TaxTMI 
TaxTMI 
2023 (11) TMI 763
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....36873/2022, W.P.(C) 12532/2022 & CM APPL. 37947/2022, W.P.(C) 13003/2022 & CM APPL. 39410/2022, W.P.(C) 13389/2022, W.P.(C) 13397/2022, W.P.(C) 13464/2022, W.P.(C) 13580/2022, W.P.(C) 13725/2022, W.P.(C) 13744/2022, W.P.(C) 13843/2022, W.P.(C) 13903/2022 & CM APPL. 42502/2022, W.P.(C) 15121/2022 & CM APPL. 46761/2022, W.P.(C) 15316/2022 & CM APPLs. 47577/2022 & 33982/2023, W.P.(C) 17065/2022, W.P.(C) 17196/2022 & CM APPL. 54652/2022, W.P.(C) 17391/2022 & CM APPL. 55372/2022, W.P.(C) 17438/2022 & CM APPL. 55567/2022, W.P.(C) 17448/2022& CM APPL. 55590/2022 W.P.(C) 17579/2022& CM APPL. 56134/2022, W.P.(C) 134/2023 & CM APPL. 493/2023, W.P.(C) 147/2023 & CM APPL. 548/2023, W.P.(C) 237/2023& CM APPL. 898/2023, W.P.(C) 478/2023, W.P.(C) 829/2023 & CM APPL. 3176/2023 W.P.(C) 838/2023 & CM APPL. 3226/2023, W.P.(C) 1623/2023& CM APPL. 6168/2023, W.P.(C) 1724/2023 & CM APPL. 6539/2023, W.P.(C) 1749/2023& CM APPL. 6701/2023, W.P.(C) 1751/2023, W.P.(C) 1812/2023& CM APPL. 6943/2023, W.P.(C) 1886/2023 & CM APPL. 7188/2023, W.P.(C) 1910/2023& CM APPL. 7262/2023, W.P.(C) 2089/2023 & CM APPL. 7930/2023, W.P.(C) 2213/2023& CM APPL. 8420/2023 W.P.(C) 2227/2023& CM APPL. 8461/2023, W.P.(C) 2357/2023....
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....arunn Chanana, Advs. In W.P.(C) 13389/2022, W.P.(C) 13903/2022, W.P.(C) 478/2023, W.P.(C) 1623/2023, W.P.(C) 1751/2023, W.P.(C) 4878/2023, W.P.(C) 6281/2023, W.P.(C) 6661/2023 Mr Manu K. Giri, Adv. in W.P.(C) 13397/2022 and W.P.(C) 17196/2022; Mr Yogesh Jagia, Mr Amit Sood and Mr Hriday Minocha, Advs in W.P.(C) 17065/2022, W.P.(C) 1724/2023, W.P.(C) 1749/2023, W.P.(C) 1812/2023. Dr Rakesh Gupta, Mr Somil Agarwal and Mr Ansul Mittal, Advs. In W.P.(C) 17391/2022, W.P.(C) 17438/2022, W.P.(C) 237/2023, W.P.(C) 1885/2023, W.P.(C) 1886/2023, W.P.(C) 1910/2023; Mr Amol Sinha and Mr Kshitiz Garg, Advs in W.P.(C) 17579/2022, W.P.(C) 134/2023, W.P.(C) 147/2023, W.P.(C) 838/2023 Mr S.Krishnan and Mr K.C. Jain, Advs in W.P.(C) 1270/2023, W.P.(C) 2776/2023; Mr S. Krishnan and Mr. Rakesh Kumar, Advs in W.P.(C) 16473/2022; Mr Kapil Goel, Adv in W.P.(C) 2357/2023; Mrs Anjali Jha Manis, Mr Priyadarshi Manish, Ms Divya Rastogi, Ms Saksham Garg, Advs. in W.P.(C) 829/2023 & 2227/2023; Mr Prashant Shukla, Adv in W.P.(C) 5972/2023. Mr Nagesh Kumar Behl and Mr Rajesh Kumar Aggarwal, Advs. For petitioner in W.P.(C) 13744/2022. Mr Prasouk Jain with Mr Rabiya Thakur, Advocates in W.P.(C) 13843/2022. Mr Ved ....
