AI Drafter 
TaxTMI 
TaxTMI 
2026 (5) TMI 113
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....eral under the new regime as in force from 01.04.2021. According to the Petitioner, the Return of Income originally filed culminated in an Assessment Order dated 31.03.2016 under Section 143(3) of the Act against which Appeal is pending before the Appellate Forum. 3. Dispute in the present case relates to an inter-corporate loan for a sum of Rs. 10,18,80,000/- received by the Petitioner from M/s.Ananya Infrastructure Pvt. Ltd. It is submitted that the said inter-corporate loan was also reflected in the books of accounts. It is submitted that the explanation offered by the Petitioner was accepted in the said Assessment Order dated 31.03.2016. 4. It is stated that the Petitioner had furnished ledger extracts, bank statements, confirmation letters, PAN details, and financial statements of the creditor of Petitioner Company to establish the identity, genuineness, and creditworthiness of the lender. According to the Petitioner, once such materials were furnished, the burden stood discharged and it was for the Department to establish that the amount represented undisclosed income in the hands of the Petitioner. 5. The Petitioner further contends that though a statement was recor....
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.... was obtained only from the Director General. 10. Per contra, learned Senior Standing Counsel for the Respondents submitted that the Petitioner did not initially respond within the time stipulated in the Notice issued under Section 148A(b) of the Act dated 02.06.2022, and that the Reply was submitted only on 13.07.2022, pursuant to which the impugned Order under Section 148A(d) of the Act was passed on 30.07.2022 and Section 148 Notice was issued on 30.07.2022. It is therefore contended that the proceedings were validly initiated and the Assessment Order dated 31.03.2023 was within jurisdiction. 11. The learned Senior Standing Counsel for the Respondents also drew attention to the Proviso to Section 149 and placed reliance on Section 148A(d) of the Act in support of the impugned proceedings. 12. I have considered the arguments advanced by the learned counsel for the Petitioner and the learned Senior Standing Counsel for the Respondents. 13. The dispute in the present case pertains to the Assessment Year 2013-2014. The limitation for issuing a Notice under amended Section 148 of the Act and amended Section 149 of the Act would have expired on 31.03.2017 and 31.03.2024. T....
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.... the concerned Assessing Officers to hold any enquiry, if required; (iii) The assessing officers shall thereafter pass orders in terms of section 148A(d) in respect of each of the concerned assessee's; Thereafter after following the procedure as required under section 148A may issue notice under section 148 (as substituted); (iv) All defences which may be available to the assesses including those available under section 149 of the IT Act and all rights and contentions which may be available to the concerned assessee's and Revenue under the Finance Act, 2021 and in law shall continue to be available." 15. Thus, as per the above decision of the Hon'ble Supreme Court in Ashish Agarwal case (cited supra), a Re-Assessment Notice under Section 148 of the old regime was to be treated as Section 148A(b) Notice for the Assessing Officers for issuance of a Re-Assessment Notice under Section 148 under the new regime within the time limit surviving under the Income Tax Act. The Court therefore did not deal with the provisions of the Taxation and other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020. 16. As per the first Proviso to Section 149 of the Act ....
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....assessment year falls between March 20, 2020 and March 31, 2021, then the specified authority under section 151(i) has extended time till June 30, 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 March 20, 2020 and March 31, 2021, then the specified authority under section 151(2) has extended time till March 31, 2021 to grant approval; (f) The directions in Union of India Vs. Ashish Agarwal [(2022) 444 ITR 1 (SC); (2023) 1 SCC 617] will extend to all the ninety thousand reassessment notices issued under the old regime during the period April 1, 2021 and June 30, 2021; (g) The time during which the show- cause notices were deemed to be stayed is from the date of issuance of the deemed notice between April 1, 2021 and June 30, 2021 till the supply of relevant information and material by the Assessing Officers to the assessee's in terms of the directions issued by this court in 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 notic....
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....d (iii) the monetary threshold of Rupees fifty lakhs will apply to the re assessment for previous assessment years; c. The relaxations provided under section 3(1) of TOLA apply "notwithstanding anything contained in the specified Act." Section3(1), therefore, overrides the time limits for issuing a notice under Section 148 read with Section 149 of the Income-tax Act; d. TOLA does not extend the life of the old regime. It merely provides a relaxation for the completion or compliance of actions following the procedure laid down under the new regime; e. The Finance Act 2021 substituted the old regime for reassessment with a new regime. The first proviso to Section 149 does not expressly bar the application of TOLA. Section 3 of TOLA applies to the entire Income-tax Act, including Sections 149 and 151 of the new regime. Once the first proviso to Section 149(1)(b) is read with TOLA, then all the notices issued between 1 April 2021 and 30 June 2021 pertaining to assessment years 2013-2014, 2014-2015, 2015-2016, 2016-2017, and 2017-2018 will be within the period of limitation as explained in the tabulation below: Assessment Year Within 3 Years Expiry of....
