THAHIR HUSSAIN,TIRUVALLUR vs. ITO NON CORPORATION WARD 19(1), CHENNAI

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ITA 2344/CHNY/2026Status: DisposedITAT Chennai05 August 2026AY 2018-196 pages
AI SummaryAllowed

What did the Tribunal hold?

The ITAT held that the notice issued under Section 148 was invalid because the approval was obtained from the Principal Commissioner of Income Tax (PCIT) instead of the Principal Chief Commissioner of Income Tax (PCCIT), as required for reopening beyond three years. Consequently, the assessment stemming from this invalid notice was quashed.

What were the facts?

The assessee's appeal before the CIT(A) was dismissed due to a delay. The assessee then appealed to the ITAT, explaining the delay with an affidavit and medical certificates. The ITAT condoned the delay.

What were the issues?

Whether the notice issued under Section 148 is invalid due to non-sanction by the competent authority as prescribed under Section 151 of the Act, considering the reopening was beyond three years.

Which sections of the Income-tax Act were involved?

Section 148,Section 148A,Section 151

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, ‘C’ BENCH: CHENNAI

Before: SHRI ABY T. VARKEY & SHRI GAGAN GOYAL

Hearing: 18.06.2026Pronounced: 05.08.2026

आदेश / O R D E R PER ABY T. VARKEY, JM: This is an appeal preferred by the assessee against the order of the Learned Commissioner of Income Tax (Appeal)/NFAC, (hereinafter referred to as ‘Ld.CIT(A)’), Delhi, dated 24.02.2026 for the Assessment Year (hereinafter referred to as ‘AY’) 2018-19, passed u/s.250 of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’)

2.

At the outset, the Ld.AR of the assessee pointed out that the Ld.CIT(A) has dismissed the appeal of the assessee on the ground that

ITA No. 2344/Chny/2026 (AY 2018-19) Thahir Hussain :: 2 :: the assessee failed to give sufficient reason for condoning the delay of 564 days in filing of the appeal before him. The Ld.AR filed an affidavit explaining the delay with medical certificates to support it. Considering the contents of affidavit corroborated by relevant material, we are of the view that there was sufficient reason for condoning the delay caused in filing of appeal before CIT(A), hence we condone delay and proceed to hear the appeal.

3.

The assessee has raised a legal issue, wherein, assessee is noted to be impugning a notice dated 06th April 2022 issued under Section 148 of the Act. One of the grounds raised is that the sanction to pass the order under Section 148A(d) of the Act and issuance of notice under Section 148 of the Act is invalid inasmuch as the sanction has been admittedly issued by the Principal Commissioner of Income Tax (“PCIT”) and not by the Principal Chief Commissioner of Income Tax.

4.

The impugned notice dated 6th April 2022 state that the Authority that has accorded the sanction is the PCIT, Chennai-3. The matter pertains to AY 2018-19 and since the order passed u/s.148A(d) of the Act as well as the impugned notice are issued on 6th April 2022, both have been issued beyond a period of three years, therefore, the sanctioning authority has to be the PCCIT as provided under Section 151 (ii) of the Act. It is noted that the Proviso to Section 151 has been inserted only with effect from 1st April 2023 and, therefore, shall not be applicable to the matter at hand.

ITA No. 2344/Chny/2026 (AY 2018-19) Thahir Hussain :: 3 :: 5. In this circumstance, the Ld AR relied on the decision of (i) the Hon’ble Bombay High Court in M/s Siemens Financial Services Private Limited Vs. Deputy Commissioner of Income Tax & Ors. 457 ITR 647 (Bom) (ii) this Tribunal in the case of Vasanthi Ragunathan Vs. The ITO Salem, (ITA 2896/Chny/2025, dated 25.03.2026 ); (iii) Meganapuram Primary Agricultural Cooperative Credit Society vs PCIT (ITA No.895/Chny/2025 dated 19.09.2025), the sanction is invalid and consequently, the order and impugned notice both dated 06th April 2022 under Section 148A(d) and 148 of the Act are wholly without jurisdiction and deserve to be quashed and set aside.

6.

The Ld. DR on the other hand pointed out that the AO initiated the proceedings by issue of notice u/s. 148A(b) within 3 years i.e on 26.03.2022 and therefore the AO has rightly obtained the approval from PCIT. The Ld DR in this regard placed reliance on the decision of the Hon'ble Calcutta High Court in the case of Girija Commercial (P) Ltd vs UOI 2024 169 taxmann.com 168 (Calcutta).

