Prior approval for reopening after three years requires Chief Commissioner sign-off; absence of such approval invalidates reassessment notice.

Where more than three years have elapsed from the end of the relevant assessment year, the prior approval required to pass an order under section 148A(d) and to issue a consequent notice under section 148 must be obtained from the higher authority specified for that period (Chief Commissioner or equivalent); section 148A mandates prior approval both for conducting the enquiry and for the decision under clause (d), and section 151 prescribes the temporal shift in the competent approving authority. Failure to secure fresh approval from the appropriate higher authority at the time of the section 148A(d) order produces a jurisdictional defect and renders the reassessment invalid.

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Issues: Whether the order passed under section 148A(d) and the subsequent notice under section 148 are void for want of valid prior approval from the Chief Commissioner when more than three years have elapsed from the end of the relevant assessment year.

Analysis: Section 148A requires the Assessing Officer to obtain prior approval of the specified authority both for conducting any enquiry under clause (a) and for passing an order under clause (d) deciding whether to issue a notice under section 148. Section 151 identifies the specified authority: within three years from the end of the relevant assessment year the approval must be from the Principal Commissioner/Principal Director/Commissioner/Director, and if more than three years have elapsed the approval must be from the Principal Chief Commissioner/Principal Director General or, where none exists, the Chief Commissioner/Director General. The AO obtained prior approval from the Principal Commissioner when the notice under section 148A was issued, at a time when three years had not yet expired; however, by the time the AO passed the order under section 148A(d) and issued the notice under section 148 on 07.04.2022, more than three years had elapsed, and therefore fresh approval was required from the Chief Commissioner/appropriate higher authority. The absence of such fresh approval meant the statutory requirement in section 148A(d) read with section 151 was not complied with, producing a jurisdictional defect in the reopening proceedings. Applying these provisions to the facts, the Tribunal found that the required approval at the time of passing the section 148A(d) order was not obtained from the Chief Commissioner and consequently the reassessment was not in accordance with law.

Conclusion: The reassessment proceedings initiated by issuance of notice under section 148 on 07.04.2022 are invalid for want of the required prior approval from the Chief Commissioner; the reassessment order is quashed and the appeal is allowed in favour of the assessee.

Ratio Decidendi: Where more than three years have elapsed from the end of the relevant assessment year, an order under section 148A(d) and any consequent notice under section 148 can be validly issued only after obtaining the prior approval of the Chief Commissioner (or other authority specified in section 151 for that time period); failure to obtain that approval renders the reopening jurisdictionally defective.

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