TaxTMI 
TaxTMI 
2025 (2) TMI 891
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.... the Id. CIT(A) was justified in restricting the additions made by the AO on account of bogus purchases to Rs. 4,51,400/- and thereby allowing a relief of Rs. 86,86,100/- relying upon the decision of ITAT Raipur in case of M/s Gopal Rice Industries vs. ITO In ITA No. 62& 74/RPR/2020 for the Asstt. Year 2014-15, without going to the merits of the case?" 2. "Whether on the facts and in the circumstance of the case Id. CIT(A) was justified in restricting the additions made by the AO on account of bogus purchases to Rs. 4,51,400/- and thereby allowing a relief of Rs. 86,86,100/- by applying GP @8% instead of entire bogus purchase?" 3. "Whether on the facts and in the circumstance of the case Id. CIT(A) has erred in deciding the appeal in favour of the appellant, failed to allude to relevant facts on record, misread the evidence and its probative value thereby giving rise to perversity in the order of Id. CIT(A), which itself gives rise to Question of Law as held in several case laws including the case of Sudarshan Silk and Sarees 300 ITR 205 (SC)?" 4. The order of the CIT(A) is erroneous both in law and on facts. 5. Any other ground which may be addu....
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....3. The respondent reserves the right to add, amend or alter any of the ground/s of cross objection. 3. Since the aforesaid two appeal pertains to the same assessee, involving therein similar facts and issues, which are interconnected, common and identical in nature, except the quantum of addition, therefore, these appeals are heard together and taken up for adjudication under this common order. 4. For the sake of deliberation, ITA No. 29/RPR/2025 and CO No. 2/RPR/2025 for the AY 2014-15, are taken up as the lead cases, wherein our discussions, observations and decisions qua the common issues involved therein, shall apply mutatis mutandis to the remaining appeal / CO. 5. Brief facts of the case are that the assessee is an individual has filed his Return of Income (ROI) for the AY 2014-15, declaring total income at Rs. 9,95,120/- on 30.09.2014. Since, the department has information in the case of assessee that certain income had escaped assessment, therefore, a notice/SCN u/s 148A(b) of the Act, was issued along with information for explanation of such information. However, in response, the assessee had not furnished any reply. Subsequently, an order u/s. 148A(d) is passed a....
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....tice u/s 148 was issued beyond the prescribed time permitted by the law, therefore, the case of assessee is squarely covered by the decision of this Tribunal in the case of Kachrulal Jitendra Kumar Vs. ITO in ITA No. 307/RPR/2024 for the AY 2014-15 vide order dated 05.02.2025, wherein the relevant observations of the tribunal on the issue, are extracted as under: 13. Apropos the validity of the jurisdiction that was assumed by the AO for framing the impugned assessment, the Ld. AR submitted that as the notice u/s. 148 of the Act, dated 25.07.2022 is barred by limitation, therefore, the consequential assessment order passed by the A.O u/s. 147r.w.s. 144B of the Act, dated 29.04.2023 cannot be sustained and is liable to be quashed on the said count itself. Elaborating further on his contention, the Ld. AR had taken us through a "Chart", as per which, notice u/s. 148 of the Act, dated 25.07.2022 in the case of the assessee firm could have been issued latest by 16.06.2022. The Ld. AR submitted that as the notice u/s. 148 of the Act had been issued by the A.O on 25.07.2022 i.e. much after 16.06.2022, therefore, the same being barred by limitation was invalid. 14. Aprop....
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....ssment notice under the new regime if such notice have become time-barred under the old regime; and (vi) the sanctioning authorities specified under Section 151 of the new regime are different from those specified under the old regime. 17. Also, Section 151 of the new regime specifies the following authorities for Sections 148 and 148A of the Act, viz. (i) Principal Commissioner or Principal Director or Commissioner or Director if three years or less have elapsed from the end of the relevant assessment year; and (ii) Principal Chief Commissioner or Principal Director General or Chief Commissioner or Director General if more than three years have elapsed from the end of the relevant assessment year. 18. The Taxation and Other Laws (Relaxation of Certain Provisions) Ordinance Act, 2020 [for short "TOLA], had come into force with retrospective effect from March 31, 2020. Section 3(1) of TOLA extended the time limit for completion of actions or compliances under the "Specified Act", which fell for completion or compliance during the period from March 20, 2020 to March 31 2021. Section 3(1) of the TOLA empowered the Central Government to extend the time limit beyond 31....
