TMI Blog2010 (12) TMI 164X X X X Extracts X X X X X X X X Extracts X X X X ..... acts of the case, relevant for me to decide the question referred to, are that the original assessment under section 143(3) was completed in the case of the assessee vide order dated 29.01.2001. Subsequently, proceedings under section 147 of the Act were initiated vide notice dated 24.03.2005 issued under section 148 after getting the approval from JCIT, Range-I, Agra after the expiry of 4 years from the relevant A.Y. by the ACIT. In response to the notice under section 148, the assessee filed the return on 29.04.2005. The assessee objected to the validity of the jurisdiction of the Assessing Officer which was rejected by the Assessing Officer. The assessee went in appeal before the CIT(A). Before the CIT(A) also the assessee contended that since the original assessment order was passed under section 143(3) of the Act and notice under section 148 was issued after the expiry of 4 years as per proviso to section 151(1), the Assessing Officer must have taken the sanction of the Chief Commissioner of Income Tax (CCIT) or Commissioner of Income Tax (CIT) to reopen a completed assessment. The CIT(A), following the decision of the Calcutta High Court in the case of East India Hotels Limit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ection 151(1) is not any Assessing Officer, i.e., irrespective of his rank, but the same, i.e., subject to the same qualification as to rank, as that referred to in sub-section (1) of s. 151." 3. The ld. J.M. did not agree with the ld. A.M. and Ld. JM was of the view that the case of the assessee was duly covered by the decision of the jurisdictional High Court in the case of Dr. Shashi Kant Garg v. CIT, 285 ITR 158 (All.) and that of the Hon ble Calcutta High Court in the case of East India Hotels Limited v. DCIT, 204 ITR 435 and upheld the order of the CIT(A). 4. I have carefully considered the rival submissions presented before me. In the instant case, the only question before me is whether, in the given facts and circumstances of the case, the requisite sanction under proviso to section 151 of the Act for issuing notice u/s. 148 is required or not. The reassessment proceedings under section 147 of the Act was initiated vide notice issued under section 148 on 24.03.2005 by the Assessing Officer who is of the rank of A.C.I.T. after obtaining the prior approval of the Addl. C.I.T. The objection of the assessee is that the reassessment proceedings are invalid as the proceedings ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... elevant Assessment Year. Notice under section 148 can be issued by the Assessing Officer who is below the rank of Assistant Commissioner or Dy. Commissioner of Income Tax but before issuing any such notice the Joint Commissioner has to be satisfied on the reasons recorded by such Assessing Officer that it is a fit case for issue of such notice. Here, the word Dy. Commissioner would include the Additional Commissioner of Income Tax as the case relates to the Assessment Year 1998-99 and the words "or Additional Commissioner of Income Tax" were omitted by the Finance (No. 2) Act 1998 w.e.f. 01.10.1998 from the definition of Dy. Commissioner given under section 2(19A). But where the Assessing Officer is of the rank of Assistant Commissioner or Dy. Commissioner, no such prior approval of the Joint Commissioner is required. There is a proviso to section 151(1) which is applicable in a case where a notice under section 148 is to be issued after the expiry of 4 years from the end of the relevant A.Y. and the assessment has been made under section 143(3) or section 147. This proviso states that unless the satisfaction is recorded by the CCIT or CIT on the reasons recorded by the Assessing O ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tant case, no sanction from the CCIT or CIT was required. 6. The ld. A.R. before me vehemently relied on the decision of the Allahabad High Court. Ld. J.M. has also taken the view that the case of the assessee is duly covered by the decision of the jurisdictional High Court in the case of Dr. Shashi Kant Garg (supra) and that of Calcutta High Court. 7. The facts in the case of Dr. Shashi Kant Garg v. CIT, 285 ITR 158 (All.) were that the original assessment under section 143(3) read with section 147 were completed for the A.Ys. 1991-92 to 1994-95 vide orders dated 31.12.1998. Subsequently, the Assessing Officer issued notice on 12.09.2000 reopening all the assessments much after the expiry of 4 years. The assessee challenged the reopening of the assessment and contended that in view of the proviso to sub-section (1) of section 151 of the Act, sanction of the CCIT or CIT was necessary to be obtained, without which the notices could not have been issued. The contention of the Department was that all the notices under section 148 were issued after obtaining the necessary satisfaction of the Addl. CIT which satisfies the requirement of section 151(1). Thus, the question before the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tisfaction has to be necessarily recorded by the Additional Commissioner or the Joint Commissioner, as the case may be. However, if the Assessing Officer is the Additional Commissioner or the Joint Commissioner, then in that case, prior approval of any higher officer is not required in case he has recorded the reasons for issuing notice in view of the provisions of sub-sections (4) and (5) of section 120 of the Act; (ii) if, however, the period of four years has expired and the assessment order has been made under sub-section (3) of section 143 or section 147 of the Act, the notice is to be issued only after the satisfaction has been recorded by either the Chief Commissioner or the Commissioner on the reasons recorded by the Assessing Officer that it is a fit case for issue of such notice. Thus, the Assessing Officer not below the rank of the Assistant Commissioner can issue a notice but before issuing the notice, the satisfaction of the Commissioner or the Chief Commissioner of the Income-tax is necessarily to be obtained. This would be the position after April 1, 1988, in view of the omission of the words "Additional Commissioner" in section 2(16) of the Act by the Direct Tax L ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Officer or the Assistant Commissioner or the Deputy Commissioner, but when such notice is to be issued after the expiry of four years after the end of the relevant assessment year, the sanction of the Chief Commissioner or the Commissioner is a pre-condition. In that view of the matter, I am of the view that the notice issued under section 148 of the Income-tax Act beyond four years after the end of the relevant assessment year is bad in law inasmuch as the sanction of the Chief Commissioner or the Commissioner was not obtained before issuance of the notice." 10. I noted from both the judgments of Hon ble Allahabad High Court and the Calcutta High Court that even though the word occurring in the proviso "Assessing Officer aforesaid" has not been specifically referred to and this word in the proviso will mean only the Assessing Officer which has been mentioned under the main provision of section 151(1) i.e. the Assessing Officer who is below the rank of Assistant Commissioner or Dy. Commissioner. Accordingly, the ld. A.M. has interpreted the proviso to section 151(1) that the sanction of the CCIT or CIT is required before issue of the notice under section 148 if the assessment ..... X X X X Extracts X X X X X X X X Extracts X X X X
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