AI OCR 
TaxTMI 
TaxTMI 
TaxTMI 
2026 (1) TMI 369
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....or the Assessment Year 2014-2015 on the grounds of (i) limitation and (ii) change of opinion. 4.Reading of the impugned order indicates that the Respondent has examined the petitioner's reply dated 20.06.2022 to the Notice dated 02.06.2022 issued under Section 148A(b) of the Act. The conclusions arrived at by the respondent for justifying the impugned order and the issuance of consequential Section 148 Notice both dated 29.07.2022, are as follows: "U/s.148A(d): 13. On perusing the return of income filed for this asst.year as well as previous asst.year and the other details furnished during the course of assessment proceedings as well as with the above submission. (i) It is noticed that during this asst.year the assessee has got 5575 shares on the demerger transaction from relinquishing the rights over 46600 shares, which, was transferred at the cost of Rs. 490 share. Since, the assessee retains these shares as on 31.03.2014 and these transfers are not an exempted one as per the provisions of section 47 of the IT Act, the assessee shall have admitted the capital gain on the above relinquishment, which, the assessee has failed. Accordingly, the sum of Rs. 2283....
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....sment proceedings on the ground of limitation stating the time limit to issue a Notice under Section 148 of the Act has expired as per Section 149 of the Act as in force with effect from 01.04.2021. In this connection, the learned counsel for the Petitioner relies on the 1st proviso to Section 149 of the Act under the new regime, which is extracted in the ensuing paragraph of this order. 6.It is further submitted by the learned counsel for the Petitioner that the time limit to issue Section 148 Notice under the old regime as in force till 31.03.2021 has expired as the time limit of four years for the Assessment Year 2014-2015 expired on 31.03.2019 and the six year limit for the relevant Assessment Year expired on 31.03.2021 as per Section 149 of the Act as in force till 31.03.2021. 7.The learned counsel for the petitioner would further submit that although the Notice under Section 148A(b) was issued on 02.06.2022 pursuant to the order dated 04.05.2022 of the Hon'ble Supreme Court in Ashish Agarwal case referred to supra, the said notice refers to an alleged failure on the part of the petitioner to disclose details of shares valued at Rs. 70,84,94,889/- to which the petitioner....
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....regime and were subsequently substituted by a Notice under Section 148A(b) of the Act on 02.06.2022, are vitiated as they are founded on a mere change of opinion. 14.It is therefore submitted that the impugned proceedings are without jurisdiction and contrary to law as laid down by (i) the Hon'ble Supreme Court in the case of Commissioner of Income -tax, Delhi vs.Kelvinator of India Ltd.[2010] 187 Taxman 312 (SC) [18-01-2010]; (ii) Hon'ble Delhi High Court in the case of Commissioner of Income-tax vs. Kelvinator of India Ltd. [2002] 123 Taxman 433 (Delhi) [19-04-2002]; (iii) Hon'ble Bombay High Court in the case of Mira Bhavin Mehta vs.Income-tax Officer [2024] 161 taxmann.com 572 (Bombay) [13-02-2024] and (iv) Hon'ble Bombay High Court in the case of Sir Jamsetjee Jejeebhoy Charity Fund vs.Income Tax Officer (Exemption), in WP.4941 of 2024. [07.11.2025]. SUBMISSIONS MADE ON BEHALF OF THE RESPONDENTS:- 15.Defending the impugned order, the learned counsel for the respondent would submit that the impugned order has recorded a categorical finding that income to the extent of Rs. 2,28,34,000/- arising from the sale of 46,600 shares had escaped assessment. It is therefore submi....
