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Facts
The assessee filed an appeal against the order of the National Faceless Appeal Centre for AY 2017-18. The original assessment was reopened by the AO under Section 147/148. The assessee claimed the reopening was invalid due to procedural errors and lack of proper approval.
Held
The Tribunal held that the approval for reopening was obtained from the Principal Commissioner of Income Tax (PCIT) instead of the Principal Chief Commissioner of Income Tax (PCCIT), which is a violation of the law. Consequently, the reopening order was deemed a nullity.
Key Issues
Whether the reopening of assessment under Section 147/148 was valid when the approval was obtained from PCIT instead of PCCIT, especially after three years from the end of the assessment year.
Sections Cited
147, 148, 143(3), 148A(b), 148A(d), 144
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Income Tax Appellate Tribunal, “SMC” BENCH MUMBAI
Before: HON’BLE SHRI SANDEEP GOSAIN
Date of Hearing 11.03.2025 Date of Pronouncement 12.03.2025 आदेश / ORDER
PER SANDEEP GOSAIN, JM:
1. The present appeal has been filed by the assessee challenging the impugned order 01.01.2025 passed u/s 250 of the Income Tax Act, 1961 (‘the Act’), by the National Faceless Appeal Centre, Delhi / CIT(A), for the A.Y 2017- 18. The assessee has raised the following grounds of appeal:
1. In the facts and circumstances of the case and in law the Assessing Officer erred in reopening u/s 148 and passing order u/s 147 r.w.s 144
Amaan Naeem Akhtar Ansari, Mumbai a. Mechanically b. Without making any inquiry c. Only on the basis of borrowed information d. even though the reopening was required to be done by FAO instead of JAO e. without serving notice u/s 148A(b) at proper address f. without providing reasons for reopening g. without granting opportunity of being heard personally h. without serving order u/s 148A[d] i. No asset is found above RS 50 lac j. Notice issued after 3 years k. Obtaining prior approval of Pr. Commissioner of Income Tax- 20 instead of Pr. Chief Commissioner of Income Tax.
1. Considering sale price as the amount of income suppressed by overlooking case aw in 468ITR 105 SC 2. At the outset, I noticed that the appeal of the assessee was rejected by Ld. CIT(A) on the grounds that the same was not filed within limitation.
3. Whereas Ld. AR drawn my attention to the detailed affidavit dated 07.10.2024 which is at paper book page no 7 and the contents of same are reproduced here in below:
1. I, Amaan Ansari date of birth is 07/01/1993.
Amaan Naeem Akhtar Ansari, Mumbai
The Learned AO / Assessment Unit has sent all the notices to Room no 6, Haji baugh Chawl, Nehru Road, Vakola Bridge, Santacruz East Mumbai 400055 the said building is demolished more than 10 years ago.
I was staying on Rental place at 603, Noble Apartment Rajendra Kamble Road Siddharath Nagar, Vakola, Santacruz East, Mumbai, Maharashtra 400055.
4. Further not given any mobile no and Email address at the time of obtaining PAN and registered E-mail address was not done till 2022 accordingly I did not receive any notices and massages and communication from income tax department write from 20/05/2022 (date of First notice issued offline) till 15/09/2023.
5. I, e-filed my first income tax return of my life for assessment year 2023-24, when my income came in taxable category, on 25TH July 2023 and Fregistered my mobile and Email address at the time of e-filing my income tax return.
6. 1, Amaan Ansari though received demand notice U/s. 147 r.w.s 144 for Rs. 21,83,680/- dated 02/05/2023 physically on 12/04/2024 through income tax officer ward 22(1)(1) because the same was not reflected on income tax portal till 11/04/2024.
7. I humbly pray before your honor to condone the delay of 319 days of filing appeal from 01/06/2023 to 15/04/2024 and the same is a very bona fide reason on account of which the delay has occurred. The Appellant has not been negligent and wants to pursue the Appeal remedy, in as much as, on merits.
After having heard the counsels for both the parties and considering the documents placed on record and also taking into consideration the contents of the affidavit and considering the principles laid down by Hon’ble Supreme Court of India in the case of Land Acquisition Collector Vs. Mst. Katiji & Ors., [1987] AIR 1353 (SC) wherein it
Amaan Naeem Akhtar Ansari, Mumbai has been held that where substantial justice is pitted against technicalities of none deliberate delay, then in that eventuality substantial justice is to be preferred, therefore we condone the delay in filing the appeal and the present appeal is admitted to be heard on merits.
Since the delay has been condoned by me, hence it is argued by Ld. AR that the case of the assessee is fully covered by the decision of different courts on identical issues. Therefore, I have decided to adjudicate the merits of the claim raised by the assessee.
Ground No. 1 raised by the assessee relates to challenging the order of AO in reopening the assessment of the assessee.
I have heard the counsels for both the parties on this ground and on the perusal of the assessment order, I noticed that order u/s 148A(d) of the act was issued with the approval of PCIT instead of approval of PCCIT. As the said approval has been sought after three years from the end of the assessment year. In this regard, reliance is placed upon the decision in the following cases:
Gigantic Mercantile (P) Ltd. v/s. Asst. Com of Income tax [2024] 164 taxmann.com 646 (Bombay High court) 26/7/2024-
Amaan Naeem Akhtar Ansari, Mumbai ii) Cipla Pharma and Life Sciences Ltd. v/s. Deputy Commissioner of Income Tax [2024] 164 taxmann.com 663 (Bombay High court) [ iii. Chitra Supekar V. ITO ([2023] 149 TAXMAN.COM 26 Bombay 8. Considering the submissions of the parties and also taking into consideration the decision cited above, I am of the view that approval taken from PCIT is invalid as the same was required to be taken from PCCIT. Hence, the impugned orders has been passed by AO in violation of the provisions of law therefore, the same is held as nullity. Therefore, this ground raised by the assessee stands allowed.
Since reopening in the present case has already been held as nullity, therefore, other grounds raised by the assessee are academic in nature and does not require further adjudication.
In the net result, appeal filed by the assessee stands partly allowed with no orders to cost.
Order pronounced in the open court on 12.03.2025.