TRANSTEK INFOWAYS PRIVATE LIMITED vs. ASSISTANT COMMISSIONER OF INCOME TAX CIRCLE 25(1)

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W.P.(C)/13726/2024HC DelhiDLHC01066143202416 December 2024Bench: HON'BLE THE ACTING CHIEF JUSTICE,HON'BLE MR. JUSTICE TUSHAR RAO GEDELA3 pages
AI SummaryDismissed

What did the High Court hold?

The Court held that the challenge regarding the limitation period was unmerited. The notice under Section 148A(b) was issued on 31.03.2024, the last day of the three-year limitation period for assessment year 2020-21. The period from 31.03.2024 to 22.04.2024 was excluded as per the fifth proviso to Section 149(1). The sixth proviso to Section 149(1) extended the limitation by seven days as the remaining period was less than seven days. Consequently, the order dated 25.04.2024 under Section 148A(d) and the notice under Section 148 were within the extended period of limitation. The Court also found that the Principal Commissioner of Income Tax had accorded the sanction, complying with Section 149. Regarding jurisdiction, the Court held that the issue was covered against the petitioner by its own decision in T.K.S. Builders Pvt. Ltd V. Income Tax Officer Ward 25(3). Therefore, the petition was dismissed.

What were the facts?

The petitioner, Transtek Infoways Private Limited, challenged a notice dated 31.03.2024 under Section 148A(b) of the Income Tax Act, 1961, a notice dated 25.04.2024 under Section 148, and an order dated 25.04.2024 under Section 148A(d). The petitioner argued that the notice under Section 148 was issued beyond the limitation period prescribed by Section 149(1) and that the Assessing Officer lacked jurisdiction. The Court noted that the notice under Section 148A(b) was issued on the last day of the three-year limitation period for assessment year 2020-21. The period from 31.03.2024 to 22.04.2024 was to be excluded as per the fifth proviso to Section 149(1). The sixth proviso to Section 149(1) extends the limitation by seven days if the remaining period is less than seven days. The order and notice dated 25.04.2024 were within this extended period. The Principal Commissioner of Income Tax had accorded sanction to issue the notice.

What were the issues?

1. Whether the notice under Section 148 of the Income Tax Act, 1961, was issued beyond the period of limitation prescribed under Section 149(1) of the Act. 2. Whether the Assessing Officer had the jurisdiction to initiate proceedings under Sections 148A/148 of the Income Tax Act, 1961. Assessee's Contentions: - The notice under Section 148 was issued beyond the period of limitation as prescribed under Section 149(1). - The Assessing Officer (JAO) lacked the jurisdiction to initiate the reassessment proceedings, based on a Notification dated 28.03.2022 issued by the CBDT. - The impugned notice was issued without the sanction of the competent authority. Revenue's Contentions: - Not explicitly recorded, but the Court found the challenge to the sanction to be unmerited and the notice to be within the period of limitation. The Court also relied on a precedent regarding the jurisdiction of the AO.

Which sections of the Income-tax Act were involved?

Section 148A,Section 148,Section 149(1)

AI-generated summary — verify with the full judgment below

$~7 * IN THE HIGH COURT OF DELHI AT NEW DELHI + W.P.(C) 13726/2024, CM APPL. 57463/2024 & CM APPL. 57465/2024

TRANSTEK INFOWAYS PRIVATE LIMITED .....Petitioner Through: Mr. Gagan Kumar, Ms. Puja Jakhar, Ms. Priyanka and Mr. Gagandeep R.M., Advocates (through VC). versus

ASSISTANT COMMISSIONER OF INCOME TAX CIRCLE 25(1) .....Respondent Through: Mr. Anant Mann, JSC for Mr. Ruchir Batra, Sr. Standing Counsel.

CORAM:

HON'BLE THE ACTING CHIEF JUSTICE

HON'BLE MR. JUSTICE TUSHAR RAO GEDELA

O R D E R %

16.12.2024

1.

