AI Drafter 
TaxTMI 
TaxTMI 
2024 (12) TMI 1560
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.... order passed by the CIT(A). 2. THE CHALLENGE TO REASSESSMENT : 2.1 The Learned Income Tax Officer, Ward 1, Jalna ['the Ld. JAO'] has erred in initiating the reassessment proceedings u/s. 148 of the Income tax Act, 1961 ['the Act']. 2.2 On the facts and in the circumstances of the case, the Ld. JAO has initiated the reassessment proceedings without fulfilling the preconditions required to initiate the reassessment proceedings u/s. 148- 151 of the Act. Further, the Ld. JAO failed to follow the directions as provided by the Hon'ble Apex Court in case of UOI v. Ashish Agrawal- [(2022) 138 taxmann.com 64 (SC)] 2.3 On the facts and in circumstances of the case, the Ld. JAO initiated and passed the assessment order without application of mind to the facts of the case. 2.4 In the above circumstances, facts and in law, the Appellants submits that this case is not fit for initiation of reassessment proceedings. Therefore, the assessment order passed is illegal and deserves to be quashed. WITHOUT PREJUDICE TO ABOVE : 3. ADDITION OF Rs. 11,61,395/- u/s. 69A OF THE ACT 3.1 In the facts and circumst....
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....om the end of the relevant assessment year. 4. The present case pertains to AY 2017-18, accordingly, the time period of three years to issue notice u/s. 148 were expiring on 31.03.2021. As the said period fell within the TOLA relaxation period (20.03.2020 to 31.03.2021), therefore, the said period got extended to 30.06.2021. (Ref: Para 69 of the Judgement). 5. Further, as per the direction of the Hon'ble Supreme Court in Ashish Agrawal (supra), the notice u/s. 148 issued between period 01.04.2021 to 30.06.2021 as per the unamended law was deemed as show cause notice u/s. 148A(b) as per the amended law. Further, the Hon'ble Supreme Court in the said decision had directed to the AO to provide the information to the Assessee as required u/s 148A(b). The same was provided to the Appellant in the present case on 28.05.2022. 6. Accordingly, the Hon'ble Supreme Court in Rajeev Bansal (supra) held that period up to 30.06.2021 is covered by the provisions of Income-tax Act read with TOLA. (Ref: Para 94 of the Judgement). 7. Thereafter, in Rajeev Bansal the Hon'ble Supreme Court by relying on third proviso to section 149 held that the perio....
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....48, which fell for completion from 20 March 2020 to 31 March 2021, till 30 June 2021. All the reassessment notices under challenge in the present appeals were issued from 1 April 2021 to 30 June 2021 under the old regime. Ashish Agarwal (supra) deemed these reassessment notices under the old regime as show cause notices under the new regime with effect from the date of issuance of the reassessment notices. The effect of creating the legal fiction is that this Court has to imagine as real all the consequences and incidents that will inevitably flow from the fiction. Therefore, the logical effect of the creation of the legal fiction by Ashish Agarwal (supra) is that the time surviving under the Income-tax Act read with TOLA will be available to the Revenue to complete the remaining proceedings in furtherance of the deemed notices, including issuance of reassessment notices under section 148 of the new regime. The surviving or balance time limit can be calculated by computing the number of days between the date of issuance of the deemed notice and 30 June 2021, (Ref: Para 108 of the Judgement). 11. From the aforesaid directions of the Hon'ble Supreme Court, the position t....
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....supra) the time period that was allowed to the Ld. JAO in the present case to issue notice u/s 148 was only till 15.06.2022. However, the notice u/s 148 (new regime) is issued by the Ld. JAO on 29.07.2022. That is beyond the surviving time. Therefore, the notice u/s 148 (new regime) issued by the Ld. JAO is barred by limitation as per the judgement of the Hon'ble Apex Court in Rajeev Bansal and therefore it deserves to be quashed. ON MERITS : 1. The Ld. AO in the present case has invoked the provisions of section 197(b) of the Income Declaration Scheme, 2016 on the ground that the declaration was made of 11,61,395/- against which the tax payable was 5,22,630/-. However, it is alleged by the Ld. AO that the Appellant has made payment of only 3,91,973/- and not made full payment. 2. In this regard it is humbly submitted that the tax was paid fully of 5,22,630/-. It was only that the Appellant inadvertently had two PAN number. However, she was regularly using PAN no. ABKPR1119C. However, while filing the declaration under the IDS, the declaration was filed on the old PAN number (ACVPR9382B). Further the payment of the challans was made as mentioned in th....
