Income Tax Appellate Tribunal - Delhi
Aruna Gupta,Delhi vs Income Tax Officer, Delhi on 1 July, 2025
IN THE INCOME TAX APPELLATE TRIBUNAL
DELHI BENCH 'SMC', NEW DELHI
Before Sh. Satbeer Singh Godara, Judicial Member
ITA No. 687/Del/2025 : Asstt. Year: 2017-18
Income Tax Officer, Vs Aruna Gupta,
Ward-10(1), B-1/45, Safdarjung Enclave,
New Delhi-110002 New Delhi-110029
(APPELLANT) (RESPONDENT)
PAN No. AAKPG2642L
CO No. 49/Del/2025 : Asstt. Year: 2017-18
Aruna Gupta, Vs Income Tax Officer,
B-1/45, Safdarjung Enclave, Ward-10(1),
New Delhi-110029 New Delhi-110002
(APPELLANT) (RESPONDENT)
PAN No. AAKPG2642L
Assessee by: Dr. Rakesh Gupta, Adv. &
Sh. Deepesh Garg, Adv.
Revenue by : Sh. Manoj Kumar, Sr. DR
Date of Hearing: 01.07.2025 Date of Pronouncement: 01.07.2025
ORDER
This Revenue's appeal ITA No. 687/Del/20 25 and assessee's cross objectio n CO No. 49/Del/2025 for Assessment Year 2017-18 arise s against the CIT(A)/ NFAC, Delhi's DIN & order No. IT BA/NFAC/S/250/2024-25/1071333531(1) dated 18.12.2024, in proceedings u/s 147 r.w .s. 144 of the Income Tax Act, 1961 (in short "the Act"), respectively.
2. Heard both the p arties at length. Case files peruse d.
3. It emerges at the outset that there arises the first and foremost issue of validity of se ction 148 proce edings herein 2 ITA No. 687 & CO 49/Del/2025 Aruna Gupta between the parties wherein the learned Assessing Officer had issued his cor responding notice dated 27 .0 7.2022 for assessment year 2017-18 in question i.e. beyond the prescribed period of three years from the end of the releva nt assessment year u/s 151(ii) of the Act. This being the clinching factual positio n, the assessee has quoted hon'b le jurisdictional high court's decision that in such an instance, the necessary sanctio n could not be obtained from the PC IT as the facts herein, in light of Communist Party of India (M) Vs. ITO, (2025) 174 taxmann.co m 925 (Del.) deciding the very issue against the department as follows:
"2. T he pet ition er is a n ati onal polit ical part y a n d is registe red un der S ection 29A of the R epresent ation of Peoples A ct, 1951. The petitioner filed i ts return of inco m e for the as ses s me nt year [A Y] 201 6-1 7 on 15.10.20 16, decla ring a N IL inc om e, a ft er cla iming exempt ion under S ection 13A of t he Income Tax Act , 1961.
3. Th e in itial not i ce un der S ectio n 14 8 of t he A ct for AY 201 6-17 wa s is s ued on 28 .06 .202 1. The said noti ce was uns us ta inab le as it was iss ued in accorda nce wit h th e sta tutory regime as existed pri or t o 31 .03 .202 1. This c ourt in t he c ase of Mon M ohan Kohli v. A ss ista nt C om missioner of I nco me Tax & A nr.: N eutral Cit ation N o.:
202 1:DHC :4181-DB ha d set aside suc h n otices t hat wer e is s ued after 31.03. 2021 w itho ut foll o wing the procedure as pr es c ribed un der Sec t ion 148A of the Ac t. Some of th e ot her High C ou rts a lso to ok a similar view and stru ck d own notices t hat were i ss ued under S ec tion 148 of the Act after 31.03.2021 but under the un amended provis io ns relatin g to th e re-a s sess m ent of incom e that had escaped assessment.
4. The R evenue a p pealed th e d ec ision s rende red by va ri ous High C ourts to the S upreme C ourt of India . In Un ion of India v . A s his h Agarwal: 2 022 SC C OnLine S C 543 - which wa s one of suc h appeals arising from th e d ecision of th e A llah abad High C ou rt - the Su preme C ourt deliv ered its decis io n on 04 .05 .202 2, whereby it con cu rred wit h the view th at the amended provisions which cam e int o force after 31.03.2021 w oul d be applicabl e to not ic es issued th ereafter. How ever, the Su preme Court also issued 3 ITA No. 687 & CO 49/Del/2025 Aruna Gupta cert ain direc tions in exerc ise of po wer s under A rticle 14 2 of th e Constit utio n of Ind ia. T he Co urt directed tha t all notices t hat were i ss ued under S ec tion 148 of the Act after 01.04.2021 till t he da te of the sa id decision (04.05.202 2), inc ludi ng t hos e that had been set a side by the High Court s, would be c ons t rued as show c ause n otices under S ect ion 148 A(b ) of the A c t. The A ssessing O fficers were d irected to pr ovid e the informa tion and m ateria l rel ied upon by th e R ev enue for iss ua n ce of such notices, to t he resp ectiv e as s es s ees wit hin a perio d o f thi rty da ys from the da te of th e dec isio n so a s to enable t he res pe ct ive assess ees to resp ond t o the s am e.
