MANGESH VISHWAS DESHMUKH ,MUMBAI vs. INCOME TAX OFFICER WARD 42(2)(4), MUMBAI

The grounds of appeal are as under:

At the outset, it was noticed that the instant appeal was delayed by 34 days as admitted by the assessee. In this regard, the assessee submitted that he is a salaried employee of Mumbai Port Trust Authority for the last several years due to certain misunderstanding of the issue, lack of availability of the Counsel as also his job commitments, he could file the appeal belatedly. It is requested to condone the delay

On careful consideration of the submissions of the assessee, we are of the view that the delay was not intentional but due to unavoidable and sufficient cause. In this connection, reliance could be placed on the landmark decision of hon’ble Supreme Court which inter alia held in Collector, Land Acquisition v Mst. Katiji And Others- 167 ITR 471 (SC) that “ordinarily, a litigant does not stand to benefit by lodging an appeal late……..Refusing to condone delay can result in a meritorious matter being thrown out at the very threshold and cause of justice being defeated….Any appeal or any application, other than an application under any of the provisions of Order XXI of the Code of Civil Procedure, 1908, may be admitted after the prescribed period if the appellant or the applicant satisfies the court that he had sufficient cause for not preferring the appeal or making the application within such period…. A litigant does not stand to benefit by resorting to delay. In fact, he runs serious risk.” We therefore, condone the delay.

In the additional ground of appeal, it is claimed by the notice u/s. 148 of the Act dated 27.04.2022 is bad in law in as much as the same is issued beyond the limitation period of six years from the end of P a g e | 4 A.Y. 2015-16 Mangesh Vishwas Deshmukh the relevant assessment year (i.e. A.Y. 2015-16) as per provisions of section 149(1) read with first proviso thereto. Since the notice u/s. 148 itself is bad in law, the consequential assessment order u/s. 147 r. w. s. 144 r. w. s. 144B of the Act is also invalid. It is further requested to admit the additional ground raised for the first time involving legal issue requiring no further investigation of facts. Reliance is placed on the decision in the case of NTPC Ltd. (SC)229 ITR 383. 6. On due consideration ,we admit the additional ground which is legal in nature and goes into the very validity of the impugned order. We therefore, take up this ground at the outset.

Before us, the ld.AR has claimed that the issue of notice u/s 148 of the Act for AY 2015-16 is no more res integra in the light of the judgment of hon’ble Supreme Court in the case of Union of India v. Rajeev Bansal [(2024) 167 taxmann.com 70 (SC).Therefore, not only the notice u/s 148 but the consequential assessment are ab intio void and liable to be quashed.

At the outset, we note that the original notice under section 148 of the Act in the present case has been issued on 27.04.2022, i.e., after 01.04.2021. This aspect assumes critical significance in view of the settled legal position laid down by the Hon’ble Supreme Court in Union of P a g e | 5 A.Y. 2015-16 Mangesh Vishwas Deshmukh India v. Rajeev Bansal (supra), wherein it has been categorically recorded that for Assessment Year 2015- 16, all reassessment notices issued on or after 01.04.2021 are liable to be dropped as they do not fall within the permissible time limits even after considering the provisions of the Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020 (TOLA).This principle has been further reiterated and applied by the Hon’ble Supreme Court in Deepak Steel and Power Ltd. v. CBDT [(2025) 174 taxmann.com 144 (SC)], wherein a notice issued after 01.04.2021 for AY 2015-16 was quashed as being time- barred. Similarly, the Hon’ble Supreme Court in Union of India v. Ashish Agarwal [(2022) 444 ITR 1 (SC)] clarified that while earlier notices could be deemed as show cause notices under section 148A(b), such deeming fiction cannot extend the limitation period prescribed under section 149 of the Act.

1 The coordinate benches of ITAT including the Mumbai Bench have been consistently following the above decision in holding that in such situations, the notice u/s 148 of the Act is barred by time limitation. A conjoint reading of the aforesaid decisions makes it abundantly clear that the Coordinate Benches have consistently applied the binding law laid down by the Hon’ble Supreme Court and have held

Since the appeal is allowed on the legal ground of jurisdiction and the notice u/s 148 and the consequential assessment orders are quashed, there appears no reasons for adjudicating the ground on merits which are left open.

In the result, the appeal of the assessee is allowed.