TOLA-based reassessment notice held time-barred after expiry of the surviving limitation period

Reassessment notice under Section 148 issued pursuant to the TOLA framework was held time-barred because the Revenue had to complete the remaining steps and issue the notice within the surviving limitation period after giving the assessee the statutory response opportunity. On the facts, the Section 148 notice was issued after that permissible period had expired, so it was without jurisdiction and invalid. The notice was therefore quashed as unsustainable in law.

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Issues: Whether the reassessment notice issued under Section 148 of the Income-tax Act, 1961, pursuant to the notice issued under TOLA, was barred by limitation and liable to be quashed.

Analysis: The notice issued under TOLA on 30.06.2021 was governed by the time framework explained in the binding decision on reassessment notices issued under the old regime and their treatment as deemed notices under the new regime. After the assessee was given the statutory opportunity to respond, the Revenue was required to complete the remaining steps and issue the notice under Section 148 within the surviving limitation period. On the facts, the impugned notice under Section 148 was issued on 27.07.2022, beyond the permissible time available after excluding the relevant period and allowing the response window. Such a notice was therefore without jurisdiction and invalid.

Conclusion: The reassessment notice was time-barred and unsustainable; it was rightly quashed, in favour of the assessee.

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