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.... or after 01-4-2021. However, the Court in order to balance the interests of the Revenue and the assessee exercised its discretionary jurisdiction under Article 142 of the Constitution of India and directed that the reassessment notices issued under the old regime shall be deemed to have been issued under Section 148A(b) of the new regime. Further, it was provided that the A.O shall within 30 days provide to the respective assessee's, the information and material relied upon by the department, so that the assessee's could reply to the show-cause notices within two weeks thereafter. The requirement of conducting any enquiry, if required, with the prior approval of specified authority u/s.148A(a) was hereby dispensed with as a one-time measure vis-à-vis those notices which had been issued u/s. 148 of the un-amended Act from 01-4-2021 till date, including those which was quashed by the High Courts. It was directed that the A.Os shall thereafter pass orders in terms of Section 148A(d) in respect of each of the assessee's concerned and, thereafter, following the procedure as required u/s.148A of the Act, they may issue notice u/s.148 of the Act. For the sake of clarity, the o....
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....to the respective assessee's shall be deemed to have been issued under section 148A of the IT Act as substituted by the Finance Act, 2021 and treated to be show cause notices in terms of section 148A(b). The respective assessing officers shall within thirty days from today provide to the assessee's the information and material relied upon by the Revenue so that the assessee's can reply to the notices within two weeks thereafter; (ii) The requirement of conducting any enquiry with the prior approval of the specified authority under section 148A(a) be dispensed with as a onetime measure vis à vis those notices which have been issued under Section 148 of the unamended Act from 01.04.2021 till date, including those which have been quashed by the High Courts; (iii) The assessing officers shall thereafter pass an order in terms of section 148A(d) after following the due procedure as required under section 148A(b) in respect of each of the concerned assessee's; (iv) All the defences which may be available to the assessee under section 149 and/or which may be available under the Finance Act, 2021 and in law and whatever rights are available to the Assessin....
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....ia including all the 90,000 reassessment notices issued under section 148 of the old regime during the period April 1, 2021 to June 30, 2021. (iii) the department was directed to provide all the relevant material or information to the assessee's and thereafter, allow the assessee's to respond to the "Show cause notices" by availing all the defences including those available under Section 149 of the Act. (iv) that as per Section 148A(b) of the Act, the A.O. had to comply with two requirements, viz. (i) issuance of a show cause notice; and (ii) supply of all the relevant information which formed the basis of the show-cause notice. (v) the total time that was excluded for computation of limitation for the deemed notices is, viz. (i) the time during which the show-cause notices were effectively stayed, that is, from the date of issuance of the deemed notice between 1st April, 2021 and 30th June, 2021 till the supply of relevant information or material by the assessing officers to the assesses in terms of the directions in Union of India & Ors Vs. Ashish Agarwal (supra); and (ii) two weeks allowed to the assesses to respond to the show-cause notices. ....
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.... allowed to the assesses to respond to the show cause notices; and h. The assessing officers were required to issue the reassessment notice under Section 148 of the new regime within the time limit surviving under the Income Tax Act read with TOLA. All notices issued beyond the surviving period are time barred and liable to be set aside;" 22. Shri Ravi Agrawal, Ld. AR for the assessee, after referring to the post-amended Section 148 r.w.s. 148A r.w.s. 149 of the Act (as had been made available on the statute vide the Finance Act, 2021 w.e.f. 01.04.2021) read in the backdrop of the aforesaid judicial pronouncements of the Hon'ble Apex Court, submitted that as the notice u/s. 148 of the Act, dated 25.07.2022 had been issued beyond the surviving/balance period that was available with the A.O, therefore, the same was barred by limitation. Elaborating further on his contention, the Ld. AR submitted that the A.O pursuant to the judgment of the Hon'ble Apex Court in the case of Union of India & Ors Vs. Ashish Agarwal (supra), had issued show- cause notice u/s. 148A(b) of the Act, dated 25.05.2022, Page 1 & 2 of APB, wherein the assessee firm was called upon to furnish its....
