Court quashes tax notice, allows reassessment under amended law. Petitioner fined.

The Court declared the explanations to certain notifications as ultra vires the Relaxation Act, 2020, and quashed the impugned notice under Section 148 of the Income Tax Act. Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the amended provisions of the Act by the Finance Act, 2021. The petitioner was ordered to pay a cost of Rs. 5000 to the High Court Legal Services Committee. Compliance mention was scheduled, and parties were instructed to obtain urgent certified photocopies of the order.

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Issues:
- Validity of impugned notice under Section 148 of the Income Tax Act, 1961
- Observance of statutory formalities under Section 148 A of the Income Tax Act
- Ultra vires declaration of Explanations A(a)(ii)/A(b) to certain notifications
- Applicability of provisions of Section 148, 149, and 151 of the Act post 31st March, 2021

Analysis:

The petitioner challenged the issuance of an impugned notice under Section 148 of the Income Tax Act, 1961, contending that it was time-barred and lacked observance of statutory formalities under Section 148 A of the Income Tax Act. The petitioner sought relief by quashing the re-assessment notice issued post 31st March, 2021, and declaring certain explanations to notifications as ultra vires the parent legislation, the Relaxation Act, 2020.

The Court noted that the issues raised in the Writ Petition were purely legal and aligned with previous decisions, such as the Division Bench of the Allahabad High Court and orders from Rajasthan High Court, Delhi High Court, and previous judgments of the Calcutta High Court. Citing these precedents, the Court disposed of the Writ Petition favorably, declaring the explanations to be ultra vires the Relaxation Act, 2020, and consequently quashing the impugned notice under Section 148 of the Income Tax Act.

Furthermore, the Court allowed Assessing Officers to initiate fresh reassessment proceedings in compliance with the relevant provisions of the Act as amended by the Finance Act, 2021. The petitioner was directed to pay a cost of Rs. 5000 to the High Court Legal Services Committee due to the delay in filing the writ petition, without any explanation provided. The Court scheduled a compliance mention for the matter and instructed the parties to obtain urgent certified photocopies of the order upon fulfilling necessary formalities.

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