TaxTMI 
TaxTMI 
2026 (8) TMI 348
X X X X Extracts X X X X
X X X X Extracts X X X X
....ar 2016-17 has been dismissed. Thereafter the assessee took necessary steps for filing of the appeal. Relying on various decisions the Ld. Counsel for the assessee submitted that the delay in filing of the appeal was neither intentional nor deliberate and therefore, should be condoned. 3. The Ld. DR on the other hand strongly opposed the condonation application filed by the assessee. 4. We have heard the rival arguments made by both the sides on the issue of delay in filing of the appeal and considered the contents of the condonation application filed along with the affidavit of the assessee. 5. We find the Hon'ble Supreme Court in the case of Collector, Land Acquisition vs. Mst. Katiji & Ors. reported in 167 ITR 471 (SC) has held that when substantial justice and technical considerations are pitted against each other, cause of substantial justice deserves to be preferred for the other side cannot claim to have vested right in injustice being done because of a non-deliberate delay. Refusing to condone delay can result in a meritorious matter being thrown out at the very threshold and cause of justice being defeated. As against this when delay is condoned the highest th....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ess of the transactions of purchases from the various concerns of Deepak Nanjyani remained unexplained and unverifiable, the Assessing Officer, invoking the provisions of section 69C of the Act made addition of Rs. 2,59,23,992/-. The Assessing Officer further made addition of Rs. 2,59,240/- being the commission incurred by the assessee for the accommodation entries being @ 1% of the total accommodation entries. The Assessing Officer accordingly determined the total income of the assessee at Rs. 2,67,80,672/-. 10. Before the Ld. CIT(A) / NFAC, apart from challenging the addition on merit, challenged the validity of re-assessment proceedings. However, the Ld. CIT(A) / NFAC was not satisfied with the arguments advanced by the assessee and dismissed the appeal filed by the assessee. 11. Aggrieved with such order of the Ld. CIT(A) / NFAC the assessee is in appeal before the Tribunal by raising the following grounds: Gr.No.1: "On the facts and circumstances of the case and in law, notice u/s 148 dt.30-6-21 for AY 16-17 under old regime is barred by limitation as it is digitally signed by ITO on 5-7-21 i.e. beyond the time allowed up to 30-621, by applying Ashish A....
X X X X Extracts X X X X
X X X X Extracts X X X X
....was found by the AO/CIT(A) more so, purchase of 'raw material' (ie., "Chana) has been treated as bogus by the AO/CIT(A) which is, in fact, consumed for production of finished & bye products (ie, 'Chana Dall', 'Chana Bhusa' & 'Chana Chuni') and such production & sales of finished & bye products are not disputed by the AO/CIT(A); impugned addition is baseless, arbitrary & unjustified and is liable to be deleted." Gr.No.5: "On the facts and circumstances of the case and in law, CIT(A) has erred in sustaining the addition of Rs. 2,59,240 on the count of 1% commission expenses on alleged bogus purchases of Rs. 2,59,23,992 of 'Chana' (i.e., raw material); addition is merely on presumption & surmises is not sustainable in the eyes of law, is liable to be deleted." Gr.No.6: "The appellant craves leave, to add, urge, after, modify or withdraw any grounds before or at the time of hearing." 12. The Ld. Counsel for the assessee at the outset submitted that the assessment year involved is assessment year 2016-17 and the order u/s 148A(d) of the Act as well as notice u/s 148 of the Act are dated 27.07.2022. Referring to t....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ed before us. It is an admitted fact that the assessment year involved in the instant case is assessment year 2016-17 and notice u/s 148 of the Act was issued on 06.07.2022 after obtaining prior approval of the PCIT. A perusal of the order u/s 148A(d) of the Act shows that the same has been issued after obtaining prior approval of the PCIT. The relevant part of the order u/s 148A(d) reads as under: ...... ...... 17. Similarly, notice u/s 148 of the Act dated 29.07.2022 shows that the same has been issued after obtaining the prior approval of the PCIT. The relevant notice issued u/s 148 of the Act, copy of which is placed at pages 8 and 9 of the paper book reads as under: 18. Since the assessment year involved in the instant case is assessment year 2016-17 and the notice has been issued on 29.07.2022, therefore, the competent authority who should have given the approval as per provisions of section 151 is the Principal Chief Commissioner or Principal Director General or Chief Commissioner or the Director General of Income Tax. However, in the instant case the approval has been given by the PCIT. 19. We find the Hon'ble Bombay High Court in the case of Rame....