7.

Heard both the parties and perused the material on record. In respect of the legal issue raised by assessee assailing that statutory notice issued by AO u/s 148 as bad in law for non-sanction by competent authority as prescribed u/s 151 of the Act, we note that the notice under section 148 is dated 06.04.2022, which event is undisputedly beyond the period of 3 years from the end of the relevant AY; and therefore as per the provisions of Section 151 of the Act, the AO should have obtained the approval from Principle Chief Commissioner of Income Tax (PCCIT) before issuing the ibid notice. However, in the present case the AO has obtained

ITA No. 2344/Chny/2026 (AY 2018-19) Thahir Hussain :: 4 :: approval from Principle Commissioner of Income Tax (PCIT), Chennai-3, while issuing notice under section 148 and therefore the notice is found to be in defiance to prescription given in section 151 of the Act and hence it is invalid in eyes of law. We further notice that that the contentions raised by the Revenue against the ibid legal issue, has been addressed by the Tribunal while passing the order in the case of Meganapuram Primary Agricultural cooperative Credit Society (supra), wherein the Tribunal inter-alia has held that as per scheme of section 148A, separate sanction from competent authority is to be obtained by AO u/s.151 of the Act while issuing notices u/s 148A, which is sine qua non requirement of law at different stages envisaged u/s 148A of the Act. The Tribunal is noted to have further held that if the argument of the Ld DR is to be accepted it would defeat purpose of introduction of section 148A of the Act whereby the assessee is granted an opportunity to demonstrate his case for dropping the proceedings before issuing notice u/s.148 of the Act. In this regard, we notice that the Hon'ble Bombay High Court in the case of M/s. Vodafone Idea Limited Vs DCIT (WP No. 2768 of 2022 dated 06.02.2024) relying on the decision in M/s Siemens Financial Services Private Limited Vs. Deputy Commissioner of Income Tax & Ors (supra) has considered identical issue wherein it was held that even in cases where the notice u/s. 148A(b) was issued before completion of 3 years, if the notice u/s. 148 is issued beyond 3 years the approval needs to be obtained from PCCIT as per Section 151(ii) of the Act.

8.

Applying the ratio held by the Hon'ble Bombay High Court in the case of M/s. Vodafone Idea Limited (supra), in assessee's case, it is noted

ITA No. 2344/Chny/2026 (AY 2018-19) Thahir Hussain :: 5 :: that impugned notice u/s. 148 has been issued on 06.04.2022, which is an event undisputedly beyond 3 years from the end of the relevant AY, and find that the approval has been obtained from PCIT, Coimbatore-1. (refer page 6 PB) The relevant extract of the notice u/s. 148 is as under:

9.

From the perusal of this relevant fact, we are of the view that AO ought to have obtained Approval from Principle Chief Commissioner of Income Tax (PCCIT) before issuing the ibid notice as per Section 151(ii) of the Act. Accordingly, respectfully following the ratio of judicial precedence cited supra, we hold that the re-opening notice issued by the AO u/s.148 for AY 2018-19 beyond 3 years on 06.04.2022 with the approval of PCIT instead of PCCIT as per the provisions of section 151(ii) is not valid. Consequently, the assessment completed on 03.01.2024 stemming from the invalid notice dated 06.04.2022 deserves to be quashed, and we order accordingly.

ITA No. 2344/Chny/2026 (AY 2018-19) Thahir Hussain :: 6 :: 10. Since we have allowed the appeal considering the legal issue raised by the assessee supra, other grounds have become academic, so not examined. 11. In result, appeal of the assessee is allowed. Order pronounced on the 05th day of August, 2026, in Chennai.

Sd/- Sd/- (गगन गोयल) (एबी टी. वक�) (ABY T. VARKEY) (GAGAN GOYAL) �या�यक सद�य/JUDICIAL MEMBER लेखा सद�य/ACCOUNTANT MEMBER चे�नई/Chennai, �दनांक/Dated: 05th August, 2026. YS आदेश क� ��त�ल�प अ�े�षत/Copy to: 1. अपीलाथ�/Appellant 2. ��थ�/Respondent 3. आयकरआयु�/CIT, Chennai / Madurai / Salem / Coimbatore. 4. िवभागीय�ितिनिध/DR 5. गाड�फाईल/GF Digitally signed YASHVI by YASHVIR SINGH R SINGH Date: 2026.08.11 17:41:22 +05'30'

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