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Facts
These are cross-appeals by the assessee and revenue challenging orders related to reassessment notices for Assessment Years 2014-15 and 2016-17. The primary contention is whether the reassessment notice u/s 148 was issued within the limitation period, considering the impact of the Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020 (TOLA).
Held
The Tribunal held that the reassessment notice u/s 148 was issued within the extended time limit provided by TOLA. However, acknowledging that the assessee could not effectively contest before the CIT(A) on all grounds, the matter was restored to the CIT(A) for a fresh decision with adequate opportunity.
Key Issues
Whether the reassessment notice u/s 148 was time-barred given the provisions of TOLA, and whether the assessee had adequate opportunity to contest before the CIT(A).
Sections Cited
148, 149, 250, 148A
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Income Tax Appellate Tribunal, “D” BENCH, MUMBAI
Before: SHRI SANDEEP GOSAIN & SHRI PRABHASH SHANKAR
Date of Hearing 16.09.2025 Date of Pronouncement 13.11.2025 ORDER PER SANDEEP GOSAIN, JM:
These are the cross appeals filed by the assessee as well as revenue challenging the different impugned orders respectively passed under section 250 of the Income Tax Act, 1961 (‘the Act’), by the National Faceless Appeal Centre (NFAC) / CIT(A) for the assessment year 2014-15 & 2016-17.
Since all the issues involved in these three appeals 2. are common and identical and belongs to one assessee therefore, they have been clubbed, heard together and consolidated order is being passed. Firstly we shall take for A.Y 2014-15 as lead case and facts narrated therein.
ITA No. 3348/Mum/2025, A.Y 2014-15
The assessee has challenged the notice u/s 148 of the Act on the ground that the same is not within limitation. However Ld. CIT(A) had passed a detailed order the operative portion of the order of Ld. CIT(A) is reproduced herein below:
6.1 The appellant argues that as per the pre-amended provisions of section 149, the six year period for reopening of assessment ended on 31.03.2021. The notice u/s 148 was issued on 08.04.2021 after the limitation period ended. Notice u/s 148 could not be issued as per the amended provisions (which took effect from 01.04.2021) in a case which had become time barred as per the pre-amended provisions. 6.2 In this case, the six years from end of the relevant assessment year elapsed on 31.03.2021. However in this case AO had the benefit of relaxation of time limits provided by TOLA.
6.3 In pursuance to the power vested under section 3 of the Relaxation Act, 2020 [TOLA], the Central Government issued following Notifications inter-alia extending the time lines prescribed under section 149 for issuance of reassessment notices under section 148 of the Income Tax Act, 1961:
Date of Original Limitation for Extended Notification issuance of notice u/s 148 limitation of the Act 31.03.2020 20.03.2020 to 29.06.2020 30.06.2020 24.06.2020 20.03.2020 to 31.12.2020 31.03.2021 31.03.2021 31.03.2021 30.04.2021 27.04.2021 30.04.2021 30.06.2021 6.4 The Explanations to the Notifications dated 31 March, 2021 and 27 April, 2021 issued under section 3 of the Relaxation Act, 2020 also stipulated that the provisions, as they existed prior to the amendment by the Finance Act, 2021, shall apply to the reassessment proceedings initiated there under. The net effect of TOLA and notifications thereunder was that date of limitation for completion of any proceeding or issue of notice falling between 20-3-2020 to 31-3-2021 was extended to 30-6-2021.
6.5 Therefore upto 30.06.2021, the AO could issue a notice u/s 148 based on the pre-amended provisions. In this case notice u/s 148 was issued on 08.04.2021. Hence the notice u/s 148 was validly issued and in conformity with the provisions of section 149. Thereafter based on Supreme Court's decision in Ashish Agarwal, notice u/s 148 issued as per TOLA was treated as notice u/s 148A(b). Order u/s 148A(d) was passed and notice u/s 148 was issued on on 25.07.2022.
6.6 The appellant has referred to a number of decisions including, Hon Bombay High Court decision in Godrej Industries Ltd vs ACIT [2024] 160 taxmann.com 13 (Bombay). However this matter has reached finality with Supreme Court decision in Rajeev Bansal [2024] 167 taxmann.com 70 (SC). It was held that TOLA overrides Income-tax Act to the extent of relaxing time limit for issue of reassessment notice which fell for completion from 20-3- 4315 & 3349/Mum/2025 Rahul Ratanlal Harchwani,. Mumbai. 2020 to 31-3-2021, till 30-6-2021. Hence the argument of the appellant that notice u/s 148 is time barred is not valid.
Ld. CIT(A) considered the net effect of TOLA and notification there under, wherein date of limitation for completion of any proceeding or issuance of notice falling between 20.03.2020 to 31.03.2021 was extended to 30.06.2021. Now it has been argued that the Coordinate Bench of ITAT in the case of ITO Vs. Pushpak Realities Pvt Ltd, in 4814 & 4816/Mum/2024, has held that “even under TOLA, the time limit for issuance of notice u/s 148 had expired on 31.06.2021 for both the assessment years i.e 2013-14 & 2014-15”
Apart from the above Ld. AR also relied upon the decision of the Coordinate Bench of ITAT in the case of Manish Financial in and argued that approval for issuance of notice u/s 148 has not been obtained from “appropriate Authority”
Whereas on the contrary Ld. DR relied upon the orders passed by the Revenue Authorities.
After having heard the counsels for both the parties at length and after going through the documents placed on record and the orders passed by the revenue authorities and considering the judgments cited before us, we noticed that the decision of the Coordinate Bench of ITAT in the case of Pushpak Realities (supra) was available when Ld. CIT(A) passed the impugned order.
4315 & 3349/Mum/2025 Rahul Ratanlal Harchwani,. Mumbai. Even the other argument of approval not sought from the “appropriate authority” was not even argued or discussed before Ld. CIT(A).
Be that as it may, without going into the merits of the 8. issues raised by the assessee we are of the view that since the assessee could not effectively contest before Ld. CIT(A) by raising these grounds. Therefore one more opportunity is being given to the assessee to represent his case before Ld. CIT(A) by raising all the arguments now being raised before us. Hence, considering the overall circumstances of the present case, we deem it proper to restore the matter back to the file of Ld. CIT(A) for deciding the matter afresh by providing adequate opportunity to the assessee.
Before parting, we make it clear that our decision to restore the matter back to the file of the Ld. CIT(A) shall in no way be construed as having any reflection or expression on the merits of the dispute, which shall be adjudicated by the Ld. CIT(A) independently in accordance with law.
In the result, the appeal filed by the assessee is allowed for statistical purposes.
4315/Mum/2025, A.Y 2014-15
10. Since, we have restored the appeal filed by the assessee to the file of Ld. CIT(A) for afresh decision, therefore in view of our decision in for the same Assessment year, the 4315 & 3349/Mum/2025 Rahul Ratanlal Harchwani,. Mumbai. present appeal is also restored to Ld. CIT(A) to be decided along with ITA No. 3348/Mum/2025. Hence, this appeal also stands allowed for statistical purpose.
3349/Mum/2025, A.Y 2016-17
As the facts and circumstances in this appeal is identical to for the A.Y 2014-15 (except variance in figures) and the decision rendered in above paragraph would apply mutatis mutandis for this appeal also. Accordingly, the grounds of appeal of the present appeals also stands allowed for statistical purposes.
In the result, both the appeals filed by the assessee and revenue’s appeal allowed for statistical purposes.
Order pronounced in the open court on 13/11/2025