SUBURBAN DEVELOPERS ,MUMBAI vs. DCIT, CIRCLE 19(3), MUMBAI

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ITA 130/MUM/2026Status: DisposedITAT Mumbai16 July 2026AY 2017-184 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 obtained was not in accordance with the mandatory requirements of section 151(ii) of the Act. Consequently, the notice issued under section 148 and the subsequent assessment order were quashed.

What were the facts?

The assessee's case for AY 2017-18 was reopened by issuing a notice under section 148 after three years from the end of the relevant assessment year. The approval for this notice was obtained from the Principal Commissioner of Income-tax instead of the Principal Chief Commissioner of Income-tax as mandated by section 151(ii).

What were the issues?

Whether the notice issued under section 148 was valid when the approval for reopening was obtained from an authority not specified under section 151(ii) for cases beyond three years from the end of the assessment year.

Which sections of the Income-tax Act were involved?

Section 148,Section 151(ii),Section 250

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, MUMBAI BENCH “F”, MUMBAI

Before: SHRI NARENDER KUMAR CHOUDHRY & SHRI JAGADISH

For Appellant: Shri Shreyas Shah, Adv
For Respondent: Shri Amit Gurav, SR. D.R
Hearing: 21.05.2026Pronounced: 16.07.2026

Per : Narender Kumar Choudhry, Judicial Member:

This appeal has been preferred by the Assessee against the order dated 26.12.2025, impugned herein, passed by the National Faceless Appeal Centre (NFAC), Delhi (in short Ld. Commissioner) u/s 250 of the Income Tax Act, 1961 (in short „the Act‟) for the A.Y. 2017-18.

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2.

In the instant case, the assessment year involved is A.Y. 2017-18, and the case of the Assessee was reopened by issuing a notice dated 31.07.2022 under section 148 of the Act, admittedly, after the expiry of three years from the end of the relevant assessment year. The approval for issuance of the said notice was obtained from the Ld. Principal Commissioner of Income-tax-19, Mumbai, and not from the Ld. Principal Chief Commissioner of Income-tax, as mandated under section 151(ii) of the Act.

3.

Thus, the Assessing Officer violated the mandatory provisions of section 151(ii) of the Act, and therefore, the notice dated 31.07.2022, issued under section 148 of the Act, is void ab initio, and, consequently, the assessment order dated 08.02.2023, passed pursuant thereto, is also liable to be quashed.

4.

We find support from the judgement rendered by the Hon‟ble Jurisdictional High Court in the case of Cipla Pharma and Life Sciences Ltd. v. Dy. Commissioner of Income-tax [2024] 164 taxmann.com 663 (Bom.), wherein the Hon‟ble High Court quashed the notice issued under section 148 of the Act and consequential order passed pursuant thereto, by observing and holding as under:

“9. The record clearly indicates that the sanction in the present case was issued by the Principal Commissioner which can only be in respect of cases if three years or less than three years have elapsed from the end of the relevant assessment year, as would fall under the provisions of clause (i) of Section 151 of the Act. As in the present case the assessment year in question is 2016-17 and the impugned notice itself has been issued on 30 July, 2022, it is issued after a period more than 3 years having elapsed from the end of the said assessment year, hence, clause (ii) of Section 151 of the Act was applicable, which required the sanction to be issued by either Principal Chief Commissioner or Principal Director General or where there is no Principal Chief

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Commissioner or Principal Director General, Chief Commissioner or Director General for issuance of notice under Section 148 of the Act. 10. As rightly pointed out at the bar, such issue fell for consideration of the Division Bench of this Court in Section 151 of the Act read with the provisions of Section 148A(b), the latter provision clearly providing that Siemens Financial Services Pvt. Ltd. (supra), wherein the Division Bench considered the provisions of prior to issuance of any notice under Section 148 of the Act, the assessing officer shall provide an opportunity of being heard to the assessee only after considering the cumulative effect of Section 148A(b) read with Section 151 of the Act and as provided under sub- clause (d), the assessing officer shall decide on the basis of material available on record including reply of the assessee, whether or not it is a fit case to issue a notice under Section 148 by passing an order, with the prior approval of specified authority within one month from the end of the month in which the reply is received. It is held that the sanction of the specified authority has to be obtained in accordance with the law existing when the sanction is obtained and, therefore, the sanction is required to be obtained by applying the amended section 151(ii) of the Act and since the sanction has been obtained in terms of section 151(i) of the Act, the impugned order and impugned notice are bad in law and should be quashed and set aside.”

5.

Thus, respectfully following the aforesaid judgment of the Hon‟ble Jurisdictional High Court, and the order passed by the Hon‟ble Co-ordinate Bench, we hold that the approval obtained from the Ld. Principal Commissioner of Income-tax was not in accordance with the mandatory requirement of section 151(ii) of the Act. Consequently, the notice dated 31.07.2022, issued under section 148 of the Act, along with the assessment order dated 08.02.2023, passed pursuant thereto, is hereby quashed.

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6.

In the result, Assessee’s appeal is allowed.

Order pronounced in the open court on 16.07.2026.

Sd/- Sd/- (JAGADISH) (NARENDER KUMAR CHOUDHRY) ACCOUNTANT MEMBER JUDICIAL MEMBER

(ANKIT SWARNKAR) Private Secretary Copy to: The Appellant The Respondent The CIT, Concerned, Mumbai The DR Concerned Bench

//True Copy// By Order

Dy/Asstt. Registrar, ITAT, Mumbai.

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