Vishesh Developers Pvt. Ltd. Vs ACIT (ITAT Delhi)
The Delhi ITAT adjudicated an appeal filed by the assessee against the order of the Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi, dated 16.10.2025 for Assessment Year 2019-20. The principal issue was the validity of reassessment proceedings initiated under Section 148 of the Income Tax Act, 1961 where the notice was issued beyond three years from the end of the relevant assessment year.
The assessee contended that the Assessing Officer had reopened the assessment by issuing a notice under Section 148 beyond the statutory period of three years. It was submitted that, in such cases, Section 151 mandates prior sanction from the Principal Chief Commissioner of Income Tax (PCCIT) or Chief Commissioner of Income Tax (CCIT). Referring to the approval dated 12.04.2023 granted under Section 151, the assessee pointed out that the Principal Commissioner of Income Tax (PCIT), in Row No. 9 of the approval, had specifically recorded that the proceedings were covered under Section 149(1)(b), i.e., “more than three years but not more than ten years.” According to the assessee, despite acknowledging that the reopening was beyond three years, the PCIT proceeded to grant approval, although Section 151 required sanction from a higher authority. The assessee also argued, in the alternative, that the approval reflected a mechanical exercise without application of mind. In support of this contention, reliance was placed on the judgment of the Bombay High Court in ITO v. Nikhil Chandrakant Dharia, 469 ITR 262 (Bombay), wherein approval under Section 151 granted mechanically without application of mind was held to invalidate the reassessment notice. It was further submitted that the Supreme Court had dismissed the Revenue’s appeal in ITO v. Nikhil Chandrakant Dharia, 469 ITR 315 (SC).
