Capital Broadways Pvt Ltd Vs ITO (Delhi High Court)
Whether simply writing “ I am satisfied” in the approval u/s 151 of the Income-tax Act,1961 is sufficient to show that the Sanctioning authority applied its mind while approving the reassessment proceedings u /s 148 of the Income-tax Act,1961
The Division bench of Delhi High court in this case was dealing with a reassessment notice which was issued on the basis of purported allegation that the petitioner had taken accommodation entry of Rs 55 lacs which was based on report on money laundering in the case of Jain brothers. The Ld Judges reproducing the approval which was given observed that the approval order is bereft of any reason and there is no whisper of any material that may have weighed for grant of the approval. The entire exercise was said to have been ritualistic rather than meaningful . The Ld Judes thereafter referred to decision of Delhi high court in the case of SBC Minerals Private Limited Vs ACIT as well as Yum! Restaurants Asia Pte Ltd (2017) 397 ITR 665 and distinguishing the judgement in the case of PCIT Vs Meenakshi Overseas Pvt ltd where there was an express letter of approval, held that the approval was not valid and the notice u/s 148 was set aside.
