JASARAM KESRAMJI RATHOD,NAVI MUMBAI vs. ITO WARD 28(1)(1) , NAVI MUMBAI

This appeal has been preferred by the assessee against the order dated 23-07-2025 impugned herein passed by National Faceless Appeal
Centre (NFAC), Delhi (in short „NFAC‟)/Ld. Commissioner of Income Tax (in short „Ld. Commissioner‟) u/s. 250 of the Income Tax Act 1961 (in short „the Act‟) for the AY. 2013-14. 2. In the instant case, the assessee had declared his total income of Rs.
16,97,210/-by filing his return of income for the year under consideration on dt. 01-11-2013, which was subsequently reopened for re-assessment u/s.
147 of the Act by issuing notice dt. 30-03-2021 u/s. 148 of the Act, mainly on the reason that the assessee though made cash payment of Rs.
22,50,000/-for purchase of land with Shri Mahesh M. Munde and 11 others, but has not offered the same for taxation for the AY. 2013-14. 2
3. The assessee in response filed his return of income on 05-01-2022, declaring total income at Rs. 16,97,210/-as declared originally. The said return filed by the assessee was declared/considered as belated and/or filed after the stipulated time given in the notice dt. 30-03-2021 u/s. 148 of the Act i.e., within thirty days and, therefore, the same was treated as „nonest’
and accordingly the case of the assessee was finalized u/s. 144 of the Act making the addition of the aforesaid amount of Rs. 22,50,000/- by passing the assessment order dt. 29-03-2022 u/s. 147 r.w.s. 144B of the Act.

“That six years’ time limit for AY. 2013-14 u/s. 149(1)(b) of the Act, would have expired on 31-03-2020, which falls within the COVID-19 relaxation period covered by TOLA, which can utilize such time limits, till 31st March, 2021. Therefore, even if the normal six years’ time limit had expired on 31-03-2020, TOLA would extend it till 31-03-2021. The notice dt. 30-03-2021 is therefore, within the extended time limit provided by TOLA.
Therefore, the additional ground, challenging the validity of notice u/s. 148 of the Act on the ground of limitation, is without merit and is hereby rejected”.

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7. Heard the parties and perused the material available on record.
Admittedly in the instant case six years from the end of the relevant assessment year i.e., AY. 2013-14, expired on 31-03-2020 and, therefore, the AO by taking refuge of TOLA, issued notice dt. 31-03-2021 u/s. 148 of the Act. But thereafter admittedly no notice or order either under section 148A(b) or 148A(d) or 148 of the Act, has ever been passed/issued by the AO. Further escaped income, which was taken into consideration for reopening of assessment under section 147 of the Act, was Rs.22,50,000/- only, which was less than Rs. 50 lakhsand the sanction for issuing the notice u/s 148 of the Act has been taken from the Ld. PCIT but not from the Pr. CCIT.

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 overrides Section 149 of the Income Tax Act only to the extent of relaxing the time limit for issuance of a reassessment notice under Section 148; d. TOLA will extend the time limit for the grant of sanction by the authority specified under Section 151. The test to determine whether TOLA will apply to Section 151 of the new regime is this: if the time limit of three years from the end of an assessment year falls between 20 March 2020 and 31 March 2021 to grant approval;

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10. In the result, the Assessee‟s appeal is allowed.

Order pronounced in the open court on 30-12-2025 [NARENDER KUMAR CHOUDHRY]
JUDICIAL MEMBER

TNMM

Copy to :

1)
The Appellant
2)
The Respondent
3)
The CIT concerned
4)
The D.R, ITAT, Mumbai
5)
Guard file

By Order

Dy./Asst.