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.... * show-cause notice u/s 148A(b) of the Act was issued by the A.O to the assessee firm on 26.05.2022; * the time period of two weeks (14 days) from the date of issuing of notice u/s. 148A(b) dated 26.05.2022 [as per the judgment of the Hon'ble Apex Court in the case of Union of India & Ors Vs. Ashish Agrawal (supra)] lapsed on 08.06.2022; * the balance/surviving period available with the A.O to issue notice u/s 148 of the Act (under new regime) was 1 day [time between 30.06.2021 (the date of issuance of notice u/s.148A of the Act) AND 30.06.2021 i.e. (extended time period under TOLA, 2020); * as the balance/surviving period available with the A.O for passing an order under clause (d) of 148A of the Act was 1 day i.e. less than 7 days, therefore, as per the "fourth proviso" to Section 148A of the Act, the period of limitation so available would stand extended to 7 days; * the A.O could have validly issued notice u/s. 148 of the Act (under the new regime) latest by 14.06.2022; 24. As the A.O in the present case had issued notice u/s. 148 of the Act, dated 25.07.2022 i.e. much subsequent to lapse of the period of limitation as was ....
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....e u/s. 148 of the Act (under the new regime) latest by the days from the date under Sr. No. 3 of this table (i.e., date of issuance of notice u/s 148A(b) 23.06.2022 (22 days from 02.06.2022) 12. In view of aforesaid information, it was the submission by Ld. AR, that the notice u/s 148 (new regime) in the instant case, was issued beyond the prescribed time available to the Ld. AO under the mandate of law r.w. permissible additional time on account of deeming fiction, as per under the judgments in the case of Ashish Agrawal and Rajeev Bansal (supra). Accordingly, as the issue in the instant case is covered by the decision in the case of Kachrulal Jitendra Kumar (supra), therefore, the assessment in the present case passed on the foundation of a notice u/s 148 issued on 29.06.2022, which should have been issued on or before 23.06.2022 was barred by limitation and is liable to be quashed. 13. Per contra, Dr. Priyanka Patel, Ld. Sr. DR, vehemently supported the order of Ld. AO. 14. We have considered the rival submissions, perused the material available on record and case laws relied upon by the Ld. AR. Admittedly, as per facts of the case, dates of the notices ....
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.... 148A(b) of the Act in furtherance of his earlier notice dated 01.06.2021, is also required to be excluded by virtue of the third proviso to Section 149(1) of the Act as held by the Supreme Court in Union of India & Ors. v. Rajeev Bansal4. 68. In addition to the above, the time granted to the petitioner to respond to the notice dated 30.05.2022 - the period of two weeks -is also required to be excluded by virtue of the third proviso to Section 149(1) of the Act. The petitioner had furnished its response to the notice under Section 148A(b) of the Act on 13.06.2022. Thus, the period of limitation began running from that date. 69. As noted above, by virtue of TOLA, the AO had period of twenty-nine days limitation left on the date of commencement of the reassessment proceedings, which began on 01.06.2021, to issue a notice under Section 148 of the Act. The said notice was required to be accompanied by an order under Section 148A(d) of the Act. Thus, the AO was required to pass an order under Section 148A(d) of the Act within the said twenty-nine days notwithstanding the time stipulated under Section 148A(d) of the Act. This period expired on 12.07.2022. 70. S....
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....efore, the issues raised by the revenue become infructuous, accordingly, the appeal of the revenue stands dismissed. 18. In result, the appeal of assessee in ITA No. 29/RPR/2025 of the revenue is dismissed and CO of the assessee in CO No. 02/RPR/2025 is allowed. 19. Having identical issue, in ITA no. 30/RPR/2025 for AY 2015-16 in the case of present assessee filed by the revenue and the CO against the appeal of revenue in CO No. 03/RPR/2025 filed by the assessee, wherein the facts regarding date of issuance of notices are produced as under: Sr. No. Description Relevant Date No. of Days Remarks 01. Date of notice u/s. 148 of the Act under the old regime (deemed notice u/s 148A) was issued by the A.O to the assessee firm. 09.06.2021 02. Date of show-cause notice u/s 148A(b) of the Act was issued by the A.O to the assessee firm. 23.05.2022 03. The date on which, the time period of two weeks (14 days) from the date of issuing of notice u/s. 148A(b) [as per the judgment of the Hon'ble Apex Court in the case of Union of India & Ors Vs. Ashish Agrawal (supra)]has been lapsed. 05.06.2022 ....