5. In c omplia nc e o f th e directi ons issued by the S uprem e C ourt in Uni on of I ndia & Ors . v. A s hish A garwal ( sup ra), th e AO p rovided the information to the petit ioner on 30.05.2022 . Th e is su e ra is ed in t he n o tice p ert ained to an am ount of ? 1,64,50,2 27/-, which was deposited by th e Petit ion er in its ba nk a cc ou nt m aintained with the Stat e B ank o f Travan co re, K ozh ikode. It wa s alleged t hat t he sa id am ount h ad not been disclos ed by t he pet ition er in its return of income , specifica l ly in column 1 3(b). Th e petit ioner res pon ded to t he said notic e on 08.06.2022 .
6. B y t he letter da ted 08.06.2022 , t h e p etit ione r fu rnis hed a c opy of the bank s ta tement pert aining t o the said accoun t ma inta ined wit h the S tate Ban k of Trava ncore (now St at e B ank of India), Ko zhik ode. The pet itioner exp lain ed t hat, alt hou gh th e s aid ba nk account ha d ina dvertently not been mentioned in colu m n 13(b) of the ret urn o f in come, th e tr ans ac tions r eflec t ed therein w ere dul y a ccou nted for wh ile pr epa ring the bo ok s o f a ccount of the pet itioner. It was furt her s ub mitt ed t hat the income arising from such tr ans ac tions was appropriately consider ed a t th e tim e of filing th e return of i ncome.
7. The lea rned AO was not persuaded wit h t he explanati on pr ovid ed by the pet itioner a nd pass ed an ord er dated 29.07.2022 under S ec tio n 148A (d) of the Act , ho lding tha t it was a fit cas e for reop ening the assessment proceedi ngs und er Sec t ion 147/1 48 of the A ct. The said ord er was is s ued with t he a pprova l of the C ommissio ner of Inc om e Ta x (Exempt ion) [C IT(E)] on an assumption th at the C IT (E) wa s a s pecified a u thority und er the provis ions of S ect i on 151 of the A c t.
8. The AO issu ed a not ice dat ed 2 9.07 .202 2 unde r S ecti on 148 of th e Ac t a ccompan ied with the ord er da ted 29.07.2022 pas s ed under S ect ion 1 48A (d) of the A ct. It is th e petit ion er's c ase that the said no tice is barr ed by limitat ion.
9. I t is material t o n ote t ha t the original notice un der S ection 148 of the A ct [deemed to be a show cause no tice und er Sec tion 148A (b) of the A ct in terms of th e decisi on in th e cas e of Un ion of India & Ors . v. A shish Agarw al 4 ITA No. 687 & CO 49/Del/2025 Aruna Gupta (supra )] wa s is sue d on 28.06.2021, th at is, tw o days prior to the exp ir y o f the limit at ion period a s ext end ed b y v irtu e of the Ta xa tion a nd O ther Laws (R ela xation a nd Am end men t of C erta in Provis io ns) A ct, 2020 [TOL A]. Th us, t he A O had tw o day s t o iss ue t he notice unde r Sec tion 148 of t he Act after rec eiving th e reply da ted 08. 06.2022 fil ed by th e petit ioner. Sinc e t h e sa id p eriod w as less tha n seven days, th e AO h ad, by virt ue of the fou rth provis o to S ect ion 149 (1) of the Act, seven da ys t o pass an order under S ection 14 8A (d) of the A ct (whic h was nec essari ly requi red to ac company a n otic e under S ecti on 148 of th e A ct). T h e said perio d expi red o n 1 6.06.2022. Ther efo re, the order pa ssed un der Sec tion 1 48A(d) of t he Act wa s beyond th e peri od of limitat ion .
10. The imp ugned n otice is als o liable t o be set aside on th e gro und tha t it wa s issued wit hou t the approva l o f th e au thority s pec ifi ed under Section 151 of t he Act . S ince th e imp ugned noti ce w as issued beyond the peri od of t hree years f rom the en d of t he relevant as sessment year, th u s, in t erms of Sec tion 151(i i) of the Act, the same was requi red to be a ppro ved by th e P rincipa l C hief C om missi oner or Pr incipal D irect or G eneral or wh ere t her e is no s uch authori ty, by C hief C om missioner o r D i rec tor Genera l. The det ermin ation of th e sp ec ified authorit y for gr ant of app rova l und er Sec tion 151 o f the A ct depend s on whether th e not ic e under Section 148 of th e A ct has been is s ued a ft er the expiry of three yea rs from the end of th e relevant ass ess ment year or w ithin th e sa id per iod.
