TaxTMI 
TaxTMI 
2024 (8) TMI 885
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....ct to and/or taking any step whatsoever pursuant to and/or in furtherance of the said purported notice under Section 148 of the Act and/or in any proceedings initiated thereunder for the A.Y. 2015-16." 2. The necessary facts are being set out hereinafter. Petitioner filed the original return of income for the Assessment Year ["AY"] 2015-16, declaring an income of Rs. 23,14,930/-. Revised return was filed on 28.01.2017, declaring an income of Rs. 26,64,930/-. The return was processed under Section 143 (1) of the Income Tax Act, 1961 ["Act"]. 3. Respondent No. 1 issued a notice dated 30.03.2021 under Section 148 of the Act for the AY 2015-16. 4. To comply with the impugned notice, petitioner filed his return of income on 03.12.2021, declaring income amounting to Rs. 26,64,930/-. 5. On 12.01.2022, notice under Section 143(2) of the Act was issued by respondent No. 3 on the basis of information received by respondent No. 1 from Insight portal. Petitioner was identified as one of the parties/entities who made financial transactions with BKR Capitals Pvt. Ltd. He had made a transaction of Rs. 31,07,963/- with BKR Capitals Pvt. Ltd. to bring his unaccounted money/cash into his....
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....at being so, the impugned notice dated 30.03.2021 issued by respondent No. 1 under Section 148 of the Act is wholly without jurisdiction. 11. Per contra, the learned counsel for the respondents has defended the order granting approval, arguing that the proforma for seeking approval along with sheet containing the reasons for re-opening of assessment under section 147 of the Act was placed before the Principal Commissioner, Income Tax ['PCIT'], who after considering the entire record including the information received, relevant details, evidence submitted and the reasons recorded by the Assessing Officer ["AO"], accorded the approval. It is submitted that the prescribed authority found the case to be fit for action on the basis of prima facie finding arrived at from the record and therefore the conditions envisaged under Section 151 of the Act stand satisfied. 12. Before considering the merits of the contentions of the parties, it would be apposite to examine the relevant legal framework. 13. Section 151 of the Act, as it stood prior to the substitution by Act of 13 of 2021 is reproduced hereunder:- "151. Sanction for issue of notice.-(1) No notice shall be issued ....
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....n the grant of approval in the present case. While the PCIT is not required to record elaborate reasons, he has to record satisfaction after application of mind. The approval is a safeguard and has to be meaningful and not merely ritualistic or formal. The sanction order does not refer to the material of any of the 111 cases. The grant of approval in such a manner does not fulfil the requirement of section 151 of the Act. 18. We note that dealing with an identical challenge of approval having been accorded mechanically and without due application of mind had arisen for our consideration in the case of The Principal Commissioner of Income Tax-7 vs. Pioneer Town Planners Pvt. Ltd. (2024) SCC OnLine Del 1685, wherein, we had held as follows:- "13. The primary grievance raised in the instant appeal relates to the manner of recording the approval granted by the prescribed authority under Section 151 of the Act for reopening of assessment proceedings as per Section 148 of the Act. xxxx xxxx xxxx 17. Thus, the incidental question which emanates at this juncture is whether simply penning down "Yes" would suffice requisite satisfaction as per Section 151 of the....
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.... which is expected is that an appropriate endorsement is made in this behalf setting out brief reasons. Reasons are the link between the material placed on record and the conclusion reached by an authority in respect of an issue, since they help in discerning the manner in which conclusion is reached by the concerned authority. Our opinion is fortified by the decision of the apex court in Union of India v. M. L. Capoor, AIR 1974 SC 87, 97 wherein it was observed as under: "27.. .. We find considerable force in the submission made on behalf of the respondents that the 'rubber stamp' reason given mechanically for the supersession of each officer does not amount to 'reasons for the proposed supersession'. The most that could be said for the stock reason is that it is a general description of the process adopted in arriving at a conclusion. 28.... If that had been done, facts on service records of officers considered by the Selection Committee would have been correlated to the conclusions reached. Reasons are the links between the materials on which certain conclusions are based and the actual conclusions. They disclose how the mind is applied to the s....
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....signature while according approval for reassessment under Section 148 of the Act. The said approval cannot be granted in a mechanical manner as it acts as a linkage between the facts considered and conclusion reached. In the instant case, merely appending the phrase "Yes" does not appropriately align with the mandate of Section 151 of the Act as it fails to set out any degree of satisfaction, much less an unassailable satisfaction, for the said purpose. 22. So far as the decision relied upon the Revenue in the case of Meenakshi Overseas Pvt. Ltd. is concerned, the same was a case where the satisfaction was specifically appended in the proforma in "Yes, I am satisfied". Moreover, paragraph 16 of-terms of the phrase the said decision distinguishes the approval granted using the expression "Yes" by citing Central India Electric Supply, which has already been discussed above. The decision in the case of Experion Developers P. Ltd. would also not come to the rescue of the Revenue as the same does not deal with the expression used in the instant appeal at the time of granting of approval. 23. Therefore, it is seen that the PCIT has failed to satisfactorily record its co....