Reassessment sanction under the correct provision is mandatory; wrong statutory approval invalidates the notice, assessment, and consequential proceedings.

For A.Y. 2016-2017, reassessment sanction had to be obtained under Section 151(ii) of the Income-tax Act, 1961 and not under Section 151(i). Because the sanction was taken under the wrong provision, it was invalid, so the reassessment notice could not survive. The assessment order passed on that defective sanction also failed, and all consequential proceedings were set aside. The decision applies the earlier view that correct statutory sanction is a mandatory condition for valid reassessment action, and non-compliance vitiates the entire chain of proceedings.

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Issues: Whether the reassessment sanction for A.Y. 2016-2017 was required under Section 151(ii) of the Income-tax Act, 1961 instead of Section 151(i), and whether the assessment order and consequential proceedings were liable to be quashed for want of valid sanction.

Analysis: The petitions were covered by the earlier decision holding that, for A.Y. 2016-2017, sanction had to be accorded under Section 151(ii) of the Income-tax Act, 1961 and not under Section 151(i). Since the sanction was obtained under the wrong provision, it was invalid, and the notice founded on such sanction could not survive. An assessment order passed in reliance on an invalid sanction was also liable to fail, along with proceedings flowing from it.

Conclusion: The reassessment sanction was invalid and the impugned assessment order was quashed together with all consequential proceedings.

Final Conclusion: The petitions succeeded, and the challenged reassessment action was set aside on the ground of defective sanction.

Ratio Decidendi: For A.Y. 2016-2017, reassessment sanction must be obtained under the correct statutory provision, and a sanction granted under the wrong clause renders the notice and all proceedings founded upon it invalid.

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