Reassessment notice invalid where sanction came from the wrong authority, making the reopening jurisdictionally defective.

Reassessment under section 148 was held invalid because the sanction under section 151 was obtained from the Principal Commissioner instead of the specified higher authority required for a notice issued beyond three years from the end of the relevant assessment year. That defect was treated as jurisdictional because valid approval by the correct specified authority is a precondition to reopening. As the approval did not satisfy the mandatory statutory requirement, the notice was bad in law and the assessment made on its basis could not stand. The reassessment notice and consequential assessment were therefore quashed.

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Issues: Whether the reassessment notice issued under section 148 was invalid for want of approval by the correct specified authority under section 151, and whether the consequent assessment could stand.

Analysis: The notice under section 148 was issued after approval by the Principal Commissioner, although for a notice issued beyond three years from the end of the relevant assessment year, the statute required approval of the Principal Chief Commissioner, Principal Director General, Chief Commissioner, or Director General, as applicable. The approval therefore did not satisfy the mandatory requirement under section 151(ii)(b). The defect was jurisdictional, since valid sanction of the specified authority is a precondition for reassessment jurisdiction. In the circumstances, the reassessment notice was bad in law and the assessment framed on its basis was consequential.

Conclusion: The reassessment notice and the consequential assessment were quashed, and the assessee succeeded on the challenge to the reopening.

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