GEOTECH HOMZ PRIVATE LIMITED vs. ASST. COMMISSIONER OF INCOME-TAX & ANR.

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W.P.(C)/16081/2024HC DelhiDLHC01081751202424 March 2025Author: HON'BLE MR. JUSTICE VIBHU BAKHRU,HON'BLE MR. JUSTICE TEJAS KARIA4 pages
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What did the High Court hold?

The Delhi High Court allowed the petition and set aside the impugned notice issued under Section 148 of the Income-Tax Act, 1961. The Court relied on its previous decisions, including Dinesh Jindal v. Assistant Commissioner of Income Tax, Central Circle 20, Delhi & Others, KAD Housing Private Limited v. Deputy Commissioner of Income Tax Central Circle-6, Delhi, and Pankaj Jain v. Assistant Commissioner of Income Tax, Central Circle 3, Delhi & Anr. The Court also referred to its reasoning in The Pr. Commissioner of Income Tax - Central-1 v. Ojjus Medicare Pvt. Ltd., where it was explained that the block period of ten years is computed from the end of the assessment year relevant to the financial year in which the AO of the searched person recorded satisfaction and handed over material to the AO of the other assessee. The Court noted that the tabular statement provided by the assessee, which calculated the ten-year block period from the end of AY 2024-25, was not disputed by the Revenue in terms of its calculation. The operative direction was to quash the notice.

What were the facts?

The petitioner, Geotech Homz Private Limited, filed a writ petition challenging a notice dated January 18, 2024, issued under Section 148 of the Income-Tax Act, 1961, for Assessment Year (AY) 2014-15. The notice was based on a search conducted under Section 132 on March 2, 2022, concerning the Gaur Group and related persons. The petitioner argued that the notice was issued beyond the period of limitation prescribed under Section 149(1). The Revenue contended that incriminating material was found during the search and received by the petitioner's Assessing Officer (AO) in June 2022. The petitioner asserted that the requirement of a satisfaction note by the AO of the searched person is not applicable post-March 31, 2021, and the limitation period should be calculated from the date of initiation of reassessment proceedings.

What were the issues?

1. Whether the notice dated January 18, 2024, issued under Section 148 of the Income-Tax Act, 1961, for AY 2014-15 is barred by limitation as prescribed under Section 149(1) of the Act, considering the search was conducted on March 2, 2022, and the notice was issued on January 18, 2024? Assessee's Contention: The notice is beyond the period of limitation. The petitioner relied on the High Court's decisions in Dinesh Jindal v. Assistant Commissioner of Income Tax, Central Circle 20, Delhi & Others, KAD Housing Private Limited v. Deputy Commissioner of Income Tax Central Circle-6, Delhi, and Pankaj Jain v. Assistant Commissioner of Income Tax, Central Circle 3, Delhi & Anr. Revenue's Contention: The Revenue did not dispute the tabular statement presented by the assessee regarding the computation of the ten-year block period. However, the Revenue stated that it has not accepted the manner of calculating the block of ten years as explained in The Pr. Commissioner of Income Tax - Central-1 v. Ojjus Medicare Pvt. Ltd. and has preferred a Special Leave Petition against that decision.

Which sections of the Income-tax Act were involved?

Section 148,Section 149(1),Section 132,Section 132A,Section 153C,Section 153A

AI-generated summary — verify with the full judgment below

Cause title — parties, addresses and appearances
$~90 * IN THE HIGH COURT OF DELHI AT NEW DELHI + W.P.(C) 16081/2024 and CM APPL. 67522/2024 GEOTECH HOMZ PRIVATE LIMITED .....Petitioner Through: Mr Harshu Wason with Ms Neha Gupta, Advocates. versus ASST. COMMISSIONER OF INCOME-TAX & ANR. .....Respondents Through: Mr Vipul Agrawal with Ms Sakashi Shairwal and Mr Akshat Singh, Advocates. CORAM: HON'BLE MR. JUSTICE VIBHU BAKHRU HON'BLE MR. JUSTICE TEJAS KARIA

O R D E R % 24.03.2025

1.

