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Facts
The assessee filed an appeal against an order of the Commissioner of Income Tax (NFAC) for AY 2015-16, which stemmed from an assessment order under Section 147 r.w.s. 144B. The Assessing Officer had issued a notice under Section 148A(b) and passed an order under Section 148A(d) on 26.07.2022.
Held
The Tribunal held that the notice issued under Section 148 for AY 2015-16, dated 19/07/2022 and 19/04/2021, were issued after the prescribed timelines, as per the concession made by the Revenue before the Supreme Court and decisions of the Delhi High Court. Therefore, the notice and the consequential assessment order were quashed.
Key Issues
Whether the notice for reassessment issued after the stipulated period, considering the Taxation and other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020, is valid.
Sections Cited
250, 147, 144B, 148A, 148, 149, 149(1)(b)
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, PUNE BENCHES “B” :: PUNE
Before: DR.DIPAK P. RIPOTE & SHRI VINAY BHAMORE
1. This is an Appeal filed by the Assessee against the Order of the Commissioner of Income tax (appeal) (NFAC) under section 250 of the Income Tax Act, 1961 for A.Y.2015-16 dated 26/09/2024 emanating from Assessment Order u/s.147 r.w.s.144B dated 26/05/2023.
Findings & Analysis :
We have heard both the parties and perused the records. We first intend to adjudicate the legal ground challenging the notice issued u/s.148A of the Act. Ld. Authorised Representative of the assessee has filed a paper book containing 55 pages. In this case, Assessing Officer had issued a notice u/s.148A(b) of the Act. Then, ITO, Ward-1(1), Jalgaon passed order u/s.148A(d) of the Act on 26.07.2022 for A.Y. 2015-16. Paragraphs 4 to 7 of the said order are reproduced hereunder :
“04.Reply of the assessee:- In response, the assesee has made submission on 16/06/2022. The gist of the reply of the assessée is as is as under : "With reference to above cited subject (Sandesh Liladhar Chaudhari PAN-ANBPC7956K) submit as under :
1.
Going through the details/information provided by Department "Case related information details", it is observed that the PAN- ANBPC7956K is of myself (Sandesh Liladhar Chaudhri). However in Notice it is shown as Chaudhari Bhikan Ganpat. Also Address of notice is A/P Talathi Lane Dharangaon Tal. Erandol D-Jalgaon. Mobile No.9689918240 which are not related to me and has not pertaining to me (i.e. Sandesh Liladhar Chaudhari) in this regard I am enclosing herewith copy of Aadhar card and PAN.
2. Further Department has not provided the account no. details in which transactions amounting to Rs.1,01,90,965/- pertains to PAN- ANBPC7956K. Mere mentioning PAN does not lead to conclusion that the amount mention in the information pertains to me. I am providing herewith certified copy of Bank Account Statement for the said period which shows that there is cash credit of Rs.2,54,530/- during A.Y.2015- 16.
3. Your honour as per CBDT Instructions dated 11.05.2012 the cases in which escaped income is more than 50 Lakhs in the form of assets are 2 reopened. Therefore, my case does not fulfill the criteria laid down by way of instructions of CBDT dated 11.05.2022.
4. Further I have filed my I. Tax Return of income for A. Y. 2015-16 on 02.03.2016 considering all transactions (including transactions effected in Renukamata Multistate Urban Credit Co-Society). Therefore, the question of escapement does not arise. Your honour is requested to consider the facts and drop the proceedings initiated. I think information (mentioned above) will suffice. However, if your honur requires any information/clarification from my end please let me forward. I will be glad to serve."
