O R D E R

Per Balakrishnan S, Accountant Member :

This appeal is filed by the assessee against the order passed by CIT(A) [NFAC, Delhi], vide DIN and Order No.ITBA/NFAC/S/250/2025-26/1079089279(1) dated 30.07.2025 for the Assessment Year 2016-17 arising out of order passed under section 147 r.w.s. 144B of the Act dated 29.05.2023.

2. Briefly stated the facts of the case are that assessee filed return of income for Assessment Year 2016-17 on 17.10.2016 admitting a total income of Rs.Nil. As per information available at the Department on the insight portal, assessee during the Financial Year 2015-16 has claimed short term capital loss on sale of units of mutual funds amounting to Rs.2,05,45,428/-. The learned AO observed that the income has escaped assessment within the meaning of section 147 of the Act and notice under section 148 of the Act was issued to the assessee on 26.07.2022 with the approval from appropriate authorities. The assessee did not file return of income in response to notice under section 148 of the Act. Thereafter, a notice under section 144 of the Act dated 28.03.2023 was issued and served to the assessee to provide one more opportunity to show cause why the assessment should not be completed under section 144 of the Act. In response, the assessee filed the ITR on 04.04.2023. Thereafter, a notice under section 143(2) of the Act was issued on 06.04.2023. Assessee furnished his response on 12.04.2023. After perusing the information furnished by the assessee, the learned AO being not satisfied, made an addition of Rs.2,05,45,428/- to the total income of the assessee.

3. On being aggrieved by the order of the learned AO, assessee carried the matter in appeal before the learned CIT(A). The learned CIT(A) considered the submissions as lacking merits and dismissed appeal of the assessee.

4. On being aggrieved by the order of the learned CIT(A), assessee is in appeal before us by raising 23 grounds.

5. At the outset, the learned AO submitted that ground No.9 challenges the jurisdiction of the AO in obtaining approval under section 151 of the Act and this may be adjudicated first since it goes to the root of the matter challenging the validity of the Assessment Order. We therefore now proceed to adjudicate ground No.9 at first.

6. At the outset, learned AR submitted that the learned AO had grossly erred in law and on facts of the case in assuming jurisdiction and framing the impugned assessment vide his order passed under section 147 r.w.s. 144B of the Act, dated 29.05.2023. Elaborating on his contention, the learned AR submitted that, as notice under section 148 of the Act, dated 26.07.2022 for the year under consideration i.e. A.Y. 2016-17 had been issued by the learned AO beyond a period of three years from the end of the relevant Assessment Year, therefore, as per the mandate of Section 151 of the Act, as was made available on the statute by the Finance Act, 2021 w.e.f. 01.04.2021 and was applicable at the time of issuing of the notice, the said notice could have been issued only after obtaining the prior approval of the authorities contemplated in sub-section (ii), viz. Principal Chief Commissioner/Principal Director General/ Chief Commissioner/Director General. The learned AR, to fortify his contention, has drawn our attention to the notice under section 148 of the Act, dated 26.07.2022, which revealed that the same was issued after obtaining the prior approval of Principal Commissioner of Income Tax – 1, Bangalore. Carrying his contention further, the learned AR submitted that as the impugned notice under section 148 of the Act, dated 26.07.2022 had been issued by the learned AO without obtaining the approval of the specified authority, therefore the said notice and the consequential assessment framed by him vide his order passed under section 147 r.w.s. 144B of the Act, dated 29.05.2023 cannot be sustained and is liable to be quashed on the said count itself.

7. Per contra, learned DR on being confronted with