YAGNESH HARNISH SHAH,MUMBAI V. ITO-42(1)(4), MUMBAI, KAUTILYA BHAWAN

CO 196/MUM/2024

AI Insights

The case involves appeals by the Income Tax Officer (ITO) against Yagnesh Harnish Shah for the assessment years 2016-17 and 2017-18. The appeals challenged the orders related to these assessment years, which were initially decided in favor of the assessee. The primary legal issue revolved around the validity of the notice and order issued under sections 148 and 148A(d) of the Income Tax Act, 1961, respectively. The assessee contended that these were issued without the necessary approval from the appropriate authority, rendering them invalid. The tribunal agreed with the assessee, leading to the dismissal of the revenue's appeals and the allowance of the assessee's cross-objections.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 39641 (ITAT-MUMBAI)
• Appeal Type: Cross Objection
• Pronouncement Date: 14-02-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: G
• Assessment Year: 2016-2017
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: BHANGEPATIL PUSHKARAJ RAMESH; DR
• Assessee Lawyers: JIGAR MEHTA
• Keywords: Set aside; Competent authority
• Section: 148

Judgement Text

" | आयकर अपीलीय अिधकरण \fा यपीठ, मुंबई | IN THE INCOME TAX APPELLATE TRIBUNAL “G” BENCH, MUMBAI BEFORE SHRI SAKTIJIT DEY, HON’BLE VICE PRESIDENT & SHRI NARENDRA KUMAR BILLAIYA, HON’BLE ACCOUNTANT MEMBER I.T.A. Nos. 4540 & 4538/Mum/2024 Assessment Year: 2016-17 & 2017-18 ITO-42(1)(4), Mumbai, Kautilya Bhawan Vs Yagnesh Harnish Shah, Mumbai C-1, C-49/50, Mahavir Nagar Shankar Lane, Kandivali West Mumbai - 400067 [PAN: AVTPS0554R] अपीला थ\u0016/ (Appellant) \u0017\u0018 यथ\u0016/ (Respondent) C.O. Nos. 196 & 195/Mum/2024 Assessment Years: 2016-17 & 2017-18 Yagnesh Harnish Shah, Mumbai C-1, C-49/50, Mahavir Nagar Shankar Lane, Kandivali West Mumbai - 400067 [PAN: AVTPS0554R] Vs ITO-42(1)(4), Mumbai, Kautilya Bhawan अपीला थ\u0016/ (Appellant) \u0017\u0018 यथ\u0016/ (Respondent) Assessee by : Shri Jigar Mehta, C.A. Revenue by : Shri Bhangepatil Pushkaraj Ramesh, Sr. D/R सुनवाई की तारीख/Date of Hearing : 11/02/2025 घोषणा की तारीख /Date of Pronouncement : 14/02/2025 आदेश/O R D E R PER NARENDRA KUMAR BILLAIYA, AM: I.T.A. Nos. 4540 & 4538/Mum/2024 are two separate appeals by the revenue preferred against two separate orders dated 05/07/2024 pertaining to AY 2016-17 & 2017-18. The assessee has also preferred cross-objections in C.O. Nos. 196 & 195/Mum/2024 for respective assessment years. I.T.A. Nos. 4540 & 4538/Mum/2024 C.O. Nos. 196 & 195/Mum/2024 2 2. Revenue’s appeal for AY 2017-18 and both the cross-objections by the assessee are time barred. The delay is condoned. 3. In its cross-objection, the assessee has challenged the validity of the order u/s 148A(d) of the Act dated 08/07/2022 and notice u/s 148 of the Act dated 11/07/2022 being devoid of approval of appropriate competent authority making the same as invalid, non-est and bad in law. 4. Since the cross-objection of the assessee goes to the root of the matter, we decided to adjudicate it first. Order u/s 148A(d) for AY 2016- 17 is exhibited at page 58 to 60 of the paper book and the impugned notice u/s 148 of the Act dated 11/07/2022 for AY 2016-17 read as under:- I.T.A. Nos. 4540 & 4538/Mum/2024 C.O. Nos. 196 & 195/Mum/2024 3 4.2. It can be seen from the above that this notice is issued after obtaining prior approval of the Principal Commissioner of Income Tax- 3, Mumbai. 5. We have given a thoughtful consideration to the impugned order u/s 148A(d) and the notice u/s 148 of the Act. The relevant assessment years are 2016-17 & 2017-18 and the time limit of three years elapsed on 31/02/2021 which falls between 20/03/2020 and 31/03/2021 during which provisions of TOLA would apply. Accordingly, the amended provisions under the Act read with TOLA extended the time limit for granting of approval till 30/06/2021 by the specified authority. In the present case, since the notice u/s 148 of the Act and the impugned order u/s 148A(d) of the Act have been issued beyond the period of three years from the end of the relevant assessment year, the case of the assessee falls within the provisions of Section 151(ii) of the amended law where the specified authority for grant of approval is specified as Principal Chief Commissioner/ Principal Director General, Chief Commissioner or Director General, whereas, in the appeals under consideration, the approval obtained is from Principal Commissioner of Income tax. 5.1. Therefore, in our considered opinion, since proper sanction by the specified authority had not been obtained for issue of notice u/s 148 of the Act as per the relevant provisions of the Act, the said notice is bad in law. The notice is accordingly set aside. The resultant order is quashed. Since we have quashed the assessment order, we do not find it necessary to delve into the merits of the case. I.T.A. Nos. 4540 & 4538/Mum/2024 C.O. Nos. 196 & 195/Mum/2024 4 6. In the result, appeals of the revenue are dismissed and cross- objections filed by the assessee are allowed. Order pronounced in the Court on 14th February, 2025 at Mumbai. Sd/- Sd/- (SAKTIJIT DEY) (NARENDRA KUMAR BILLAIYA) VICE-PRESIDENT ACCOUNTANT MEMBER Mumbai, Dated 14/02/2025 *SC SrPs *SC SrPs *SC SrPs *SC SrPs आदेश की \u0014ितिलिप अ\u0019ेिषत /Copy of the Order forwarded to : 1. अपीलाथ\u001b / The Appellant 2. \u0014\u001cथ\u001b / The Respondent 3. संबंिधत आयकर आयु! / Concerned Pr. CIT 4. आयकर आयु! ) अपील ( / The CIT(A)- 5. िवभागीय \u0014ितिनिध ,आयकर अपीलीय अिधकरण, मुंबई /DR,ITAT, Mumbai, 6. गाड% फाई/ Guard file. आदेशानुसार/ BY ORDER, TRUE COPY Assistant Registrar आयकर अपीलीय अिधकरण ITAT, Mumbai "