Assessment reopening sanction under section 151 was defective, so the reassessment notice and order were quashed.

Reopening of assessment after three years from the end of the relevant assessment year required sanction from the specified higher authority under section 151 of the Income-tax Act, 1961. Sanction taken only from the Principal Commissioner did not satisfy the statutory requirement in the stated circumstances, rendering the reopening procedurally and jurisdictionally defective. The reassessment notice dated 26.07.2022 and the assessment order dated 09.05.2023 were quashed.

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Issues: Whether the reopening of assessment was invalid for want of proper sanction under section 151 of the Income-tax Act, 1961, and whether the consequent notice and assessment order were liable to be quashed.

Analysis: The assessment was reopened after three years from the end of the relevant assessment year. The recorded sanction was taken from the Principal Commissioner, whereas the applicable statutory requirement in the circumstances was sanction by the specified higher authority under section 151 of the Income-tax Act, 1961. The absence of such proper approval rendered the reopening procedurally and jurisdictionally defective.

Conclusion: The reopening was invalid, and the notice dated 26.07.2022 and the assessment order dated 09.05.2023 were quashed.

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