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Reassessment u/s 148 Without Approval from Competent Authority u/s 151 is Void ab Initio: ITAT [Read Order]

Reassessment procedures for all three years were unlawful ab initio and should be quashed outright since there was no evidence that the AO had obtained the necessary consent prior to sending out the letters under Section 148

Reassessment u/s 148 Without Approval from Competent Authority u/s 151 is Void ab Initio: ITAT [Read Order]
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The Delhi Bench of the Income Tax Appellate Tribunal (ITAT) has quashed reassessment orders for three consecutive years after finding that the Assessing Officer (AO) initiated reassessment proceedings under Section 148 of Income tax act, 1961 without obtaining the mandatory prior approval from the competent authority under Section 151. The appeals arose from reassessments framed...


The Delhi Bench of the Income Tax Appellate Tribunal (ITAT) has quashed reassessment orders for three consecutive years after finding that the Assessing Officer (AO) initiated reassessment proceedings under Section 148 of Income tax act, 1961 without obtaining the mandatory prior approval from the competent authority under Section 151.

The appeals arose from reassessments framed for Assessment Years 2009-10, 2010-11, and 2011-12, wherein the AO made additions under Section 69A of the Act. During the hearing, the assessee pointed out that the reasons recorded for reopening the original assessments were undated, casting doubt on the validity of the entire process.

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More critically, the AO failed to mention anywhere in the recorded reasons that prior sanction under Section 151, a statutory prerequisite for issuing notices under Section 148 had been obtained from the designated authority.

To verify this procedural lapse, the assessee filed an RTI request seeking copies of any approval orders, but the Revenue could not produce any documentary evidence of such approval having ever been obtained.

Noting this glaring omission, the Tribunal observed that reopening an assessment without fulfilling the statutory mandate of obtaining prior sanction under Section 151 strikes at the root of jurisdiction and renders the entire reassessment process invalid in law.

The bench of M Balaganesh ( Accountant members) and C.N. Prasad (Judicial member) ruled clearly that the reassessment procedures for all three years were unlawful ab initio and should be quashed outright since there was no evidence that the AO had obtained the necessary consent prior to sending out the letters under Section 148.

The Tribunal declined to decide the merits of the underlying additions, leaving those concerns open, because the reassessments were revoked on this basic legal basis. Accordingly, the ITAT allowed the assessee’s appeals.

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