11. Sect ion 151 of t he A c t ( as amend ed by the F inan ce Act, 202 1) a s in forc e o n t he date of issua nce of notice r ead as und er:
"151 . S anc t ion for is sue of notic e.- S pecified authorit y for th e purp oses o f sec tion 148 and s ecti on 148A shall be,-
(i) Princ ipal C omm is sioner or P rincipal Directo r or C om missi oner or D irecto r, if t hree yea rs or less th an t hree years have elapsed fr om the end of the relevant as s essment year;
(ii) Princ ipal C hief Com miss ioner o r Prin cipal D irect or Genera l or where there is n o P rincipa l C hief C om missi oner or Principal Director Gener al, C hief C om missi oner o r D irect or Gen eral, if more tha n th ree yea rs ha ve elap sed from the end of th e relevant as s essment year. "
12. The ques ti on w het her the sanct ion in respect of notices th at were is su ed d uring the period of limit at ion as ext en ded by TOLA requi red t he pri o r sanction i n terms of S ect ion 151 of the Ac t , as in forc e aft er 31.03.20 21 or a s in force p ri or to the sa id da te, has fell for consi d er a tion of this court in sev era l ca ses including T wylig ht In frastru ct ure Pvt . Ltd. v.
5 ITA No. 687 & CO 49/Del/2025Aruna Gupta Inco me Ta x Offic er Ward 25 3 Delhi & Ors.: Neutra l C itat ion N o.2024:D HC :25 9-DB and A bhi na v Jind al HU F v. Incom e Ta x Officer Wa rd 5 4(1) Delhi & Ors.: Neutral C itat ion No.:
202 4:DHC :7238-DB. Th is court had h eld th at TOLA would ha ve no releva nce fo r d etermining t he sp ecified auth ority whose a pproval w as m andatory un der S ection 151 of th e A ct for issuance of a notic e u nder Sect ion 1 48 of the A ct.
We cons id er it a p posit e t o refer to the follow ing ext ract from the decis ion of this court in Abhina v Jind al HUF v. Inco me Ta x Officer Ward 54(1) Delh i & Ors. (supra). T he same is s et out bel ow:
"17. A s was noticed in the introduct ory p art s of this decis io n, t he resp on dent s had, c ontrary to the above , argued tha t once a notice fo r reass essment co mes to b e is s ued after the expiry of fo ur y ear s by virtue of t he extended period of time m ade availa ble b y TOLA, all th e imp ugned not ic es would fall within the ken of sub- s ection (2) of th e pre -am endment S ect ion 151 a nd c ons eq uent ly t he sanction and approva l accord ed b y th e JCIT would be in ac cord ance wit h law.
*** *** ***
38. It would the ref ore be w ho lly incorrect to read TO LA as intending t o amend the d istribution of pow er or t he c ategoriz ation envis aged a nd pres crib ed by S ection 151. The add itional t ime tha t th e said statu te provided to an au thority c an not possibly be constr ued as altering or modifying t he hierarchy or the structure set up b y S ection 15 1 of t he Act . The iss ue of approval w ould st i ll be lia ble to be an swered bas ed on whet her t he reas ses s ment wa s com menced a ft er or wit hin a period of four years f rom t h e end of the rel evant A Y o r a s per th e am end ed regime dependent upon whether a ction w as being propos ed wi t hin three years of the en d of th e relev ant A Y or therea ft er. T he bi furcat ion of th os e po wers would co n tinue un altered a nd unaffected by TO LA .
