Petition Dismissed: Search-Related Income Tax Notices Can Be Issued Without Time Limits u/s 149.

The HC dismissed the petition challenging the reassessment proceedings and notices issued under Section 148 of the Income Tax Act. The court held that the second proviso to Section 149 exempts cases involving searches from the time limitations for issuing such notices. The court concluded that the Revenue retains the authority to issue notices without time restrictions in search-related cases, rendering the petitioner's arguments based on the proviso as untenable. Consequently, the petition was dismissed without costs.

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Issues:
The issues involved in this case are the challenge to the order passed under Section 148A(d), the consequential notice issued under Section 148, and the assessment order. The main contention is regarding the applicability of the second proviso to Section 149 of the Income Tax Act, 1961.

Challenge to Orders and Notice:
The petitioner challenged the orders and notice, arguing that the reassessment proceeding, based on a search conducted in 2014, should not be subject to Section 148A(d) due to the second proviso to Section 149 of the Income Tax Act. The dispute is deemed purely legal, and the court refrains from delving into the factual aspects.

Legal Provisions:
The court reproduced the relevant provision of Section 149 of the Income Tax Act, emphasizing that the second proviso exempts cases related to searches from the time limitations for issuing notices under Section 148. The amendment brought by the Finance Act, 2021, clarifies the time frame for issuing notices under Section 148.

Interpretation of Proviso:
The court clarified that in cases of searches, like the present one, there is no restriction on the time period for issuing notices under Section 148. The objective of the second proviso is to exclude cases of search conducted for reassessment from the time restrictions under Section 149.

Conclusion:
The court concluded that the second proviso to Section 149 does not limit the Revenue's power to issue notices under Section 148. The restriction imposed by the proviso pertains to the applicability of time frames in cases related to searches. Therefore, the petitioner's reliance on the proviso was deemed untenable, and the petition was dismissed without costs.

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