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2023 (1) TMI 472 - ITAT AHMEDABADValidity of Reopening of assessment u/s 147 - appropriate sanction u/s 151 - unexplained receipt of loan - as argued approval granted by the Ld. Additional CIT u/s 151 of the Act is not proper and without application of mind - HELD THAT:- AO has after recording reason to believe sent a letter in specified format before additional commissioner for sanction of reopening as per the provision of section 151 of the Actwhich was approved by the ACIT by noting “yes”. However, on perusal of such approval request letter, we find that such request was with regard to general scrutiny under section 143(3) of the Act and not under the income escapement proceeding under section 147/148. There was no approval u/s 151 for issuance of notice under section 148 of the Act for income escapement assessment. Therefore, the notice issued under section 148 of the Act, without having proper approval of higher authority, is invalid notice and jurisdiction assumed by the AO for making assessment on the basis of such notice under section 147 of the Act is invalid. Thus the jurisdiction assumed by the AO is not tenable in the eyes of law. If authority was vested with power to approve the initiation of proceeding against the assessee in certain circumstances, therefore he/she is expected to verify the detail after application of mind in order to reach to the conclusion that such detail and information is fit enough for initiating of reassessment proceeding - If discretion is exercised under the direction or in compliance with some higher authorities instruction, then it will be a case of failure to exercise discretion altogether. In the given case what inferred is this that the learned Additional commissioner noted “yes” on approval letter without any verification and application of mind. Thus we hold that the initiation of proceedings under section 147/148 of the Act are not valid in the eyes of law and liable to be quashed. Accordingly, we quash the same. Hence, the technical grounds of appeal of the assessee are hereby allowed.
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