ITO Vs Navyug Eduventures Private Limited (ITAT Delhi)
Summary: The Income Tax Appellate Tribunal, Delhi Bench ‘E’, in ITO Vs M/s Navyug Eduventures Private Limited, ITA No. 3524/Del/2025 and Cross Objection No. 271/Del/2025, decided on 15 April 2026, held that a reassessment notice under Section 148 digitally signed on 31 March 2021 but actually dispatched by email on 1 April 2021 was invalid when the Assessing Officer failed to follow the statutory procedure introduced by the Finance Act, 2021. The dispute concerned Assessment Year 2013-14. The Revenue had appealed against the order of the Commissioner of Income Tax (Appeals), NFAC, Delhi, dated 30 January 2025, while the assessee filed a cross-objection challenging the jurisdiction of the Assessing Officer to reopen the assessment. The underlying reassessment order had been passed on 30 March 2022 under Section 147 read with Section 144B of the Income-tax Act, 1961. The assessee contended that although the Section 148 notice bore the date and digital signature of 31 March 2021, it was released and communicated through email only on 1 April 2021, when the substituted reassessment provisions had already come into force.
The assessee argued that the old reassessment procedure could not validly be invoked after 31 March 2021 and that the Assessing Officer had not complied with the mandatory safeguards prescribed under Section 148A of the Income-tax Act. The Tribunal examined the notice and the supporting ITBA email record placed at page 158 of the assessee’s paper book. The electronic sending timestamp established that the notice was issued on 1 April 2021. The Departmental Representative could neither dispute this fact nor produce evidence demonstrating that the notice had been dispatched on 31 March 2021. The Tribunal therefore treated 1 April 2021 as the actual issuance date, rather than the earlier date appearing on the digitally signed document. Referring to the Supreme Court’s decision in Union of India Vs Ashish Agarwal, (2022) 444 ITR 1 (SC), the Tribunal observed that notices issued under the old regime after the substituted provisions came into effect could be construed as show-cause notices under Section 148A(b), but the Assessing Officer was required to complete the procedure mandated by the amended law.
Cases Discussed
- Union of India Vs Ashish Agarwal (Supreme Court); Civil Appeal No. 3005 of 2022; 04/05/2022; (2022) 444 ITR 1 (SC) — Applied for the principle that reassessment notices issued under the earlier Section 148 regime after the substituted provisions came into force may be treated as show-cause notices under Section 148A(b), subject to compliance with the applicable statutory procedure. The Tribunal found that the required procedure had not been followed in the present case.
FULL TEXT OF THE ORDER OF ITAT DELHI
This appeal by the Revenue and the cross-objection by the assessee are arising out of the order of learned CIT(A), NFAC, Delhi in appeal No.NFAC/2012-13/10130920, order dated 30th January, 2025. Assessment was framed by the Assessing Officer of NFAC for the assessment year 2013-14 under Section 147 read with Section 144B of the Income-tax Act, 1961 (hereinafter referred to as ‘the Act’) vide his order dated 30th March, 2022.
2. At the outset, learned Counsel for the assessee Shri Suraj Bhan Nain pointed out that the assessee has raised jurisdictional issue that the notice under Section 148 of the Act is without jurisdiction and for this, he drew our attention to ground No.2 of the cross-objection, which reads as under:-
“2. That having regards to the facts and circumstances of the case, the Ld. Commissioner of Income Tax (Appeal) erred in not holding that the impugned Notice u/s 148 of the Income Tax Act, 1961 for A.Y. 2013-14 issued on 01.04.2021 by the Ld. Assessing Officer as per old provisions of section 148, which were substituted by the new provisions w.e.f. 01.04.2021 by the Finance Act 2021, is void ab initio and invalid.”
3. Learned Counsel for the assessee stated that the impugned notice under Section 148 of the Act (which is enclosed in assessee’s paper book at page 158) dated 31st March, 2021 and it was also signed on 31st March, 2021, but it was released by the Department only on 1st April, 2021. Learned Counsel for the assessee explained that with effect from 1st April, 2021, the entire scheme of reopening is amended and the entire process is provided in the provisions of Section 148 of the Act, which is not followed and therefore, the entire reassessment proceedings based on such belated notice is invalid. Learned Counsel pointed out that the assessment year involved is AY 2013-14 and the notice under Section 148 for AY 2013-14 is barred by limitation as the said notice was issued to the assessee on 1st April, 2021 by email though it was digitally signed on 31st March, 2021 and hence, the entire assumption of jurisdiction for reopening the assessment under Section 147 read with Section 148 is without assuming valid jurisdiction and hence, initiation of proceedings under Section 147 of the Act is void ab-initio and bad in law.
4. When these facts were confronted to the learned CIT-DR, she could not controvert the above fact situation.
5. We have heard the rival contentions and perused the material placed before us. We find that the notice under Section 148 of the Act is available in assessee’s paper book at page 158 and the proof of email issued to the assessee and sending time stamp is 1st April, 2021 as per ITBA document, which reflects that the notice has been issued on 1st April, 2021. The learned CIT-DR could not controvert or place any document to demonstrate that the requirement of issuing notice under Section 148 of the Act on 31st March, 2021 i.e., the same date as it was digitally signed, was fulfilled. Since the date of issuance of notice under Section 148 of the Act is 1st April, 2021, the notice under Section 148 of the Act can be construed as having been issued under Section 148A(b) of the Act under the provisions of Section 148 of the Act as inserted by the Finance Act, 2021 with effect from 1st April, 2021, as held by Hon’ble Supreme Court in the case of Union of India Vs. Ashish Agarwal – [2022] 444 ITR 1 (SC). But, the Assessing Officer has to follow necessary process laid down in the amended provisions under Section 148A of the Act. The amended provisions of Section 148 and 148A of the Act mandate conducting of an enquiry if required under Section 148A(a) of the Act and providing an opportunity of being heard to the assessee under Section 148A(b) of the Act and passing of an order under Section 148A(d) of the Act after taking due approval from specified authority before issuing notice under Section 148 of the Act is necessary, which is missing in the present case. Hence, we are of the view that notice under Section 148 of the Act issued on 1st April, 2021 is barred by limitation and without following due process of law as mandated under Section 148(a) of the Act. Hence, notice issued under Section 148 is invalid and bad in law. We hold so.
6. Coming to the Revenue’s appeal, since we have adjudicated the jurisdictional issue in favour of the assessee and quashed the reopening notice issued under Section 148 of the Act, the appeal of the Revenue on merits has become academic and accordingly, is dismissed.
7. In the result, the appeal of the Revenue is dismissed and the cross-objection of the assessee is allowed.
Decision pronounced in the open Court on 15th April, 2026.
