AI Drafter 
Generate professional replies, appeals, opinions to Show Cause Notices, assessment orders, audit objections, and other legal communications using TaxTMI's AI Drafter. 
TaxTMI 
TaxTMI 
2026 (4) TMI 651
X X X X Extracts X X X X
X X X X Extracts X X X X
....Pr. Commissioner of Income Tax, Rohtak to the order passed u/s 148A(d) as well as issue of notice u/s 148 is out of jurisdiction, which makes the order passed u/s 147 r.w.s 144B nonest, void-ab-initio bad in law, the same be quashed. 3. That having regard to the facts and circumstances of the case, the Ld. AO has erred in re-opening the case of the appellant without following the mandate provisions of section 148A (as amended by the Finance Act, 2021) by only issuing the notice u/s 148A(b) and without any information and carrying on the further proceedings. 4. On the facts and circumstance of case, notice issued u/s 148 for A.Y. 2016-17 on 29.07.2022 is bad in law because no closure of the notice issued u/s 148 on 22.04.2021 for the same assessment year was made. It is a trite law that no valid jurisdiction can be assumed to issue notice u/s 148, if assessment of any return of income filed against the earlier notice issued u/s 148 for the same assessment year is pending before issuance of fresh notice. 5. That the Ld. Assessing Officer erred in re-opening of the assessment without appreciating the fact that the original assessment was completed u/s 143(3)....
X X X X Extracts X X X X
X X X X Extracts X X X X
....tio and that consequently the assessment order per se does not survives. Grounds of appeal no.1 is general and hence dismissed as infructuous. Ground of appeal no. 2 to 9 are regarding the legality of proceedings under section 148 of the Act. The grounds of appeal nos. 7 and 9 raised by the appellant concerning nonavailability of DIN no. and notice u/s 148 issued JAO were not pressed. Accordingly, grounds of appeal nos. 7 and 9 are dismissed as not pressed. 4. Explaining brief factual matrix of the case, the ld counsel of the assessee submitted that in its case original notice u/s 148 was issued on 22.04.2021 was issued. Subsequently, in compliance to the decision of the Hon'ble Apex Court in Civil Appeal No. 3005/2022 in the case of Union of India and others Vs. Ashish Aggarwal dated 04.05.2022, the department proceeded to issue it a notice u/s 148A(b) dated 23.05.2022. Thereafter, order u/s 148A(d) of the Act dated 29.07.2022 along with notice u/s 148 of even dated was passed making the appellant liable for reassessment of its income qua AY 2016-17. 5. The simple challenge raised by the appellant assessee is that the notice u/s 148 dated 29.07.2022 issued to it was irregula....
X X X X Extracts X X X X
X X X X Extracts X X X X
....efrom so as to pass u/s 148A(d) and consequent notice u/s 148 if any. In the case of Rajeev Bansal (supra) Hon'ble Apex Court further mandated that apropos to its decision in Ashish Aggarwal, the notices u/s 148 shall have to be issued in compliance to the stipulations made Section 151(i) &(ii) of the Act. Hon'ble Apex Court ruled that "...grant of sanction by the appropriate authority is a pre-condition for the assessing officer to assume jurisdiction u/s 148 to issue a reassessment notice........it links up time limits with the jurisdiction of the authority to grant sanction. Section 151(ii) of the new regime prescribed higher level of authority if more than have elapsed from the end of the relevant assessment year. Thus, a noncompliance by the Assessing Office with the strict time limit prescribed u/s 151 affects their jurisdiction to issue a notice u/s 148...." 8. We have noted that a Hon'ble Bench of the Mumbai Tribunal in the case of Manish Financials (supra) has ruled as under:- "11. The assessee for the year under consideration filed the return of income declaring a loss of Rs. 3,37,77,313/-. The assessment was reopened by issue of notice under section 148 of th....
X X X X Extracts X X X X
X X X X Extracts X X X X
....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. (b) 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 notice could be issued after the expiry of three years; and (ii) If income escaping assessment is more than Rupees fifty lakhs: (a) a reassessment notice could be issu....
X X X X Extracts X X X X
X X X X Extracts X X X X
....arch 2021, contemplated under Section 3(1) of TOLA. Resultantly, the authority specified under Section 151(i) of the new regime can grant sanction till 30 June 2021. (f) 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 148; and d. Section 148-to issue a reassessment notice. (g) In Ashish Agarwal (supra), this Court directed that Section 148 notices which were challenged before various High Courts "shall be deemed to hav....
X X X X Extracts X X X X
X X X X Extracts X X X X
....nder section 148 on 30.07.2022. From the above observations of the Hon'ble Supreme Court it is clear that the though the prior approval under section 148A(b) and 148(d) were waived in terms of the decision of Ashish Agarwal (supra), for issue of notice under section 148A(a) and under section 148 on or after 1 April 2021, the prior approval should be obtained from the appropriate authorities specified under Section 151 of the new regime. The provisions of section 151 of the Act under the new regime read as under: Sanction for issue of notice. 151. Specified authority for the purposes of section 148 and section 148A shall be,- (i) Principal Commissioner or Principal Director or Commissioner or Director, if three years or less than three years have elapsed from the end of the relevant assessment year; (ii) Principal Chief Commissioner or Principal Director General or where there is no Principal Chief Commissioner or Principal Director General, Chief Commissioner or Director General, if more than three years have elapsed from the end of the relevant assessment year. 15. In assessee's case from the perusal of para 3 of the notice issu....
X X X X Extracts X X X X
X X X X Extracts X X X X
....dingly as if such return were a return required to be furnished under section 139:Provided that no notice under this section shall be issued unless there is information with the Assessing Officer which suggests that the income chargeable to tax has escaped assessment in the case of the assessee for the relevant assessment year and the Assessing Officer has obtained prior approval of the specified authority to issue such notice: [Provided further that no such approval shall be required where the Assessing Officer, with the prior approval of the specified authority, has passed an order under clause (d) of section 148A to the effect that it is a fit case to issue a notice under this section.] Explanation 1 - For the purposes of this section and section 148A, the information with the Assessing Officer which suggests that the income chargeable to tax has escaped assessment means,- (1) any information [***] in the case of the assessee for the relevant assessment year in accordance with the risk management strategy formulated by the Board from time to time; (ii) any audit objection to the effect that the assessment in the case of the assessee for the relevant as....
X X X X Extracts X X X X
X X X X Extracts X X X X
....e. The specified authority is also defined in explanation of the above provision. As per the above provision, specified authority is the authority who referred to in Section 151. 8. At this juncture, it would be relevant to extract the provision of Section 151, which is as follows: "Specified authority for the purposes of Section 148 and Section 148A shall be:- (i) Principal Commissioner or Principal Director or Commissioner or Director, if three years or less than three years have elapsed from the end of the relevant assessment year; (ii) Principal Chief Commissioner or Principal Director General or Chief Commissioner or Director General, if more than three years have elapsed from the end of the relevant assessment year." 9. A perusal of Section 151(i) would show that, the specified authority for the purpose of issuing notice under Section 148 within a period of three years from the end of the relevant assessment year is, the Principal Commissioner or Principal Director or Commissioner or Director. Further, in terms of provision of Section 149, three year time period is fixed for issuance of 148 notice, in the event of the amount is bel....