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....r the notices issued to the petitioners under Section 148 of the Income Tax Act, 1961 [hereafter referred to as the "1961 Act"] are sustainable in law having regard to Clauses (a) and (b) of Section 149(1) of the 1961 Act? 2.1. In short, the contention of the petitioners [hereafter referred to collectively as "assessee(s)", unless the context requires otherwise] is that in cases where the alleged escaped income is below the prescribed monetary threshold of Rs. 50 lakhs, the period of limitation as stipulated under Clause (a) of Sub-section (1) of Section 149 of the 1961 Act would be applicable. The period prescribed under the said Clause is three (03) years from the end of the relevant AY. 2.2. Thus, if the extended period of limitation provided under Clause (b) of Sub-section (1) of Section 149 of the Act is to be applied, which is a period beyond three years (03) but not more than ten (10) years, to sustain the notice issued under Section 148 of the Act, jurisdictional conditions stipulated therein would have to be fulfilled. 2.3. One of the conditions prescribed for invoking the extended period of limitation is that the income chargeable to tax, which has escaped assess....
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....r dates which fell after 29.06.2020 provided these dates were specified by the Central Government by way of a Notification. 5.2. The actions qua which time limits were extended for completion of compliance were referred to in Chapter II Section 3(1)(a) to (c) of the 2020 Ordinance, insofar as the Specified Acts were concerned. The Specified Acts were defined in Section 2(1)(a) of the 2020 Ordinance. 5.3. As far as the above-captioned writ petitions are concerned, we are required to accord attention to only one Specified Act, i.e., the 1961 Act. Reference to the 1961 Act was made in Section 2(1)(a)(ii) of the 2020 Ordinance. Besides this, the 2020 Ordinance made amendments to the 1961 Act and other statutes, which resulted, inter alia, in the extension of time limits in those statutes as well. 5.4. By virtue of the provisions of the 2020 Ordinance, the due date/time limit/limitation for completion of proceedings and compliance referred to in Section 3(1), which fell during the period spanning between 20.03.2020 and 29.06.2020 stood extended to 30.06.2020. 5.5. Likewise, Notification No. 35 of 2020 dated 24.06.2020 issued under the 2020 Ordinance extended the end date to ....
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.... concerning AY 2020-21 and for furnishing audit reports under the relevant provisions of the 1961 Act. These Notifications are 88 of 2020, dated 29.10.2020 and 93 of 2020, dated 31.12.2020. 9. In the interregnum, a press release dated 30.12.2020 was also issued broadly for the same purpose, which, apart from the 1961 Act, referred to other statutes as well. Insofar as the Notification dated 31.12.2020 was concerned, it provided that the end date for limitation would be 31.03.2021 concerning those proceedings, in which the due date for compliance fell between 20.03.2020 and 30.03.2021. 10. The point of inflection, however, came about with the CBDT issuing two (02) Notifications, i.e., Notification No. 20 of 2021 dated 31.03.2021 and Notification No. 38 of 2021 dated 27.04.2021. 10.1. Insofar as the Notification dated 31.03.2021 was concerned, it shifted the end date prescribed for the expiration of limitation as per the provisions of Section 149 of the 1961 Act, to 30.04.2021, concerning the notices issued under Section 148, the due date for which fell within the period spanning between 20.03.2020 and 31.03.2021. 10.2. Likewise, the Notification dated 27.04.2021 extended....
