Sunny Fulchandji Shah Vs DCIT (ITAT Ahmedabad)
ITAT Ahmedabad: Reopening Beyond Three Years Invalid Where Escapement Is Below ₹50 Lakh—Section 80GGC Disallowance Falls
The Income Tax Appellate Tribunal allowed the assessee’s appeal for AY 2019-20 and quashed the reassessment proceedings as void ab initio, holding that the notice under section 148 issued on 20.04.2023 was time-barred under section 149.
The reopening was based on an alleged bogus political donation of ₹5 lakh claimed under section 80GGC. The Tribunal noted that for AY 2019-20, a notice issued after three years can be sustained only if the AO possesses material showing escapement of income amounting to ₹50 lakh or more in the specified forms under section 149(1)(b). Since the alleged escapement was only ₹5 lakh, the statutory threshold was not met.
Applying the plain language of section 149 (as amended by the Finance Act, 2021), the ITAT held the jurisdictional condition precedent failed, rendering the notice invalid. Consequently, the entire reassessment—along with the disallowance of ₹5 lakh u/s 80GGC—was set aside without entering into merits.
Result: Appeal allowed; reopening quashed and consequential disallowance annulled.
FULL TEXT OF THE ORDER OF ITAT AHMEDABAD
This appeal has been filed by the Assessee against the order dated 31.09.2025 passed by the Ld. Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi (‘Ld. CIT (A)’ in short), under Section 250 of the Income-tax Act, 1961 (‘the Act’ in short) for Assessment Year 2019-20.