39. The fallac y of the submission addressed by th e resp ondents bec om es ev en m ore ev id ent whe n we wei gh in c onsiderat ion the fact that even if the reassessment ac tion w ere init iat ed, as per the extended TO LA ti melin es , an d thus after the p eriod o f fou r years, S ection 15 1 inc orp orated adequa te m ea sures t o deal wit h su ch a co ntin gency a nd in una mbiguous terms identified t he au thority wh ich was to be moved for th e purposes of s anct ion and app roval. S ection 151 dis tributed the p owers of approval am ongst a set of s pec ified aut horit ies based upon the la pse of tim e between the end of the relevant A Y and t he dat e when reas ses s ment wa s proposed . Thus even if t he reas ses s ment was propos ed t o be ini t iat ed wit h the aid of TOL A a ft er t he expiry of four yea rs from th e end of 6 ITA No. 687 & CO 49/Del/2025 Aruna Gupta th e re leva nt A Y, the aut horit y s ta tut ori ly emp ow ered t o c onfer a pproval wo uld be t he Principal C hi ef C om missi oner / Chief C omm issioner /Prin cipal C om missi oner /C o mmiss ioner. It w ou ld only be in a cas e where t he reas ses sm ent w as p ropos ed to be initiated befo re th e exp iry of fou r yea rs f r om the en d of t he relev ant A Y t hat a pproval c ould h ave been a cco rded b y th e J CI T. S imila r would be th e po sition wh ich would em erg e if t he ac tions were t ested o n th e basis of th e am end ed Sec t ion 151 and wh ich divides the pow er of s anc tion amongs t two set s of au thoriti es ba sed on whether reas s ess m ent is c omm enc ed withi n three yea rs or thereaft er. "
13. In Twylight I nfra st ructu re P vt . Ltd. v. Income Ta x Offic er W ard 2 5 3 D elhi & Ors.(supra), a C oordina te Bench of this c ourt exa mine d the validity of initiation of reasses s ment pr oc eedings, in ca ses where the incom e all eged to ha ve es ca ped assessmen t w as ?50,00,000/- or less . In th e afore sa id context, this court also considered th e q uestion a s to th e specified au thority, whose p rio r ap prov al was requi red and hel d a s under:
"10. A s indic at ed a bove, t he specif i ed authorit y changes depend ing on the t ime lim it prescribed in section 1 51 o f th e A ct. I t is on this a cc ou nt that there is a linka ge betw een ruling ren dered i n Gan esh Dass Khanna [Ganesh Dass K han na v. I TO, ( 2024) 460 ITR 546 (D elhi) ; 20 23 SC C On Line Del 7286; 2 023 : D HC : 8187-DB.] and the instan t ma tt ers.
11. It may a ls o b e noted that i n Ganesh Da ss Khann a [Ganes h D as s K hanna v. ITO, (2 024) 460 ITR 546 (Delhi); 202 3 S CC OnLi ne Del 72 86; 2023 : D HC : 8187-DB .], w e ha d reco rded t he s t and of the R evenue th at the issu e conc erning limitat ion and the specified authority ar e "intert wined". F or convenience , th e relevan t part of th e j udgm ent is ex tra cted hereaft er (pa ge 567 of 460 ITR ):
"24. On b ehalf of the R evenue, the fo ll owing broa d s ubm issions were ma de:... ...
(viii) Bot h under t he u namended 1961 Act and amended 196 1 Act , t he iss ue con ce rning l imit ation is inextrica bly int ert wined w ith tw o as pects:
(a) Firs t, t he rank of the au tho rity g rant ing ap proval/s an ct ion for t rigge ring reassessmen t pr oceed ings .
(b) S econ d, the quantum of income whic h h as escaped ass es s ment."
(Empha sis is o urs)
12. C lea rly, th e R evenue advanced the argu men t of int erl in kag e b etw een limit at ion a nd the ascert ainm ent of 7 ITA No. 687 & CO 49/Del/2025 Aruna Gupta th e s pec ified a uth ority due to t he p lain languag e of th e am end ed sect ion 1 51 of the Ac t. Section 151 , when read alo ngside t he firs t provi so t o s ectio n 148, b rings th e as pec t of inext ric a ble l inkage to t he for e.
12.1. C laus es (i) a nd (ii) of section 1 51 of the am ended A ct (which has been ext ra cted hereinabove) c learl y s pec ify the a uthor ity wh ose a pprova l can trigger th e reas ses s ment proc eedi ngs . Thus, if t hree (3) yea r s or less h ave e lapsed from the end of t he relevan t as sess ment year, the specified authorit y who would gr ant approval fo r i nitia tion of reasses sment proceedings will be t he Pri nci pal Comm issioner or Principal D irecto r or C ommissio ner or Di rect or. H owe ver, if m ore th an th ree (3) years f rom th e end of the relevant assessmen t year h ave ela ps ed, the spec ified au thority fo r acco rd ing ap prov al for the reass essment shall be the Princip al C hief C om mis sioner or P rincipa l Directo r Gen eral or, where the re is n o Princ ipal C hief C ommission er or Princ ipal D irecto r General , Chief C omm issi oner or Di rec to r Gen era l.
12.2. That t he a pproval is man dat ory is pla inly eviden t on p erus a l of t he firs t proviso a ppen ded to section 148 of t he A ct . The s aid provis o, at t he risk o f rep eti tion, reads as foll ows :
"Pr ovided tha t no no tice u nder th is section shall b e is s ued unl ess t here is informat ion wit h t he Assessing Offic er whic h su ggests tha t the income charg eabl e to ta x ha s es ca ped a sses sm ent in th e ca se of the a ss essee for th e releva nt as s essment year an d the A ssessing Officer ha s obta ined prio r approval o f the s pecifi ed auth orit y to is s ue s uch n otic e."
12.3. In these ca ses , the re is no dis put e th at al thou gh th ree (3) yea rs had ela psed from th e end of t he relevan t as sess ment year, t he a ppro va l was sought from the au thorities s pec ifie d in c laus e (i), as against clau se (ii) of sec ti on 15 1.
