Darbari Industries Vs ACIT (ITAT Mumbai)
Mumbai ITAT quashed reassessment proceedings holding that approval under Section 151 was obtained from the wrong authority, rendering the entire reopening void ab initio.
The Tribunal noted:
- Notice u/s 148 was issued on 27.04.2023, i.e., beyond 3 years from end of A.Y. 2019-20
- As per Section 151(ii), approval in such cases must be from PCCIT (higher authority)
- However, approval was obtained only from PCIT, which is not valid in law
Relying on Bombay HC in Chitra Supekar, the ITAT held:
- Correct sanction is a jurisdictional requirement
- Defect in sanction is not procedural but fatal
- Wrong authority approval = no jurisdiction to reopen
Accordingly:
- Notice u/s 148 and entire reassessment were quashed
- Additions of ₹2 crore u/s 68 and interest disallowance became academic
The appeal was allowed on legal ground, reinforcing that:
- Strict compliance with Section 151 is mandatory
- Jurisdictional defects cannot be cured later
FULL TEXT OF THE ORDER OF ITAT MUMBAI
This appeal by the assessee is directed against the order dated 14.11.2025 passed by the learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi, [hereinafter referred to as “CIT(A)”] under section 250 of the Income-tax Act, 1961 [hereinafter referred to as “the Act”], for the Assessment Year 2019–20, arising out of the assessment order dated 28.01.2025 passed by the Assessing Officer under section 147 read with section 144B of the Act.
