AO Cannot Issue Notice to Reopen Income Tax Assessment After 3 Years Without PR/CCIT Approval: ITAT Quashes Notice Against Saif Ali Khan

The Income Tax Appellate Tribunal (ITAT) quashed a notice issued to actor Saif Ali Khan seeking to reopen an assessment after three years without approval from the Principal Commissioner/Chief Commissioner of Income Tax (PR/CCIT). The Tribunal noted that Section 148 of the Income Tax Act mandates prior approval for reopening assessments beyond the standard three-year period, ensuring procedural compliance. The absence of such approval rendered the notice invalid. The decision safeguards taxpayers from arbitrary or untimely reopening of assessments and underscores the need for tax authorities to follow statutory safeguards meticulously. It also sets a precedent in high-profile cases where adherence to procedural safeguards is critical, reinforcing taxpayer rights and accountability in assessment practices. The ITAT emphasized that long-settled assessments cannot be disturbed without proper authority, protecting financial and legal certainty for taxpayers.