the Learned AO has in his possession books of account or other documents or evidence which reveal that the income chargeable to tax represented in the form of an asset, expenditure in respect of a transaction or in relation to an event or occasion or an entry of entries in the books of account, which has escaped assessment amounts to or is likely to amount to fifty lakh rupees or more. Likewise, as per section 148 of the Act, no notice under this section shall be issued unless there is information with the AO which suggests that the income chargeable to tax has escaped assessment in the case of assessee for the relevant AY and the AO has obtained prior approval of the specified authority to issue such notice.
7. We noticed that this matter is related with A.Y. 2019-20, in which the notice u/s 148 of the Act was issued by the Income Tax Officer Ward-1, Bhilwara on 17-04-2023. In this regard, it is submitted that as matter pertains to 2019-20, than it was required to issue the notice of reopening only upto 31-03-2023 and as per Section 149(1)(a), three years already been elapsed on 17.04.2023 and also the reopening notice was given by the Income Tax Officer Ward-1, Bhilwara, who was not specified authority to issue notice or initiate the reopening proceedings u/s 148 of the Act.
8. In this regard, the Learned AR relied upon the order of the co-ordinate bench Jaipur passed in ITA No. 381/JPR/2026, AY 2019-20, titled as ITO Vs. Mayank Khandelwal, dated 25.08.2026, in which held where reopening was resorted to on the basis of information procured during search conducted on a third party and the notice u/s 148A of the Act was to be considered on a standalone basis, de hors the earlier notice issued u/s 148A of the Act, as notice issued u/s 148 of the Act on 17-04-2023 was beyond three years from the end of the relevant AY i.e. 2019-20 and income escaping assessement being less than Rs. 50 lakhs , accordingly, the notice u/s 148 of the Act, being the jurisdictional notice for framing assessment u/s 147 of the Act was issued beyond the period prescribed u/s 148(1)(a) of the Act and assessment order passed by the Learned AO not sustainable in the eye of law.
9. Likewise, the Learned AR also relied upon another order of co-ordinate bench in ITA No. 4596/MUM/2026, AY 2019-20, titled as Sachin Madhukar Fegde Vs. DCIT, Circle-1, dated 21.08.2026 in which the approval for reopening of the assessement had been granted beyond a peroid of three years from the end of the relevant AY, not by the Principal Chief Commissioner of Income Tax as mandated under the provisions of section 151(ii) of the Act, accordingly, such notice is bad in law and consequently, the reassessemenent framed is void ab initio, which is liable to be quashed.
10. In present case, the matters pertains to AY 2019-20, income escaping assessement less than Rs 50 Lakhs, in which notice was issued on 17-04-2023, beyond the period prescribed in law and in view of the foregoing fact situation and in order to maintain judicial consistency, by following the judicial precedents cited supra, we hold that the reassessment framed u/s 147 of the Act is quite contrary to law, invalid, unsustainable and accordingly, the reassessment framed for A.Y. 2019-20 u/s 147 read with section 144B of the Act is deserves to be quashed, by allowing legal grounds raised by the appellant. Since we allowed the same, other grounds raised, are not being adjudicated as acadamic in nature.
11. Consequently, this appeal is hereby allowed as indicated above.
Order pronounced on 04/11/2026 in Open Court