12.4. B efore us, th e counsel for the R evenue con tinue t o hold t his position. The only libert y t ha t they seek is that if, ba sed on the jud gment in Ganesh Dass K hanna [Ganes h D ass Khanna v. I TO, (2024 ) 46 0 ITR 546 (D elhi); 2023 SC C On Line D el 7286; 2023 : D HC : 81 87- DB .], the impugned ord ers and n oti ces are set aside, libe rty b e given to the R evenue to comm ence th e reas ses s ment proc eedings afresh.
13. Therefore, h avin g regard t o t he aforesaid , th e imp ugned not ic es a nd ord ers in e ac h of t he a bove - c apt ioned wr it peti t ions ar e qu ashed on the gr ound tha t th ere is no ap pr oval of t he spec i fied au thority, as indi ca ted in s ec ti on 151(ii) of the Act. The direction is 8 ITA No. 687 & CO 49/Del/2025 Aruna Gupta is s ued wit h t he ca veat tha t the R evenue w ill h ave lib ert y to t ak e st eps , if deemed n eces sary , al b eit as per law."
14. In J M Financia l & Investm ent s C onsulta ncy S ervices Privat e L imit ed v. AC IT, C irc le 3(2)(1) & O rs., W.P. No. 105 0/2020, dec ided on 04.04. 2022, t he Bo mba y High Court ha d m ade observat ions to th e effect t hat even i f the t ime t o is s ue not ice m ay have been ext ende d b y T OLA , the sam e would not am end the p rovis ions of S ection 151 of t he Act. The rele van t ext rac t of the sa id decis i on is set out be low :
"5. R es pon dent s h ave relied upon a lett er dated 18t h Marc h 2021 iss ued by one Income Tax Office r, who has giv en an o pin ion to t he A dditional Commi ssione r o f Inco me Tax tha t in view of th e Taxati on and othe r L aws (Rela xa tion of Ce rt ain Pro vis ion s) A ct, 2020 (Relaxati on A ct), lim itat ion, in ter alia, unde r pr ovisio ns of Secti on 151 (1) a nd S ect ion 151(2 ), whic h w ere o riginally expirin g on 31st March 2020 stand exten ded t o 3 1st Marc h 2 021. A c cord ing to the Inco me Tax O fficer, in view of th e ab ove , A ss ess ment Year 2015-2016 which falls under the c at egory within fou r years as on 3 1st Marc h 20 20, the statutory ap proval for issuance o f notice und er Sec t ion 148 o f the A ct for t he A ssessmen t Year 2015-2 016 m ay be given by the Range Head as per th e sa id p rovis ions . Mr. S harma clarif i es t hat t he Incom e Ta x Offic er is only co nveying t he view of t he Princip al C om missi oner of I ncome Tax b ec ause this l ett er has been is sued on t he letterhead of P rin ci pal C om missioner of Inc om e Tax.
6. Even for a mom ent we agree with the view expressed by the Princ ipal Com miss ioner of In co me Ta x, still it ap plies to only c ases where the lim it a tion was expi ring on 31s t March 202 0. In the cas e at hand, th e as sess ment year i s 20 15-201 6 and, th erefo re, the si x years lim itation w ill expire only on 31st Ma rch 2022. C ertain ly, th erefo re, t he R elaxat ion Act provisions ma y not b e appl ica ble. In a ny event, the time to issue not ice ma y hav e been ex tended but th at would not amount t o am end ing the provisions o f S ection 151 of t he A ct.
7. In our vi ew , si nce fou r years had expired fr om th e en d of th e releva nt a ssessme nt year, as pro vided unde r S ection 151(1 ) o f the Act, it is o nly t he Principal C hief C om missi oner or C hief C omm issioner or Pri ncipal C om missi oner or C om miss ioner who c ould ha ve accorded th e approva l a nd not the Additio nal C omm issioner of Inco me Ta x. O n th is g roun d alon e, w e will ha ve t o set as ide the n otice dated 31st March 202 1 issued under S ection 148 of the Ac t, whic h is imp ugned i n this petit ion. I n view t hereof, the consequent orders a nd notices wil l als o have to go."
