Section 148 Notice Invalid Without Approval Under Section 151(ii) | ITAT

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Section 151(ii) approval for reassessment notice

Case Details: Income Tax officer (International Taxation) vs. Shapoorji Pallonji Mistry Sterlin Bay - [2025] 180 taxmann.com 870 (Mumbai-Trib.)

Judiciary and Counsel Details

  • Amit Shukla, Judicial Member & Girish Agrawal, Accountant Member
  • Satya Pal Kumar, CIT DR for the Appellant.
  • Porus Kaka, Sr. Adv. & Divesh Chawla, Adv. for the Respondent.

Facts of the Case

The assessee, a non-resident individual, filed returns of income for A.Ys. 2015-16 and 2016-17. The Assessing Officer initiated reassessment proceedings by issuing notices under section 148 of the old regime. Pursuant to the amendments introduced by the Finance Act, 2021 and directions of the Supreme Court in Ashish Agarwal, fresh proceedings were initiated, and notices under section 148 were issued on 30-07-2022 under the new regime.

For A.Y. 2016-17, the assessee challenged the validity of reassessment on the ground that approval under section 151(ii) was obtained from the CIT (International Taxation) instead of the specified authority, i.e., the Principal Chief Commissioner/Chief Commissioner, as required where more than three years had elapsed.

The Commissioner (Appeals) quashed the reassessment proceedings on the same ground. Aggrieved, the Revenue filed appeals before the Tribunal.

ITAT Held

The Tribunal held that, for A.Y. 2016-17, the notice was issued beyond three years from the end of the assessment year, and the alleged escaped income exceeded Rs. 50 lakhs. Therefore, prior approval from the specified authority under section 151(ii) was mandatorily required. As approval had been obtained only from the CIT (IT) and not from the specified higher authority, the notice and consequent reassessment were held to be invalid.

Accordingly, the Tribunal upheld the orders of the CIT(A), quashed the notice issued under section 148 and the consequential reassessment orders for the assessment year, and dismissed the appeals filed by the Revenue.

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Author: Taxmann

Taxmann Publications has a dedicated in-house Research & Editorial Team. This team consists of a team of Chartered Accountants, Company Secretaries, and Lawyers. This team works under the guidance and supervision of editor-in-chief Mr Rakesh Bhargava.

The Research and Editorial Team is responsible for developing reliable and accurate content for the readers. The team follows the six-sigma approach to achieve the benchmark of zero error in its publications and research platforms. The team ensures that the following publication guidelines are thoroughly followed while developing the content:

  • The statutory material is obtained only from the authorized and reliable sources
  • All the latest developments in the judicial and legislative fields are covered
  • Prepare the analytical write-ups on current, controversial, and important issues to help the readers to understand the concept and its implications
  • Every content published by Taxmann is complete, accurate and lucid
  • All evidence-based statements are supported with proper reference to Section, Circular No., Notification No. or citations
  • The golden rules of grammar, style and consistency are thoroughly followed
  • Font and size that's easy to read and remain consistent across all imprint and digital publications are applied