SRINIVASAN RAJARAMAN,KANCHIPURAM vs. ACIT, CIRCLE-2(1), TRICHY

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ITA 909/CHNY/2026Status: DisposedITAT Chennai21 July 2026AY 2015-166 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the notice issued under Section 148 of the Income Tax Act on 27.07.2022 was barred by limitation as the six-year period expired on 31.03.2022. Consequently, the reassessment proceedings were quashed.

What were the facts?

The assessee filed an appeal with a delay of 80 days, which was condoned. The primary issue was whether the notice for reassessment under Section 148 was barred by limitation.

What were the issues?

The key issue was whether the notice issued under Section 148 for reassessment for AY 2015-16 was issued within the time limit prescribed under Section 149 of the Act.

Which sections of the Income-tax Act were involved?

Section 148,Section 149,Section 147,Section 144B,Section 69A

AI-generated summary — verify with the full judgment below

Before: Shri S.S. Viswanethra Ravi & Shri S.R. Raghunatha

Hearing: 22.06.2026Pronounced: 21.07.2026

आयकर अपीलीय अिधकरण, ’सी’ �ायपीठ, चे�ई IN THE INCOME-TAX APPELLATE TRIBUNAL ‘C’ BENCH, CHENNAI �ी एस.एस. िव�ने� रिव, �ाियक सद� एवं �ी एस.आर. रगुनाथॎ◌, लेखा सद� के सम% Before Shri S.S. Viswanethra Ravi, Judicial Member & Shri S.R. Raghunatha, Accountant Member आयकर अपील सं./I.T.A. No. 909/Chny/2026 िनधा&रण वष&/Assessment Year: 2015-16 Srinivasan Rajaraman, Vs. Assistant Commissioner of 74, Anna Salai, BBC City Park, Income Tax, Chinnaporur, Valasaravakkam, Circle -2(1), Kanchipuram – 600 116. Trichy , Tiruchirapalli – 620 001. [PAN: BGLPS-2944-B] (अपीलाथ(/Appellant) ()*थ(/Respondent) अपीलाथ( की ओर से / Appellant by : Mr. R. Kumar, Advocate )*थ( की ओर से/Respondent by : Ms. Swarnalatha.V, Addl.CIT सुनवाई की तारीख/ Date of hearing : 22.06.2026 घोषणा की तारीख /Date of Pronouncement : 21.07.2026 आदेश /O R D E R PER S.S. VISWANETHRA RAVI, JUDICIAL MEMBER:

This appeal filed by the assessee is directed against the order dated 03.09.2025 passed by the ld. Commissioner of Income Tax (Appeals), National Faceless Appeal Centre [NFAC], Delhi (herein after “ld.CIT(A)”) for the assessment year 2015-16.

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2.

We find that this appeal was filed with a delay of 80 days. The

assessee filed an affidavit explaining the reasons to condone the said

delay. On perusal of the same and upon hearing both the parties, we

find the reasons stated by the assessee are bonafide which really

prevented the assessee in filing the appeal in time. Thus, delay of 80

days condoned.

3.

The Ld.AR, Mr. R. Kumar, Advocate, drew our attention to the

ground nos. 2 to 16 and argued that the reopening is barred by limitation

for Assessment Year 2015-16 and prayed to take up the ground nos.2

to 5 as preliminary issue as it goes to the root of the matter. He argued that the notice u/s 148 of the Act was issued beyond the specified date

which is beyond six years. He placed on record the order of this tribunal

in the case of Natarajan Sangeetha in ITA No.3280/Chny/2025 for AY-

2015-16 and argued that the issue of notice for AY 2015-16 u/s. 148 of

the Act is four years from the end of the relevant assessment year.

Further, notice u/s. 148 of the Act was issued on 27.07.2022 which is beyond the time limit as specified u/s. 149 of the Act. The Ld.AR argued

that the notice issued on 27.07.2022 is barred by limitation and

resultantly the re-assessment is thereon is liable to be quashed.

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4.