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....ent of reassessment proceedings under the 1961 Act. 15.1. A slew of directions were issued by the Supreme Court in the exercise of its powers under Article 142 of the Constitution, not only qua matters vis-à-vis which appeals were preferred by the UOI but also those judgments which had ruled on the same issue but were not, at that point in time, carried in appeal to the Supreme Court. 16. The CBDT, as noticed above, issued the impugned Instruction dated 11.05.2022, purportedly in compliance with the directions in the judgment rendered by the Supreme Court in Ashish Agarwal's case. 17. As a follow-up, the revenue via the AOs issued communications/notices, which indicated reassessment proceedings were being triggered under the new regime, which had been brought into effect on 01.04.2021 with the enactment of FA 2021. 17.1. The assessees filed their objections in terms of Section 148A(c) to the communications/notices, which were aligned with the provisions of Section 148A(b) of the 1961 Act. 17.2. Among several objections taken by the assessees, one objection flagged was that the time limit prescribed under Section 149(1)(a) had expired and given the fact that th....
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....nneled to the bank account of MRA. 19.3. MRA filed a response dated 04.06.2022 to the notice issued under Section 148A(b) of the Act, which was dated 20.05.2022. Amongst other objections, one of the objections that MRA flagged was that the reassessment proceedings triggered against it were time-barred as the limitation qua the AY 2017-18 expired on 31.03.2021. In this context, the attention of the AO was drawn to Clause (a) of Sub-section (1) of Section 149 of the 1961 Act. MRA also highlighted the fact that the AO could not take recourse to the extended period of limitation provided in Clause (b) of Sub-section (1) of Section 149, as the preconditions provided therein, which included that the escaped income should amount to Rs. 50 lakhs or more, remained unfulfilled. 19.4. The AO, via order dated 27.07.2022, rejected the said objection raised by MRA, broadly, on the ground that this court, while rendering the judgment in Mon Mohan Kohli's case had only found fault with the nonadherence by the revenue to the procedure prescribed for reopening assessment which came into effect on 01.04.2021, pursuant to FA 2021. 19.5. Furthermore, the AO took the position that the decision ....
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....NCLT responded to the Section 142(1) notices issued by the AO. Via this communication, the RP conveyed to the AO that the Corporate Insolvency Resolution Process [hereafter referred to as "CIRP"] had been initiated vis-à-vis South East and that moratorium against the recovery of debts as per Section 14 of the 2016 Code was in operation. 20.6. The AO, however, via communication dated 24.02.2022, took the position that notwithstanding the provisions of Section 14 of the 2016 Code, he could continue with the reassessment proceedings. Accordingly, the AO granted a final opportunity to South East to file its response by 02.03.2022. 20.7. The RP, via his response dated 03.03.2022, restated his objection regarding the continuance of reassessment proceedings. However, the RP went on to defend the position of South East on merits, as well. 20.8. Via communication dated 07.03.2022, the AO disposed of the objections preferred by RP on behalf of South East and requested cooperation in the assessment proceedings. 20.9. Not being satisfied, the RP, via communication dated 14.03.2022, reemphasized his objection to the continuation of reassessment proceedings, having regard to t....
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....on or after 01.04.2021, i.e., after the expiry of the three (03) year limitation period prescribed under Section 149(1)(a). (ii) The extended period of limitation provided in Section 149(1)(b) of the 1961 Act can be taken recourse to only if the conditions precedent provided therein are fulfilled. One such condition provided in Clause (b) of Sub-Section (1) of Section 149 is that income chargeable to tax, which allegedly has escaped assessment, amounts to or is likely to amount to Rs 50 lakhs or more. In the above-captioned writ petitions, even according to the revenue, the alleged escaped income is below Rs. 50 lakhs. That being the case, the period of limitation for issuing notice under Section 148, which extends to ten (10) years, is not available to the revenue. (iii) The revenue's stand (which is primarily based on the CBDT Instruction dated 11.05.2022) that the directions issued by the Supreme Court in Ashish Agrawal's case, when read along with TOLA, will allow the "...extended reassessment notices to travel back in time to their original date when such notices were to be issued...." is unsustainable in law for the following reasons: (a) The law does not suppo....
