Prem Antony Sequeira Vs National Faceless Assessment Centre (ITAT Mumbai)
Mumbai ITAT Quashes Reassessment for Want of Proper Sanction; PCIT’s Approval Invalid for Notices Issued Beyond Three Years
The Mumbai ITAT quashed the reassessment proceedings for AY 2017-18, holding that the notice issued under section 148 was invalid as it had been issued after the expiry of three years from the end of the relevant assessment year with the approval of the Principal Commissioner of Income Tax (PCIT) instead of the Principal Chief Commissioner of Income Tax (PCCIT), the authority mandated under section 151(ii) as it then stood. The Tribunal rejected the Revenue’s contention that the Finance Act, 2023 amendment to section 151 should be applied retrospectively, observing that the proviso was expressly made effective from 01.04.2023 and could not validate reassessment proceedings initiated earlier. Relying on the Bombay High Court’s decisions in Mystique Media Pvt. Ltd. v. ITO and Vodafone Idea Ltd. v. DCIT, as well as its own earlier decision in Shabbir v. ITO, the Tribunal held that the statutory requirement regarding the competent sanctioning authority must be strictly complied with, and the limitation provisions under section 149 cannot be imported into section 151 in the absence of an enabling provision. Consequently, the Tribunal quashed the section 148 notice and the consequential reassessment order, without examining the merits of the additions.