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....se (b) expires. 24. Further as per the third Proviso to Section 149 of the Act, for the purposes of computing the period of limitation, the time or extended time allowed to the assessee, as per Show Cause Notice issued under Clause (b) of Section 148A of the Act or the period during which the proceeding under Section 148A of the Act is stayed by an order or injunction of any Court, shall be excluded. Amended Section 148A(d) of the Act and Proviso to Section 149 of the Act have to be read in conjunction. 25. Therefore, an order has to be passed by the Assessing Officer within one month from the end of the month in which the Reply referred to in Clause (c) is responded to by the Petitioner. 26. Thus, for the purposes of computation of limitation for passing an order under Section 148A(d) of the Act as provided in Section 148A(d) of the Act and third Proviso to Section 149 of the Act, the time between 02.06.2022 and 31.07.2022 is to be excluded for both passing order under Section 148A(d) of the Act and Notice under Section 148 of the Act. 27. This has been also beautifully explained in Paragraph No.112 of the decision of the Hon'ble Supreme Court in Rajeev Bansal case (cited....
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....48A 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 sub-section, "asset" shall include immovable property, being land or building or both, shares and securities, loans and advances, deposits in bank account. 30. The so called concession in Paragraph No.19 is confined only to three (3) years limitation under the new regime. This concession is perfectly in line with the first Proviso to amended Section 149 of the Act. In other words, if four/six years limitation under the old regime had already expired, there was no scope for issuing a Section 148 Notice under the new regime. 31. On the other hand, if six years limitation under the old regime had not expired on 01.04.2021, there is no embargo under the new regime to issue a fresh Notice under amended Section 148 of the Act following the procedure under Section 148A of the Act within the limitation under Section 149 of the Act, in view of the provisions of the Taxation and other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020. 32.....
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....reme Court held as under:- "5. Taking into consideration the arguments advanced by learned counsel and the impact of the surge of the virus on public health and adversities faced by litigants in the prevailing conditions, we deem it appropriate to dispose of the M.A.21 of 2022 with the following directions:- II. The order dated 23.03.2020 is restored and in continuation of the subsequent orders dated 08.03.2021, 27.04.2021 and 23.09.2021, it is directed that the period from 15.03.2020 till 28.02.2022 shall stand excluded for the purposes of limitation as may be prescribed under any general or special laws in respect of all judicial or quasi judicial proceedings. III. ....." 36. Due to the outbreak of Covid-19 pandemic, the last date for issuing a Notice under Section 148 for the Assessment Year 2013-2014 which was to expire on 31.03.2020 stood extended to 30.06.2021 in terms of Section 3 of the Taxation and Other laws (Relaxation and Amendment of Certain Provisions Act (TOLA), 2020. This period will therefore exclude time between 15.03.2020 and 28.02.2022 in terms of the decision of the Hon'ble Supreme Court in In Re: Cognizance for Extension of Limita....
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....arwal case (cited supra) was filed on 13.07.2022. Therefore, an order under Section 148A(d) of the Act had to be passed within one month from the end of the month of such Reply. In other words, order under Section 148A(d) of the Act had to be passed on or before 31.08.2022 i.e., within one month from 31.07.2022, it being the end of the month of Reply dated 13.07.2022 referred to in Clause (c) to Section 148A of the Act. In this case, Section 148A(d) order is dated 30.07.2022 which was much prior to the expiry of deadline. Thus, order passed under Section 148A(d) of the Income on 30.07.2022 of the Act was is in time. 39. Since Section 148A(d) order was passed on 30.07.2022 much before the expiry of the limitation on 31.08.2022 specified under Section 148A(d) of the Act, it has to be held to have been passed within the time stipulated under it. Therefore, Section 148A(d) order was passed on 30.07.2022 and the Section 148 Notice was issued on the same date for the Assessment Year 2013-2014 was in time. 40. In this case, Section 148A(d) order was passed on 30.07.2022. Thus, the Section 148A(d) order dated 30.07.2022 has been passed well ahead of time, as the time for passing such....