Akshar Developers Vs ACIT (Bombay High Court)
Reassessment beyond three years – Sanction by Principal Commissioner instead of the authority specified under section 151(ii) is invalid, rendering the entire reassessment proceedings unsustainable.
Core Issue Whether reassessment proceedings for A.Y. 2017-18, initiated by an order under section 148A(d) and notice under section 148 dated 29.07.2022, were valid when the sanction under section 151 was granted by the Principal Commissioner of Income Tax, being the authority specified under section 151(i), even though more than three years had elapsed from the end of the relevant assessment year and the sanction was therefore required from an authority specified under section 151(ii).
Facts The petitioner had filed its return of income for A.Y. 2017-18 declaring total income at Nil. An initial notice under the erstwhile section 148 was issued on 01.04.2021. Following the Supreme Court judgment in Union of India v. Ashish Agarwal, the said notice was treated as a show-cause notice under section 148A(b), and a fresh notice dated 01.06.2022 was issued under the amended reassessment regime. The petitioner filed detailed objections on 10.06.2022. Thereafter, an order under section 148A(d) was passed on 29.07.2022 and a consequential notice under section 148 was issued after obtaining approval from the Principal Commissioner of Income Tax.
