Failure to provide the mandatory minimum notice period of seven days under Section 148A(b) of the Income Tax Act renders the notice illegal and all subsequent reassessment proceedings, including the assessment order, null and void.

ORDER

PER SOUNDARARAJAN K., JUDICIAL MEMBER

This is an appeal filed by the assessee challenging the order of the NFAC, Delhi dated 10/10/2025 in respect of the A.Y. 2016-17 and raised the following grounds:

“1. The Impugned Order is null and void and liable to be quashed.

2. The Learned Commissioner (Appeals) erred in not considering the record including the responses filed before the Assessing Officer, the grounds raised initially in Form 35 and additional grounds raised during the course of the appellate proceeding

3. Without prejudice, the Learned Commissioner (Appeals) erred in simply brushing. aside &Responses dated 10109/2025 and 0611012025, in which additional legal grounds were raised by the Appellant, thereby causing prejudice to the Appellant.

4. Without prejudice, the Learned Commissioner (Appeals) erred in not considering that the Reassessment Proceeding is null and void, as the Assessing Officer, while reopening the case by passing Order u/s148A(d) dated 28/03/2023, took entire sale consideration to be income chargeable to tax, without considering the cost of acquisition, which, it’ considered, would have resulted in income likely to escape assessment far below sum of Rs.50 Lakhs, which would make reopening after three years after AY 2016-17 void.

5. Without prejudice, the Learned Commissioner (Appeals) also erred in not considering that the Order tils.148A(d) dated 28/03/2023 and Notice u/s.148 dated 31/03/2023 were issued by the Income Tax Officer, Ward 4(1)(2). Bangalore, being the Jurisdictional Assessing Officer, thereby violating Section 151A and Faceless Reassessment Scheme

6. Without prejudice, the Learned Commissioner (Appeals) also erred in not considering the detailed responses and evidences filed before the Assessing Officer, justifying the claim of indexed costs of acquisition and improvement and exemption u/s. 54F.

And for other reasons and grounds that may be adduced later, it is humbly prayed that this appeal may be admitted, adjudicated on merit and justice be rendered.”

The brief facts of the case are that the assessee is an individual and he has not filed his return of income. Based on the information that the assessee had sold an immovable property on 25/02/2016 in which the TDS u/s. 194IA has been deducted, the AO had concluded that there is a capital gain. Notice u/s. 148A(b) was issued on 18/03/2023 but the assessee had not responded to the said notice and therefore an order u/s. 148A(d) was passed on 28/03/2023. Simultaneously, notice u/s. 148 was also issued on 31/03/2023. Thereafter the assessee furnished his return of income on 29/09/2023. Then notice u/s. 143(2) as well as u/s. 142(1) were issued for which the assessee had filed some explanations and also claimed deduction u/s. 54F of the Act. The assessee had sought for the refund of the TDS amount in view of the explanations offered by him. The AO not satisfied with the objections, had computed the long term capital gains and brought the same to tax. The AO had not accepted the rate adopted by the assessee at Rs. 50/- per sq.ft. for determining the cost of acquisition. The AO considered the fact that the said agricultural lands were converted into non-agricultural lands for residential purposes and therefore not accepted the rate at Rs. 50/- per sq.ft. Similarly, the AO had not accepted the claim of deduction u/s. 54F of the Act. As against the said order, the assessee filed an appeal before the Ld.CIT(A) with a delay of 12 days. The assessee also filed an additional ground on 06/10/2025 raising the legal plea that the AO had not granted minimum of 7 days time to reply to the notice issued u/s. 148A(b) of the Act and therefore the entire proceedings are bad in law. The said additional ground was uploaded on 06/10/2025. In the grounds of appeal, the assessee had also relied on the judgment of the Hon’ble Jurisdictional High Court reported in (2025) 178 taxman.com 410 (Karnataka) in the case of ITO vs. Venkatal Iyyappa Rajanna