TaxTMI 
TaxTMI 
2026 (2) TMI 760
X X X X Extracts X X X X
X X X X Extracts X X X X
.... reasons. 2.2 That the reasons recorded being vague, factually incorrect, without application of mind and in the absence of the any case of escapement of income, the Ld. CIT(A) has erred in upholding the validity of assumption of jurisdiction u/s 147 which is illegal and bad in law. 3.1 That on the facts and circumstances of the case, the Ld. CIT(A) has erred in upholding the validity of notice u/s 148 even though same was issued without proper sanction in terms of section 151 of the Act. 3.2 That the sanction granted u/s 151 being mechanical and without application of mind, the notice u/s 148 is illegal and void-ab-initio. 4.1 That on the facts and circumstances of the case, the Ld. CIT(A) was not justified in upholding the addition of Rs. 5,40,000/- on the alleged ground of unexplained Investment u/s 69 which is beyond scope and purely based on conjectures and surmises. 4.2 That the addition made by the assessing officer being made on factually incorrect ground and nonexistent fact, the Ld. CIT(A) was grossly unjustified in sustaining the addition on altogether different ground which is beyond jurisdiction and not sustainable. ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....rming that the PCIT had given approval under section 151 for issuance of notice u/s.148 of the Act, submitted that on a single day on 30.03.2021 the Ld.PCIT had sanctioned approval u/s.151 in as many as 47 cases on a single day. 5. The Ld. Counsel for the assessee placing reliance on the decision of Hon'ble Delhi High Court in the case of PCIT Vs. Pioneer Town Planners Pvt. Ltd. (2024) 465 ITR 356 submitted that the Hon'ble High Court held that when PCIT while granting approval u/s.151 of the Act simply wrote "Yes", without specifically noting his approval for issue of notice u/s.148 of the Act, such an approval could not be considered to be valid approval. 6. The Ld. Counsel for the assessee submits that in his case the Ld.PCIT did not even mention the word "Yes" while granting sanction u/s.151 of the Act. Referring to the decision of Hon'ble Delhi High Court in the case of Capital Broadways Pvt. Ltd. Vs. ITO (2024) 301 taxmann 506, the Ld. Counsel for the assessee submitted that mere repeating of the words of the statue, mere rubber stamping of the letter seeking sanction or using similar word like "Yes, I am satisfied" the requirement of law and the same cannot be consider....
X X X X Extracts X X X X
X X X X Extracts X X X X
....is granting sanction for issue of notice u/s.148 of the Act. It is further observed that such a sanction is also undated which means it is not known whether the sanction was granted prior to issue of notice u/s. 148 of the Act or after the issue of notice u/s.148. 11. The Hon'ble Jurisdictional High Court in the case of Capital Broadways Pvt. Ltd. (supra) held as under :- "12. We take note that request for approval under Section 151 of the Act in a printed format (Annexure P-6) was placed before the ACIT, who after according his satisfaction, placed the same before the PCIT. PCIT granted the approval on the very same day. The approval accorded by the ACIT and PCIT in Column No.11 & 12 are extracted below :- "11. Whether the Addl. CIT is satisfied on the reasons recorded by AO that is a fit Case for the issue of I am satisfied Sd/- (G.G. Kamel) Addl. CIT, Range-5, New Delhi Dated 22.03.2017 12. Whether the Pr. Commissioner is satisfied: On the reasons recorded by the AO that it is a fit case for the issue of notice u/s 148. Yes I am satisfied Sd/- P.K. Gupta) Pr. Commissioner of Income Tax-2, New Delhi ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....is not as if the Commissioner of Income-tax (Appeals) has to record elaborate reasons for agreeing with the noting put up. At the same time, satisfaction has to be recorded of the given case which can be reflected in the briefest possible manner. In the present case, the exercise appears to have been ritualistic and formal rather than meaningful, which is the rationale for the safeguard of an approval by a higher ranking officer. For these reasons, the court is satisfied that the findings by the Income-tax Appellate Tribunal cannot be disturbed." 18. Further, this Court in the case of Central India Electric Supply Co. Ltd. v. 170 (2011 SCC. OnLine Del 472] has taken a view that merely rubber stamping of "Yes" would suggest that the decision was taken in a mechanical manner. Paragraph 19 of the said decision is reproduced as under: - "19. In respect of the first plea, if the judgments in Chhugamal Rajpal [1971] 79 ITR 603 (SC), Chanchal Kumar Chatterjee [1974] 93 ITR 130 (Calcutta) and Govinda Choudhury and Sons case [1977] 109 ITR 370 (Orissa) are examined, the absence of reasons by the Assessing Officer does not exist. This is so as along with the proforma, reaso....
X X X X Extracts X X X X
X X X X Extracts X X X X
....bmitted by him under Section 151(2) does not mention any reason for coming to the conclusion that it is a fit case for the issue of a notice under Section 148. We are also of the opinion that the Commissioner has mechanically accorded permission. He did not himself record that he was satisfied that this was a fit case for the issue of a notice under Section 148. To Question 8 in the report which reads "whether the Commissioner is satisfied that it is a fit case for the issue of notice under Section 148", he just noted the word "yes" and affixed his signatures thereunder. We are of the opinion that if only he had read the report carefully, he could never have come to the conclusion on the material before him that this is a fit case to issue notice under Section 148, important safeguards provided in Sections 147 and 151 were lightly treated by the Income Tax Officer as well as by the Commissioner. Both of them appear to have taken the duty imposed on them under those provisions as of little importance. They have substituted the form for the substance." 20. This Court, while following Chhugamal Rajpal in the case of Ess Adv. (Mauritius) S. N. C. Er Compagnie v. ACIT [2021 SCC....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... Court noted that by writing the words "Yes, I am satisfied" the mandate of Section 151(1) of the Act as far as approval of Additional CIT was concerned, stood satisfied. However, we may take note that such finding was arrived at by the Court in light of the fact that Additional CIT addressed a letter to the ITO stating as under:- "In view of the reasons recorded under Section 148(2) of the IT Act, approval for issue of notice under Section 148 is hereby given in the above-mentioned case, you are, accordingly directed to issue notice under Section 148 and submit a compliance report in this regard at the earliest." 17. Such letter sent by the Additional CIT to the ITO clearly reveals that the sanction was accorded after due application of mind and on considering the reasons narrated by the Assessing Officer. However, in the present case, there is no such material to come to the conclusion that PCIT granted approval after considering the reasons assigned by the Assessing Officer. The decision rendered in Meenakshi Overseas (P.) Ltd. (supra), is therefore not applicable to the facts and circumstances of the present case. 18. Dealing with an identical challen....