TaxTMI 
TaxTMI 
2026 (6) TMI 1036
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.... initiated u/s 147 without properly appreciating that the mandatory conditions under sections 147 and 148A of the Income-tax Act, 1961 were not satisfied. 3. The Assessing Officer issued notice u/s 148 on 06.04.2022 for A.Y. 2015-16. As per the binding decision of the Hon'ble Supreme Court in UOI v. Rajeev Bansal and as confirmed in the ITAT Visakhapatnam Bench decision, notices for A.Y. 2015-16 issued on or after 01.04.2022 are barred by limitation, since the maximum permissible period of six years under the unamended Section 149(1)(b) expired on 31.03.2022. Hence, the impugned notice is invalid and the consequential reassessment proceedings are without jurisdiction. 4. The addition sustained by the Assessing Officer amounts to Rs. 34,27,000/-Since the income alleged to have escaped assessment is below the threshold limit of Rs. 50,00,000/-, the extended time limit under Section 149(1)(b) is not applicable. Therefore, the jurisdictional assumption by the AO for issuing notice beyond six years is patently void and the entire reassessment is liable to be quashed. 5. The learned Commissioner of Income Tax (Appeals) erred in law and on facts in confirmin....
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.... the aforesaid notice. 3. During the course of the assessment proceedings, the AO called upon the assessee to explain the source of the cash deposits of Rs. 34,27,000/- made in her bank account during the subject year. As the assessee failed to come forth with any plausible explanation alongwith supporting material to substantiate her explanation regarding the source of the cash deposits of Rs. 34,27,000/- made in her bank account, the AO vide his order passed under section 147 r.w.s 144B of the Act, dated 15/03/2024 held the entire amount of cash deposits as having been sourced out of her unexplained money under section 69A of the Act. 4. Aggrieved, the assessee carried the matter in appeal before the CIT(A) but without success. 5. The assessee aggrieved with the CIT(A) order has carried the matter in appeal before us. 6. We have heard the Learned Authorized Representatives of both parties and given thoughtful consideration to the issue in hand before us, i.e., sustainability of the impugned order of assessment passed by the AO under section 147 r.w.s 144B of the Act, dated 15/03/2024, which in turn is based on the notice issued under section 148 of the Act, dated 06/0....
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....nder Section 154 of the Act on the same issue, it cannot be made. The attention of this Court has been drawn to the notice dated 20.01.2022 issued for rectification of mistake and the order under Section l48A(d) of the Act passed on 22.04.2024. Reliance has been placed on the following decisions rendered by the Apex Court in Union of India v. Rajiv Bansal; High Court of Delhi in Sheetal international (P) Ltd v. Chief Commissioner of Income-tax, Central-2z; High Court of Karnataka at Bengaluru in Tarish Investment and Trading Company (P) Ltd., v. Union of India3; High Court of Rajasthan in Shree Cement Ltd., v. Assistant Commissioner of Income Tax; High Court of Bombay in Godrej Industries Ltd., v. The Assistant Commissioner of Income Tax, Circle 14(1X2), Mumbai, and by a coordinate Bench of this Court in M/s. Sri Sai Dhurga Balaji Health and Educational Welfare Society v. the Income Tax Officer6. All these decisions relate to the Assessment Year 2017-18 except the case of Godrej Industries Ltd., (supra) which relates to the Assessment Year 2014-15. 7. On the second issue, reliance has been placed on the decision of the Apex Court in the case of S.M. Overseas (P) Ltd., v. C....
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.... for the assessment year 2021-2022 and before. Resultantly, a notice under Section 148 of the new regime cannot be issued if the period of six years from the end of the relevant assessment year has expired at the time of issuance of the (a) if three years have elapsed from the end of the relevant assessment year, unless the case falls under clause (b); (b) if three years, but not more than ten years, have elapsed from the end of the relevant assessment year unless the Assessing Officer 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- (i) an asset; (ii) expenditure in respect of a transaction or in relation to an event or occasion; or (iii) an entry or entries in the books of account, Which has escaped assessment amounts to or in likely to amount to fifty lakh rupees or more: Provided that no notice under section 148 shall be issued at any time in a case for the relevant assessment year beginning on or before 1" day of April, 2021, if a notice under section 148 or section 153A or section 153C could not have been issued at tha....
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....ll notices issued invoking the time limit under Section 149(1)(b) of the old regime will have to be dropped if the income chargeable to tax which has escaped assessment is less than Rupees fifty lakhs." 11. The first proviso) to the amended Section 149 of the Act prescribes that no notice under Section 148 of the Act shall be issued at any time in a case for the relevant assessment year beginning on or before 01.04.2021, if a notice under Section148 of the Act could not have been issued at that time on account of being beyond the time limit specified under the provisions of clause (b) of sub-section (1) of Section 149 of the Act or as they stood immediately before the commencement of the Finance Act, 2021. For the purposes of appreciating the first proviso, the un-amended Section 149 of the Act is also extracted in the foot note10 Time limit for notice. 149. (1) No notice under section 148 shall be issued for the relevant assessment year, (a) if four years have elapsed from the end of the relevant assessment year, unless the case falls under clause (b) or clause (c); (b) if four years, but not more than six years, have elapsed from the e....
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....th and sixth provisos in the first place do not amount to clarification of the first proviso. These two provisos qualify the substantive amended Section 149 of the Act and do not relate to the un-amended Section 149 of the Act for which the first proviso takes care of. The contention of the learned counsel for the Revenue that the time spent from the issuance of notice under Section 148A(b) of the Act up to the passing of the order under Section 148A(d) of the Act in terms of the fifth and sixth provisos stands excluded for reckoning the limitation period for issuance of notice under Section 148 of the Act is not worth acceptance. Section 148A of the Act lays down the procedure for issuance of notice under Section 148 of the Act whereas Section 149 of the Act prescribes strict time limit within which notice under Section 148 of the Act can be issued in the prescribed circumstances. The Revenue is therefore obliged to adhere to the timeline prescribed under Section 149 of the Act for issuance of such notice and undertake the procedure before issuance of notice under Section 148A of the Act. 13. In this regard, it is apposite to refer to opinion of the Delhi High Court. Para....
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.... issuing notice under Section 149 of the Act, however, first proviso is an exception to the period of limitation and provides for a restriction on the notices under Section 148 of the Act being issued for assessment years up to 2021-22 (in this case, it is Assessment Year 2017-18) beyond a certain date. Therefore, the way the section would operate, is to fira decide whether a notice issued under Section 148 of the Vet is within the period of limitation under Section 149(1)(2) or (b) of the Act. To decide whether the notice is within the period of limitation under Section 149(1)(a) or (b) of the Act, the extension of time as prescribed in fifth and/or sixth proviso would be considered. The Court further held once. The notice is otherwise within the period of limitation, thereafter one has to see whether the said limit is within the prescribed restriction provided in first proviso or not. If the notice is beyond the restriction period, the notice is invalid, and the fifth and/or the sixth proviso cannot apply at this stage to extend the period of restriction as per first proviso. Hence, if a notice is not within the time prescribed under first proviso to Section 149(1) of the Act, th....