[em phasis added] 9 ITA No. 687 & CO 49/Del/2025 Aruna Gupta
15. In a latte r dec is io n in Siemens F inan cia l Services P vt. Ltd. v. Deput y C om miss ioner of In come-T ax & Ors.:2 023 S CC On Line Bo m 2822, the B ombay High C o urt re iterated th e sa id view i n t he follow ing word s:
"24. A s per sec tion 151 of the A ct, the " sp ec ified au thority " w ho has to grant his sanctio n for t he purpos es of s ect i on 1 48 a nd sect ion 1 48A is the Principa l C hief C om missi oner o r Principal Dir ec to r Genera l or wher e th ere is n o P rinc i pa l C hief Co mmissioner or Princip al Di rec to r G ene ral, t he Ch ief C om mis sione r or D irector Genera l if mo re t h an t hree years h ave elapsed from th e en d of t he relev ant ass es smen t year. Th e p res en t petit ion r elates t o th e a ss es sment year 2016-17, and as th e im pugned o rd er an d impugned notice a re issue d beyon d the pe ri od of three yea rs w hic h elapsed on March 31, 2 020 the a pp roval as co ntempla ted in sectio n 15 1(i i) of the Ac t w ould ha ve to be ob tained which has n ot been do ne b y th e A s ses si ng Officer. The imp ugned not ice mentions that the prior appr ova l has been tak en of th e "Pr inc ipal Commissione r of Inc ome -ta x-8" ("PC IT-8") whic h is bad in law as the approva l shou ld ha ve been ob tained in t erms of sect ion 151(ii) and not secti on 151 (i) of t he A ct an d t he Principa l C ommissioner of Inco me- tax-8 cannot be t he specified au tho rity a s per s ection 15 1 o f the A c t. F urth er, even in the affida vit-in- reply , th e Department h as accept ed that the approval ob tained is of the "P rincipa l C omm issioner of Incom e- ta x-8" and, he nce, such a n approval would be ba d in law .
25. The Ta xat ion a nd Other Laws (R elaxat ion a nd A mendment of Certain P rovisions) A ct, ena cted on S eptem ber 29 , 2020 an d came int o fo rc e on March 31, 202 0 ([202 0] 428 ITR ( St .) 29 ). I t, inter a lia, p rovided for a relaxati on of certa in pro visi ons of the Income-ta x A ct, 1961. Where any time lim it fo r compl eti on or c omp lianc e of a n action such a s c omplet ion of an y pr oceed ings or pa s sing of any ord er or issuan ce o f an y notice f ell between t he period Marc h 20 , 2 020 t o Decemb er 31, 2 020, t he time limit for complet ion o f s uc h a c tion stood extended to Ma rch 3 1 , 2021. Thus, th e Ta xat ion and O ther Laws (R ela xation and Am end ment of C ertain Prov isi ons ) Act o nly seeks to extend the period of lim itat ion and d oes not affect th e scop e of secti on 151 .
26. The As s es sing Office r cannot rel y on the pro visions of the Taxa tion and Othe r L aw s (Relaxa tio n and A mendment of C ert ain Provisi ons) Act and the notific atio ns iss ued thereu nder as s ection 15 1 has been am end ed b y the Fi nance A ct, 202 1 an d t he p rov isions of th e a mended s ect i on would have t o be c omplied w ith b y th e As sess ing Officer, w ith eff ect f rom A pril 1, 2021.10 ITA No. 687 & CO 49/Del/2025
Aruna Gupta Henc e, the As s es sing O fficer ca nnot seek t o ta ke t he s helter of t he Ta xat ion a nd Ot her Laws (R elaxat ion and A mendment of C ert ain Provis ion s) Act as a su bord inat e legislatio n cannot override an y statute enact ed b y Pa rlia ment . Further , the notifica tio n extending the dates from Ma rc h 31 , 2 02 1 till Ju ne 30 , 2021 ca nnot appl y on ce th e F inanc e A ct , 2021 is in e xis tence. Th e sancti on of the s pe cifi ed a utho rit y has t o be obtain ed in ac cordanc e with the law exist ing w hen the sanctio n is ob tained and, therefore, the sa nction is req uired to b e ob tained by a pplying the a mended section 151(i i) of t he A ct and s ince the s anc tion h as been obt ained in term s of s ection 151(i) of the Act , the impug ned order and imp ugned not ice are b ad in law a nd should b e quashed an d s et as ide. "
16. I n R amac han dra n S hiv an v. Inc om e Tax Office r, W.P. N o. 8570/20 23 and oth er conn ected matters, decided on 04.03.2024 , the Madras High C ourt also refe rre d to t he decis io ns of th e Bo mbay High C ourt a s well as t he decisi on of this co urt in Tw ylight Infrast ructur e Pvt. Ltd. v. Inco m e Ta x Office r Wa rd 25 3 D elhi & Ors. (supra ) and expres sed th e simila r v iew. The releva nt extra ct of the said d ecision is se t out bel ow :
"13. The o rders and not ices a re challenged herein no t on th e g rou nd t hat the tim e limit und er preamended section 149 does not apply , but on the grou nd t hat sanction was not grant ed b y the sp ecifi ed authorit y. The refore, it rema ins t o be c onsidered a s to whet her t he ap plication of the p rov iso t o sec ti on 1 49 h as the eff ect of inc orpo ra ting by refe ren ce t o prea m ended section 151 . In order to su bstan tiat e the contenti on t hat prea mended s ection 151 gets incorpo rat ed by reference, lea rn ed s ta nding coun se l reli ed on sub-section (2 ) to t he pr eam ended sect io n 149. It should be no ticed t hat th e pr ovis o to s ub-s ection (1) of th e amended sect ion 149 do es not even in corpo rat e the whole of pream ende d s ection 1 49. It m erel y mak es the time limit p rescrib e d th erein a pplic abl e t o the issua nce of not ices for reas ses s ment in respec t of any assessm ent yea r beginnin g before A pril 1, 2021. A fortio ri the provis o c ert ainl y d oes not incorporat e prea mended section 15 1 by ref erence and ma ke it applic able.
