DEEPALI DESIGNS AND EXHIBITS PVT. LTD,NEW DELHI vs. DCIT, CENTRAL CIRCLE-17, DELHI

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ITA 1091/DEL/2022Status: DisposedITAT Delhi26 May 2025AY 2012-133 pages

In favour of the assessee: the assessee's appeal was allowed. From the AI summary of this appeal.

AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the impugned reopening of the assessment for assessment year 2012-13 was invalid. This decision was based on the fact that the approval granted by the prescribed authority under section 151 of the Income-tax Act, 1961, was found to be mechanical, as indicated by the noting "perused reasons, satisfied fit case...". This crucial fact, that the approval was mechanical, went unrebutted by the department. Citing the Supreme Court decision in CIT Vs. S. Goyanka Lime and Chemical Pvt. Ltd. (2015) 64 taxmann.com 313 (SC), the Tribunal quashed the impugned assessment. Consequently, all other pleadings on merits were rendered academic. The appeal filed by the assessee was allowed.

What were the facts?

The assessee, M/s. Deepali Designs and Exhibits Pvt. Ltd., filed an appeal for assessment year 2012-13 against an order dated 31.03.2022 passed by the Commissioner of Income Tax (Appeals)-27, New Delhi. This order was passed in proceedings under section 143(3)/147 of the Income-tax Act, 1961. The appeal was heard on 26.05.2025. The core of the dispute revolved around the validity of the reopening of the assessment. The assessee contended that the reopening was invalid due to a mechanical approval of the Assessing Officer's proposal by the prescribed authority under section 151 of the Act. The department did not rebut this contention.

What were the issues?

1. Whether the reopening of the assessment for assessment year 2012-13 is valid, considering the approval granted by the prescribed authority under section 151 of the Income-tax Act, 1961? (Question of law and fact) Assessee's contentions: The assessee argued that the impugned reopening is invalid because the approval granted by the prescribed authority under section 151 of the Act was mechanical. This was evidenced by the prescribed authority's noting, "perused reasons, satisfied fit case...". Revenue's contentions: The judgment records that the department did not rebut the assessee's contention regarding the mechanical approval by the prescribed authority.

Which sections of the Income-tax Act were involved?

Section 143(3),Section 147,Section 151

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI BENCH: ‘B’ NEW DELHI

Before: SHRI SATBEER SINGH GODARA & SHRI MANISH AGARWAL

For Appellant: Ms. Ananya Kapoor, Adv
Hearing: 26.05.2025Pronounced: 26.05.2025

Assessment Year: 2012-13 Vs. DCIT, M/s. Deepali Designs and Exhibits Pvt. Ltd., Central Circle-17, GN-06, Shivaji Enclave, Delhi Rajouri Garden, New Delhi PAN: AABCD5680K (Appellant) (Respondent) Assessee by Ms. Ananya Kapoor, Adv. Department by Sh. Rajesh Kumar Dhanesta, Sr.DR Date of hearing 26.05.2025 Date of pronouncement 26.05.2025 ORDER

PER SATBEER SINGH GODARA, JM

1.

This assessee’s appeal for assessment year 2012-13, arises against the Commissioner of Income Tax (Appeals)-27 [in short, the “CIT(A)”], New Delhi’s order dated 31.03.2022 passed in CIT(A), Delhi-27/10224/2019-20, involving proceedings under section 143(3)/147 of the Income-tax Act, 1961 (hereinafter referred to as ‘the Act’).

2.

Heard both the parties. Case file perused.

3.

It emerges during the course of hearing that there arises the first and foremost issue of the validity of the impugned reopening itself, which goes to the root of the matter. This is for the precise reason that the learned counsel representing the assessee has invited our attention to the prescribed authority’s section 151 approval to the Assessing Officer’s reopening proposal, wherein, he has recorded “perused reasons, satisfied fit case………………”.

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