SAPANA SHRINIVAS SAMAL,MUMBAI vs. ITO WARD 42(3)(3), MUMBAI

The brief facts are that the appellant is a non-filer for the relevant assessment year. The AO was in receipt of information from the Insight portal and from the SRO, Kurla, Mumbai-1 about the appellant having entered into Sapana S. Samal transaction of purchase of immoveable property and having received Rs.40,000/- being fees for professional/technical services. The AO initiated proceedings by an order dated 22.04.2023 under Section 148A(d) of the Act. A notice under Section 148 of the Act came to be issued on the same day requiring the assessee to file Return of Income (RoI), which was not complied with. The appellant did not even respond to any of the notices issued during the course of assessment proceedings. As such, the AO completed the assessment under Section 147/144 r.w.s. 144B of the Act on 26.02.2024 making the impugned additions, which has been confirmed in appeal.

We have heard parties. Perused record.

It is submitted by the learned AR that the impugned assessment proceedings for assessment year 2015-16 was time barred for which reliance is placed on the decision of the Supreme Court in case of Union of India vs Rajeev Bansal, 469 ITR 46 (SC). It is also submitted that the reopening by the Jurisdictional Assessing Officer (JAO) was invalid as the reopening, if any, was required to be made by the Faceless Assessing Officer (FAO). It is submitted that the JAO had not made an independent inquiry as required under Section 148A(d) of the Act and the same is passed without granting opportunity of personal hearing through video conferencing as held by the Bombay High Court in Chander Arjandas Manwani (2021) 130 taxmann.com 445 (Bombay). It is further submitted that the AO failed to appreciate that the immoveable property was purchased jointly by the assessee along with her husband and thus, the impugned addition for the entire amount could not be made against the assessee.

Considering the submissions we do find that the assessee has been totally non responsive. The assessee even did not file any return for the relevant assessment year nor any return in response to the notice under Section 148AD of the Act. The appeal filed before the CIT(A) was also delayed and has been dismissed on the ground of limitation. Notwithstanding the inaction on the part of the assessee at every stage of the proceedings starting from the filing of return under Section 139(1) of the Act and thereafter in response to notice under Section 148A of the Act and the fact that there were no responses to the notices issued during the assessment proceedings, we are constrained to allow the appeal on the ground that the reopening notices were barred by limitation. The issue of limitation which arises in this appeal is no longer res integra and is covered by the decision of Supreme Court in the case of Rajeev Bansal (supra). The Supreme Court, inter alia, held that the provisions of the Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020 (‘TOLA’ for short) do not extend the period for issuance of notice for reopening. It only extends the period for issuance of notices, making compliances and passing orders which fall for such compliance or otherwise during the period from 20.03.2020 to 31.03.2021. The period for such compliance falling during the aforesaid period stood extended to 31.06.2021. Insofar as assessment year 2015-16 is concerned, the Supreme Court has noticed a concession on behalf of Sapana S. Samal the Revenue that in respect of the said assessment year, all reassessment notices issued on or after 01.04.2021 would be invalid. We thus find that the notice in the present case issued on 22.04.2023 was invalid as a consequence of which the subsequent proceedings would also stand invalidated. Only on this technical ground of limitation we find that the appeal deserves to be allowed. In that view of the matter, the appeal is allowed. The impugned addition stands deleted.