TaxTMI 
TaxTMI 
2026 (6) TMI 1325
X X X X Extracts X X X X
X X X X Extracts X X X X
....ange resulting in business loss amounting to Rs.4,03,43,000/- during F.Y. 2014-15 relevant to assessment year 2015-16. After following the guidelines of Hon'ble Supreme Court order dated 04/05/2022 in the case of Union of India & Ors. Vs. Ashish Agarwalas as well as the CBDT's Instruction No. 01/2022 dated 11.05.2022, the ld. AO has passed the Order u/s. 148A(d) after issuing show cause notice u/s 148A(b) of the Act and after taking into account the reply of the assessee. Accordingly, notice u/s 148 was issued to reopen the assessment. In response to the notice u/s 148 of the Act assessee filed its ITR showing total income of Rs.5,15,165/-. Accordingly, the assessment was framed u/s 147 read with section 144B of the Income tax Act, vide order dated 29.05.2023, assessed the total income at Rs. Rs.4,08,58,170/- by making addition in respect of fictitious loss in share trading. 4. Aggrieved assessee preferred the appeal before the ld. CIT (A), who allowed the appeal of the assessee by observing and holding as under:- "5. Observation and Decision: The impugned assessment order, the statement of facts and the written submission of the appellant have been perused. Ba....
X X X X Extracts X X X X
X X X X Extracts X X X X
....f being heard is in gross violation of principles of natural justice and, therefore, illegal and liable to be quashed. (147/148 - Computation of income not correct) 8. For that the Ld. Assessing Officer erred in not allowing proper credit of taxes paid by the assessee and hence the Ld. Assessing Officer be directed to allow the same as per law. (234 - Interest not correctly computed) 9. For that the Ld. Assessing Officer erred in calculation of the interest charged in the assessment order and hence the Ld. Assessing Officer be directed to recomputed the interest as per law. 10. For that the Ld. Assessing Officer did not compute the income and tax on income correctly as per law and hence the Ld. AO be directed to compute the income as per law. (250-Leave for admission of additional evidence) 11. The appellant craves leave to produce additional evidences in terms of Rule 46A of the Income Tax Rules 1962. (250-Leave for ground modification) 12. The appellant craves leave to press new, additional grounds of appeal or modify, withdraw any of the above grounds at the time of hearing of the appeal." ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....imated by the AO vide letter dated 24.05.2022 that the notice issued u/s 148 on 16.04.2021 under the old law (old scheme of reopening) has been held to be show cause notice (SCN) issued under clause (b) of section 148 of the new law (new scheme of reopening). The appellant was provided the information/material relied upon to issue notice u/s 148 dated 16.04.2021 and asked to submit its reply by10.06.2022. (c) In compliance of the above deemed show cause notice (SCN), the appellant sought for adjournment on 10.06.2022, which was accepted by the AO and the appellant vide letter dated 10.06.2022 was intimated to submit its response by 23.06.2022. In compliance, the appellant submitted its reply before the AO. The reply was considered by the AO, but was not found tenable. Thus, considering the case as fit for issue of notice u/s 148, order u/s 148A(d) was passed on 27.07.2022 after obtaining prior approval of Pr.CCIT, WB & Sikkim. Notice u/s 148 was also issued to the appellant on 27.07.2022 after obtaining prior approval of Pr.CCIT, WB & Sikkim. 5.2.2 The rival contentions available on record have been examined. In this regard, it has been noted that the judgement of....
X X X X Extracts X X X X
X X X X Extracts X X X X
....le SC in the case of UoI Vs Rajeev Bansal, the Revenue made a submission. The submission has been noted in para 19/pg. 51-52 of the Hon'ble SC judgment. This submission will make the legality of issuance of notice u/s 148 under the old regime versus the new regime abundantly clear. The relevant part of par 19 of the Hon'ble SC judgment is reproduced below - "19. Mr N Venkataraman, learned Additional Solicitor General of India, made the following submissions on behalf of the Revenue: a. Parliament enacted TOLA as a free-standing legislation to provide relief and relaxation to both the assesses and the Revenue during the time of COVID-19. TOLA seeks to relax actions and proceedings that could not be completed or complied with within the original time limits specified under the Income Tax Act; b. Section 149 of the new regime provides three crucial benefits to the assesses: (i) the four-year time limit for all situations has been reduced to three years; (ii) the first proviso to Section 149 ensures that re-assessment for previous assessment years cannot be undertaken beyond six years; and (iii) the monetary threshold of Rupees fift....
X X X X Extracts X X X X
X X X X Extracts X X X X
....e Revenue has categorically admitted that for the AY 2015-16 TOLA is not applicable. The Revenue also conceded that for the AY 2015-16, all notices issued on or after 01.04.2021will have to be dropped as they will not fall for completion during the period prescribed under TOLA. In view of the categorical admission of the Revenue before the Hon'ble SC, notice u/s 148 cannot be issued after 31.03.2021 under the old regime. In this case the AO has issued the notice u/s 148 on 16.04.2021 as per provisions of the old regime taking benefit of the extended time under TOLA, which as per the Hon'ble SC judgment is not available for the AY 2015-16. 5.2.7 The Hon'ble SC concluded the judgement with the following directions - "G. Conclusions 114. In view of the above discussion, we conclude that: a. After 1 April 2021, the Income Tax Act has to be read along with the substituted provisions; b. TOLA will continue to apply to the Income Tax Act after 1 April 2021 if any action or proceeding specified under the substituted provisions of the Income Tax Act falls for completion between 20 March 2020 and 31 March, 2021; c. Section 3(1) of TOLA ov....
X X X X Extracts X X X X
X X X X Extracts X X X X
....dity of notice issued u/s 148 on 16.04.2021 under the old regime being invalid is squarely covered, as per facts of the case, by the decision of Hon'ble Supreme Court in the case of the UoI Vs Rajeev Bansal. In light of the above facts, law and discussion it has been established that the notice issued u/s 148 of the Act on 16.04.2021 for the AY 2015-16 is barred by limitation and hence all subsequent actions become legally invalid. Therefore, respectfully following the decision of the Hon'ble SC, the reopening of the case for the AY 2015-16 u/s 147 is invalid and hence the notice issued u/s 148 on 16.04.2021 for reopening the assessment and the subsequent notices and assessment order dated 29.05.2023 are hereby quashed being barred by limitation for the reasons as discussed above in this order. 5.2.9 As noted above, the appeal has been allowed on the above legal grounds only and therefore, the other grounds of appeal are not decided as the same have been left infructuous in light of the vitiated initiation of the reassessment proceedings and lack of jurisdiction of the AO in light of the discussion and decision noted in the preceding paragraphs. 6. In the end,....