Reopening of assessment based on risk management information upheld; prior competent authority approval validated and notice sustained.

Reopening of assessment was held valid where the assessing officer received information linked to a risk management strategy but Explanation 2(iv) to the proviso to Section 148 is not displaced by such receipt; information from a search does not preclude additional risk strategy information. The assessing officer had prior approval from the competent tax authority equivalent to the specified authority approval required for issuance of the notice, so no separate duplicate approval under the proviso was necessary. The writ petition challenging the notice was dismissed and the reassessment notice sustained.

---

---

Issues: (i) Whether receipt of information under the CBDT risk management strategy satisfies Explanation 1 to Section 148 of the Income-tax Act, 1961 so as to exclude reliance on Explanation 2(iv) to the proviso to Section 148; (ii) Whether, in addition to the approval obtained under Section 151 of the Income-tax Act, 1961 for issuance of a notice under Section 148, a separate approval under clause (c) of the proviso to Section 148A of the Income-tax Act, 1961 is required.

Issue (i): Whether information received under the CBDT risk management strategy precludes application of Explanation 2(iv) to the proviso to Section 148 of the Income-tax Act, 1961.

Analysis: The impugned notice was issued after a search under Section 132 of the Income-tax Act, 1961 and the AO also had information said to be received pursuant to the CBDT risk management strategy. The presence of information obtained under the risk management strategy does not negate or exclude other sources or categories of information contemplated by Explanation 2(iv) to the proviso to Section 148. Both types of information can coexist, and the existence of one does not oust the applicability of the other.

Conclusion: Explanation 1 reliance on information from the CBDT risk management strategy does not preclude application of Explanation 2(iv) to the proviso to Section 148; therefore reliance on Explanation 2(iv) remains permissible.

Issue (ii): Whether the approval obtained under Section 151 of the Income-tax Act, 1961 for issuance of a notice under Section 148 suffices, or whether an additional approval under clause (c) of the proviso to Section 148A of the Income-tax Act, 1961 is separately required.

Analysis: The approval obtained from the competent Principal Commissioner is in terms similar to the approval referred to in clause (c) of the proviso to Section 148A. Requiring two identical approvals for the same action would be duplicative. The approval given under the authority specified in Section 151 fulfills the statutory requirement for issuance of the notice under Section 148.

Conclusion: The approval secured under Section 151 of the Income-tax Act, 1961 is sufficient; no separate, additional approval under clause (c) of the proviso to Section 148A is required.

Final Conclusion: The contentions challenging the notice under Section 148 of the Income-tax Act, 1961 on the grounds that Explanation 2(iv) was excluded by reliance on CBDT risk management strategy and that a separate approval under clause (c) of the proviso to Section 148A was required are rejected; the petition is dismissed.

Ratio Decidendi: Receipt of information under a CBDT risk management strategy does not exclude other statutory bases for issuance of a Section 148 notice, and approval obtained from the authority specified under Section 151 of the Income-tax Act, 1961 satisfies the approval requirement reflected in clause (c) of the proviso to Section 148A of the Income-tax Act, 1961.

---