Reassessment limitation and "asset" threshold under section 149 upheld, allowing reopening to proceed.

Reassessment notices for assessment year 2015-2016 were held to be within time because the limitation period had to be computed under the applicable old and substituted regimes, including the statutory exclusions and the pandemic-related relaxation framework. The notice under section 148A(b) was issued on the last permissible date, the assessee's response time was excluded, and the section 148A(d) order and consequent section 148 notice were therefore not barred by limitation. The court also accepted that survey material and books of account could satisfy the statutory reference to income represented in the form of an asset under section 149(1)(b), treating the later expansion of that expression as clarificatory. The writ challenge failed.

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Issues: (i) Whether the notice issued under the reassessment regime for assessment year 2015-2016 was barred by limitation in view of the first proviso to section 149(1) of the Income-tax Act, 1961 and the relaxation regime applicable to the relevant period; (ii) Whether the information gathered from the survey material and books of account could satisfy the statutory requirement of income represented in the form of an asset for invoking section 149(1)(b) of the Income-tax Act, 1961.

Issue (i): Whether the notice issued under the reassessment regime for assessment year 2015-2016 was barred by limitation in view of the first proviso to section 149(1) of the Income-tax Act, 1961 and the relaxation regime applicable to the relevant period.

Analysis: The time limit for reopening had to be tested with reference to the old regime and the substituted regime, together with the exclusions built into section 149 and the effect of the relaxation legislation and the exclusion directions governing the pandemic period. The notice under section 148A(b) was issued on the last permissible date, the assessee was granted time to respond, and the order under section 148A(d) was passed within the permissible period after excluding the response time. The reassessment notice under section 148 followed a valid section 148A(d) order and was therefore not hit by limitation.

Conclusion: The reassessment notice was not time-barred and the challenge on limitation failed.

Issue (ii): Whether the information gathered from the survey material and books of account could satisfy the statutory requirement of income represented in the form of an asset for invoking section 149(1)(b) of the Income-tax Act, 1961.

Analysis: The statutory explanation to section 149(1)(b), as applicable during the relevant period, used an inclusive description of "asset", and the later amendment expanding the clause was treated as clarificatory. On that approach, the material emerging from the survey and the books of account could be relied upon for the threshold contemplated by the reopening provision, and the argument that the material did not qualify as an asset was rejected.

Conclusion: The objection based on the alleged absence of an "asset" within the meaning of section 149(1)(b) failed.

Final Conclusion: The writ petition was rejected, and the reassessment proceedings were permitted to continue.

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