Clipped from: https://www.taxscan.in/acit-cannot-sanction-re-assessment-notice-after-expiry-of-4-years-bombay-hc/168573/?utm_source=izooto&utm_medium=push_notifications&utm_campaign=Re-assessment%20Notice
By Taxscan Team – On April 15, 2022 8:47 pm
The Bombay High Court has held that the Additional Commissioner of Income Tax cannot sanction re-assessment after the expiry of four years under the provisions of the Income Tax Act, 1961.
A bench of Justice N.R. Borkar and Justice K.R. Shriram has held that after four years of expiry from the end of the relevant assessment year, only the Principal Chief Commissioner or Chief Commissioner or Principal Commissioner or Commissioner (PCIT) can accord the approval to the reassessment notice and not the Additional Commissioner of Income Tax (ACIT).
The petitioner/assessee has challenged the reassessment notice issued under Section 148 of the Income Tax Act, 1961 for Assessment Year 2015-2016 on the grounds that the approval obtained for issuing the notice under Section 148 of the Income Tax Act, 1961 was not in accordance with the mandate of Section 151 of the Income Tax Act, 1961 as the approval was from the Additional Commissioner of Income Tax instead of the Principal Commissioner of Income Tax.
While quashing the assessment, the Court held that “Even for a moment we agree with the view expressed by the Principal Commissioner of Income Tax, still it applies to only cases where the limitation was expiring on 31st March 2020. In the case at hand, the assessment year is 2015-2016 and, therefore, the six years limitation will expire only on 31st March 2022. Certainly, therefore, the Relaxation Act provisions may not be applicable. In any event, the time to issue notice may have been extended but that would not amount to amending the provisions of Section 151 of the Act.”
“Since four years had expired from the end of the relevant assessment year, as provided under Section 151(1) of the Act, it is only the Principal Chief Commissioner or Chief Commissioner or Principal Commissioner or Commissioner who could have accorded the approval and not the Additional Commissioner of Income Tax. On this ground alone, we will have to set aside the notice dated 31st March 2021 issued under Section 148 of the Act, which is impugned in this petition. In view thereof, the consequent orders and notices will also have to go,” the Court said.To Read the full text of the Order CLICK HERE