DESIGNERS POINT INDIA PVT LTD vs. ASSISTANT COMMISSIONER OF INCOME TAX CENTRAL CIRCLE 18, DELHI

2025

As is manifest from the above, the Proviso to Section 149 clearly bids us to go back in point of time and examine whether a proposed reassessment pertaining to a period prior to 01 April 2021 would sustain based on the time frames as they existed prior to the promulgation of Finance Act, 2021. The Proviso embodies a negative command restraining the respondents from issuing a notice under section 148 in respect of an AY prior to 01 April 2021, if the period within which such a notice could have been issued in accordance with the provisions as they existed prior thereto had elapsed. This is manifest from the provision using the expression "no notice under section 148 shall be issued" if the time limit specified in the relevant provisions "…..as they stood immediately prior to the commencement of the Finance Act, 2021" had expired. A reassessment which is sought to be commenced post 01 April 2021 would thus have to abide by the time limits prescribed by Sections 149 (1)(b), 153A or 153B as may be applicable.

Undisputedly, Section 149(1)(b) as it stood prior to the introduction of the amendments by way of Finance Act, 2021 prescribed that no notice under section 148 shall be issued if four years "but not more than six years" have elapsed from the end of the relevant assessment year. Thus the period of six years stood erected as the terminal point which when crossed would have rendered the initiation of reassessment impermissible in law.

Viewed in light of the above, the impugned notice when tested on the anvil of the pre-amendment Section 149(1)(b) in order to be sustained would have to meet the prescription of six years. Undisputedly that period in respect of AY 2016-17 came to an end on 31 March 2023. We thus find ourselves unable to sustain the impugned action of reassessment and which was commenced pursuant to the notice dated 29 April 2024. 15. It would be important to note that the respondents also do not attempt to sustain the initiation of action on any other statutory provision and which could be read as extending the time limit that applied. We also find ourselves unable to read Twylight Infrastructure as empowering them to reopen assessments contrary to the negative covenant which forms part of Section 149 of the Act. This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 21/11/2025 at 12:43:02

We accordingly allow the present writ petition and quash the impugned order under section 148A (d) dated 29 April 2024 as well as the consequential notice under section 148 of even date.”

In fact, we find that the notice in the present case was issued on 31.08.2024, whereas in the case of Manju Somani (supra), it was issued in the month of April 2024 for the Assessment Year 2016-17. Even in that context, this court has held that the order passed under Section 148A(d) of the Act and also the notice issued under Section 148 of the Act are clearly hit by the provisions of Section 149 of the Act.

As we have already reproduced the relevant paragraphs of the judgment and also the fact that Mr. Sanjeev Menon JSC has not shown anything contrary to what has been contended by the counsel for the petitioner, the present petition needs to be allowed. Accordingly, we set aside the notice dated 31.08.2024 issued under Section 148 of the Act. Any subsequent proceedings initiated are also set aside.

The petition is disposed of. V. KAMESWAR RAO, J VINOD KUMAR, J NOVEMBER 13, 2025 dd This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 21/11/2025 at 12:43:02