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2015 (11) TMI 644 - ITAT DELHI

2015 (11) TMI 644 - ITAT DELHI - TMI - Validity of reopening of assessment - notice u/s. 148 has been issued with the approval of the Addl. CIT - Held that:- According to Section 151(1) of the I.T. Act, after the expiry of the 4 years from the end of the relevant assessment year, no notice u/s. 148 of the I.T. Act shall be issued unless the Chief Commissioner or Commissioner is satisfied on the reasons recorded by the AO that is fit case for the issue of such notice.

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and in the present case of the assessee the approval/satisfaction should be from the Chief Commissioner or Commissioner only. In the present case, the case of the assessee has been reopened and notice u/s. 148 has been issued with the approval of the Addl. CIT, therefore, the notice u/s. 148 is bad in law and liable to be quashed. Ld. CIT(A) has rigtly declared invalid the Notice u/s. 148 of the I.T. Act issued on 28.3.2011 for the asstt. Year in dispute i.e. 2004-05, which is beyond the period .....

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iposing of these appeals by this common order for the sake of convenience, by dealing with ITA No. 3098/Del/2014 (AY 2004-05) - ITO vs. Smt. Sarti Devi. 2. The following grounds have been raised in the Revenue s Appeal:- 1. On the facts and circumstances of the case, the Ld. Commissioner of Income tax (Appeals) has erred in law and facts in quashing the assessment order made uls 143(3)/147 with the observation that the notice uls 148 of the act was issued without obtaining approval from the Comm .....

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s covered under the exception as per para 8(a) of instructions 3 of 2011 issued by CBDT. 3.That the appellant craves for the permission to add, delete or amend the grounds of appeal before or at the time of hearing of appeal. 3. The brief facts of the case are that Notice u/s. 148 for the AY 2004-05 was issued to the assessee on 28.3.2011 and in response to notice u/s. 148 the assessee did not file her return of income within the statutory time prescribed in the notice. Thereafter notice u/s. 14 .....

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assessee alongwith Sh. BL Gupta, Advocate of the assessee from time to time. Written replies were filed which have been consdiered and placed on record. The case was discussed and the assessment is completed u/s. 147/143(3) of the I.T. Act vide order dated 15.12.2011 and made the additions. 4. Against the above order dated 15.12.2011, assessee filed an appeal before the Ld. CIT(A), who vide impugned order dated 13.3.2014 has allowed the appeal of the assessee. 5. Ld. DR relied upon the order of .....

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and again to the assessee, therefore, I am deciding the present appeal exparte qua assessee, after hearing the Ld. DR and perusing the records. 7. I have heard the Ld. DR and perused the records. I find that the Ld. CIT(A) has adjudicated the issue in dipsute as under:- 1. According to the Section 151(1) proviso which is as under:- Provided that, after the expiry of 4 years from the end of the relevant assessment year, no such notice shall be issued unless the Chief Commissioner or the Commissio .....

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prior approval of Additional Commissioner of Income Tax Rewari and not with the approval of Commissioner. Additional Commissioner has been defined u/s 2(lC) and the Commissioner is defined under section 2(16). It is cardinal principle of law that when a statute mandates the satisfaction of a particular functionary for the exercise of power, satisfaction must of that authority only, where a statute requires something to be done in a particular manner it has to be done in that manner. If it is a c .....

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rani Versus Assistant Commissioner of Income Tax and others Division Bench 346 ITR 443. The Additional Commissioner of Income Tax can not be Commissioner of Income Tax within the meaning of section 2(16). The Bombay High Court has held "there is no statutory provision under which a power to be exercised by an officer can be exercised by a superior officer when the statutes mandates the satisfaction of particular functionary for the exercise of the power, satisfaction must of that authority. .....

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a certain manner it shall be done in that manner alone and the court would not accept its being done in some other manner. If the statutory authority has been vested with the jurisdiction he has to be exercised it according to be its own discretion. The Delhi High Court in the above said judgment has also held that if it is not done that is if the approval is to be granted by Commissioner but the case is re-opened with the approval of Additional Commissioner. This was not irregularity curable un .....

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as a different and distinct authority. Such different and distinct authorities have to exercise their powers in accordance with law as per power given to tdem in specified circumstances. If powers confirmed on a particular authority are arrogated by other authority without mandate law, it will create chaos in the administration of law and hierarchy of administration will mean nothing. Satisfaction of one authority cannot be substituted by satisfaction by another authority. It is tri that when a .....

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section then it will be case of failure of exercise discretion altogether. Keeping in view of above said views expressed by the different High Court and Apex Court it is very much clear that the approval/ sanction to reopen the case and issued the notice u/ s 148 is to be of the same officer to whom law requires and not by the different officer. In the present case as per section 151 ( 1) proviso if the case is to be re-opened after expiry of 4 years the approval/ satisfaction should be of Commi .....

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of village Khatod has a joint saving account in OBC Mahendergarh as per A/C No.2239. As per information there are deposits in this joint account and no share of each member has been quantified. On receipt of this information the authority, have re-opened the case of Rati Ram Yadav and Sarti Devi may be in the status of HUF or at the most AOP. But the Assessing Officer instead of reopening the case of joint person in the status of HUF or AOP has re-opened the case and notice issued under section .....

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case has been re-opened has some deposit in his own account which are liable to be taxed. 3. The only information on the basis of which the Assessing Authority reopened the case is of ACIT Rewari. ACIT Rewari communicated is belief that there is a huge deposit in OBC Joint Account No.2239 of Rati Ram and Smt. Sarti Devi. The Assessing Authority have mentioned in the assessment order that I have reason to believe that an income to the tune of ₹ 15,15,500/- + Interest Income and any other in .....

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made any independent enquiry or there was no independent reason believe that the income of the assessee to the tune of ₹ 15,15,500/- has escaped assessment. As per provision of law before recording the reason to believe or issuing notice under section 148 there should be independent belief and reason to believe of the Assessing Authority here it is not there, so the notice on this ground too is void. 3. I have examined the submissions made by the appellant and the facts on record. The ass .....

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have gone through the aforesaid order passed by the Ld. CIT(A) on the issue in dispute and I am of the considered view that according to Section 151(1) of the I.T. Act, after the expiry of the 4 years from the end of the relevant assessment year, no notice u/s. 148 of the I.T. Act shall be issued unless the Chief Commissioner or Commissioner is satisfied on the reasons recorded by the AO that is fit case for the issue of such notice. In my view the case of the Assessee is fall under section 151 .....

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