Limitation for reassessment notice depends on actual escaped income, and the extended period fails below the statutory threshold.

A notice under section 148 can be issued within the extended limitation under section 149(1)(b) only where the income alleged to have escaped assessment meets the statutory threshold of Rs. 50 lakhs or more. Where the actual cash deposit attributable to the assessee was only Rs. 38,10,000, the case fell outside that category and the three-year limitation from the end of the relevant assessment year applied. Incorrect or unsupported factual assumptions recorded at the section 148A(b) and 148A(d) stage could not justify use of the extended period. The reassessment notice was therefore held to be time-barred and invalid.

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Issues: Whether the notice issued under section 148 of the Income-tax Act, 1961 was barred by limitation on the footing that the actual cash deposit found in the assessee's bank account was below Rs. 50 lakhs and, therefore, the extended limitation under section 149(1)(b) was unavailable.

Analysis: The reopening was initiated on the basis of three cash transaction entries, but the Tribunal found that only one deposit of Rs. 38,10,000 stood established as relating to the assessee. The other two entries were not attributable to her. On that basis, the case did not fall within the category of income escaping assessment of Rs. 50 lakhs or more. The Tribunal held that the limitation for issuing notice under section 148 was three years from the end of the relevant assessment year, and a notice issued beyond that period could not be sustained by relying on incorrect or non-existing facts recorded at the stage of section 148A(b) and section 148A(d). The Tribunal followed the view that the actual primary facts determine the limitation question, and once the escapement amount is below the statutory threshold, the extended period does not apply.

Conclusion: The notice under section 148 was time-barred and invalid, and the reassessment proceedings failed.

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