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Judgment
PER SHRI SATBEER SINGH GODARA, JUDICIAL MEMBER:
This assessee's appeal for assessment year 2018-19, arises against the Commissioner of Income Tax (Appeals)/National Faceless Appeal Centre [in short, the "CIT(A)/NFAC"], Delhi's DIN and order no. ITBA/NFAC/S/250/2025-26/1080087049(1), dated 28.08.2025 involving proceedings under section 147 r.w.s. 144 r.w.s. 144B of the Income-tax Act, 1961 (hereinafter referred to as 'the Act').
Heard both the parties at length. Case file perused.
We no w advert to the first and foremost legal issue of validity of the impugned reopening itself a s p er the assessee’s substantive grounds raised in the insta nt appeal. Learned counsel at the o utset, invites our attention to the assessee’s paperbo ok running into 14 pages inter alia placing on record the assessing authority’s section 148A(b) notice dated 24.03.2022 followed by his twin replies thereto dated 31.03.2022 and 07.04.2022, the former’s section 148A(d) order dated 08.04.2022 finally culminating in his section 148 notice issue dated 09.04.2022, respectively. The assessee’s case accordingly is that the impugned reopening is a non-est one in the eyes of law once the learned PCIT, Delhi-15 and not the PCCIT, as the case may be, had granted his prior approval to section 148A(b) proceedings initiated on 24.03.2022. Mr. Lalchandani further quotes section 151(ii) of the Act that such an invalid approval vitiates the impugned reopening itself as is the case herein.
The Revenue on the other hand, submits that the learned PCIT herein has rightly granted approval to the authorities’ section 148(b) proceedings since initiated within a period of three years from the end of the relevant assessment year A.Y. 2018-19.
That being the case, we hereby notice that hon’ble Bombay high court in Vodafone Idea Limited vs Deputy Commissioner of Income Tax in Writ Petition no. 2766 of 2022 (A.Y.: 2018-19) decided on 06.02.2024 has settled the very issue in the assessee’s favour and against the department that such proceedings ought to be initiated only after obtaining the PCCIT’s approval and not the PCIT’s approval; as under:
1.Petitioner is impugning a notice dated 15th March 2022 issued under Section 148A(b) of the Income Tax Act, 1961 (“the Act”), the order dated 5th April 2022 passed under Section 148A(d) of the Act and the notice dated 6th April 2022 issued under Section 148 of the Act. One of the grounds raised is that the sanction to pass the order under Section 148A(d) of the Act and issuance of notice under Section 148 of the Act is invalid inasmuch as the sanction has been admittedly issued by the Principal Commissioner of Income Tax (“PCIT”) and not by the Principal Chief Commissioner of Income Tax (PCCIT”).
2.Petitioner’s request for a copy of the sanction has also been denied. Even in the affidavit in reply, the Department is refusing to give the sanction which makes us wonder what is the national secret involved in that, that Assessee is being refused what he is rightfully entitled to receive from the Department. In the affidavit in reply, the stand taken by the Revenue is it will be made available during the re-assessment proceeding.
3.In the impugned order dated 5th April 2022 and the impugned notice dated 6th April 2022, both state that the Authority that has accorded the sanction is the PCIT, Mumbai 5. The matter pertains to Assessment Year (“AY”) 2018-19 and since the impugned order as well as the notice are issued on 5th April 2022 and 6th April 2022, respectively, both have been issued beyond a period of three years. Therefore, the sanctioning authority has to be the PCCIT as provided under Section 151 (ii) of the Act. The proviso to Section 151 has been inserted only with effect from 1st April 2023 and, therefore, shall not be applicable to the matter at hand.
4.In this circumstances, as held by this Court in Siemens Financial Services Private Limited Vs. Deputy Commissioner of Income Tax & Ors.,1 the sanction is invalid and consequently, the impugned order dated 5th April 2022 and impugned notice dated 6th April 2022 under section 148A(d) and 148, respectively, of the Act are hereby quashed and set aside.
We adopt the above detailed reasoning mutatis mutandis to conclude that the impugned reopening has not been validly initiated in the assessee’s case for want of a proper approval u/s 151(ii) of the Act. The same stands quashed in very terms therefore.
All other remaining pleadings between the parties on merits stand rendered academic.
This assessee’s appeal is allowed.