TaxTMI 
TaxTMI 
TaxTMI 
2022 (2) TMI 1189
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....O. 3. That the authorities below did not appreciate that the reopening of this case u/s 148 is illegal, invalid and void abinitio and the assessment order passed is bad in the eyes of law and the same is liable to be cancelled. 4. That the reasons recorded for reopening the case are bad in law and accordingly the assessment framed is bad in law and the same is liable to cancelled. 5. That the reasons are no reasons in the eyes of law inasmuch as the source of investment is yet to be verified and explained and it cannot be held as income escaping assessment for the purpose of section 148. 6. That the Ld CIT(A) failed to appreciate that the AIR information is no tangible material to empower the AO to reach the requisite satisfaction as envisaged u/s 147/148. As such the proceedings are bad in law and the assessment proceedings thereof are also liable to be cancelled for all intends and purposes. 7. That the assessment made in response to issue of notice u/s 148 is illegal, invalid and void abinitio and the same deserves to be quashed. 8. That the Ld CIT(A) has grossly erred in confirming the order passed by the AO in response to proceedings u/s 148 is bad and the sa....
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.... his returned income and vide his order passed u/s 147/143(3) of the Act, dated 24/02/2014 assessed his income at an amount of Rs. 44,12,657/-. 3. Aggrieved, the assessee carried the matter in appeal before the CIT(A). However, finding no infirmity in the view taken by the AO the CIT(A) upheld the addition and dismissed the appeal. 4. The assessee being aggrieved with the order of the CIT(A) has carried the matter in appeal before us. 5. At the very outset of the hearing of the appeal, it was submitted by the ld Authorized Representative (for short "A.R") for the assessee, that the AO had wrongly assumed jurisdiction and reopened the case of the assessee u/s 147 of the Act. Elaborating on his aforesaid contention, it was submitted by the ld AR that the reopening of the assessee's case suffers from certain serious jurisdictional defects, viz. (i). that the AO had reopened the case without carrying out any enquiries either u/s 131 or u/s 133(6) of the Act; (ii). that the reasons on the basis of which the case of the assessee was reopened does not bear any nexus with the material available on record; (iii). that the AO prior to reopening of the case of the assessee had not consulte....
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....al in a mechanical manner and without application of mind. It was submitted by the ld AR that in a host of cases where the sanctioning authority had granted approval by merely scribbling "Yes" instead of giving any cogent reason qua his satisfaction on the reasons recorded by the AO for reopening the case of the assessee before them, the reopening of the respective assessments had been struck down by the courts/tribunals, on the ground, that an approval granted in a mechanical manner would by no means justify valid assumption of jurisdiction by the AO for reopening the case of an assessee. In support of his aforesaid contention the ld. AR had relied on the following judicial pronouncements:- i. Shri Tek Chand Vs. ITO, ITA No. 255/Chd/2020 dated 15.03.2021 ii. Yum Restaurants Asia Pte Ltd Vs. DCIT (2017) 397 ITR 665 iii. Smt Monika Rani Vs. ITO, ITA No. 582/Chd/2019 dated 28.02.2020 iv. ACIT Vs. Bharti Axa Life Insurance Co ltd, ITA No. 2930/Mum/2019 dated 31.03.2021 v. Shri Tralochan Singh Vs. ITO, ITA No. 306/Asr/2019 dated 30.06.2021.' In the backdrop of his aforesaid contention, it was submitted by the ld AR, that as the approval in the case of the assessee was g....
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....t was incorrect on the part of the ld AR to claim that the AO had obtained the approval from an authority different from that as stated in the body of the "reasons to believe". We, thus, finding no substance in the aforesaid claim of the ld AR are constrained to reject the same. 8. Adverting to the claim of the ld AR, that the authority granting the sanction u/s 151 of the Act, viz. Addl. CIT, Range-VI, Pathankot had granted the approval in a mechanical manner, i.e, without application of mind, we find substance in the same. On a perusal of Column No. 12 of the form of approval wherein sanction had been granted by the Additional CIT, Range-VI, Pathankot, we find that the same reads as under :- 12. Whether the Additional Commissioner of Income Tax is satisfied on the reasons record by the AO Yes Sd/- In our considered view, a mere scribbling or stating "Yes" would by no means suffice the statutory requirement as contemplated in Sec. 151 of the Act, i.e, satisfaction on the part of the sanctioning authority, on the reasons recorded by the A.O, that it is a fit case for issuance of a notice u/s 148 of the Act. As provided in Section 151 of the Act, no notice u/s 148 is to be is....
