2022 (12) TMI 1170 - HC - Income Tax

Reopening of the assessment - Necessity of grant of approval u/s 151(ii) - Competent authority u/s 151(ii) to grant approval - HELD THAT - It appears from record and instruction submitted by Mr. Dutt that in this said case approval has been granted by principal CIT -9, Kolkata who is not the authority falls u/s 151(ii) of the Act as such the approval in this case is not an authority authorized under the law and such approval is not sustainable in law and in view of this factual and legal position the impugned notice under Section 148A(b) of the Act and all subsequent proceedings are not sustainable in law and accordingly quashed. Quashing of the impugned notice and subsequent proceedings will not be a bar on the part of the Income Tax authorities concerned to initiate any fresh proceeding in future in accordance with law.

Summary

Issues:
Validity of approval under Section 151(ii) of the Income Tax Act for issuance of notice under Section 148A(b) for assessment year 2016-2017.

Analysis:
The judgment by the High Court of Calcutta, delivered by Justice MD. Nizamuddin, pertained to the validity of approval granted by the principal CIT -9, Kolkata under Section 151(ii) of the Income Tax Act for the issuance of a notice under Section 148A(b) for the assessment year 2016-2017. The petitioner contended that the approval granted by the principal CIT -9 was not by the appropriate authority as required under the law. Upon review of the record and the instructions submitted by Mr. Dutt, representing the respondent, the Court found that the approval was indeed granted by an authority that did not fall under Section 151(ii) of the Act. Consequently, the Court held that the approval was not sustainable in law, rendering the impugned notice under Section 148A(b) and all subsequent proceedings invalid. As a result, the Court quashed the impugned notice and subsequent proceedings.

Moreover, the judgment clarified that the quashing of the notice and subsequent proceedings did not prevent the Income Tax authorities from initiating fresh proceedings in the future in accordance with the law. The Court disposed of the writ petition, numbered as WPA 25770 of 2022, with the aforementioned observations and directions. Additionally, the Court ordered that the record submitted by Mr. Dutt should be kept with the official record for reference. This comprehensive analysis highlights the key legal issues addressed in the judgment and the Court's decision regarding the validity of the approval for the notice under the Income Tax Act.