The Ld.DR Ms. Swarnalatha. V. Addl.CIT, submits that the

reassessment was initiated vide notice u/s 148 of the Act dated

27.07.2022 based on NMS – flagged cash deposits treated as

unexplained money u/s 69A of the Act. The argument of Ld.AR that all

the notices issued u/s 148 of the Act post 01.04.2021 for AY 2015-16

are invalid in terms of decision in the case of Rajiv Bansal is a gross

misreading and does not invalidate notices wholesale, it upholds them

where compliant with extended timelines under TOLA 2020 and

exclusions under the third proviso to section 149(1) of the Act. Further,

she argued that the Hon’ble Supreme Court in the case of Ashis Agarwal

addressed notices issued u/s 148 old regime (pre 01.04.2021) between 01.04.2021 and 30.06.2021 deeming them as show cause notices u/s

148A(b) of the new regime w.e.f. 01.04.2021. She argued vehemently

that this a curative measure under article 142 to balance revenue and

assessee’s interest amid Covid-19 disturbances and legislative

amendments via Finance Act 2021.

5.

Further, she submits that the deeming fiction revived notices valid

under the old regime extended six year limit (old section 149(1)(b) r.w.

proviso old section 147 expiring 31.03.2022 for AY 2015-16 in cases of

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escaped income more than one lakh. She submits it prevented still

born proceedings and allowed continuation under the new regime

subject to timelines. She argued vehemently that the notice dated

27.07.2022 issued u/s 148 of the Act falls within this transitional frame

work, post Ashis Agarwal implementation via CBDT instruction

no.1/2022 dated 11.05.2022. Further, she argued that contradictory to

the assessee’s claim, Rajiv Bansal decision does not invalidate section

148 notices as it clarifies and upholds them for AYs like 2015-16 when

issued within surviving timelines. The court examined interplay of old /

new regimes, TOLA extensions from 20.03.2020 – 31.03.2021 to

30.06.2021 exclusions under the third proviso to section 149(1) of the Act. She prayed to dismiss the ground nos. 2 to 5 raised by the

assessee.

6.

Heard both the parties and perused the material available on

record. We note that this Tribunal in the case of Natarajan Sangeetha

(Supra), in order to find out as to whether the notice issued u/s 148 is time barred or not, examined the relevant provisions of the Act and legal

position as per judicial proceedings vide para-4 of the order dated

04.02.2026. We note that the Tribunal examined the provisions u/s 149

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as on 01.04.2022 and prior to the amendment in paras-4 & 5

respectively. Considering the same and also based on the decision of

Hon’ble Supreme Court in the case of Rajiv Bansal reported in 469 ITR

430(SC) held that the revenue cannot issue notice u/s. 148 of the Act for

assessment years prior to AY-2021-22 if six years from the end of the

relevant assessment year is expired on the date of issue of such notice.

Accordingly, held the notice therein dated 07.04.2022 was issued

beyond the time limit hence not valid. Further, the Tribunal held the

arguments of Ld.DR is not acceptable for the reason, for the purpose of

applying exclusion period, the notice should first survive the test of being

issued either under sections 149(1)(a) or 149(1)(b) under the new regime. Accordingly, held the question of applying on the third proviso

for calculating time limit does not arise. On plain reading of the said

order, we find facts and circumstances of the present case are similar in

respect of issue of notice u/s. 148 dated 27.07.2022 is barred by

limitation as the six years period would expire as on 31.03.2022.

Therefore, we hold that the notice dated 27.07.2022 issued u/s. 148 of the Act is barred by limitation, resultantly the reassessment dated

18.05.2023 u/s 147 r.w.s 144B of the Act is invalid and accordingly

quashed. Thus, ground nos. 2 to 5 raised by the assessee are allowed.

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7.

In view of our decision in ground nos. 2 to 5, all other grounds raised in the form-36 become academic and requiring no adjudication.

8.

In the result, the appeal of the assessee is allowed. Order pronounced on 21st July, 2026 at Chennai.

Sd/- Sd/- (S.R. RAGHUNATHA) (S.S. VISWANETHRA RAVI) ACCOUNTANT MEMBER JUDICIAL MEMBER Chennai, Dated: 21.07.2026 JPV आदेश की )ितिलिप अ0ेिषत/Copy to: 1. अपीलाथ(/Appellant, 2.)*थ(/ Respondent, 3. आयकर आयु1/CIT, Chennai/Madurai/Coimbatore/Salem 4. िवभागीय )ितिनिध/DR & 5. गाड& फाईल/GF

Digitally signed by PRASANNA PRASANNA VANI JETTY VANI JETTY Date: 2026.07.22 17:09:31 +05'30'

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