Case Law Details
CIT Vs. SPL’s Siddhartha Ltd (Delhi High Court)- The argument of the assessee before the Tribunal was that the approval was not granted by the Joint Commissioner for reopening U/s. 147. Instead, it was taken from the CIT, Delhi-III, New Delhi, who was not competent to approve even when he was a higher Authority inasmuch as Section 151 of the Act specifically mentions Joint Commissioner as the Competent Authority. This contention of the respondent-assessee has been accepted by the Tribunal thereby quashing the assessment proceedings. The contention of the Revenue that it was merely an irregularity committed by the AO and was rectifiable under Section 292B of the Act, has not been found convincing by the Tribunal. Where the Assessing Officer does not himself exercise his jurisdiction under Section 147 but merely acts at the behest of any superior authority, it must be held that assumption of jurisdiction was bad for non-satisfaction of the condition precedent.
The Apex Court in the case of Anirudh Sinhji Karan Sinhji Jadeja Vs. State of Gujarat, (1995) 5 SCC 302 has held that if a statutory authority has been vested with jurisdiction, he has to exercise it according to its own discretion. If discretion is exercised under the direction or in compliance with some higher authorities instruction, then it will be a case of failure to exercise discretion altogether.
HIGH COURT OF DELHI
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The Hon’ble High Court could have gone further to investigate, why the Officer has sought sanction from the Commissioner when the Act clearly states it should be from the Joint Commissioner or a direction to the Chief Commssioner to investigate the reasons, so that the damage caused to the revenue could be avoided in future. Any of how whether it is negligence or arrogance both requires to be admonised by appropirate authorites. Income tax Act is not a new enactment to commit such grave mistatkes , it is unfortunate the department tries to seek heldp of section 292B to getout from the negligence.