2026 (4) TMI 172

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

.... by the appellant, without considering the facts and circumstances of the case. 3. The appellant craves leave to add, amend, alter or delete the said ground of appeal." 2. The assessee is a company and filed its return of income for AY 2016-17 on 30/11/2016 declaring total income at Rs. 1,17,54,82,920/-. The case was subsequently reopened u/s 147 and notice u/s 148 dated 30/07/2022 was issued, in response to which the assessee filed its return on 30/08/2022 declaring total income at Rs. 1,17,54,89,220/-, and order u/s 148A(d) was thereafter passed. 2.1. The reopening was based on the allegation that the assessee had reversed income recognized in FY 2014-15 and claimed the same as loss in FY 2015-16 on assignment of creditors amounting to Rs. 6.32 crore/- under the head "other expenses". During the assessment proceedings, the Ld. AO issued show cause notice dated 12/05/2023 asking the assessee to explain as to why Rs. 632.82 lakh/- on account of loss on assignment of creditors, should not be added to the total income. 2.2. The assessee submitted that it had entered into an agreement with M/s Wellknown Technologies Pvt. Ltd. on 31/03/2015 for assignment of creditors....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....f India vs Ashish Agrawal, reported in (2022) 444 ITR 1. The Revenue after following the procedure as per the new regime u/s 148A issued notice u/s 148 of the Act on 30/07/2022, under the new regime which was approved by the Joint Commissioner of Income Tax, Range-4(3), Mumbai. 4.1. The Ld.AR submitted that the notice issued under section 148A(b) and the order passed u/s 148A(d) of the Act are beyond three years. The Ld. AR thus submitted that in present facts, the appropriate authority who has to approve the issuance of notice u/s 148 of the new regime, as per section 151 of the Act, would be the Principal Chief Commissioner of Income Tax or the Chief Commissioner of Income Tax. In support, he placed reliance on the decision of the Hon'ble Supreme Court in the case of Union of India v. Rajeev Bansal, reported in [2024] 469 ITR 46, wherein it has been held that the sanctioning authority has to be in accordance with the provisions of section 151 of the Act, based on the new provisions u/s 148A of the Act. 4.2. On the contrary, the Ld. DR relied on the orders passed by the authorities below. We have perused the submissions advanced by both sides in the light of the records p....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....expiry of four years; and (ii) If income escaping was more than Rupees one lakh: (a) a reassessment notice could be issued within four years after obtaining the approval of the Joint Commissioner; and (b) after four years but within six years after obtaining the approval of the Principal Chief Commissioner or Chief Commissioner or Principal Commissioner or Commissioner. 75. After 1 April 2021, the new regime has specified different authorities for granting sanctions under section 151. The new regime is beneficial to the assessee because it specifies a higher level of authority for the grant of sanctions in comparison to the old regime. Therefore, in terms of Ashish Agarwal (supra), after 1 April 2021, the prior approval must be obtained from the appropriate authorities specified under section 151 of the new regime. The effect of Section 151 of the new regime is thus: (i) If income escaping assessment is less 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) no n....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....egime comes into effect on 1st April 2021. 78. For example, the three year time limit for assessment year 2017-2018 falls for completion on 31st March 2021. It falls during the time period of 20th March 2020 and 31st March 2021, contemplated under section 3(1) of TOLA. Resultantly, the authority specified under section 151(i) of the new regime can grant sanction till 30th June 2021. 79. Under Finance Act 2021, the assessing officer was required to obtain prior approval or sanction of the specified authorities at four stages: a. Section 148A(a) - to conduct any enquiry, if required, with respect to the information which suggests that the income chargeable to tax has escaped assessment; b. Section 148A(b) - to provide an opportunity of hearing to the assessee by serving upon them a show cause notice as to why a notice under section 148 should not be issued based on the information that suggests that income chargeable to tax has escaped assessment. It must be noted that this requirement has been deleted by the Finance Act 2022; c. Section 148A(d) - to pass an order deciding whether or not it is a fit case for issuing a notice under section ....