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....21, as per the unamended provisions. As is evident upon perusal of the judgment of the Supreme Court, its direction to treat Section 148 notices as notices issued under the new regime was to quell the possibility of reassessment proceedings failing, even where they were viable under FA 2021. [See paragraph 8 of the judgment] (iv). The directions contained in the judgment of the Supreme Court in Ashish Agarwal's case, while exercising its powers under Article 142 of the Constitution, were issued keeping the aforesaid object in mind while specifically holding that all defences would be available to the assessees. Thus, notices issued on or before 31.03.2021 will be governed by the old regime, while those issued on or after 01.04.2021 must be aligned with the new regime. Accordingly, all those notices issued between 01.04.2021 and 30.06.2021 stood converted to notices issued under Section 148A(b) of the new regime and were, thus, subject to the amended Section 149 of the 1961 Act. (v) The revenue's stand is flawed as that would result in deferring the application of the amended provisions of Section 149. The revenue, which represents the executive, is not invested with the power....
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....sment proceedings are required to be completed within twelve (12) months from the end of the Financial Year (FY) in which notice under Section 148 is served on the assessee. Thus, if the notice issued under Section 148 is construed to travel back in time, i.e., to 31.03.2020/31.03.2021, the reassessment proceedings ought to have concluded by 31.03.2021/31.03.2022. The portal set up by the revenue, however, discloses that the end date provided for the completion of reassessment proceedings is 31.03.2024. This date has been provided having regard to the fact that the notices were served in FY 2022-23. (viii). The circulars issued by the CBDT cannot run contrary to the decision of the Supreme Court. Likewise, the delegate cannot act in contravention of the Parent Act. Thus, the circulars/instructions/notifications issued by the Central Government cannot override the Parent Act. (ix). The rule of strict interpretation applies to taxing statutes. It is not permissible in the context of taxing statutes to cure deficiencies. The Court should look at the plain words of the statute. Thus, if the assessee does not come within the ambit of the charging provision and the words are ambigu....
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....022 is bad in law as it seeks to deprive the assessees of defences available to the assessees under the amended Section 149 of the 1961 Act, an aspect which the Supreme Court has recognized in its judgment rendered in Ashish Agrawal's case. Submissions on behalf of the revenue: 24. On behalf of the revenue, the following broad submissions were made: (i) The contentions raised on behalf of the assessees that the notices issued under Section 148 of the 1961 Act vis-à-vis AYs 2016-17 and 2017-18 are covered by the limitation period prescribed under Clause (a) and not Clause (b) of Sub-Section (1) of Section 149 of the amended 1961 Act is completely misconceived. The coordinate bench of this Court in Touchstone Holdings Pvt. Ltd. v. ITO and Ors. [2023] 451 ITR 196 (Del) and Salil Gulati v. ACIT 2022:DHC:3709-DB has ruled that since the Supreme Court held that notices issued under Section 148 between 01.04.2021 and 30.06.2021 were to be treated as notices issued under Section 148A(b) of the 1961 Act, the said notices stood revived and were, thus, within the limitation period prescribed under the amended Section 149(1)(a) of the 1961 Act. (ii) The power exercised by th....
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....d have to be excluded, having regard to the third proviso appended to Section 149 of the amended 1961 Act. (vi) In the instant cases, there is no assertion that timelines, as provided in the Ashish Agrawal case, have been breached. Thus, the notices issued under Section 148, after passing the order under Section 148(A)(d) of the amended 1961 Act, are within the limitation period prescribed in Section 149(1)(a) of the amended 1961 Act. The criterion that the escaped income should amount to or is likely to amount to Rs. 50 lakhs or more is not applicable in the matters presently before the court. (vii) Section 3(1) of TOLA, read with the judgment of the coordinate bench of this court rendered in Mon Mohan Kohli's case leaves no manner of doubt that the limitation for issuance of notice under Section 148 of the Act, which was coming to an end on 31.03.2020, qua AY 2016-17 as per the amended provisions of Section 149(1)(a), stood extended till 30.06.2021. Therefore, if this extended period of limitation is kept in mind and the timeframe between the date when the erstwhile notice under Section 148 was issued and when the reply was filed is excluded, in terms of the third proviso a....
