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TMI Blog2022 (12) TMI 429X X X X Extracts X X X X X X X X Extracts X X X X ..... case, Ld. CIT (A) has erred in law and on facts in confirming the addition of Rs. 12,56,487/- allegedly on the ground that the land sold by the appellant was not the agricultural land and that too by recording incorrect facts and findings. 4. That having regard to the facts and circumstances of the case, Ld. CIT (A) has erred in law and on facts in confirming the addition of Rs. 12,56,487/- allegedly on the ground that the appellant is not entitled for exemption u/s 54B/54F of the Income Tax Act by recording incorrect facts and findings and without observing the principles of natural justice. 5. That in any case and in any view of the matter, action of Ld. CIT (A) in confirming the addition of Rs. 12,56,487/- allegedly on the ground that the land sold was not agricultural land and denial to allow exemption under section 54B and 54F is bad in law and against the facts and circumstances of the case. 6. That the appellant craves the leave to add, modify, amend or delete any of the grounds of appeal at the time of hearing and all the above grounds are without prejudice to each other." 3. The ld. Counsel of the assessee, drawing our attention to copy of the reasons recorded ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... respect of an inquiry only with the prior approval of the Director or the Commissioner. The ld. Counsel submitted that there is no iota of fact emerging from the assessment order that the AO has obtained any approval before issuing letter dated 30.10.2015/notice to the assessee as per the mandate of section 133(6) of the Act. He further submitted that before issuing notice u/s 148, it is mandatory for the AO to obtain approval from competent authority u/s 151 of the Act, but, this compliance has also not been made by the AO in the present case. The ld. Counsel also drew our attention to second proviso to section 133(6) as amended by Finance (No.2) Act, 1998 w.e.f. 01.10.1998 to submit that the powers provided under the said provision cannot be exercised by any income-tax Authority below the rank of Director or Commissioner without prior approval of Director or as the case may be, the Commissioner. Therefore, the impugned notice u/s 148 of the Act, reassessment proceedings and the consequent reassessment order dated 05.12.2016 may kindly be quashed being bad in law. 4. Replying to the above, the ld. Sr. DR vehemently supported the initiation of reassessment proceedings and the act ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sis of AIR information, verification letter 30.10.2015 was issued to the assessee to verify the sale of immovable property during F.Year 2008-09 relevant to A. Year 2009-10 for Rs.68,72,000/-. No compliance of verification letter was made by the assessee till date. The assessee has not filed return of income for the A. Year 2009-10 showing any income from Capital Gains. Hence, I have reason to believe that capital gain on sale consideration of Rs.68,72,000/- chargeable to tax has escaped assessment within the meaning of section 147 of the IT Act, 1961 for the A.Y. 2009-10. Therefore, notice u/s 148 may be issued. Sd/- Income-tax Officer, Ward-2(1), Ghaziabad. Date: 03.02.2016" 7. From the above, it is clearly discernible that the AO proceeded on the basis of AIR information and issued a verification letter dated 30.10.2015 to the assessee to verify the sale of immovable property during F.Y. 2008-09 relevant to A.Y. 2009-10. Thereafter, the AO noted that no compliance of verification letter was made by the assessee till the date of recording the reasons, i.e., 03.02.2016. After mentioning that the assessee has not filed return of income for AY 2009-10 showing income from ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ttended was provided the copy of notice issued from the Office of the ITO, but, there is no mention regarding obtaining of approval u/s 151 of the Act from the competent authority. 10. On above submissions, I may point out that by way of Finance Act, 2021, w.e.f. 01.04.2021, section 151 of the Act has been amended. I am dealing with the case of AY 2009-10 for which pre-amended provisions of section 151 applies. As per sub-section (1) of section 151, no notice shall be issued u/s 148 by an AO, after expiry of a period of four years from the end of relevant assessment year unless Principal Chief Commissioner or Chief Commissioner or Principal Commissioner or Commissioner is satisfied on the reasons recorded by the AO that it is a fit case for issue of such notice. In the present case, this mandatory compliance has not been made by the AO and on being asked by the Bench, the ld. Sr. DR also could not show us that the AO has complied with the requirement of sub-section (1) of section 151 prior to issuing notice u/s 148 of the Act. Therefore, on this count, the legal contention of the ld. Counsel of the assessee is found to be sustainable and I allow the legal contention of the assesse ..... X X X X Extracts X X X X X X X X Extracts X X X X
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