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February 2025

Whether Obtaining Prior Approval For Reopening Of Assessment Has Become An Empty Ritual?

By Pankaj R. Toprani, Advocate
Reading Time 20 mins

I. INTRODUCTION

The Finance (No. 2) Act, 2024, inserted new sections 148, 148A, and 151 relating to the reopening of assessment in the Income Tax Act, 1961 ("the Act”).

Sections 148 inter alia provides for procedure for reopening of assessment and section 148A inter alia provides for passing of an order before issuance of notice for reopening of assessment under section 148. As per these sections, the acts of issuing notice for reopening of assessment and passing an order before the issue of notice for reopening of assessment can be done by the Assessing Officer only after obtaining prior approval of the specified authority laid down under section 151, which states that specified authority for section 148 and 148A shall be the Additional Commissioner or the Additional Director or the Joint Commissioner or the Joint Director as the case may be.

In this write-up, an attempt is made to show the manner in which the rigours of provisions relating to obtaining prior approval for the reopening of assessment have been toned down as per the recent amendment, and thus, the said provisions have become an empty ritual.

II. IMPORTANT OBSERVATIONS OF THE COURTS IN THE CASE OF REOPENING OF ASSESSMENT

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