Jurisdiction to cancel section 10(23C)(vi) approval rested only with the prescribed authority; cancellation by another officer was void.

A cancellation of approval under section 10(23C)(vi) was held to be beyond jurisdiction where the order was passed by the DGIT (Investigation) after CBDT notifications and rule 2CA had already vested the power to grant or cancel approval in the prescribed authority, namely the Commissioner of Income-tax (Exemptions) or the Principal Commissioner of Income-tax, as applicable. Because the impugned authority was not empowered under the operative notifications, the cancellation was contrary to the statutory scheme and void ab initio, and the assessee succeeded.

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Issues: Whether the authority that cancelled approval under section 10(23C)(vi) of the Income-tax Act, 1961 had jurisdiction to do so in light of the CBDT notifications and rule 2CA of the Income-tax Rules, 1962.

Analysis: Approval under section 10(23C)(vi) had earlier been granted to the assessee for educational activities. The cancellation was made by the DGIT (Investigation), but the relevant CBDT notifications identified the prescribed authority for granting or cancelling approval as the Commissioner of Income-tax (Exemptions) or the Principal Commissioner of Income-tax from the specified date. Once the statutory notifications became operative, the power to deal with approval under section 10(23C)(vi) vested only in the prescribed authority named therein. The cancellation order passed by an authority not so empowered was contrary to the notifications and beyond statutory competence.

Conclusion: The cancellation order was without jurisdiction and void ab initio, and the assessee succeeded.

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