Sushil Bansal v. ACIT - Taxpublishers.in

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The Tax Publishers2019 TaxPub(DT) 1645 (Del-Trib)

INCOME TAX ACT, 1961

Section 148 Section 151

Section 148 notice issued on the basis of specific information received from investigation wing could not be set aside for want of approval under section 151 as notice under section 148 has been issued within four years, therefore, no sanction was required under section 151(2) and since no assessment was made under section 143(3), therefore, case of assessee did not come within the purview of section 151(1).

Reassessment - Notice under section 148 issued within four years - Requirement of approval of competent authority - Information from investigation wing

AO received information from investigation wing as to assessee having paid capitation fee at the time of admission of his son, to Medical College. In addition to regular fees out of undisclosed sources. Accordingly, AO initiated reassessment proceedings by issuing notice under section 148. Assesee's case was that reopening was based on information from investigation wing without application of mind on AO's part. Further, reassessment notice without obtaining proper sanction under section 151 was not properly served.Held: No assessment was made under section 143(3), therefore, case of assessee did not come within the purview of section 151 (1). It is significant to note that the information received from investigation wind was neither unspecific nor vague. It referred to direct transaction of capitation fee paid in cash by the assessee. Not only this, AO was in possession of documentary evidences seized in search, i.e., ledger account of medical college, statements of principal person of the Institute admitting receipt of capitation fee. Further, notice under section 148 had been issued within four years. From the end of relevant assessment year, therefore, no sanction under section 151(2) was required. Moreover, assessee, when appeared before AO himself had shown copies of three letters issued by AO which included notice under section 148, thus notices, issued to assessee at the given address admittedly stood served upon assessee and accordingly, reassessment notice was valid.

Relied:CIT v. Nova Promoters & Finlease (P) Ltd. (2012) 18 Taxmann.com 217 (Del) : 2012 TaxPub(DT) 1558 (Del-HC) and Asstt. CIT v. Rajesh Jhaveri Stock Brokers (P) Ltd. (2007) 161 Taxman 316 (SC) : 2007 TaxPub(DT) 1257 (SC). Distinguished:Shamshad Khan v. Asstt. CIT 2017 (6) TMI 599 : 2017 TaxPub(DT) 1691 (Del-HC).