DCIT-19(1), MUMBAI vs. ANISH PIYUSH KOTHARI, MUMBAI

At the outset assessee has raised the additional ground in its Cross Objection, which is reproduced herein below:

On the additional ground of appeal, I have heard the counsels of both the parties, perused the material placed on record, judgments cited before me and also the orders passed by the revenue authorities. From the records I noticed that notice u/s 148 of the Act dated 13.03.2014 was issued beyond the period of limitation as laid down u/s 149 of the Act. In this regard, it was submitted that as per CO No. 166/Mum/2025 Anish Piyush Kothari, Mumbai. the provisions of Section 149, as applicable for AY 1997- 98, the time limit for issuance of notice was ten years from the end of the relevant assessment year. Thus the period of limitation for issue of notice under Section 148 of the Act was as under:

The provisions of Section 149 of the Act were further amended vide Finance Act 2012. w.e.f. 1st July 2012, wherein the maximum time limit was extended to 16 years from the end of the relevant assessment year.

Therefore in my view, the extended period of limitation under the amended provisions would be applicable to those assessments where the time limit to issue notice under section 148 had not expired as on the date of the amended provisions i.e. 1st July, 2012. As the same is clarified in Explanation to Section 149 of the Act.

In this way as per the facts of the present case, the period of limitation to issue notice u/s 148 r.w.s 149 of the Act had already expired on 31st March 2008, which is several years prior to the date from which the amendment made to section 149 by Finance Act, 2012 was effective. Thus, the re-opening of the proceedings for AY 1997-98 is

In this regard reliance is being placed on the decision of the Hon'ble Delhi High Court in the case of Brahm Datt v. ACIT [100 taxmann.com 324] wherein on identical facts, the Court held that ‘assessment for AY 1998-99 which was s re-opened on 24.03.2015 was held to be invalid’. The SLP filed by the Department in the said case was dismissed by Hon'ble Supreme Court vide order dated 5th July 2019 [SLP No. 016287/2019]. Reliance is also placed upon the decision of Hon'ble jurisdictional ITAT, Mumbai in the case of DCIT v. Deval Thakkar [ITA No. 968 and 967/MUM/2020] wherein on similar facts, it was held that ‘the re-opening of the assessment is invalid since the time limit for issuing notice under section 149 of the Act had expired and thus, the assessment order was held to be invalid and bad in law’.

Therefore considering the facts and circumstances of the present case and also keeping in view the decision of Hon’ble Supreme Court and also the Coordinate Bench of ITAT and while applying the principles of Stare Decisis I hold that the reopening of the assessment in the present case is invalid as the time limit for issuing notice u/s 148 of the Act had expired as a consequence thereof the assessment order passed by the revenue authorities is invalid and bad in law, therefore additional ground raised by the assessee stands allowed.

In view of our above finding with regard to additional ground raised by the assessee in CO with respect to validity of issuance of notice u/s 148 of the Act, the bench has been already allow the additional ground raised by the assessee and held the order of assessment as invalid therefore in view of the said finding, the appeal filed by the revenue stands dismissed.

In the result, the CO filed by the assessee is allowed and appeal filed by the revenue is dismissed.