TAPAN JENA,BALASORE vs. THE INCOME TAX OFFICER, WARD-1, BALASORE, BALASORE

ITA 566/CTK/2026Status: DisposedITAT Cuttack30 September 2026AY 2017-185 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the notice issued under Section 148 of the Income Tax Act is invalid and consequently quashed. The reasoning was based on the fact that the notice was issued on July 29, 2022, for the assessment year 2017-18, which is beyond three years from the end of the relevant assessment year. As per Section 151(ii) of the Act, for such cases, the approval must be granted by the Principal Chief Commissioner of Income Tax (Pr. CCIT). However, in this case, the approval was granted by the Principal Commissioner of Income Tax (Pr. CIT), Bhubaneswar. The Tribunal, respectfully following the decision of the Hon'ble Supreme Court in ITO vs. Prakash Pandurang Patil, found that the approval was granted by a lower authority and not the appropriate authority. Therefore, the notice issued under Section 148 was deemed invalid, and the consequential assessment also stood quashed. The appeal of the assessee was allowed.

What were the facts?

The assessee, Tapan Jena, filed its return of income for Assessment Year 2017-18 on October 26, 2017, disclosing an income of Rs. 98,51,560. The Assessing Officer (AO) reopened the assessment by issuing a notice under Section 148 of the Income Tax Act on July 29, 2022. The assessee challenged this notice, arguing that the approval for issuing the notice was granted by the Principal Commissioner of Income Tax (Pr. CIT) instead of the Principal Chief Commissioner of Income Tax (Pr. CCIT), as required by Section 151(ii) of the Act, given that the notice was issued more than three years after the end of the relevant assessment year. The National Faceless Appeal Centre (NFAC) had previously passed an order dated August 27, 2025, which is under challenge.

What were the issues?

1. Whether the notice issued under Section 148 of the Income Tax Act, 1961, is invalid and liable to be quashed, considering that the approval for its issuance was granted by the Principal Commissioner of Income Tax (Pr. CIT) instead of the Principal Chief Commissioner of Income Tax (Pr. CCIT), as stipulated by Section 151(ii) for reassessment proceedings initiated beyond three years from the end of the relevant assessment year? Assessee's Contentions: The assessee argued that the approval for the Section 148 notice was granted by the Pr. CIT, which is a lower authority than what is required under Section 151(ii) of the Act. This section mandates approval from authorities of the rank specified in Section 151(ii) when reassessment is initiated after the expiry of three years from the end of the relevant assessment year. The assessee relied on the Supreme Court's decision in ITO vs. Prakash Pandurang Patil, which held that sanction for issuing a notice under Section 148 after three years must be granted by authorities of the rank referred to in Section 151(ii), not those under Section 151(i). Revenue's Contentions: The revenue, through its Senior Departmental Representative, supported the order of the Assessing Officer and the CIT(A). No specific arguments were recorded for the revenue regarding the validity of the approval.

Which sections of the Income-tax Act were involved?

Section 148,Section 151(ii),Section 151(i)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, CUTTACK BENCH CUTTACK

Before: SHRI GEORGE MATHAN & SHRI GOPALAN GURUSAMY

Hearing: 30/09/2026Pronounced: 30/09/2026

Per Bench: This is an appeal filed by the assessee against the order of the NFAC, DELHI [hereinafter referred to as the ‘CIT(A)’] in appeal no.NFAC/2016-17/10255396 dated 27.08.2025 for the assessment year 2017-18. 2. Shri P. K. Mishra, AR appeared on behalf of the assessee and Shri Vijay Singh, Sr. D.R. represented on behalf of the revenue.

3.

It was submitted by the ld. AR that the impugned assessment year is 2017-18. The assessee had filed its return on 26.10.2017 disclosing an income of Rs.98,51,560/-. It was the submission that the assessment wa

The order continues below.

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