| The Tax Publishers2019 TaxPub(DT) 7087 (Del-Trib) INCOME TAX ACT, 1961
Section 147
Merely giving approval under section 151 by mentioning, “Yes. I am satisfied that it is a fit case for reopening of assessment” was not a valid approval as it clearly indicates non-application of mind. Therefore, the reassessment proceedings were bad in law and hence, quashed.
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Reassessment - Validity - Approval under section 151 given in a mechanical manner -
AO reopened the case of assessee under section 147/148 after recording satisfaction and prior approval under section 151(1). Assessee contended that the initiation of reassessment proceedings was made in a mechanical manner, on borrowed satisfaction and without application of mind because it was purely based on the report received from the Investigation Wing. Therefore, such reassessment proceedings were a nullity. Further, assessee contended that the PCIT while giving approval had simply mentioned: 'I am satisfied that it is a fit case for issue of notice under section 148, therefore approval under section 151 was given in a mechanical manner, hence, fatally defective. Held: Merely giving approval under section 151 by mentioning, “Yes. I am satisfied that it is a fit case for reopening of assessment” was not a valid approval as it clearly indicates non application of mind. Accordingly, PCIT have merely given their approval in a mechanical manner without independent application of mind, therefore, the reassessment proceedings were bad in law and hence, quashed.
Followed:Pr. CIT v. N.C. Cables Ltd. (2017) 391 ITR 11(Del) : 2017 TaxPub(DT) 0264 (Del-HC)
REFERRED : GKN Driveshafts (India) Ltd. v. ITO & Ors. (2003) 259 ITR 0019 (SC) : 2003 TaxPub(DT) 0734 (SC), Scan Holding P. Ltd. v. Asstt. CIT & Anr. (2018) 402 ITR 290 (Del) : 2018 TaxPub(DT) 0809 (Del-HC), Sabh Infrastructure Ltd. v. Asstt. CIT (2017) 398 ITR 198 (Del) : 2017 TaxPub(DT) 4248 (Del-HC), Pr. CIT v. RMG Polyvinyl (I) Ltd. (2017) 396 ITR 5 (Del) : 2017 TaxPub(DT) 2034 (Del-HC), Goa State Co-Operative Bank Ltd. v. Asstt. CIT & Ors. (2017) 295 CTR (Bom) 369 : 2017 TaxPub(DT) 1735 (Bom-HC), Pr. CIT v. Meenakshi Overseas Pvt. Ltd. (2017) 395 ITR 677 (Del) : 2017 TaxPub(DT) 1791 (Del-HC), Pr. CIT v. G & G Pharma India Ltd. (2016) 384 ITR (Del) 147 (Del) : 2015 TaxPub(DT) 4054 (Del-HC), Pr. CIT v. Tupperware India Pvt. Ltd. (2015) 127 DTR 161 (Del) : 2015 TaxPub(DT) 3491 (Del-HC), CIT v. S. Goyanka Lime & Chemicals Ltd. (2015) 56 taxmann.com 390 (MP) : 2018 TaxPub(DT) 4342 (MP-HC), Sarthak Securities Co. Pvt. Ltd. v. ITO (2010) 329 ITR 110 (Del) : 2010 TaxPub(DT) 2311 (Del-HC), United Electrical Co. P. Ltd. v. CIT & Ors. (2002) 258 ITR 317 (Del) : 2002 TaxPub(DT) 1670 (Del-HC)
FAVOUR : In assessee's favour.
A.Y. : 2010-11
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