The petitioner has filed the present petition, inter alia, praying as under: “(a) Quash the Impugned Notice dated 18.01.2024 (Annexure P- 1) issued by the Respondent under Section 148 of the Income- Tax Act, 1961 for Assessment Year 2014-15. (b) Quash the approval dated 11.01.2024 given by the Respondent No. 2 under Explanation 2(iv) of Section 148 of the Act.”

2.

The petitioner contends that the notice was issued beyond the period of limitation as prescribed under Section 149(1) of the Income Tax Act, 1961 [the Act]. The impugned notice dated 18.01.2024 is premised on a search conducted under Section 132 of the Act or a requisition made under Section 132A of the Act in respect of Gaur Group and related persons. The 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.

search was conducted on 02.03.2022. It is stated that there is no satisfaction note which has been recorded by the Assessing Officer [AO] of the searched person. However, the Revenue states that during the course of the search, certain incriminating material was found, which was received by the AO exercising jurisdiction in case of the petitioner in June, 2022. As noted above, the impugned notice was issued on 18.01.2024. 3. The requirement of recording a satisfaction note by the AO exercising jurisdiction in case of a searched person to the effect that the material found during the search under Section 132 of the Act or requisition under Section 132A of the Act, belongs to another assessee [not being a searched person] or contains information relating to another assessee, is not applicable in case where the search is conducted after 31.03.2021. Thus, the date on which the AO decides to initiate action for reassessment would necessarily have to be considered for the purposes of calculating the limitation as provided under Section 153C read with Section 153A of the Act.

4.

This issue is covered by various decisions of this court including in Dinesh Jindal v. Assistant Commissioner of Income Tax, Central Circle 20, Delhi & Others: Neutral Citation No.: 2024:DHC:4554-DB, KAD Housing Private Limited v. Deputy Commissioner of Income Tax Central Circle-6, Delhi : Neutral Citation No.: 2024:DHC:8214-DB as well as Pankaj Jain v. Assistant Commissioner of Income Tax, Central Circle 3, Delhi & Anr. : Neutral Citation No. : 2025:DHC:157-DB.

5.

In The Pr. Commissioner of Income Tax - Central-1 v. Ojjus Medicare Pvt. Ltd : Neutral Citation : 2024:DHC:2629-DB, this court had explained that the block period of ten years is required to be computed from the end of the assessment year relevant to the financial year in which the AO 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.

of the searched person has recorded its satisfaction and handed over the material or books of account to the AO of the assessee not being the searched person. Thus, the block period of ten years is required to be computed from the end of the AY 2024-25, which is relevant to the financial year in which the impugned notice was issued.

6.

The learned counsel for the Assessee has handed over a tabular statement setting out the block of ten years that would possibly be covered by a notice issued in financial year 2023-24. The said tabular statement is set out below: ANAYSIS OF TIME-PERIOD TO ISSUE REASSESSMENT NOTICE Date of Issuance of notice under Section 148 of the Act – 18.01.2024 *This chart is prepared in light of the first proviso of Section 149 of the Act as amended by Finance Act, 2021 Relevant Assessment Year for initiating proceedings under Section 148 of the Act Computation of 10 years in light of first proviso to Section 149 AY 2024-25 1 AY 2023-24 2 AY 2022-23 3 AY 2021-22 4 AY 2020-21 5 AY 2019-20 6 AY 2018-19 7 AY 2017-18 8 AY 2016-17 9 AY 2015-16 10 AY 2014-15 11 (beyond terminal point of 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.

10 years)

7.

The learned counsel appearing for the Revenue has no cavil with the said tabular statement. He, however, submits that the Revenue has not accepted the manner of calculating the block of ten years as explained in The Pr. Commissioner of Income Tax - Central-1 v. Ojjus Medicare Pvt. Ltd. (supra) and has preferred a Special Leave Petition against the said decision.

8.

In view of the above, the present petition is allowed and the impugned notice issued under Section 148 of the Act is set aside. Pending application also stands disposed of. VIBHU BAKHRU, J TEJAS KARIA, J MARCH 24, 2025/tr Click here to check corrigendum, if any 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.

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