SHREEM INC,MUMBAI vs. ITO WARD 19(3)(1), MUMBAI

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ITA 7358/MUM/2025Status: DisposedITAT Mumbai06 August 2026AY 2018-194 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 approval for issuing the section 148 notice was obtained from an incompetent authority, making it a jurisdictional defect. Consequently, the notice and the reassessment proceedings were quashed.

What were the facts?

The assessee's appeal was against an order passed by the NFAC for AY 2018-19. A notice under section 148 was issued after three years from the end of the assessment year.

What were the issues?

Whether the reassessment proceedings are vitiated due to invalid approval for issuing a notice under section 148 beyond the prescribed time limit.

Which sections of the Income-tax Act were involved?

Section 148,Section 151,Section 250,Section 147,Section 144B

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, MUMBAI

Before: SHRI NARENDER KUMAR CHOUDHRY & SHRI RAKESH KUMAR LODHA

For Appellant: Ms. Dindle H. Hariya

PER SHRI NARENDER KUMAR CHOUDHRY, JUDICIAL MEMBER:

This appeal has been preferred by the Assessee against the order dated 01.03.2026, impugned herein, passed by National Faceless Appeal Centre (NFAC) / Ld. Commissioner of Income Tax (Appeals), [in short “Ld. Commissioner] u/s 250 of the Income Tax Act, 1961 [in short “the Act”] for the A.Y 2018-19.

2 ITA 7358/MUM/2025 SHREEM INC 2. We have heard the parties, perused the material available on record and given thoughtful consideration to the rival claims of the parties. Admittedly, the notice dated 30.04.2022 under section 148 of the Act was issued after expiry of three years from the end of the relevant assessment year by obtaining approval from the Ld. PCIT, Mumbai-19, instead of the competent specified authority as prescribed under section 151(ii) of the Act, thus the notice dated 30.04.2022 u/s 148 of the Act along with Assessment Order dated 08.03.2024 is liable to be quashed specifically, in view of dictum laid by the Hon’ble Jurisdictional High Court in Skypak Travels Private Limited vs. ITO, [2026] 185 taxmann.com 963 (Bom.) {Writ Petition no.5456 OF 2024 decided on dated 24.04.2026}, to the effect that where the notice under section 148 is issued beyond three years, approval must be obtained from the higher authority specified under section 151(ii) of the Act. Approval granted by the PCIT, being an incompetent authority, is not a mere procedural irregularity but a jurisdictional defect, which vitiates the entire reassessment proceedings. Further grant of sanction by the appropriate authority is a pre-condition for the Assessing Officer to assume jurisdiction under Section 148. Section 151 is not an empty formality but it is a statutory safeguard and check against arbitrary reopening. Non-compliance with that requirement strikes at jurisdiction itself, as held by Hon’ble Apex Court in Union of India & Ors. vs. Rajeev Bansal [(2024) 469 ITR 46 (SC)]. Further, the proviso to section 151, inserted with effect from 01.04.2023, cannot be applied retrospectively to validate such approval.

3.

Thus, considering the bare provision of law as applicable to the case in hand and respectfully following the aforesaid binding judgments, we hold that the approval obtained from the Ld. PCIT, Mumbai-19, is invalid. Consequently, the notice dated 30.04.2022 issued under section 148 of the Act and all consequential proceedings, including the assessment order dated 08.03.2024 passed under section 147 read with section 144B of the Act, are quashed.

3 ITA 7358/MUM/2025 SHREEM INC 4. In the result, the appeal filed by the Assessee stands allowed.

Order pronounced in open Court on 06.08.2026.

Sd/- Sd/- RAKESH KUMAR LODHA NARENDER KUMAR CHOUDHRY, ACCOUNTANT MEMBER JUDICIAL MEMBER KRK, Sr. PS

4 ITA 7358/MUM/2025 SHREEM INC

आदेश की �ितिलिप अ�ेिषत/Copy of the Order forwarded to : 1. अपीलाथ� / The Appellant ��थ� / The Respondent. 2. 3. संबंिधत आयकर आयु� / The CIT(A) 4. आयकर आयु�(अपील) / Concerned CIT 5. िवभागीय �ितिनिध, आयकर अपीलीय अिधकरण,मु�ई/ DR, ITAT, Mumbai 6. गाड� फाईल / Guard file. आदेशानुसार/BY ORDER, स�ािपत �ित //True Copy//

1.

उप/सहायक पंजीकार ( Asst. Registrar) आयकर अपीलीय अिधकरण, मु�ई / ITAT, Mumbai

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