Court quashes notice & order due to delay and technical glitches, upholds time-barred argument.

The High Court quashed the notice under Section 148A(b) and the order under Section 148A(d) of the Act due to delay in service and technical glitches, including an inchoate digital signature. The court upheld the petitioner's argument that the proceedings were time-barred, leading to the disposal of the writ petition and the application.

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Issues involved:
The issues involved in this case include the validity of the notice dated 30.06.2021 under Section 148A(b) of the Income Tax Act, the communication of relevant material through the notice dated 13.05.2022, and the order dated 27.07.2022 under Section 148A(d) pertaining to the Assessment Year 2014-15. Additionally, the validity of Instruction No. 1 dated 11.05.2022 issued by the Central Board of Direct Taxes (CBDT), the constitutionality of sections 147 and 148 of the Act in light of Article 14 of the Constitution, and the stay of reassessment proceedings initiated under sections 147/148 are also in question.

Validity of Notice under Section 148A(b):
The petitioner challenged the notice dated 30.06.2021, contending that it was dispatched on 16.07.2021, beyond the window available for issuance. The petitioner argued that the notice was time-barred as it was served after the expiration of the limitation period. The Senior Standing Counsel for the respondent/revenue admitted the delay in issuance was due to technical glitches. The court noted that the digital signature on the notice was inchoate, lacking a date, and was never physically delivered to the petitioner. Despite the digital signature, service was only affected through email on 16.07.2021, after the limitation period had expired on 30.06.2021.

Validity of Instruction No. 1 dated 11.05.2022:
The petitioner assailed Instruction No. 1 dated 11.05.2022 issued by the CBDT as ultra vires, contending it was contrary to the provisions of the Act and violated the law laid down by the Supreme Court in a specific case. The petitioner invoked Article 14 of the Constitution to challenge the vires of sections 147 and 148 of the Act, alleging them to be highly arbitrary and violative of the Constitution and substantive provisions of the Act.

Stay of Reassessment Proceedings:
The petitioner sought a stay of the reassessment proceedings initiated under sections 147/148 through the impugned notice dated 27.07.2022. The petitioner argued that since the notice was served after the limitation period, the proceedings were time-barred. The court, citing similar cases, allowed the writ petition, quashing the impugned notice under Section 148A(b) and the order under Section 148A(d), thereby disposing of the application.

Conclusion:
The High Court quashed the notice under Section 148A(b) and the order under Section 148A(d) of the Act, based on the delay in service and technical glitches, as well as the inchoate digital signature on the notice. The court upheld the petitioner's arguments regarding the time-barred nature of the proceedings, leading to the disposal of the writ petition and the application under consideration.

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