Limitation on Reassessment: notice issued after the surviving period held time-barred, therefore reassessment void ab initio.

The article examines whether a section 148 notice dated 22.07.2022 is time barred, applying principles for computing the surviving period and excluding intervals between deemed notice, supply of material and the statutory reply period. It explains that the assessing officer's limitation clock restarts only after receipt of the assessee's response and that any reopening must occur within the remaining surviving period. Applying those exclusion rules and relevant authority, the notice issued after the surviving period expired is characterised as outside permissible time and the consequent reassessment is described as void ab initio in favour of the assessee.

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Issues: Whether the notice issued under section 148 of the Income-tax Act, 1961 dated 22.07.2022 (issued after 01.04.2021) is barred by limitation and whether the consequent reassessment framed pursuant thereto is void ab initio.

Analysis: The timeline of events establishes that an original notice under the pre-amendment regime was issued within the extended period but subsequent steps and the later notice under section 148 were taken after the statutory surviving period had expired. Applying the exclusion principles and the computation of the surviving period as explained in the decisions referenced by the Tribunal, including the decision of the Hon'ble Supreme Court in Rajeev Bansal and the jurisdictional High Court guidance, the period between the deemed notice and the supply of material and the two-week reply period are to be excluded and the clock for the assessing officer starts only after receipt of the response. The assessing officer was required to issue the section 148 notice within the remaining surviving period; the notice dated 22.07.2022 was issued beyond that surviving period and therefore falls outside the permissible time for reopening.

Conclusion: The notice under section 148 dated 22.07.2022 is time barred and the reassessment framed pursuant thereto is void ab initio; the ground challenging limitation is allowed in favour of the assessee.

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