DCIT Vs Interlink Foods Private Ltd. (ITAT Delhi)
The appeals filed by the Revenue & cross-objections by Interlink Foods Pvt. Ltd. were heard together since they involved common issues.
For AY 2011-12, Assessee challenged reopening u/s 147 based on incorrect reasons—AO had recorded that Assessee took accommodation entries from Surendra Kumar Jain of RKG Finvest Pvt. Ltd., but later admitted this was a “typographical mistake” & proceeded against other entities (Twinkle Mercantile Pvt. Ltd. & Shalini Holding Pvt. Ltd.). Tribunal held that such substitution of reasons is impermissible; jurisdiction to reopen depends solely on reasons originally recorded & duly approved. Since reopening was based on non-existent facts, the entire assessment was declared void ab initio. The cross-objection was allowed, making Revenue’s appeal infructuous.
For AY 2015-16, Tribunal followed the Supreme Court ruling in Union of India v. Rajeev Bansal (2024 SCC OnLine SC 2693), wherein the Revenue conceded that all notices issued on or after 1-4-2021 for AY 2015-16 are time-barred & must be dropped as TOLA (Taxation & Other Laws Relaxation Act, 2020) does not extend the limitation. Hence, the notice issued to Interlink Foods was beyond limitation & the reassessment proceedings were quashed.
For AY 2016-17, Tribunal found that notice u/s 148 issued on 30-6-2021 lacked valid approval from the specified authority u/s 151 since more than three years had elapsed & approval was wrongly taken from PCIT instead of PCCIT/PDGIT. Such sanction being mandatory, absence of approval from the competent authority rendered the notice illegal & without jurisdiction.
