2023 (3) TMI 1608 - HC - Income Tax

Income tax reassessment reopened beyond six-year limit under s 147/148A(d), proceedings stayed pending affidavits and final hearing.

The dominant issue was whether reopening of assessment under s 147, initiated through an order under s 148A(d), was barred by limitation and hence without ... Validity of reopening of assessment as barred by limitation - re-assessment proceeding are beyond six years - HELD THAT:- In the impugned order u/s 148A(d) of the Act, the assessing officer has tried to justify the initiation of re-assessment proceeding by relying on an instruction being No. 01/2022 dated 11th May, 2022 issued by CBDT. Admittedly, the issuance of notice and initiation of re-assessment proceeding are beyond six years and, prima facie, it is barred by limitation both under the old Act as well as under newly amended provision relating to Section 147 of the Act. This matter deserves adjudication by calling for affidavits from the respondents and also of the view that the petitioner has been able to make out a prima facie case for an interim order by raising the issue of jurisdiction of the assessing officer concerned in initiating the impugned re-assessment proceeding. Let the respondents file affidavit-in-opposition within four weeks; petitioner to file reply thereto, if any, within two weeks thereafter. The matter shall appear for final hearing in the monthly list of May, 2023. In the meantime, there will be no further proceeding on the basis of the impugned order. A writ petition challenges an order dated 23 July 2022 under Section 148A(d) of the Income Tax Act, 1961 for AY 2013-14 and 'all subsequent proceedings' founded on a notice dated 28 April 2021 under Section 148. The principal ground is lack of jurisdiction because the Section 148 notice is 'barred by limitation under Section 149(1)(b).' The assessing officer sought to justify initiation of reassessment by relying on CBDT Instruction No. 01/2022 dated 11 May 2022. The Court notes that, on admitted facts, 'the issuance of notice and initiation of re-assessment proceeding are beyond six years and, prima facie, it is barred by limitation both under the old Act as well as under newly amended provision relating to Section 147.' Finding that the limitation-based jurisdictional objection raises a prima facie case, the Court calls for affidavits (affidavit-in-opposition within four weeks; reply within two weeks) and lists the matter for final hearing in May 2023. Interim relief is granted: 'there will be no further proceeding on the basis of the impugned order dated 23rd July, 2022 ... till the disposal of the writ petition.'