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TMI Blog2025 (4) TMI 1216X X X X Extracts X X X X X X X X Extracts X X X X ..... ly confirmed addition of Rs. 21,92,000/- u/s 69 A of the l.T. Act, 1961 on account cash deposit in bank account. 4.That, the Ld. CIT(A) has wrongly confirmed applicability of provisions of section 115BBE of the IT Act, 1961. 5.That, the Ld. CIT(A) has confirmed levy of interest u/s 234A, 234B and 234C of the I.T. Act, 1961. 6.That, the Ld. CIT(A) has wrongly confirmed initiation of penalty u/s 271AAC and 272(A)(1)(d) of the Act,1961. 7.The assessee craves leave to add, amend, alter, or withdraw any aforesaid grounds of appeal. 3. The facts of the case which can be stated quite shortly are as follows: The assessee filed return of income, declaring an income of Rs. 48,770/- for the assessment year 2017-18, on 28.10.2017, which was processed at returned version. As per information available with the department, the assessee has made cash deposits amounting to Rs. 21,92,000/-in its Bank Account No. 006000400000066 maintained with the Nawanagar Co-operative Bank during demonetization period. The assessee has failed to disclose details of cash deposits during demonetization in its return of income. Accordingly, proceedings u/s 147 of the Income Tax Act were initiated after recor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessment is shown to the tune of Rs. 21 lakhs, which is not applicable after 1st April 2021. The criteria to issue the notice, after 1st April 2021 is that if the income escaped assessment exceeds Rs. 50 lakhs, then only notices can be issued to the assessee in new law regime, after after 1st April 2021. The ld.Counsel for the assessee submitted that the notices were issued to the assessee by following new provisions of the Act, which are applicable after 1.4.2021. However, the order was passed by the assessing officer under the old provisions of the Act. The ld.Counsel for the assessee also took us through the approval given by the Appropriate Income-tax Authority and stated that the approval was not taken prior to the issuance of the notice under section 148 of the Act, therefore, reassessment order passed by the assessing officer, under section 147 of the Act, may be quashed. 8. On the other hand, the ld.DR for the Revenue submitted that as per the section 292B of the Act, the notice issued by the assessing officer will be deemed to be correct, when the assessee has participated in the assessment proceedings. The ld.DR also pointed out that the assessing officer as well as the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... notice u/s 148 of the Act is enclosed at page no. 21 of the assessee`s paper book, and it can be seen from the notice and the note mentioned in the said notice, which contains a statement "If digitally signed, the date of digital signature may be taken as date of document". The digital signature of notice is 01/04/2021 at 12:45 pm. The screenshot of digital signature is enclosed at page no. 22 of the assessee`s paper book. It is also stated that digitally signing a notice is an act different from the act of issuing the notice. In this regard it is stated that notice is served on email id of the Appellant on 01/04/2021. The screenshot of email is as under: The issue date, as per income tax portal, is also 01/04/2021. The screenshot from the portal is as under: The process of digitally generating the notice on the system was carried out on 01/04/2021. The impugned notice could not have been issued prior to the same being signed. The date of the said notice is duly reflected as on 01/04/2021.It has been consistently held that the expression 'issue' in its common parlance and its legal interpretation means that the issuer of the notice must after drawing up the notice and sig ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in respect of which the Assessing Officer has information to suggest that it has escaped assessment, is below the threshold limit of Rs.50 lakhs. [Para 8]." (ii) Suman Jeet Agarwal v. ITO [2022] 143 taxmann.com 11 (Delhi) "The notices which were digitally signed on or after 1st of April, 2021, are held to bear the date on which the said Notices were digitally signed and not 31st March 2021. The said petitions are disposed of with the direction that the said Notices are to be considered as show-cause-notices under section 148A(b) of the Act as per the directions of the apex Court in the Ashish Agarwal (supra) judgment." (iii) Bennett Coleman & Co Ltd. V. NFAC (I.T.A. No.1387/Mum/2023) (Mum. Trib.) The court held that the signing of the assessment order is an integral part of order generation in e-assessment and the assessment proceedings conclude only after the order is digitally signed, therefore, signing of the assessment order should not be brushed aside lightly. Therefore, the signing of the assessment order is a mandatory requirement and not a procedural formality unless the order is signed assessment does not complete. As per the Faceless Assessment Scheme 2019 which wa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e to the show-cause notice referred to in clause (b); and (iv) decide, on the basis of material available on record including reply of the assessee, as to whether or not it is a fit case to issue a notice under section 148 and (v) the Assessing Officer is required to pass a specific order within the time stipulated." However, the assessment order u/s 143(3) of the Act has been passed under the old law by following the procedure as stated under the old provisions prior to amendments in the year 2021. Therefore, the AO is failed to follow the procedure as laid down under the new regime of proceedings u/s 148, wherein following procedure is required to be followed. * "148A(a): conduct any enquiry, if required, with the approval of specified authority, with respect to the information which suggests that the income chargeable to tax has escaped assessment; * 148A(b): provide an opportunity of being heard to the assessee, with the prior approval of specified authority; * 148A(c): consider the reply of the assessee furnished, if any, in response to the show-cause notice referred to in clause (b); and * 148A(d): decide, on the basis of material available on record including re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ; to propose with difference or modesty; to hint; to intimate. As per Merriam-Webster - 'to call to mind by thought or association'. The expression 'information' in the context in which it occurs must, mean instruction or knowledge derived from an external source concerning facts or particulars, or as to law relating to a matter bearing on the assessment vide: CIT v. A. RAMAN & CO. [1968] 67 ITR 11 (SC)]. Therefore, section 148 would point out to concrete information which could be facts which point out to a case of income having escaped assessment. Section 148A would only assist the Assessing Officer in coming to a conclusion whether such information is good enough to allow a notice to be issued under section 148. The new provisions should be interpreted so as to make them workable in accord with the intent to achieve the purpose for which statutory change was brought about. On a conjoint reading of section 147 and section 148, it is clear that the escapement of income is a sine qua non for initiating proceedings u/s 147 of the Act. Therefore, availability of the 'information which suggests that there is an escapement of income' is a prerequisite for issuin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e than three years have elapsed from the end of the relevant assessment year:] [Provided that the period of three years for the purposes of clause (i) shall be computed after taking into account the period of limitation as excluded by the third or fourth or fifth provisos or extended by the sixth proviso to sub-section (1) of section 149.]" The notice u/s 148 of the Act has been issued after obtaining the approval from JCIT Range 1, Jamnagar. The said fact is stated in notice u/s 148 of the Act. The AO is required to follow the procedure under new law and required to follow the approval as per Section 148A(d) of the I.T. Act, 1961. Therefore, the notice has been issued without obtaining the approval as prescribed under amended provision of section 151 of the Act.In this regards, reliance is placed in the case of UOI v. Rajeev Bansal [2024] 167 taxmann.com 70 (SC) the Hon'ble court has dealt with various issues as under: "Para 68: After 1-4-2021, the Income-tax Act has to be read along with the substituted provisions. The substituted provisions apply retrospectively for past assessment years as well. On 1-4-2021, TOLA was still in existence, and the revenue could not have ign ..... X X X X Extracts X X X X X X X X Extracts X X X X
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