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....ich are covered by the coordinate bench judgment of this Court rendered in Mon Mohan Kohli or the Ashish Agrawal's case. (xii) The amended law is so designed that the show-cause notice issued under Section 148A(b) becomes the reference date for determining limitation under Section 149 of the said Act. [See the third and fourth proviso appended to Section 149, amended by FA 2021]. (xiii) Notices issued under Section 148 of the unamended 1961 Act, having been converted into notices under Section 148A(b), the jurisdictional prerequisites, as provided under the unamended law, would have no relevance for determining the validity of the notices issued under the amended law. (xiv) To ascertain whether the instant cases concerning AYs 2016-17 and 2017-18 fall under Clause (a) or Clause (b) of Sub-Section (1) of Section 149 of the amended 1961 Act, one would have to take into account the judgment of Supreme Court in Ashish Agrawal's case, the provisions of Section 3(1) of TOLA, the observations made in paragraphs 98 and 99 in Mon Mohan Kohli's case and the provisions of the third and fourth proviso of Section 149(1) of the amended 1961 Act. If all of these factors are considered, i....
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.... for triggering the extended period, which goes up to ten (10) years in cases where three (03) years have elapsed, is that income chargeable to tax which has escaped assessment amounts to, or is likely to amount to Rs. 50 lakhs or more for the AY in issue. 28. Therefore, after the coming into force of FA 2021, in cases where, for the relevant AY, the alleged escaped income was less than Rs. 50 lakhs, notice under Section 148 could only be issued for commencement of reassessment proceedings within the limitation period provided in Clause (a) of Section 149(1) of the amended 1961 Act. 29. Thus, in the ordinary course, the limitation for AY 2016-17 would expire on 31.03.2020; likewise, for AY 2017-18, the end date for the culmination of the limitation period would be 31.03.2021. 30. The revenue seeks to take recourse to the provisions of Section 3(1) of TOLA and the Notifications issued thereunder, from time to time, which, in effect, extended the end date for completion of proceedings and compliances up until 30.06.2021. 30.1 In this regard, we may refer to the last two Notifications. Via Notification dated 31.03.2021, the end date was extended till 30.04.2021. The Notifi....
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.....2021. This was also the view taken by various High Courts; a view which was sustained by the Supreme Court. 32.3. The Supreme Court, however, having regard to the fact that the procedure prescribed under the new regime (which was encapsulated in FA 2021) had not been followed, modified the judgments of the High Courts by issuing specific directions to balance the interests of the assessees and the revenue. 32.4. The Supreme Court was persuaded to modify the judgments, having regard to the fact that if the decisions of various courts, including that of the coordinate bench of this court in Mon Mohan Kohli, were to be sustained as is, it would result in the failure of reassessment proceedings, even if the same were "permissible" under FA 2021 and as per the substituted provisions incorporated in the statutes, i.e., Sections 147 to 149 and Section 151. In this regard, the following observations made in the Ashish Agrawal judgement, being apposite, are extracted hereafter: "...21. Substituted Section 149 is the provision governing the time-limit for issuance of notice under Section 148 of the IT Act. The substituted Section 149 of the IT Act has reduced the permissible ....
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....e the various respective High Courts shall be deemed to have been issued under Section 148-A of the IT Act as substituted by the Finance Act, 2021 and construed or treated to be show-cause notices in terms of Section 148-A(b). The assessing officer shall, within thirty days from today provide to the respective assessees information and material relied upon by the Revenue, so that the assessees can reply to the show-cause notices within two weeks thereafter. 28.2. The requirement of conducting any enquiry, if required, with the prior approval of specified authority under Section 148-A(a) is hereby dispensed with as a one-time measure vis-à-vis those notices which have been issued under Section 148 of the unamended Act from 1-42021 till date, including those which have been quashed by the High Courts. 28.3. Even otherwise as observed hereinabove holding any enquiry with the prior approval of specified authority is not mandatory but it is for the assessing officers concerned to hold any enquiry, if required. 28.4. The assessing officers shall thereafter pass orders in terms of Section 148-A(d) in respect of each of the assessees concerned; Thereafter ....
