KSHITIZ IMPEX PRIVATE LIMITED,NEW DELHI vs. ITO WARD 14(3), DELHI

The assessee has raised grounds challenging the validity of assumption of jurisdiction under section 147 of the Act. One such legal issue raised by the assessee is as to whether the assumption of jurisdiction of the Learned AO under section 147 of the Act could be construed as valid when the Page | 1 approval under section 151 of the Act has been obtained from Learned Principal Commissioner of Income Tax (PCIT) instead of Learned Principal Chief Commissioner of Income Tax (PCCIT ) .

We have heard the rival submissions and perused the materials available on record. The issue involved is reopening of assessment for the Assessment Year 2016-17. For this purpose, the Learned AO obtained approval under section 151 of the Act from the Learned PCIT which fact is quite evident from the order passed under section 148A(d) of the Act dated 27-7-2022. Since the reopening in the instant case has been made beyond 3 years from the end of the relevant assessment year, the specified sanctioning authority for the purposes of section 148 of the Act is Learned PCCIT. Since the approval in the instant case has been obtained from a wrong authority, the entire reassessment proceedings gets vitiated. Reliance in this regard has been rightly placed by the Learned AR before us on the decision of the Hon’ble Jurisdictional Delhi High Court in the case of Kids Dream International Private Limited vs ACIT in W P (C ) 2814/2023 dated 24-2-2025 . The relevant operative portion of the said order is reproduced below:-

Similar view was expressed by the Hon’ble Jurisdictional High Court in the case of H and M Hennes and Mauritz Retail P Ltd vs ACIT reported in 174 taxmann.com 1113 (Del HC) dated 14-5-2025.

Respectfully following the same, the reassessment proceedings are hereby quashed and Ground No. 2 raised by the assessee is allowed.

Since the entire reassessment is quashed, the other grounds raised by the assessee both on law as well on facts need not be gone into and they are left open.

In the result, the appeal of the assessee is partly allowed.

The appeal in ITA No.2194/Del/2025 for AY 2014-15, arise out of the order of the National Faceless Appeal Centre (NFAC), Delhi [hereinafter referred to as ‘ld. CIT(A)’, in short] dated 09.12.2025 against the order of assessment passed u/s 147 r.w.s. 144B of the Income-tax Act, 1961 (hereinafter referred to as ‘the Act’) dated 26.05.2023 by the Assessing Officer, Assessment Unit, Income Tax Department (hereinafter referred to as ‘ld. AO’).

On going through the order of the National Faceless Appeal Centre (NFAC), we find that the ld NFAC had decided the issue ex parte without adjudicating the issue on merits giving its independent finding. Hence, in the interest of justice and fairplay, we deem it fit and appropriate to restore this appeal to file of ld NFAC for de novo adjudication in accordance with law. Needless to mention the assessee be given reasonable opportunity of being heard. The assessee is directed to cooperate with ld NFAC for expeditious disposal of the appeal by not taking unwarranted adjournments except due to bonafide or exceptional circumstances. Hence, the grounds raised by the assessee are allowed for statistical purposes.

In the result, the appeal of the assessee is allowed for statistical purposes.

To sum up, the appeal of the assessee for Assessment Year 2014-15 is allowed for statistical purposes and appeal of the assessee for Assessment Year 2016-17 is partly allowed.