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TaxTMI 
TaxTMI 
TaxTMI 
2018 (2) TMI 768
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....ary approval of Chief Commissioner or Commissioner of Income Tax as per the provisions of Section 151 (1) of the Act had not been obtained by the Assessing Officer?" 2. The facts in brief are: The assessee's return declared a loss, filed on 25.11.1997 was processed under Section 143(1); later a scrutiny assessment was completed on 30.03.2000 at a loss of Rs. 29,94,053/-. A notice was issued under Section 148 of the Income Tax Act, 1961 (hereafter referred to as "the Act") on 26.03.2003 leading to re-assessment. After rejecting the assessee's challenge to the re-opening, the AO proceeded to complete the re-assessment and added back substantial amounts under Section 68 of the Act (to the tune of Rs. 2,71,62,000/-) and completed the assessme....
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....ommissioner had to be satisfied that the reasons of the AO, were justified. With the 1989 amendment, urged counsel for the Revenue, the position changed and notices could be issued by Assessing Officers of the rank of Assistant Commissioner or Deputy Commissioner, suo moto, without the approval of a higher official provided it was within the period of four years from the end of the assessment year. It was urged that in cases of assessments completed by Assistant Commissioners/Deputy Commissioners, there was no need for obtaining approval of the Chief Commissioner/Commissioner. Emphasis was placed upon the expressions "no such notice" and "Assessing Officer aforesaid" to say that it was only in the event of completed assessments by AOs, belo....
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....t Commissioner completed the assessment, no approval was essential but in all other cases approval was essential. Learned counsel also highlighted that in other cases i.e. where assessments were merely framed under Section 153(1), the Parliamentary intent was to ensure that the approval of the higher authorities was always necessary, by reason of Section 151(2). The Calcutta High Court after noticing, the provision which existed when it decided the case (i.e. on 13.02.1992), in relation to notice issued on 13.08.1991) observed as follows: ".............. Therefore, the satisfaction of the Chief Commissioner or the Commissioner is a sine qua non before issuance of a notice under section 148 by the Assessing Officer. The Assessing Officer ma....
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....rutiny assessment can be re-opened only with the approval of the Chief Commissioner or Commissioner. A non-scrutiny case can be opened or re-opened by any Assessing Officer and after the expiry of 4 years from the end of the relevant assessment year it can be opened or re-opened with the approval of the Deputy Commissioner. However, where the Assessing Officer is the Deputy Commissioner himself, no sanction of the higher authority will be necessary for opening or re-opening a non-scrutiny case. 7.11 The new provisions of Section 149(1) regarding time limits and section 151 regarding issuing and sanctioning authorities for the issue of a notice under section 148 are explained in the following chart: Sl. No. Upto 4 years Beyond 4 years b....
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....ar. (iii) Same as (i) in Col.(3). 7. It is quite obvious from a reading of the above circular that the Revenue authorities at a higher level existed and interpreted the amendments in the manner that the Calcutta High Court did. The arguments of the Revenue by laying emphasis on the expression "as aforesaid" appeared to have some force. However, a closer reflection would reveal that "as aforesaid" is capable of two interpretations - narrow - textual one as is urged on behalf of the Revenue and a broader one. In the contention of Section 151(1), the proviso when it refers to an Assessing Officer, could also mean not merely an Assessing Officer below the rank of Assistant Commissioner and Deputy Commissioner but also all Assessing Officers.....