Tax Assessment Petition Succeeds: Section 148 Notice Invalidated Due to Expiry of Six-Year Limitation Period

HC allowed a tax assessment petition challenging a notice under Section 148 of Income Tax Act for AY 2015-16. The court found the notice was time-barred as it was issued after the six-year limitation period expired on 31.03.2022. Based on SC precedent, the notice was declared invalid, and the petition was disposed of accordingly.

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The Delhi High Court, through the Acting Chief Justice and Justice Tushar Rao Gedela, adjudicated on a petition challenging a notice dated 29.08.2024 issued under Section 148 of the Income Tax Act, 1961 for AY 2015-16, along with related notices under Sections 148A(b) and 148A(d). The petitioner relied on this Court's decision in *Manju Somani v. Income Tax Officer* and the Supreme Court ruling in *Union of India & Ors v. Rajeev Bansal* (2024 SCC OnLine SC 2693).The Supreme Court's analysis clarified that under the proviso to Section 149(1)(b) of the Income Tax Act's new regime, "a notice under Section 148 of the new regime cannot be issued if the period of six years from the end of the relevant assessment year has expired at the time of issuance of the notice." This proviso protects assesses by limiting retrospective application of the extended ten-year limitation period to prospective cases only.Here, since the six-year limitation period for AY 2015-16 expired on 31.03.2022, the impugned notice issued after that date is "barred by limitation." The respondent's counsel agreed with this position.Accordingly, the Court set aside the impugned notice and allowed the petition, disposing of pending applications.

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