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....ich have some bearing on the lis before us. First, all defences, including those available under Section 149 of the amended 1961 Act, would remain open to the assessees. Second, all rights and contentions available to the assessees and the revenue under FA 2021 and in law will continue to subsist. 37. Therefore, according to us, it cannot be contended on behalf of the revenue that if the defence of limitation is available under Section 149(1)(a) of the Act, the same cannot be entertained by this Court. 38. Likewise, as indicated by the Supreme Court in no certain terms, it will also be open to the revenue to advance submissions based on the provisions of FA 2021 and those that may otherwise be available in law. 39. Besides this, since the Supreme Court, in no uncertain terms, ruled that the judgments of the various High Courts, which includes the decision of the coordinate bench of this court in Mon Mohan Kohli, stood "modified/substituted" to the extent indicated in the directions issued by the Court, it would follow that all rights and contentions will be available to the assessees, notwithstanding any observations made in that judgment which curtails the defences availa....
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....o exist till the extended period i.e. till 30th June, 2021; however, the Finance Act, 2021 has merely changed the procedure to be followed prior to issuance of notice with effect from 1st April, 2021..." 44.1. A careful perusal of the said observations would show that all that the Court noted (which was a matter of fact) that the power of reassessment which existed before 31.03.2021 continued to exist till 30.06.2021, with alteration in procedure brought about upon the enactment and enforcement of FA 2021. 44.2. This is abundantly clear if one were to read the paragraphs following paragraph 99, i.e., paragraphs 100 to 105 of the judgment. The Court, in no uncertain terms, declared explanation A(a)(ii)/A(b) of Notifications dated 31.03.2021 and 27.04.2021 as being ultra vires the parent statute, i.e., TOLA. 44.3. The said explanations sought to impose the unamended provisions of Sections 148, 149 and 151 of the 1961 Act, although the substituted provisions had kicked in. The Court refused to countenance a situation that the amended provisions, i.e., Sections 147 to 149 and 151, would not be applicable, firstly, to past AYs and/or would not operate during 01.04.2021 and 30.0....
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....s' own Circular 549 of 1989 and its own submission that from 1st July, 2021, the substitution made by the Finance Act, 2021 will be applicable. 103. Revenue cannot rely on Covid-19 for contending that the new provisions Sections 147 to 151 of the Income Tax Act, 1961 should not operate during the period 1st April, 2021 to 30th June, 2021 as Parliament was fully aware of [the] Covid-19 Pandemic when it passed the Finance Act, 2021. Also, the arguments of the respondents qua non-obstante clause in Section 3(1) of the Relaxation Act, 'legal fiction' and 'stop the clock provision' are contrary to facts and untenable in law. 104. Consequently, this Court is of the view that the Executive/Respondents/Revenue cannot use the administrative power to issue Notifications under Section 3(1) of the Relaxation Act, 2020 to undermine the expression of Parliamentary supremacy in the form of an Act of Parliament, namely, the Finance Act, 2021. This Court is also of the opinion that the Executive/Respondents/Revenue cannot frustrate the purpose of substituted statutory provisions, like Sections 147 to 151 of [the] Income Tax Act, 1961 in the present instance, by emptying it of ....
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....of the judgments in Touchstone and Salil Gulati's case, as noticed above, did not deal with the facts and circumstances, which obtain in the instant cases. There was no occasion for the writ petitioners in those cases to invoke the provisions of Clause (a) Sub-Section (1) of Section 149, given the fact that the alleged escaped income was not below Rs. 50 lakhs. (ii) Secondly, the defence that the limitation has expired goes to the root of the jurisdiction of the AO to trigger reassessment proceedings. It is well-established that the principle of res judicata is dicta, which governs procedure, and therefore, if the proceedings are wrongly initiated, it cannot come in the way of the court entertaining such an action. The estoppel, waiver or res judicata principles cannot apply in such situations. [See Chandra bhai K. Bhoir and Ors. v Krishna Arjun Bhoir and Ors, (2009) 2 SCC 315. Union of India and Another v. Association of Unified Telecom Providers of India and Ors., (2011) 10 SCC 543, Ashok Leyland Ltd. v. State of Tamil Nadu and Another (2004) 3 SCC 1 at 2861-63]. (ii)(a) Explanation IV to Section 11 of Code of Civil Procedure, 1908 [hereafter referred to as "CPC....
