Umar Daraj Vs ITO (ITAT Delhi)
Reassessment Quashed for Want of Proper Sanction: PCIT Approval Invalid u/s 151(2); ₹82.89 Crore Disallowance u/s 40A(3) Falls
Reassessment was initiated vide notice u/s 148 dated 30.03.2021 proposing disallowance of ₹82.89 crore u/s 40A(3) for alleged cash purchases of livestock, along with other issues. Tribunal held that since notice was issued prior to 01.04.2021 & more than four years had elapsed, sanction u/s 151(2) (old regime) was mandatorily required from the Joint Commissioner; however, approval was obtained from PCIT, rendering the notice jurisdictionally invalid. Relying on Supreme Court decision in Union of India vs Rajeev Bansal & consistent jurisprudence, ITAT held that sanction by a wrong authority & mechanical approval vitiates assumption of jurisdiction, making the notice non est in law. Accordingly, reassessment & consequential additions were quashed on jurisdiction alone, without adjudicating merits relating to Rule 6DD / Section 40A(3). Appeal partly allowed; other grounds kept open.
FULL TEXT OF THE ORDER OF ITAT DELHI
1. This appeal is filed by the assessee against the order of the Learned Commissioner of Income-tax (Appeals)/National Faceless Appeal Centre (NFAC), Delhi [“Ld. CIT(A)”, for short] dated 14.02.2025 for the Assessment Year 2015-16.
2. At the time of filing of appeal, the Registry has pointed out a defect that appeal is time barred by 8 days. In response thereof, the ld. AR of the assessee submitted that the delay is for meagre 8 days and the delay was not intentional and beyond the control of the assessee as well as the assessee could not get any benefit in delay filing the same. Accordingly, he prayed that the delay in filing the appeal be condoned.
