Abhinav Jindal HUF Vs ITO (Delhi High Court)
The Delhi High Court considered a batch of writ petitions challenging reassessment notices issued under Section 148 of the Income Tax Act, 1961 for Assessment Year 2015–16. The principal ground of challenge was violation of Section 151, specifically regarding the authority competent to grant sanction for initiating reassessment.
The petitioners contended that the impugned reassessment notices, issued after the expiry of four years from the end of the relevant assessment year, required mandatory approval from higher authorities such as the Principal Chief Commissioner, Chief Commissioner, Principal Commissioner, or Commissioner. However, in the present cases, sanction had been granted by the Joint Commissioner of Income Tax (JCIT), which, according to the petitioners, was not permissible under either the unamended or amended provisions of Section 151.
The petitioners further argued that Section 151 mandates prior satisfaction of the specified authority before initiating reassessment proceedings, and absence of valid sanction renders the entire action invalid. They also contended that even after the amendments introduced by the Finance Act, 2021, the role of the JCIT was not recognised for granting approval in cases where reassessment was initiated beyond the prescribed time limits.
The respondents relied on the Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020 (TOLA), arguing that the extension of timelines due to the COVID-19 pandemic allowed reassessment notices to be issued beyond the usual limitation period. They contended that, in such extended timelines, approval under Section 151(2) by the JCIT was valid.
