Court invalidates notices under Income Tax Act, allows fresh re-assessment.

The court declared Explanations A(a)(ii)/A(b) to the notifications as ultra vires the Relaxation Act, 2020, and invalidated all impugned notices under section 148 of the Income Tax Act, 1961. Assessing officers were permitted to initiate fresh re-assessment proceedings in line with amended provisions introduced by the Finance Act, 2021, ensuring statutory compliance. The judgment aligned with previous decisions, granting relief to petitioners by quashing the notices and enabling re-assessment in accordance with the law.

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Issues:
The issues involved in this case include the legality of impugned notices issued under section 148 of the Income Tax Act, 1961, the observance of statutory formalities under section 148A of the 1961 Act, the applicability of notifications extending the provisions of section 148, section 149, and section 151 of the Act beyond March 31, 2021, and the validity of Explanations A(a)(ii)/A(b) to the notifications in question.

Analysis:
The judgment addresses the common legal issues raised in multiple writ petitions concerning the issuance of impugned notices under section 148 of the Income Tax Act, 1961. The petitioners contended that the notices were time-barred and lacked compliance with statutory formalities under section 148A of the Act. Additionally, the petitioners challenged the validity of notifications extending the applicability of certain provisions beyond March 31, 2021, as ultra vires the parent legislation, the Relaxation Act, 2020.

The court noted that the issues in the present writ petitions were similar to those addressed in previous judgments by different High Courts, including the Allahabad High Court, Rajasthan High Court, and Delhi High Court, which ruled in favor of the assessees/petitioners. Citing its own previous orders, the court disposed of the writ petitions in question based on the principles established in those cases.

The court declared Explanations A(a)(ii)/A(b) to the notifications dated March 31, 2021, and April 27, 2021, as ultra vires the Relaxation Act, 2020, and therefore invalid. Consequently, all impugned notices under section 148 of the Income Tax Act, 1961, were quashed. The assessing officers were granted liberty to initiate fresh re-assessment proceedings in accordance with the amended provisions of the Act introduced by the Finance Act, 2021, ensuring compliance with the necessary formalities as required by law.

In conclusion, the judgment reaffirmed the legal position established in previous decisions and provided relief to the petitioners by declaring the impugned notices as invalid and allowing for fresh re-assessment proceedings in compliance with the amended provisions of the Income Tax Act, 1961.

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