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of <h1>Reopening Assessment Beyond Three Years Requires PCCIT Sanction Under Section 151(ii), Invalid Without It</h1> The HC held that for reopening assessment beyond three years under section 147 for AY 2018-19, sanction must be granted by the PCCIT as per Section ... Reopening of assessment u/s 147 - sanction to be issued by the Principal Commissioner of Income Tax (“PCIT”) OR Principal Chief Commissioner of Income Tax (PCCIT”) - HELD THAT:- The matter pertains to AY 2018-19. Since the impugned order as well as the notice are both issued on 21st April 2022, 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. As held in Siemens Financial Services Private Limited [2023 (9) TMI 552 - BOMBAY HIGH COURT] the sanction is invalid. Mr. Suresh Kumar agrees. Consequently, the impugned order and impugned notice issued under section 148A(d) and 148, respectively, of the Act are hereby quashed and set aside. The petition challenges notices dated 27th March 2022 (under Section 148A(b)) and 21st April 2022 (under Sections 148A(d) and 148) of the Income Tax Act, 1961, relating to Assessment Year 2018-19. A key issue is the validity of the sanction for issuing the order and notice, which was granted by the Principal Commissioner of Income Tax (PCIT) rather than the Principal Chief Commissioner of Income Tax (PCCIT). Since both the order and notice were issued beyond the three-year period, Section 151(ii) mandates that the sanctioning authority must be the PCCIT. The proviso to Section 151, allowing PCIT sanction in certain cases, was effective only from 1st April 2023 and is thus inapplicable here. Relying on the precedent in Siemens Financial Services Private Limited v. Deputy Commissioner of Income Tax [(2023) 457 ITR 647 (Bom)], the Court held the sanction invalid. Consequently, the impugned order and notice dated 21st April 2022 are quashed and set aside. The petition is disposed of with no order as to costs, keeping all rights and contentions open.
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