14. The next question t o be examined is the im pact of th e Ta xa tion and Oth er Law s (Relaxati on a nd A mendment of C erta in Provisions) Act, 2020. U ndou btedly, th e Taxa tion and Oth er Law s (Relaxati on an d A men dment of C ertain Pr ovisions) A ct , 2 020 extended the t ime lim its under spe cified enactm ents, inc ludi ng th e Inc om e-t ax A ct . A s per clause (a )(ii) of s ub-s ection(1) of s ect ion 3 there of, t i me limi ts for gran t of s an ct ion or a pproval were a lso ex tended . Sin ce th e petit ioner d oes not challenge the sanction w ith respec t 11 ITA No. 687 & CO 49/Del/2025 Aruna Gupta to t he tim e l imit, cla use (a) of sub-sect ion (1) of secti on 3 is im mat erial. I ndeed, th e Taxat i on and O ther Laws (Rela xa tion and A mendm ent of C erta in Provisi ons) A ct, 202 0, w hic h extends the time l imits for comp letion of s pec ified tas ks up to March 31, 20 21, itself becomes irre lev ant beca us e of the na ture of the challenge in th ese writ p eti tion s.
15. I n S iemen s Fina ncial S ervices [Siem ens Fina ncial S ervic es Pvt. Lt d. v. D y. C IT, (2023 ) 457 ITR 647 (Bom ); 2023 S CC OnLine Bo m 2822; (202 3) 15 4 ta xmann.com 159 (Bo m).] , the Division Bench of th e B om bay High C ou rt concluded, in substantially simila r fac ts and c irc um stances, t hat the a mend ed sectio n 15 1 an d no t t he prea men ded section 1 51 would app ly. F or reas ons set out ab ove, I concur with t he conclusion in S iem ens F inan cia l Servic es [S iem ens F inancial S ervices Pv t. Ltd . v. D y. CI T, (2023) 457 ITR 647 (B om); 2 023 S CC OnLine Bom 2822; (20 23) 154 t axm ann .com 159 (Bom ).] and Ga nesh Das Khanna v. ITO [(2024) 460 ITR 546 (D elhi) ; (2 02 3) 6 HC C (D el) 516; (20 23) 156 ta xmann.com 417 (D elhi).] as subse quen tly foll ow ed in Tw ylight I nfrastru ct ure [Tw yligh t I nfr astruct ure Pvt. L td. v. ITO, ( 2024) 463 ITR 702 (D elhi ); 20 24 S CC O nLin e Del 330.] . Cons equently, t he valid i ty of sanction for is s uing the orders under section 148 A(d) a nd the notices und er sec ti on 148 should be test ed wit h reference t o am end ed s ection 151. If so t ested, it is evi dent that s anc tion was n ot gra nted by an aut hority spec ified under c lause (ii) of s ec tio n 151. Hence, the orde rs unde r s ection 1 48A(d) and th e noti ces und er section 148 a r e qua shed. As a c oro llary , the draft assessment ord ers und er s ec ti on 144B /1 44C cannot surviv e an d are also qua shed.
16. Thes e wr it petitions a re all ow ed on t he above term s. Th ere will b e n o o rder as t o cost s. C onsequen tly , th e connec ted mis c ella neo us petit ions a re als o cl osed."
17. We ma y al so note the view of the Oris sa High Court in A mb ika Iron and Steel Pvt . L td. v. P rinc ipa l C om missioner of I ncome Tax: 2 0 22 S CC OnLine O ri 4162 which i s also simila r to the v i ew as expr ess ed by t his court . Th e relevant ext rac t of the said de ci si on i s rep rod uced below:
"2. I n eac h of these cases, th e challeng es t o a notice is s ued by the Income- tax D epartmen t (hereinafter "D epa rtment ") und er sect ion 1 48 of t he Income-tax A ct, 196 1, (IT A ct) a s it st ood pr ior to th e a mendment by th e Finance Ac t of 202 1 with effect f ro m April 1, 2021 . In ot her words , i n ea ch of th ese cas es, t he n otice under s ection 14 8 o f the I nco me-tax A c t h as been issued p rior to April 1, 2021. In man y of them, i n fact , t he dat e of th e notice is Ma rch 31, 2021.
