TaxTMI 
TaxTMI 
2025 (5) TMI 1947
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....otal consideration of Rs. 4,86,00,000/- and his 1/4th share Rs. 1,21,50,000/-. The assessee purchased some other land and filed Return of Income admitting capital gain of Rs. 12,97,910/-. The assessee was issued with 148 notice dated 27-08-2022 for the Asst. Year 2016-17 after getting approval from Ld. PCIT on 23-08-2022 which is more than three years from the end of the relevant assessment year. As per Section 151 of the Act, the sanction ought to have been obtained from Principal Chief Commissioner of Income Tax or Chief Commissioner of Income Tax. Thus the approval granted u/s. 148A(d) of the Act by PCIT is invalid in law. The assessee failed to response to the various notices issued as well as the final show cause notice dated 18-05-2023 issued by the Assessing Officer, therefore the long term capital gain of Rs. 1,08,02,090/- being assessee's 1/4th share is added as the income of the assessee and demanded tax thereon. 3. Aggrieved against the reassessment order, the assessee filed an appeal before Ld. CIT(A). The Ld. CIT(A) held that the reinvestment in agricultural land was not accepted since the sale of the land was converted into non-agricultural purpose, therefore the cla....
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....DT &in Sec. 151A of the Act. 4. The Ld. CIT(A) has erred in law & on facts in upholding the validity of reopening of assessment. 5. The Ld. AO has grievously erred in making this addition without giving sufficient and specific opportunity to the appellant and thereby violating the principles of natural justice. 6. The Ld. CIT(A) has erred in law and on facts in upholding addition made by the Ld. A.O of Rs. 1,08,02,090/- (net) being 1/4th value of sale consideration inspite of sale consideration disclosed by the appellant in ROI and not allowing indexed cost, transfer cost and reinvestment in land. 7. The appellant Craves liberty to add, amend, alter or modify all or any grounds of appeal before final appeal. 5. At the outset, Ld. Counsel appearing for the assessee submitted that the jurisdiction to reopen the assessment itself is bad in law since the reopening of assessment is done beyond three years period, then the Sanctioning Authority is either PCCIT or CCIT as per Section 151 of the Act. In this case, three years from the end of the relevant assessment year 2017 is 31-03-2020 whereas approval for reopening of assessment was wrongly sought by the Assessing Officer from....
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.... 151 namely PCCIT or Principal Director or Chief Commissioner or Director General are the Sanctioning Authority required to approve the reopening of assessment. Whereas in this case, approval was obtained from the PCIT-3, Ahmedabad on 23-08-2022, the same is reproduced as follows: 7.1. Since the Sanctioning Authority for reopening of assessment was obtained from a wrong Specified Authority, the entire reopening itself is bad in law and liable to be quashed. Further this issue is no more res-integra by the land mark decision of the Hon'ble Supreme Court in the case of Union of India vs. Rajeev Bansal reported in [2024] 167 taxmann.com 70 deciding the same against the department as under: "73. Section 151 imposes a check upon the power of the Revenue to reopen assessments. The provision imposes a responsibility on the Revenue to ensure that it obtains the sanction of the specified authority before issuing a notice under Section 148. The purpose behind this procedural check is to save the assesses from harassment resulting from the mechanical reopening of assessments. 128 A table representing the prescription under the old and new regime is set out below: Regime Time limits Spec....
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....e escaping assessment is more than Rupees fifty lakhs: (a) a reassessment notice could be issued within three years after obtaining the prior approval of the Principal Commissioner, or Principal Director or Commissioner or Director; and (b) after three years after obtaining the prior approval of the Principal Chief Commissioner or Principal Director General or Chief Commissioner or Director General. 76. Grant of sanction by the appropriate authority is a precondition for the assessing officer to assume jurisdiction under Section 148 to issue a reassessment notice. Section 151 of the new regime does not prescribe a time limit within which a specified authority has to grant sanction. Rather, it links up the time limits with the jurisdiction of the authority to grant sanction. Section 151(ii) of the new regime prescribes a higher level of authority if more than three years have elapsed from the end of the relevant assessment year. Thus, non compliance by the assessing officer with the strict time limits prescribed under Section 151 affects their jurisdiction to issue a notice under Section 148. 77. Parliament enacted TOLA to ensure that the interests of the Revenue are not defea....