RAKESH KUMAR GUPTA vs. ACIT CENTRAL CIRCLE-32, DELHI & ANR.

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W.P.(C)/16906/2024HC DelhiDLHC01089525202406 December 2024Bench: HON'BLE MR. JUSTICE TUSHAR RAO GEDELA,HON'BLE THE ACTING CHIEF JUSTICE3 pages
AI SummaryAllowed

What did the High Court hold?

The Delhi High Court held that the impugned notice dated August 31, 2024, issued under Section 148 of the Income Tax Act, 1961, for AY 2014-15 is barred by limitation. The Court reasoned that the period of six years from the end of the relevant Assessment Year (AY) 2014-15 expired on March 31, 2021. As the impugned notice was issued after this date, it is consequently barred by limitation. This finding aligns with the principles discussed in the Supreme Court's decision in Union of India & Others v. Rajeev Bansal: 2024 SCC OnLine SC 2693, particularly concerning the time limits for issuing notices under the new regime and the retrospective application of Section 149(1)(b). The Court set aside the impugned notice and allowed the petition. No issue was expressly left undecided.

What were the facts?

The petitioner, Rakesh Kumar Gupta, filed a writ petition before the Delhi High Court challenging a notice dated August 31, 2024, issued under Section 148 of the Income Tax Act, 1961, for Assessment Year (AY) 2014-15. The petition also challenged the notice under Section 148A(b) and the order passed under Section 148A(d) that preceded the Section 148 notice. The petitioner contended that the issue was covered by a previous High Court decision. The respondents, ACIT Central Circle-32, Delhi & Anr., were represented. The court considered submissions from both sides regarding the validity of the notice.

What were the issues?

1. Whether the notice dated August 31, 2024, issued under Section 148 of the Income Tax Act, 1961, for AY 2014-15 is barred by limitation, considering the provisions of Section 149(1)(b) of the old regime and the proviso to Section 149(1)(b) of the new regime. Assessee's contention: The petitioner argued that the issue is covered by the decision in Manju Somani v. Income Tax Officer Ward-70(1) & Ors: 2024:DHC:5411-DB. The petitioner further submitted that the period of six years from the end of AY 2014-15 expired on March 31, 2021, making the impugned notice issued thereafter barred by limitation. Revenue's contention: The learned counsel for the respondent concurred with the petitioner's view that the notice was barred by limitation.

Which sections of the Income-tax Act were involved?

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

AI-generated summary — verify with the full judgment below

$~74 * IN THE HIGH COURT OF DELHI AT NEW DELHI + W.P.(C) 16906/2024 CM APPL. 71614/2024

RAKESH KUMAR GUPTA .....Petitioner Through: Mr. Ruchesh Sinha, Ms. Monalisa Maity and Mr. Aakash Saini, Advocates.

versus

ACIT CENTRAL CIRCLE-32, DELHI & ANR. .....Respondents Through: Mr. Anurag Ojha, SSC, Mr. V.K. Saksena, JSC, Mr. V. K. Saksena, Ms. Hemlata Rawat, JSC with Mr. Dipak Raj, Mr. Subham Kumar, Advocates.

CORAM:

HON'BLE THE ACTING CHIEF JUSTICE

HON'BLE MR. JUSTICE TUSHAR RAO GEDELA

O R D E R %

06.12.2024

CM APPL. 71615/2024 (Exemption) in W.P.(C) 16906/2024 1. Exemption is allowed, subject to all just exceptions. 2. The applications stand disposed of. W.P.(C) 16906/2024 CM APPL. 71614/2024

9.

The petitioner has filed the present petition, inter alia, impugning a notice dated 31.08.2024 (hereafter the impugned notice) issued under Section 148 of the Income Tax Act, 1961 (hereafter the Act) for the Assessment Year (AY) 2014-15. 10. The petitioner also impugns the notice issued under Section 148A(b) 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 20:19:37

of the Act, and the order passed under Section 148A(d) of the Act prior to the issuance of the impugned notice. 11. The learned counsel appearing for the petitioner submits that the issue stands covered by the decision of this Court in Manju Somani v. Income Tax Officer Ward-70(1) & Ors: Neutral Citation: 2024:DHC:5411-DB. 12. Mr. Ojha, also referred to the decision of the Supreme Court in Union of India & Others v. Rajeev Bansal : 2024 SCC OnLine SC 2693 and drew the attention of this Court to the following passages from the said judgment: “46. The ingredients of the proviso could be broken down for analysis as follows: (i) no notice under Section 148 of the new regime can be issued at any time for an assessment year beginning on or before 1 April 2021; (ii) if it is barred at the time when the notice is sought to be issued because of the “time limits specified under the provisions of” 149(1)(b) of the old regime. Thus, a notice could be issued under Section 148 of the new regime for assessment year 2021-2022 and before only if the time limit for issuance of such notice continued to exist under Section 149(1)(b) of the old regime. ***

***

*** 49. The first proviso to Section 149(1)(b) requires the determination of whether the time limit prescribed under Section 149(1)(b) of the old regime continues to exist for the assessment year 2021-2022 and before. Resultantly, a notice under Section 148 of the new regime cannot be issued if the period of six years from the end of the relevant assessment year has expired at the time of issuance of the notice. This also ensures that the new time limit of ten years prescribed under Section 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 20:19:37

149(1)(b) of the new regime applies prospectively. For example, for the assessment year 2012-2013, the ten year period would have expired on 31 March 2023, while the six year period expired on 31 March 2019. Without the proviso to Section 149(1)(b) of the new regime, the Revenue could have had the power to reopen assessments for the year 2012-2013 if the escaped assessment amounted to Rupees fifty lakhs or more. The proviso limits the retrospective operation of Section 149(1)(b) to protect the interests of the assesses.”

13.

In the present case, the period of six years from the end of the relevant Assessment Year (AY) 2014-15 expired on 31.03.2021. The impugned notice has been issued thereafter, and the same is thus barred by limitation. 14. The learned counsel for the respondent concurs with the aforesaid view. 15. In view of the above, the impugned notice is set aside. 16. The petition is allowed in the aforesaid terms. Pending application also stands disposed of.

ACTING CHIEF JUSTICE

TUSHAR RAO GEDELA, J DECEMBER 06, 2024/ssc 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 20:19:37

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