The petitioner has filed the present petition impugning a notice dated 31.03.2024 issued under Section 148A(b) of the Income Tax Act, 1961 (hereafter the Act) as well as a notice dated 25.04.2024 issued under Section 148 of the Act. The petitioner also impugns an order dated 25.04.2024 passed under Section 148A(d) of the Act. 2. The petition was listed on 30.09.2024 and the order passed on the said date indicates that petitioner had pressed the petition on two grounds – one that the impugned notice under Section 148 of the Act was issued beyond the period of limitation as prescribed under Section 149(1) of the Act for issuing such notices; and second that the Assessing Officer (JAO) did not have the jurisdiction to initiate the said proceedings. This Court had in 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. The Order is downloaded from the DHC Server on 03/07/2025 at 20:37:17

aforesaid context passed the following order: “3. The petitioner has filed the present petition, inter alia, impugning the Show Cause Notice dated 31.03.2024 (hereafter the impugned Notice) issued under Section 148A(b) of the Income Tax Act, 1961 (hereafter the Act); the order dated 25.04.2024 passed under Section 148A(d) of the Act; and the notice dated 25.04.2024 (hereafter the notice) issued under Section 148 of the Act. 4. The petitioner’s challenge is premised on two counts. First, the impugned Notice is issued by the Jurisdictional Assessing Officer (JAO) which, according to the learned counsel for the petitioner, lacks the jurisdiction to issue the impugned Notice. This challenge is premised on the basis of the Notification dated 2 8.03.2022 issued by the Central Board of Direct Taxes (CBDT). Second, that the impugned Notice has been issued without sanction of the competent authority. 5. In so far as the first ground of challenge is concerned, this Court is informed that the batch of the matters involving a similar challenge is now listed on 16.12.2024. Accordingly, the present petition is required to be taken up along with the said batch. 6. In so far as the second ground of challenge is concerned, we find the same as unmerited. 7. In the present case, the impugned Notice was issued on the last day of the period of limitation of three years from the end of relevant assessment year 2020-21. The petitioner was called upon to file its reply by 11.04.2024, which was subsequently extended till 22.04.2024 at the request of the petitioner. 8. Thus, the period between 31.03.2024 to 22.04.2024 is required to be excluded by virtue of the fifth proviso to Section 149(1) of the Act. By virtue of the sixth proviso to Section 149(1) of the Act, if the period of limitation remaining after excluding the time provided for filing a reply, is less than seven days, then the limitation is extended by a period of seven days. 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 03/07/2025 at 20:37:17

9.

In the present case, the order dated 25.04.2024 issued under Section 148A(d) and the notice were within the period of seven days from 22.04.2024. Thus, the order and the notice are within the period of limitation as prescribed. The question as to which authority was competent to grant the sanction is also required to be reckoned bearing the aforesaid in mind. 10. In the present case, the Principal Commissioner of the Income Tax has accorded the sanction to issue the impugned Notice. Accordingly, the provisions of Section 149 of the Act have been complied with. 11. The petitioner’s challenge on aforesaid ground is, unmerited and accordingly, rejected. 12. List on 16.12.2024 along with the batch of matters involving the question as to the jurisdiction of the JAO to initiate reassessment proceedings after 28.03.2022. 13. In the meanwhile, the reassessment proceedings may be continued and if any order is to be passed, the same would not be given effect to till the next date of hearing.” 2. In view of the above, the only issue that is required to be considered is whether the Assessing Officer has the jurisdiction to initiate the proceedings under Section 148A/148 of the Act. Concededly, the said issue is covered against the petitioner by a decision of this Court in T.K.S. Builders Pvt. Ltd V. Income Tax Officer Ward 25(3); Neutral Citation No. 2024:DHC:8330- DB. 3. In view of the above, the present petition is dismissed. 4. Pending applications are also disposed of. VIBHU BAKHRU, ACJ

TUSHAR RAO GEDELA, J DECEMBER 16, 2024/kct

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. The Order is downloaded from the DHC Server on 03/07/2025 at 20:37:17

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