Reassessment Quashed for Sanction by Incompetent Authority

Suresh Kumar Giddaluru Vs Jurisdictional Assessing Officer (ITAT Surat)

Reassessment Quashed for Invalid Sanction: Approval by PCIT Instead of Competent Authority Renders Notice Void

The Surat Bench of the ITAT allowed the assessee’s appeal for AY 2018-19 by quashing the reassessment proceedings on a pure jurisdictional defect. The Tribunal held that since the notice under section 148 was issued on 05.04.2022—after expiry of three years from the end of the relevant assessment year—the mandatory sanction under section 151 was required to be granted by the Principal Chief Commissioner/Chief Commissioner (or equivalent higher authority). In the present case, the approval had been accorded by the Principal Commissioner, which was admittedly not the competent authority under law.

As the statutory precondition for valid assumption of jurisdiction was not satisfied, the notice issued under section 148 was held to be vitiated and the entire reassessment proceedings were declared null and void. In view of this jurisdictional infirmity, the Tribunal allowed the appeal without going into the merits of additions relating to short-term capital gains, commission income based on Form 26AS, or penalty proceedings.

FULL TEXT OF THE ORDER OF ITAT SURAT

This appeal has been filed by the assessee against the order dated 10.07.2025 passed by the Ld. Commissioner of Income-tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi (hereinafter referred to as the “Ld. CIT(A)”), under Section 250 of the Income-tax Act, 1961 (hereinafter referred to as the “Act”) for Assessment Year 2018-19.