Mandatory approval for reassessment notice was defective, so the notice and assessment were treated as invalid.

Reassessment proceedings were held invalid because the approval for issue of notice was obtained from the Principal Commissioner, while the governing provision required approval from the Principal Chief Commissioner after three years from the end of the relevant assessment year. That defect was treated as jurisdictional and went to the root of the reassessment power. As the mandatory precondition was not satisfied, the notice and the consequential assessment could not stand, and the assessment order was quashed in favour of the assessee.

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Issues: Whether the reassessment proceedings were valid where approval for issuance of notice was obtained from the Principal Commissioner instead of the prescribed higher authority after the expiry of three years from the end of the relevant assessment year.

Analysis: The record showed that the statutory approval for issuing notice under the reassessment provisions had been taken from the Principal Commissioner, whereas the governing approval requirement was that of the Principal Chief Commissioner in a case falling beyond three years from the end of the relevant assessment year and within the monetary threshold considered by the provisions. This defect went to the root of jurisdiction. The notice and the consequential assessment proceedings were therefore not in conformity with the mandatory preconditions for valid reassessment.

Conclusion: The reassessment proceedings were invalid and the assessment order was liable to be quashed in favour of the assessee.

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