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....a power which was conferred on the Central Government under Section 3(1) of TOLA, cannot be construed as one which could extend the period of limitation provided under Section 149(1)(a) of the 1961 Act. As per the ratio enunciated in Ashish Agrawal's case, Section 149(1)(a) would apply to AY 2016-17 and AY 2017-18. 50. The other argument that the provision of the third and fourth proviso would help the cause of the revenue by excluding the periods provided therein fails to take into account the following: 50.1. The third proviso appended to Section 149 of the Act, inter alia, provides that the time or extended time allowed to the assessee as per the show-cause notice issued under Section 148A(b) of the 1961 Act shall stand excluded for computation of limitation provided under the said Section. 50.2. The fourth proviso provides that where the timeframe adverted to in the third proviso leads to the situation that the period of limitation available to the AO for passing an order under 148A(d) is less than seven (7) days, then the remaining period shall stand extended to seven (7) days. Consequently, the limitation under Sub-Section (1) shall be deemed to be ext....
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....) if three years, but not more than ten years, have elapsed from the end of the relevant assessment year unless the Assessing Officer has in his possession books of account or other documents or evidence which reveal that the income chargeable to tax, represented in the form of asset, which has escaped assessment amounts to or is likely to amount to fifty lakh rupees or more for that year: Provided that no notice under section 148 shall be issued at any time in a case for the relevant assessment year beginning on or before 1st day of April, 2021, if such notice could not have been issued at that time on account [of] being beyond the time limit specified under the provisions of clause (b) of sub-section (1) of this section, as they stood immediately before the commencement of the Finance Act, 2021. Hon'ble Supreme Court has upheld the views of High Courts that the benefit of new law shall be made available even in respect of proceedings relating to past assessment years. Decision of [the] Hon'ble Supreme Court read with the time extension provided by TOLA will allow extended reassessment notices to travel back in time to their original date when such notice....
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....ainable in law because they are vague. "Certainty" in taxing statutes is one of the grund norms, as ordinarily, they are agnostic to equitable principles. 53. Apart from what we have stated above on the language and scheme of the relevant provisions introduced with the enactment of FA 21, one has to bear in mind, in our opinion, the raison d'etre for forging the new regime. A clue about the same is provided in the Finance Minister's budget speech delivered on 01.02.2021 and the relevant parts of the Memorandum explaining the provisions of the Finance Bill 2021 [hereafter referred to as "Memorandum"] which morphed into FA 2021. For convenience, the relevant parts are extracted below: Speech of the Finance Minister "...Reduction in Time for Income Tax Proceedings 153. Honourable Speaker, presently, an assessment can be re-opened up to 6 years and in serious tax fraud cases for up to 10 years. As a result, taxpayers have to remain under uncertainty for a long time. 154. I therefore propose to reduce this time-limit for re-opening of [the]assessment to 3 years from the present 6 years. In serious tax evasion cases too, only where there is evid....
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....rmal cases, no notice shall be issued if three years have elapsed from the end of the relevant assessment year. Notice beyond the period of three years from the end of the relevant assessment year can be taken only in a few specific cases. * In specific cases where the Assessing Officer has in his possession evidence which reveal that the income escaping assessment, represented in the form of asset, amounts to or is likely to amount to fifty lakh rupees or more, notice can be issued beyond the period of three year but not beyond the period of ten years from the end of the relevant assessment year; * Another restriction has been provided that the notice under section 148 of the Act cannot be issued at any time in a case for the relevant assessment year beginning on or before 1st day of April, 2021, if such notice could not have been issued at that time on account of being beyond the time limit prescribed under the provisions of clause (b), as they stood immediately before the proposed amendment. * Since the assessment or reassessment or re-computation in search or requisition cases (where such search or requisition is initiated or made on or before 31st Ma....