AAKANSHA ADVISORY SERVICES PRIVATE LIMITED vs. ASSISTANT COMMISSIONER OF INCOME TAX, CENTRAL 2(4), AND ORS.

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WPO/2893/2022HC CalcuttaWBCHCO005612202223 November 2022Author: HON'BLE JUSTICE MD. NIZAMUDDIN2 pages
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What did the High Court hold?

The High Court held that the impugned order dated July 22, 2022, passed under Section 148A(d) of the Income Tax Act, 1961, and the notice dated June 30, 2021, under Section 148A(b) were bad and not sustainable in law. The Court reasoned that the notice under Section 148A(b) was issued after the expiry of three years from the end of the relevant assessment year (2016-17). Furthermore, the alleged escaped income, admitted to be Rs. 23,92,400/-, was below the Rs. 50 lakh threshold. These facts, as appearing from the impugned order itself, rendered the proceedings without jurisdiction. The ratio decidendi is that notices for reassessment under the amended provisions, particularly concerning the time limits and monetary thresholds stipulated in Section 149, must be strictly adhered to. The Court quashed the impugned order and the notice. No issue was expressly left undecided.

What were the facts?

The petitioner, Aakansha Advisory Services Private Limited, challenged an order dated July 22, 2022, passed under Section 148A(d) of the Income Tax Act, 1961, concerning assessment year 2016-17. The petitioner argued that the order and the related notice dated June 30, 2021, were issued without jurisdiction and contrary to Sections 149(1)(a) and (b) of the Act. Specifically, the petitioner contended that the notice was issued after the expiry of three years from the end of the relevant assessment year. Furthermore, the alleged escaped income of Rs. 23,92,400/-, as noted by the assessing officer, was below the Rs. 50 lakh threshold. The revenue was represented by the Assistant Commissioner of Income Tax, Central 2(4), and others.

What were the issues?

1. Whether the impugned order dated July 22, 2022, passed under Section 148A(d) of the Income Tax Act, 1961, and the notice dated June 30, 2021, under Section 148A(b) are without jurisdiction and contrary to the provisions of Section 149(1)(a) and (b) of the Act, considering the notice was issued after the expiry of three years from the end of the relevant assessment year and the alleged escaped income is below Rs. 50 lakh? Assessee's Contentions: Ms. Swapna Das and Mr. Siddharth Das, learned counsel for the petitioner, argued that the impugned order and notice are bad in law as they were issued beyond the prescribed time limit under Section 149(1)(a) and (b) of the Income Tax Act, 1961. They emphasized that the notice was issued after three years from the end of the assessment year 2016-17. Additionally, they pointed out that the alleged escaped income of Rs. 23,92,400/- was below the Rs. 50 lakh threshold, which is a critical factor under the amended provisions for issuing such notices. Revenue's Contentions: Mr. S. Roy Chowdhury, learned counsel for the revenue, made submissions, the specifics of which are not detailed in the judgment.

Which sections of the Income-tax Act were involved?

Section 148A,Section 148A(d),Section 148A(b),Section 149,Section 149(1)(a),Section 149(1)(b),Section 148

AI-generated summary — verify with the full judgment below

OD –8 ORDER SHEET WPO/2893/2022 BEFORE: The Hon'ble JUSTICE MD. NIZAMUDDIN Date: 23rd November, 2022. Appearance: Ms. Swapna Das, Adv. Mr. Siddharth Das, Adv. …For the Petitioner Mr. S. Roy Chowdhury, Adv. …For the Revenue The Court: Heard learned counsel appearing for the parties. By this writ petition, petitioner has challenged the impugned order dated 22nd July, 2022 under Section 148A(d) of the Income Tax Act, 1961, relating to assessment year 2016-17 on the ground that the same being without jurisdiction and contrary to the provision of Section 149(1)(a) and (b) of the Income Tax Act, 1961 by contending that admittedly the impugned notice has been issued on 30th June, 2021 after the expiry of three years from the end of relevant assessment year and it is also an admitted position which appears from the conclusion of the assessing officer himself in the impugned order that the alleged escapement of income is Rs. 23,92,400/- which is below Rs. 50 lakh. Considering the submission of the parties and admitted factual and legal position which appears on perusal of the impugned order dated 22nd July, 2022, I am of the considered view that the aforesaid impugned order is 2 bad and not sustainable in law and is liable to be quashed for the reason that the impugned notice under Section 148A(b) under the newly amended Act was issued after expiry of three years from the end of relevant assessment year and the alleged escapement of income is below Rs. 50 lakh. In view of the discussion made above, this writ petition being WPO 2893 of 2022 is disposed of by quashing the aforesaid impugned order dated 22nd July, 2022 under Section 148A(d) of the Act and impugned notice dated 25th July, 2022 under Section 148 of the Act.

(MD. NIZAMUDDIN, J.) TR/

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