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....fferent High Courts, the Hon'ble Supreme Court stepped in a batch of cases and finally disposed of the cases on 04.05.2024 in Union of India Vs. Ashish Agarwal case referred to supra. 22.In Paragraph 28 of Ashish Agarwal case (cited supra), it was held as under:- 28. In view of the above and for the reasons stated above, the present Appeals are allowed in part. The impugned common judgments and orders passed by the High Court of Judicature at Allahabad in W.T. No. 524/2021 and other allied tax appeals/petitions, is/are hereby modified and substituted as under: (i) The impugned section 148 notices issued to the respective assessee's which were issued under unamended section 148 of the IT Act, which were the subject matter of writ petitions before the various respective High Courts shall be deemed to have been issued under section 148A of the IT Act as substituted by the Finance Act, 2021 and construed or treated to be show cause notices in terms of section 148A(b). The assessing officer shall, within thirty days from today provide to the respective assessee's information and material relied upon by the Revenue, so that the assessee's can reply to the show cause not....
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....e Court framing the following issues/questions of law:- "(a) Whether the Taxation and other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020 and notifications issued under it will also apply to reassessment notices issued after April 1, 2021; and (b) Whether the reassessment notices issued under section 148 of the new regime between July and September 2022 are valid." 27.In Paragraph No. 112 and 114 of Rajeev Bansal case (cited supra), the Hon'ble Supreme Court observed and concluded as under:- "112. Let us take the instance of a notice issued on May 1, 2021 under the old regime for a relevant assessment year. Because of the legal fiction, the deemed show-cause notices will also come into effect from May 1, 2021. After accounting for all the exclusions, the Assessing Officer will have sixty-one days (days between May 1, 2021 and June 30, 2021) to issue a notice under section 148 of the new regime. This time starts ticking for the Assessing Officer after receiving the response of the assessee. In this instance, if the assessee submits the response on June 18, 2022, the Assessing Officer will have sixty one days from June 18, 2022 to issue....
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....n Union of India Vs. Ashish Agarwal [(2022) 444 ITR 1 (SC); (2023) 1 SCC 617], and the period of two weeks allowed to the assessee's to respond to the show-cause notices; and 8. 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 the Taxation and other Laws (Relaxation and Amendment of Certain Provisions Act, 2020. All notices issued beyond the surviving period are time barred and liable to be set aside;" 28.Before the Hon'ble Supreme Court in Rajeev Bansal case referred to supra, the Revenue itself conceded the position regarding limitation under both the old and the new regimes, in the light of the Taxation and other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020 extensions for Assessment Years 2013-14 to 2017-18 as follows:- Assessment Year Within 3 years (2) Expiry of limitation read with TOLA for (2) (3) Within six years (4) Expiry of limitation read with TOLA for (4) (5) 2013-2014 31.03.2017 TOLA not applicable 31.03.2020 30.06.2021 2014-2015 31.03.2018 TOLA not applicable 31.03.2021....
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....021 has to be treated as a Notice issued under Section 148A(b) of the Act in terms of Ashish Agarwal case (cited supra) and Rajeev Bansal case (cited supra). 33.The Hon'ble Supreme Court in Rajeev Bansal case referred to supra, thus held that the combined effect of the legal fiction and the directions issued by the Hon'ble Supreme Court in Ashish Agarwal case referred to supra was that the time begins to run for an assessee to respond to the show-cause notices, after the supply of the relevant material and information to the assessee. 34.This has been explained by the Hon'ble Supreme Court in Rajeev Bansal case referred to supra in Paragraph Nos. 94 to 107, which are extracted as under:- "94. Before we proceed, we need to bear in mind three important periods: (i) The period up to June 30, 2021 - this period is covered by the provisions of the Income-tax Act read with Taxation and other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020; (ii) The period from July 1, 2021 to May 3, 2022 - the period before the decision of this court in Union of India v. Ashish Agarwal [(2022) 444 ITR 1 (SC); (2023) 1 SCC 617.] ; and (....
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....because the other requirement of supplying the relevant material or information to the assessee's was not fulfilled. The second requirement could only have been fulfilled by the Revenue by an actual supply of the relevant material or information that formed the basis of the deemed notice. 102. While creating the legal fiction in Union of India v. Ashish Agarwal [(2022) 444 ITR 1 (SC); (2023) 1 SCC 617.], this court was cognizant of the fact that the Assessing Officers were effectively inhibited from performing their responsibility under section 148A until the requirement of supply of relevant material and information to the assessee's was fulfilled. This court lifted the inhibition by directing the Assessing Officers to supply the assessee's with the relevant material and information relied upon by the Revenue within thirty days from the date of the judgment. Thus, during the period between the issuance of the deemed notices and the date of judgment in Union of India v. Ashish Agarwal [(2022) 444 ITR 1 (SC); (2023) 1 SCC 617.], the Assessing Officers were deemed to have been prohibited from proceeding with the reassessment proceedings. ... 107. The third ....