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....h, which would beyond any doubt defeat the very purpose for which the said supervisory jurisdiction of the superior authorities had been made available on the statute by the legislature. Our aforesaid conviction is supported by the recent order of this Tribunal in the case of Shri Charanjiv Lal Aggarwal, Prop. M/s. Premier Rubber Mills, Amritsar Vs. ITO, Ward-4(1), Amritsar, ITA No. 598/Asr/2015. Also, a similar view had been taken by this Tribunal in the case of S/shri Tralochan Singh & Narotam Singh Vs. ITO, Ward 1(4), Mansa in ITA Nos. 306 & 307/ASR/2019, dated 30.06.2021, wherein it was held as under:- "12. As regards to the validity of the reassessment proceedings under section 147 r.w.s 148 of the Act, it is not in dispute that the A.O. is required to get the approval of the competent authority i.e; JCIT in the present case. Copy of the form for recording the reasons for initiating the proceedings under section 148 of the Act and for obtaining the approval of the JCIT is placed at page no. 2 & 3 of the assessee's paper book wherein at S.No. 12 relating to satisfaction of the JCIT on the reasons recorded by the ITO for issuing of the notice under section 148 of the Act. The ....
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....n of the Commissioner as contemplated under Subsection (2) in the facts and circumstances of the case. In the column of the report whether the Commissioner was satisfied, the Additional Commissioner said " Yes ". 23. We have already found that the first ground given by the Income-tax Officer in his report praying for sanction for acting under Section 148 is admittedly a mistaken ground and, therefore, nonexistent. That being so, the satisfaction of the Additional Commissioner in the instant case, so far as the first ground is concerned, is wholly mechanical without applying his mind. It has further been held 24. Regarding the second ground, we find that the satisfaction could in law be only with respect to Clause (b) of Section 147 and that being so the notice issued on March 10, 1971, would be clearly barred under Section 149 of the Act. 25. In the result, in any view of the matter, we find that the impugned notice under Section 148 in the instant ease is bad in law and without jurisdiction. Accordingly, we quash the impugned notice dated March 10, 1.971, under Section 148 of the Act. 14.2 A similar view has been taken by the Hon'ble Andhra Pradesh High Court in....
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....exercise is shown to have been performed in less than 24 hours of time which also goes to indicate that the Commissioner did not apply his mind at all while granting sanction. The satisfaction has to be with objectivity on objective material. 8. If the case in hand is analysed on the basis of the aforesaid principle, the mechanical way of recording satisfaction by the Joint Commissioner, which accords sanction for issuing notice under section 148, is clearly unsustainable and we find that on such consideration both the appellate authorities have interfered into the matter. In doing so, no error has been committed warranting reconsideration. 9. As far as explanation to Section 151, brought into force by Finance Act, 2008 is concerned, the same only pertains to issuance of notice and not with regard to the manner of recording satisfaction. That being so, the said amended provision does not help the revenue. 10. In view of the concurrent findings recorded by the learned appellate authorities and the law laid down in the case of Arjun Singh (supra), we see no question of law involved in the matter, warranting reconsideration. 14.3 Against the said order, the Hon'ble Ape....
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.... Court of Madhya Pradesh in case of CIT Vs. S. Goyanka Lime & Chemical Ltd (2015) 56 taxmann.com 390 (MP) and that in the case of Arjun Singh Vs. Asst. DIT reported in (2000) 246 ITR 363 (MP), had observed, that as the reopening of the case of the assessee u/s 148 was on the basis of a mechanical approval, i.e, without application of mind by the Principal. CIT, therefore, the reopening of the case on the basis of the notice issued u/s 148 could not be sustained and was liable to be quashed. At this stage, we may herein observe, that the aforementioned judgment of the Hon'ble High Court of Madhya Pradesh in the case of S. Goyanka Lime (supra) had thereafter been impliedly approved by the Hon'ble Supreme Court which had dismissed the Special Leave Petition (SLP) that was filed by the revenue in Commissioner of Income-tax, Jabalpur (MP) Vs. S. Goyanka Lime & Chemical Ltd. (2015) 64 taxmann.com 313 (SC). Also, we find that a similar view had been taken by ITAT, Amritsar Bench in the case of Shri Satnam Singh Vs. ITO, Ward-1(4), Jalandhar, ITA No. 579/Asr/2019 for AY 2013-14 vide its order dated 29/06/2021. In the case before the Tribunal, the approving authority had granted the approva....