TaxTMI 
TaxTMI 
2010 (12) TMI 164
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....g Officer which was rejected by the Assessing Officer. The assessee went in appeal before the CIT(A). Before the CIT(A) also the assessee contended that since the original assessment order was passed under section 143(3) of the Act and notice under section 148 was issued after the expiry of 4 years as per proviso to section 151(1), the Assessing Officer must have taken the sanction of the Chief Commissioner of Income Tax (CCIT) or Commissioner of Income Tax (CIT) to reopen a completed assessment. The CIT(A), following the decision of the Calcutta High Court in the case of East India Hotels Limited v. DCIT, 204 ITR 435, took the view that since the requisite sanction was not received from the CCIT or CIT, in accordance with proviso to section 151(1), the notice issued under section 148 of the Act and the Assessment Order passed in pursuance thereof was held as without jurisdiction and invalid. When the matter came before the Tribunal, the ld. A.M. decided the issue against the assessee by holding as under : - "To summarize, the decision in the case of Dr. Shashi Kant Garg v. CIT (supra) does not cover the assessee's case in its favour; rather, against it. The rank of the A.O. issui....
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....ed the rival submissions presented before me. In the instant case, the only question before me is whether, in the given facts and circumstances of the case, the requisite sanction under proviso to section 151 of the Act for issuing notice u/s. 148 is required or not. The reassessment proceedings under section 147 of the Act was initiated vide notice issued under section 148 on 24.03.2005 by the Assessing Officer who is of the rank of A.C.I.T. after obtaining the prior approval of the Addl. C.I.T. The objection of the assessee is that the reassessment proceedings are invalid as the proceedings were initiated after the expiry of 4 years and the permission for the issue of notice under section 148(1) was not taken from the CCIT or CIT. The ld. A.R. before me supported the order of the ld. J.M. and contended that the case of the assessee is duly covered by the decision of the jurisdictional High Court in the case of Dr. Shashi Kant Garg v. CIT, 285 ITR 158 (All.) and that of the Calcutta High Court in the case of East India Hotels Limited v. DCIT, 204 ITR 435. While, the ld. D.R vehemently supported the order of the ld. A.M. In my view, perusal of section 151 is necessary before decidi....
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.... from the definition of Dy. Commissioner given under section 2(19A). But where the Assessing Officer is of the rank of Assistant Commissioner or Dy. Commissioner, no such prior approval of the Joint Commissioner is required. There is a proviso to section 151(1) which is applicable in a case where a notice under section 148 is to be issued after the expiry of 4 years from the end of the relevant A.Y. and the assessment has been made under section 143(3) or section 147. This proviso states that unless the satisfaction is recorded by the CCIT or CIT on the reasons recorded by the Assessing Officer aforesaid that it is a fit case for issue of such notice, no such notice can be issued. Sub-section (2) of section 151 is applicable where the case is not falling under section 151(1) i.e. the case where the assessment has not been completed under section 143(3) or section 147. In the case of the assessee, admittedly, the assessment has seen completed under section 143(3) for the Assessment Year 1998-99 vide order dated 29.01.2001. Proceedings under section 147 by issuing notice under section 148 were initiated by the Assessing Officer who is of the rank of Assistant Commissioner vide notice....
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....sessing Officer issued notice on 12.09.2000 reopening all the assessments much after the expiry of 4 years. The assessee challenged the reopening of the assessment and contended that in view of the proviso to sub-section (1) of section 151 of the Act, sanction of the CCIT or CIT was necessary to be obtained, without which the notices could not have been issued. The contention of the Department was that all the notices under section 148 were issued after obtaining the necessary satisfaction of the Addl. CIT which satisfies the requirement of section 151(1). Thus, the question before the High Court was whether in case where the assessment has been made under section 143(3) and/or section 147 of the Act, 4 years from the end of the Assessment Year had expired, a notice for reassessment under section 148 can be issued only with the prior approval/recording of necessary satisfaction by CCIT or CIT, as required under the proviso to sub-section (1) of section 151 of the Act or not by the Addl. CIT. While deciding this issue, the Hon'ble High Court held that all the notices issued under section 148 to be invalid and set aside all the proceedings taken in pursuance of these notices by holdi....
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....after the satisfaction has been recorded by either the Chief Commissioner or the Commissioner on the reasons recorded by the Assessing Officer that it is a fit case for issue of such notice. Thus, the Assessing Officer not below the rank of the Assistant Commissioner can issue a notice but before issuing the notice, the satisfaction of the Commissioner or the Chief Commissioner of the Income-tax is necessarily to be obtained. This would be the position after April 1, 1988, in view of the omission of the words "Additional Commissioner" in section 2(16) of the Act by the Direct Tax Laws (Amendment) Act, 1987; and (iii) where an assessment has not been made under sub-section (3) of section 143 or section 147 of the Act and the period of four years from the end of the relevant assessment year had expired, notice under section 148 of the Act can be issued only by an officer of the rank of Joint Commissioner after being satisfied on the reasons recorded by the Assessing Officer that it is a fit case for issue of such notice. Here, the term "Joint Commissioner' is interchangeable with the words "Additional Commissioner" in view of the definition of the term "Joint Commissioner", as given....