TaxTMI 
TaxTMI 
2025 (1) TMI 1854
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.... of the Act was issued on 21-06-21. Thereafter, as per directions of the Hon'ble Supreme Court in its judgment dated 04.05.2022 (2022 SCC Online SC 543) in the case of Union of India Vs. Ashish Aggarwal, the notice u/s 148 of the IT Act issued between 01.04.21 to 30.06.21 is deemed to be the show cause notice issued under clause (b) of the Section 148A of the IT Act. Without closure of proceedings of notice u/s 148 dated 21-06-21, notice issued u/s 148A(b) dated 28-05-22, notice again issued u/s 148 dated 27-07- 22 are not according to law. Notice u/s 148A(b) was issued on 28/05/22 without providing material, information and documents and which has not been served as per Rule 127 of the Income-tax Rules. Without providing proper opportunity order u/s 148A(d) of the Act has been passed on 27/07/22. Notice u/s 148 was issued on 27-07-22, which has no DIN and intimation letter for notice u/s 148 of the Act was issued on 30.07.22. Notice u/s 148 dated 27-07-22 is without digital signature and it has not been issued as per procedure and formats and standards for ensuring secured transmission of Electronic Communication. Notice u/s 148 dated 27-07-22 has also not been issued in facel....
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.... the assessee and further observed that there is presumption in favour of the department that earlier notices were served upon the appellant and therefore, the ground in respect of reopening of the assessment under section 148 of the Act was rejected and dismissed. 5. Aggrieved by the impugned order, the assessee is in appeal before the Tribunal raising following grounds: "On the facts and in the circumstances of the case and in law the Ld. CIT (A), National Faceless Appeal Centre, has erred in: 1. Ld. CIT(A) has erred in upholding the validity of order u/s 147 r.w.s. 144B of the Income-tax Act dated 19-05-23 vide order dated 30-06-25, which is without jurisdiction: 2. Ld. CIT(A) has erred in confirming the order dated 19-05-23 u/s 147 r.w.s. 144B of the Act passed by the Assessment Unit, Income-tax Department. 3. Ld. CIT(A) has erred in confirming the addition of Rs. 7,68,03,950/- u/s 68 of the Income-tax Act, 1961. 4. Ld. CIT(A) has erred in confirming the order dated 19-05-23, without affording adequate opportunity. 5. Ld. CIT(A) has erred in confirming the order dated 19-05-23, as proceeding initiated u/s 147 of the Act i....
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....he said aspects regarding the notice under section 148 of the Act was barred by limitation, therefore, the appeal be allowed and the assessment order be quashed. 7. We have also heard the Ld. DR who was supplied with the paper book, and after going through Page No. 1 containing the table for the calculation of time-barred notice under section 148 of the Act, the Ld. Sr. DR. has submitted that the Bench may consider the submissions with respect to the applicability of the judgment of Supreme Court in Rajiv Bansal case (supra) in its own discretion and has prayed for restoring the file to the AO for deciding the matter afresh. 8. We have considered the rival submissions and have perused the material on record. Page no. 1 of the paper book containing the details in respect of notice dated 27.07.2022 under section 148 of the Act being time barred is extracted as under: Before the Income Tax Appellate Tribunal, "E" Bench, Delhi The Hisar Leading Bank Co-Op Non Agri Thrift & Credit Society Limited, Shop No. 52-53, Saini School, Saniyan Mohalla, Hisar-125001 (Haryana) PAN-AADAT3893L ITA NO. 5053/DEL/2025 A.Y. 2014-15 S. No. Particulars &n....
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....bmissions of the parties on the challenge to the legal ground assailing the jurisdiction of the Assessing Officer to issue notices under Section 148 of the Act beyond the limitation period. The controversy lies in a narrow compass-whether the notice issued under section 148 on 27.07.2022 for A.Y. 2014-15 is barred by limitation. The Hon'ble Supreme Court in Union of India v. Rajiv Bansal (supra) has conclusively interpreted the interplay between the amended provisions of sections 148 and 149, the old regime, and TOLA. Significantly, the Revenue itself conceded before the Hon'ble Supreme Court that for A.Y. 2015-16, all notices issued on or after 01.04.2021 are liable to be dropped, as they would not fall for completion within the period prescribed under TOLA. 11.1 The Hon'ble Supreme Court further held that the extended ten-year limitation under section 149(1)(b), as amended, operates prospectively, and for earlier assessment years, the test is whether the six-year periodunder the old regime was still alive on the date of issuance of notice. Applying the aforesaid test to the facts of the present case, it is undisputed that the six-year limitation for A.Y. 2014-15 ex....