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....rom the fiction. (East End Dwellings Co. Ltd. v. Finsbury Borough Council [[1952] A.C. 109. (Lord Asquith, in his concurring opinion, observed:"If you are bidden to treat an imaginary state of affairs as real, you must surely, unless prohibited from doing so, also imagine as real the consequences and incidents which, if the putative state of affairs had in fact existed, must inevitably have flowed from or accompanied it.")] ) Therefore, the logical effect of the creation of the legal fiction by Union of India v. Ashish Agarwal [(2022) 444 ITR 1 (SC); (2023) 1 SCC 617.] is that the time surviving under the Income-tax Act read with Taxation and other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020 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 June 30, 2021. 109. If this court had not created the legal fiction and the original reassessment notices were validly issued according to th....
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....tion 148 if it was a fit case for reassessment. Once the clock started ticking, the Assessing Officer was required to complete these procedures within the surviving time limit. The surviving time limit, as prescribed under the Income-tax Act read with Taxation and other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020, was available to the Assessing Officers to issue the reassessment notices under section 148 of the new regime." 36.Thus, if an assessee replies within the time stipulated in the above illustrations, the Assessing Officer has time up to sixty-one days from the date of reply. Therefore, the notices issued under Section 148 of the new regime issued in pursuance of the deemed notices ought to have been issued within the time limit surviving under the Act read with TOLA. 37.Thus, for the Assessment Years 2013-2014, 2014-2015, 2015- 2016, 2016-2017 and 2017-2018, the Hon'ble Supreme Court in Rajeev Bhansal case referred to supra held to assume jurisdiction to issue notices under Section 148 under the new regime with respect to these Assessment Years, an Assessing Officer has to: 1. issue the such notices within the period prescribed under ....
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....cuments or any assets requisitioned under section 132A, on or before the 31st day of March, 2021: Provided also that for the purposes of computing the period of limitation as per this section, the time or extended time allowed to the assessee, as per show-cause notice issued under clause (b) of section 148A or the period during which the proceeding under section 148A is stayed by an order or injunction of any court, shall be excluded: Provided also that where immediately after the exclusion of the period referred to in the immediately preceding proviso, the period of limitation available to the Assessing Officer for passing an order under clause (d) of section 148A is less than seven days, such remaining period shall be extended to seven days and the period of limitation under this sub-section shall be deemed to be extended accordingly. Explanation.- For the purposes of clause (b) of this subsection, "asset" shall include immovable property, being land or building or both, shares and securities, loans and advances, deposits in bank account. (2) The provisions of sub-section (1) as to the issue of notice shall be subject to the provisions of section 151." ....
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....ime in case for the relevant assessment year beginning on or before 1st day of April, 2021, if [a notice under section 148 or section 153A or section 153C could have been issued at that time on account of being behind the time limit specified under the provisions of clause (b) of sub-section (1) of this section or section 153A or section 153C as the case may be], as they stood immediately before the commencement of the Finance Act, 2021;" 47.By virtue of TOLA extensions, the six year limitation for issuance of Notice under Section 148 under the old regime was extended upto 30.06.2021 in view of the extension under Taxation and other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020 (TOLA) for the Assessment Year 2014-2015. The limitation would have otherwise expired on 31.03.2021 under the old regime. 48.This will be in accordance with the ratio in Ashish Agarwal case (cited supra) and Rajeev Bansal case (cited supra) and in accordance with the 1st proviso to Section 149 of the Act as in force with effect from 01.04.2021. 49.Dealing with a somewhat similar situation, this Court, in Mrs.Thulasidass Prabavathi, Proprietrix, M/s.Venkateshwara Traders vs. Income ....