TaxTMI 
TaxTMI 
2026 (6) TMI 287
X X X X Extracts X X X X
X X X X Extracts X X X X
....r 2019-20 declaring total income of Rs. 21,02,070/-. The Assessing Officer observed that no scrutiny assessment was done in the cases of the assessee for the year under consideration. Accordingly, the Assessing Officer issued notice u/s. 148A(b) of the Act and has extracted the order passed u/s. 148(d) of the Act dated 10.04.2023 in his order. Further, notice u/s. 148 of the Act was issued on 10.04.2023 after obtaining necessary approval from the competent authority. In response to the above notice, the assessee filed return of income on 18.04.2023 declaring total income as declared in the original return of income. Accordingly, notice u/s. 143(2) and 142(1) of the Act were issued and served on the assessee. In response, Ld. AR of the asses....
X X X X Extracts X X X X
X X X X Extracts X X X X
....sed various grounds including legal ground, wherein assessee has raised ground on valid notice issued u/s. 148 r.w.s. 149(1)(a) read with relevant proviso and assessment order passed u/s. 147 of the Act is beyond jurisdiction. After considering the grounds of appeal and detailed submission made by the assessee, ld. CIT(Appeals) dismissed the grounds raised by the assessee on merit as well as above technical ground with the following observation:- "5.7 Ground No. 4, the appellant has challenges the validity of issuing of notice u/s. 148 of the Act. It is noted that section 149(1) of the Act, as substituted by the Finance Act, 2021, clearly provides that a notice u/s. 148 can be issued within three years from the end of the relevant ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....t of Rs.3,50,000/-. 2. On the facts and in the circumstances of the case and in law, the learned CIT (A) ought to have quashed the notice u/s. 148, ought to have annulled the assessment under appeal being void ab initio, and ought not to have upheld/confirmed the disallowance of Rs.3,50,000/-. 3. It is therefore prayed that the notice u/s. 148 may be quashed, the assessment under appeal may be annulled and the disallowance of Rs.3,50,000/- may be deleted. 4. Your appellant craves leave to add, amend, alter or withdraw any ground of appeal at the time of hearing." 7. At the time of hearing, Learned AR of the assessee has contested the validity of the reassessment proceedings on the ground that the notice issued ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ow cause notice u/s. 148A(b) of the Act, shall be excluded. In the instant case, the notice u/s. 148A(b) was issued on 29-03-2023 allowing time for response till 05-04-2023. Excluding 29-03-2023, the AO allowed clear 7 days' time for response. Therefore, in computing the period of limitation u/s. 149(1)(a), period of 7 days need to be excluded. In other words, the limitation for issuing notice u/s. 148 would be extended from 31-03-2023 to 07-04-2023. However, the notice u/s. 148 was issued after 07-04-2023, i.e., on 10-04-2023. The same was therefore issued after expiry of limitation, and therefore being was liable to be quashed. • During the hearing, we had further pointed out the sixth proviso for consideration so as to clari....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... under this clause is one month from the end of the month in which the reply to show cause notice u/s. 148A(b) is received or where no such reply is received (as is the case of the appellant), from the end of the month in which the period allowed to furnish the reply expires. • Applying the above provision to the facts of the instant case, the appellant was allowed to furnish reply by 05-04-2023. He did not furnish reply. Therefore, the period available for passing the order u/s. 148A(d) of the Act was one month from the end of the month of April, 2023, i.e., 31-05-2023. • Thus, it is clear that the period available for passing order u/s. 148A(d) of the Act was more than a month and a half. Therefore the sixth prov....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... material placed on record. I observed that the AO initiated the reassessment proceedings based on the information received from the investigation wing that the assessee utilized the bogus donation from the unregistered political party to book the donation to curtail the tax. However, the amount involved is only Rs.3,50,000/-. In order to reopen the assessment beyond 3 years, as per the provisions of section 149(1)(b), the precondition is, the AO 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 as asset, expenditure or an entry in the books, which has escaped income amounts to or likely to amounts to fifty lakh rupees or more. In the given case, t....