3. In eac h of thes e cases, the rel evan t assessment yea r (AY) in rel ati on to which such not ic e ha s bee n issued is 12 ITA No. 687 & CO 49/Del/2025 Aruna Gupta more tha n four years pri or to the da te of th e reop ening , i.e., it is bey ond four yea rs f rom the exp iry of t h e as sess ment year in ques tion and is clea rly t her ef o re, ti me ba rred in terms of the first pro viso t o section 147 of the I nc ome-ta x Act .
4. The st and of the R evenue th at in view of t h e notific atio ns iss ued by the Central Governm ent in terms of the pro vis ions of t he Taxati on and Other L aws (Rela xa tion and A mendm ent of C erta in Provisi ons) A ct, 202 0, the s aid time limits stood ext end ed is clea rly unt ena ble as t hos e not ifications w ere iss ued to dea l wit h th e sit uat ion arisin g from the a men dment to th e Incom e-
ta x A c t by t he F inanc e Act, 2021 wi th effect f rom Ap ril 1, 2021 wherea s i n t hes e ca ses the n otices w ere issue d pr ior to A pri l 1 , 20 21.
5. This c ourt h ad a n occasion in sim il ar circumstances to qua sh an identic al notice un de r sec t ion 148 of t h e Inco me-t ax Ac t by its ord er da ted Nov ember 2 0, 2019 in Writ P etiti on (C) N o. 7 618 of 2009 and which ord er stoo d c onfirm ed by thi s court by t he dismissal of th e Depa rtm ent's revi e w petitio n, i. e., RV WPET No. 188 of 202 0 by the o rder da ted December 3, 2021 which re ads as under:
"1. Alt hou gh th e point m ade by t he Revenue in this rev iew petit i on is that this court in its order dated Nov em ber 20, 20 19 erred in draw ing a d istinction bet ween an Additional C om missioner a nd C ommissioner in term s of their a uth ority, th e po int involved wa s tha t for the purpos e o f s ection 1 51(1) o f t he Income -ta x Act , 1961 s inc e the reopening of the assessment was bey ond four yea rs, it ha d to have the prior approva l of the C om missi oner of Incom e-t ax, a nd the re was no suc h a pproval in the p res ent ca se.
2. C onse quen tly, no ground is ma de ou t for review ing the or der da ted N ovember 20, 2019 in Writ P etition (C ) No. 7618 of 2009.
3. The r evi ew pet itio n is dismis sed."
6. Indeed in the n otice issued unde r section 148 of th e Inco me-t ax Ac t on Ma rch 31, 2021 wh ich has been c hallenged in Writ Pet ition (C ) No. 418 26 of 20 21 it has been sta ted tha t the notices had been issued after ob taining "neces sa ry s atisfa ct ion of t he Join t C om missi oner of I n come-tax Range-I, C ut tack " w hereas th e Offi ce r a ut hori zed to r eco rd th e necessar y s atisfac t ion had t o be t he C hief Commi ssion er of Inco me-t ax/C omm issioner of Income-t ax.
7. F or all the af oresa id r eason s, in each of t he abov e c ases, t he im pugned not ice under s ect ion 148 of t he 13 ITA No. 687 & CO 49/Del/2025 Aruna Gupta Inco me-t ax A c t is hereb y quas hed. T he writ petiti ons ar e all owed, but in th e ci rcum stances, w ith no ord er as t o c osts ."
18. I n view o f t he above, the o rder dat ed 29.07.2 022 pa ssed und er S ectio n 1 48A(d) of t he A c t is not su staina ble. C onseq uent ly, the s ubsequent p roceedings, including th e as s es s ment ord er dat ed 23.05.2023, can not be susta ined. A ccordin gly, t he im pugned ord er pas sed und er S ecti on 148 A(d ) of th e Ac t, th e no tic e i ssued under S ection 1 48 of th e A c t as well as the assessm ent order da ted 23.05 .2 0 23 an d the demand rais ed pursuant t her et o, a re hereby set as ide."
4. I adopt the above detailed reasoning mutatis mutandis to quas h the impugned reopening itself in very terms.
5. The assessee's cross objection C O No. 49/Del/2025 to this effect succeeds and the Reve nue's main appeal ITA No. 687/Del/2025 fails therefore.
6. All o ther pleadings on merits herein stand rendered academic.
7. To sum up, this Revenue 's appeal ITA No. 687/Del/2025 is dismissed and the assessee' s cross objection CO No. 49/Del/2025 is allowed in above terms. A copy of this commo n order be placed in the respective case files.
Order Pronounced in the Open Court o n 01/07/2025.
Sd/-
(Satbeer Singh Godara) Judicial Member Dated: 01/07/2025 *Subodh Kumar, Sr. PS* Copy forwarded to:
1. Appellant
2. Respondent
3. CIT
4. CIT(Appeals)
5. DR: ITAT ASSISTANT REGISTRAR