X X X X Extracts X X X X
X X X X Extracts X X X X
....39;ble SC Order dated 04.05.2022 - Order Document 2 Considering the discussion made in preceding paras, it is decided that the case of Kamlesh Kumar Kukreja (PAN: AHVPK6618C) is a fit case for issuance of notice u/s 148 of the Act for A.Y. 2016-17. This order u/s 148A(d) is passed with prior approval of Pr. Commissioner of Income Tax-1, Raipur vide letter F.No.Pr.CIT-1/RPR/Tech/148/2022-23/3168 dated 06.07.2022. Document 3 GOVERNMENT OF INDIA MINISTRY OF FINANCE INCOME TAX DEPARTMENT OFFICE OF THE INCOME TAX OFFICER WARD 1(1), RAIPUR KAMLESH KUKREJA Prop. Anmol Industries Surajpura Road,Bhatapara Bhatapara Raipur,Raipur 493118,Chhattisgarh India PAN A.Y. Dated DIN & Notice No: AHVPK6618C 2016-17 29/07/2022 Notice Under section 148 of the Income Tax Act, 1961 Sir/Madam/ M/s, 1. (A) I have the following information in your case or in the case of the person in respect of which you are assessable under the Income Tax Act, 1961 (hereinafter referred to as "the Act") for Assessment Year 2016-17. Information flagged by the risk management strategy formulated in this regard; Final objection has been raised by the Comptroller and Auditor General of India to the ef....
X X X X Extracts X X X X
X X X X Extracts X X X X
....PR/Tech/148/2022-23/3168. (Puja R. Agarwal) Income Tax Officer-1(1), Raipur Document 5 5. The Petitioner has contended that in the present case, the order under section 148A(d) dated 13.07.2022 was passed beyond three years from the end of the relevant Assessment Year 2016-17. Consequently, according to the provisions of section 151(i), when more than three years have elapsed from the end of the relevant assessment year, the specified authority for obtaining the approval was either the Principal Chief Commissioner (PCCIT) or Principal Director General (PDGIT), or where there is no PCCIT or PDGIT, the Chief Commissioner (CCIT) or the Director General (DGIT). However, in paragraph 7 of the order dated 13.07.2022 passed under section 148A(d), Respondent No.I has stated that before passing the said order, prior approval of Respondent No.2 ie. the Principal Commissioner of Income Tax-27, Mumbai, was obtained and the said order was passed thereafter. This aspect remains uncontroverted by the Respondents. 6. In these facts, the limited point to be examined is whether the order dated 13.07.2022 passed under section 148A(d) for the Assessment Year 2016-17 after obtaining approval ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ing 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: (4) 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 (i) If income escaping assessment is more....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... March 2021. It falls during the time period of 20th March 2020 and 31% 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 148; and d. Section 148-to issue a reassessment notice. 80. In Ashish Agarwal (supra), this Court directed that Section 148 notices which were challenged before various High C....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ird stage under Section 148A(d); and (iv) at fourth stage under Section 148. In the case of Ashish Agarwal (supra) the Hon'ble Supreme Court waived off the requirement of obtaining prior approval under section 148A(a) and Section 148A(b) of the Act only. Therefore, the Assessing Officer was required to obtain prior approval of the "Specified Authority' according to Section 151 of the new regime before passing an order under Section 148A(d) or for issuing a notice under Section 148. 8.2 Under new regime, if income escaping assessment is more than Rupees 50 lakhs, a reassessment notice could be issued after the expiry of three years from the end of the relevant assessment year only after obtaining the prior approval of the Principal Chief Commissioner or Principal Director General or Chief Commissioner or Director General. 8.3 Section 151(ii) of the substituted provisions prescribes a higher level of authority if more than three years have elapsed from the end of the relevant assessment year. Thus, non-compliance with the provisions of section 151 vitiates the jurisdiction of the Assessing Officer to issue a notice under section 148. 8.4 Grant of sanction by the ap....
X X X X Extracts X X X X
X X X X Extracts X X X X
....o issue a notice under Section 148 of the Act. 12. We are clearly of the view that the present matter stands covered by the decision of Hon'ble Supreme Court in the case of UP/ v. Rajeev Bansal (supra). We accordingly hold that the order dated 13.07.2022 passed under Section 148A(d) of the Act and the consequential notice issued under section 148 dated 15.07.2022 are bad in law for being violative of the provisions of Section 151(ii) of the Act. Hence they are required to be quashed and set aside. 13. We, accordingly, set aside the impugned order dated 13.07.2022 passed under section 148A(d), the Notice issued under Section 148 and all other proceedings/orders emanating therefrom and allow the writ Petition in terms of Prayer Clause (a) of the petition. 14. Rule is made absolute in the aforesaid terms and the Writ Petition is also disposed of in terms thereof. No order as to costs. 15. This order will be digitally signed by the Private Secretary/Personal Assistant of this Court. All concerned will act on production by fax or email of a digitally signed copy of this order. Document 8 9. A perusal of Section 151(i) would show that, the specified authority for the....