2021 (10) TMI 503

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....Appeals) ought to have appreciated that the notice issued by obtaining prior approval from the learned Commissioner of Income-tax is bad in law and contrary to the provisions of section 151(2) of the Act on the facts and circumstances of the case. 2. The Ld. A.R. submitted that the assessee is an AOP constituted as per agreement of venture executed on 19.3.2004. The assessee is carrying on the business in real estate transactions. Consequent to some search proceedings conducted in the hands of M/s. H.M. Constructions and other group cases on 30.6.2011, the case of the assessee was reopened by issuing a notice dated 27.3.2012 u/s. 148 of the Act. In the assessment order, the A.O. has stated that the notice u/s. 148 of the Income-tax Act, 19....

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....not vitiate assessment proceedings. He also submitted that the proposal for approval before Ld. CIT is usually sent through Joint Commissioner and hence Joint Commissioner is also aware of the proceedings. 5. We heard the rival contentions and perused the record. The provisions of section 151 of the Act, then existing reads as under: "151. Sanction for issue of notice- (1) In a case where an assessment under sub-section (3) of section 143 or section 147 has been made for the relevant assessment year, no notice shall be issued under section 148 by an Assessing Officer, who is below the rank of Assistant Commissioner or Deputy Commissioner unless the Joint Commissioner is satisfied on the reasons recorded by such Assessing Officer that i....

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....pra) and it was held that when 151(2) of the Act mandates that sanction to be taken for issuance of notice u/s. 148 of the Act in certain cases has to be of Joint Commissioner, then reopening of assessment with the approval of Commissioner is unsustainable. The relevant observations made by Hon'ble High Court of Bombay in this regard are extracted below: "6. -The second ground upon which the reopening is sought to be challenged is that the mandatory requirement of election 151(2) has not been fulfilled. Section 151 requires a sanction to be taken for the issuance of a notice under Section 148 in certain cases. In the present case, an assessment had not been made under Section 143(3) or Section 147 for A.Y. 2004-05. Hence, under sub-se....

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....o be of the Joint Commissioner. That expression has a distinct meaning by virtue of the definition infection 2(28C). The Commissioner-of Income Tax is not a Joint Commissioner within the meaning of Section 2(28C). In the present case, the Additional Commissioner of Income Tax forwarded the proposal submitted by the Assessing Officer to the Commissioner of Income Tax approval which has been granted is not by the Additional Commissioner of Income Tax but by the Commissioner of Income Tax. 'There is no statutory provision hereunder which a power to be exercised by an officer can be Exercised by a superior officer. When the statute mandates the satisfaction of a particular functionary for the exercise of a power, the satisfaction must be of....