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....upreme Court and finding no fruitful object will be achieved if the issue is remanded to the file of the Ld. CIT(A), therefore, we deem it fit to decide the Appeal by adjudicating the issue of limitation to issue Notice under Section 148 of the Act. 9. In the present case, the notice under erstwhile provision of Section 148 of the Act was issued on 23/06/2021 under the provision of Section 148 of the Act i.e.prior to substitution of Section 148 by Finance Act, 2021, w.e.f. 01/04/2021. 10. The Hon'ble Supreme Court vide its Judgment dated 04/05/2022 in the case of Union of India Vs. Ashish Agarwal (2023) 1 SCC 617, deeming the notice issued under the erstwhile Section 148 of the Act as Notice under Section 148A (b) of new Law as amended by Finance Act, 2021 and directing that material/information be given in 30 days from date of the said order and Assessees shall reply within two weeks thereafter. 11. The Ld. A.O. issued a letter u/s 148A (b) of the Act on 25/05/2022 pursuant to the Judgment of Hon'ble Supreme Court in the case of Ashish Agarwal (supra). The time limit to file reply was till 10/06/2022 and the Assessee filed reply on the same day. ....
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....s sub-section shall not apply in a case, where a notice under section 153A, or section 153C read with section 153A, is required to be issued in relation to a search initiated under section 132 or books of account, other documents 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 undersection 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 ITAs No.6140 & 6167/Mum/2024 (A.Ys. 2013-14 & 2014-15) 8 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) ....
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....ll apply as they apply for the purposes of that section. (2) The provisions of sub-section (1) as to the issue of notice shall be subject to the provisions of section 151. (3) If the person on whom a notice under section 148 is to be served is a person treated as the agent of a non-resident under section 163 and the assessment, reassessment or recomputation to be made in pursuance of the notice is to be made on him as the agent of such non-resident, the notice shall not be issued after the expiry of a period of six years from the end of the relevant assessment year. Explanation-- For the removal of doubts, it is hereby clarified that the provisions of sub-sections (1) and (3), as amended by the Finance Act, 2012, shall also be applicable for any assessment year beginning on or before the 1st day of April, 2012." 16. From the plain reading of section 149 of the Act, prior to its amendment by the Finance Act, 2021, it is evident that the same provides period of 4 years, up to 6 years, and up to 16 years for issuance of notice under section 148 of the Act, provided the conditions laid down therein are satisfied. In the present case, it cannot be disputed tha....
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....iction, the assessing officers were deemed to have been inhibited from acting in pursuance of the Section 148A(b) notice till the relevant material was supplied to the assesses. Therefore, the show cause notices were deemed to have been stayed until the assessing officers provided the relevant information or material to the assesses in terms of the direction issued in Ashish Agarwal (supra). To summarize, the combined effect of the legal fiction and the directions issued by this Court in Ashish Agarwal (supra) is that the show cause notices that were deemed to have been issued during the period between 1 April 2021 and 30 June 2021 were stayed till the date of supply of the relevant information and material by the assessing officer to the assessee. After the supply of the relevant material and information to the assessee, time begins to run for the assesses to respond to the show cause notices. 107. The third proviso to Section 149 allows the exclusion of time allowed for the assesses to respond to the show cause notice under section 149A(b) to compute the period of limitation. The third proviso excludes "the time or extended time allowed to the assessee." Resultantly, the....
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....iction by Ashish Agarwal (supra) is that the time surviving under the Income Tax Act read with TOLA 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 30 June 2021." 19. Thus, the Hon'ble Supreme Court held that the surviving time under the Act read with the TOLA will be available to the Revenue to complete the remaining proceedings in furtherance of the deemed notice, including issuance of re-assessment notice under section 148 of the Act under the new regime. While explaining the methodology for computation of the surviving or balance time limit, the Hon'ble Supreme Court in paragraph-112 of Rajeev Bansal (supra) observed as follows: - "112. Let us take the instance of a notice issued on 1 May 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 1 May 2021. After accounting for all the ....
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....jeev Bansal (supra). 22. We find that even if the benefit of the fourth proviso to section 149 of the Act is granted to the Revenue, since the remaining period in the present case, after the exclusion of time period as provided in the third proviso to section 149, is less than 7 days, even then the notice dated 28/07/2022 under ITAs No.6140 & 6167/Mum/2024 (A.Ys. 2013-14 & 2014-15) 14 section 148 of the Act was issued much beyond the 7 days' extension provided in the fourth proviso to section 149 of the Act. 23. As regards the other contention of the learned DR that as per the provisions of section 148A(d) of the Act, the AO has time period of one month from the end of the month in which the reply is received from the assessee, and therefore, since in the present case, the assessee filed its reply on 24/06/2022, the order passed under section 148A(d) and notice issued under section 148 of the Act on 28/07/2022 is within the limitation period, we find that similar argument of the Revenue was negated by the Hon'ble Delhi High Court in Ram BalramBuildhome (P.) Ltd. v/s Income-tax Officer, reported in [2025] 171 taxmann.com 99 (Delhi), by observing as follows:....