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....by the Supreme Court in Ashish Agrawal 15.06.2022 Reply filed by the Appellant The response submitted by the Appellant in response to notice u/s. 148A(b) ( issue letter dated 28.05.2022) 29.07.2022 Order u/s. 148A(d) Alleged escapement of income as per the ld.AO is Rs.11,61,395/- 29.07.2022 Notice u/s. 148 As per the amended law 6. The ld. Counsel for the assessee based on his understanding and interpretation of the judgment of Hon'ble Apex Court in the case of Union of India Vs. Rajeev Bansal (supra) is contending that since the notice u/s. 148 of the Act has been issued on 30.06.2021, there was no surviving time left with the AO to carry out further the proceedings under the amended section 148 of the Act. Contention of the ld. Counsel for the assessee has been observed in para 13 of its written submissions extracted (supra). 7. Before examining the facts, I would first like to go to the relevant extracts from the judgment of Hon'ble Apex Court in the case Union of India Vs. Rajeev Bansal (supra) which read as under : "108. The Income Tax Act read with TOLA extended the time limit for issuing reassessment notices under Section 148, whi....
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....anted to the assesses to reply to the show cause notices must also be excluded in terms of the third proviso to Section 149. 111. The clock started ticking for the Revenue only after it received the response of the assesses to the show causes notices. After the receipt of the reply, the assessing officer had to perform the following responsibilities: (i) consider the reply of the assessee under Section 149A(c); (ii) take a decision under Section 149A(d) based on the available material and the reply of the assessee; and (iii) issue a notice under Section 148 if it was a fit case for reassessment. Once the clock started ticking, the assessing officer was See State of A P v. A P Pensioners Association, (2005) 13 SCC 161 [28]. [This Court observed that the "legal fiction undoubtedly is to be construed in such a manner so as to enable a person, for whose benefit such legal fiction has been created, to obtain all consequences flowing therefrom."] PART F required to complete these procedures within the surviving time limit. The surviving time limit, as prescribed under the Income Tax Act read with TOLA, was available to the assessing officers to issue the reassessment notices und....
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....; c. Section 3(1) of TOLA overrides Section 149 of the Income Tax Act only to the extent of relaxing the time limit for issuance of a reassessment notice under Section 148; d. TOLA will extend the time limit for the grant of sanction by the authority specified under Section 151. The test to determine whether TOLA will apply to Section 151 of the new regime is this: if the time limit of three years from the end of an assessment year falls between 20 March 2020 and 31 March, then the specified authority under Section 151(i) has extended time till 30 June 2021 to grant approval; e. In the case of Section 151 of the old regime, the test is: if the time limit of four years from the end of an assessment year falls between 20 March 2020 and 31 March 2021, then the specified authority under Section 151(2) has extended time till 31 March 2021 to grant approval; f. The directions in Ashish Agarwal (supra) will extend to all the ninety thousand reassessment notices issued under the old regime during the period 1 April 2021 and 30 June 2021; g. The time during which the show cause notices were deemed to be stayed is from the date of issuance of the ....
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....ty of notice u/s. 148 of the Act, Hon'ble Apex Court clubbing various judgments of Hon'ble High Courts in the Case of Union of India Vs. Ashish Agrawal & others (2022) 444 ITR 1 (SC) decided the issue but subsequently the issue was again taken up by Hon'ble Supreme Court in the case of Union of India Vs. Rajeev Bansal (supra) laying down certain guidelines which have been reproduced above. As per the judgment of Hon'ble Supreme Court Union of India Vs. Rajeev Bansal (supra), it was held that if any notice u/s. 148 of the Act under the unamended law has been issued after 01.04.2021 then it will be deemed to have been issued u/s. 148A of the Act. In the instant case, even though the AO was having the period of four years from the end of relevant assessment year for reopening the assessment proceedings but since the notice u/s. 148 of the Act was issued after 01.04.2021, the new and amended provisions effective from 01.04.2021 were applicable and in a case where the income escaped is less than Rs. 50.00 lakhs the time limit for issuing notice u/s. 148 of the Act was three years. 9. Now in the case of assessee, first notice u/s. 148 was issued on 30.06.2021. Subsequently Hon'bl....
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....ated for 61 days to issue a notice u/s. 148 of the amended law. The plea of the assessee is that since the notice in the case of assessee was issued on 30.06.2021, there was no surviving time left with the AO. It seems that Ld. Counsel for the assessee has merely taken the facts of the example given by Hon'ble Apex Court in the case of Rajeev Bansal (supra) and has applied the dates of his own case on that example, without understanding the principle laid down by the Hon'ble Court. If this plea of the assessee is considered, then all the further proceedings carried out in the instant case after 28.05.2022 would become redundant. In my view, this is not the right interpretation by the ld. Counsel for the assessee of the ratio laid down by the Hon'ble Apex Court in the case of Rajeev Bansal (supra). 12. A perusal of section 148A(d) of the Act provides that once the assessee has replied to the letter issued u/s. 148A(b) of the Act, then the ld. AO has to decide on the basis of material available on record including reply of the assessee, whether or not it is a fit case to issue a notice u/s. 148, by passing an order, with the prior approval of specified authority, within one month ....