The reply of the assessee is perused but found not acceptable. As per the information received through Insight Portal, it is revealed that there is cash deposit of Rs. 1,01,90,965/- in the bank account maintained with M/s Renukamata Multistate Urban Co-op Society. The assessee has submitted that he is having bank account in the society but there is cash deposit of Rs.2,54,530/- during the year under consideration and also enclosed the copy of the bank account statement in support of the claim.However, assessee has failed to provide the letter of confirmation from the banking authority regarding proof that assessee is having only one bank account. Therefore, the submission of the assessee that there is only cash deposit of Rs.2,54,530/- is not acceptable. The assessee has filed the return of income for A.Y.2015-16 on 02.03.2016 declaring total income at Rs.2,55,830/-. As per the return of income, it is also evident that amount deposit of Rs. 1,01,90,965/- in the society is unexplained Income of the assessee which he has failed to offer for taxation. Therefore, the income chargeable to tax at Rs.1,01,90,965/- has escaped assessment. On the basis of the material available on record and in view of the above facts, it clearly suggests that there is an escapement of income. It is pertinent to mention here that deposit in bank account is covered. under the definition of asset laid down in Explanation to Section 149 of the Act.. Further, the income chargeable to tax, represented in the form of asset, which has escaped assessment amounts to Rs.1,01,90,965/- which is more than fifty lakh rupees. Thus conditions laid down in Section 149(1)(b) of the IT Act, 1961 are being met in the case of the assessee for year under consideration. 06. In view of the above facts, the information in my possession as mentioned above suggests that this is a fit case for issue of notice u/s 148. 3
This order is passed with prior approval of Pr.CCIT, Pune vide letter No.PN/PCCIT/Coord/148/2022-23/3033 dated 26/07/2022.”
3. Before the Hon’ble Supreme Court in the case of UoI Vs. Rajeev Bansal 469 ITR 46(SC), Mr.N.Venkataraman, learned Additional Solicitor General of India, made the following submissions on behalf of the Revenue:
Quote, “a. Parliament enacted TOLA as a free-standing legislation to provide relief and relaxation to both the assesses and the Revenue during TOLA seeks to relax actions and proceedings that could not be completed or complied with within the original time limits specified under the Income-tax Act, b. Section 149 of the new regime provides three crucial benefits to the assesses: (1) the four-year time limit for all situations has been reduced to three years; (ii) the first proviso to Section 149 ensures that re- assessment for previous assessment years cannot be undertaken beyond sic years; and (iii) the monetary threshold of Rupees fifty lakhs will apply to the re assessment for previous assessment years; f. The Revenue concedes that for the assessment year 2015-16, all notices issued on or after 1 April 2021 will have to be dropped as they will not fall for completion during the period prescribed under TOLA;” Unquote.
3.1 Thus, the Ld.Additional Solicitor General of India submitted before the Hon’ble Supreme Court that for A.Y.2015-16 all the notices issued after 01/4/2021 will have to be dropped.
3.2 In the case under consideration, we have already mentioned that the initial notice u/s.148 was issued 19/04/2021, which is after 01/04/2021. Thus, as submitted by Ld.ASG the proceedings initiated for A.Y.2015-16 after 01/04/2021 needs to be dropped. However, in this case the AO has not dropped the proceedings initiated after 4 01/04/2021 for A.Y.2015-16, which should have been dropped as submitted by Ld.ASG.
3.3 The Hon’ble Delhi High Court had considered this issue in the case of Pratishta Garg Vs. ACIT WP(C) 16878/2024 order dated 19/12/2024. The relevant paragraphs of the order of the Hon’ble Delhi High Court is reproduced here as under :
Quote, “1. The petitioner has filed the present petition, inter alia, praying asunder: "A. Issue a writ in the nature of Certiorari to quash the impugned notice dated 22.06.2021 issued under section 148 of the Act, and the consequential notice 25.05.2022 issued under section 148A(b) of the Act; the impugned order dated 19.07.2022 passed under section 148A(d) of the Act and the impugned notice dated 19.07.2022 issued under section 148 of the Act in the case of the petitioner for AY 2015- 16; D. Issue any other Writ, order, or Direction which this Hon'ble Court may deem fit and proper in the facts and circumstances of the case, and E. To allow the writ petition with cost in favor of the Petitioner and against the Respondent."
2. Learned counsel for the Revenue fairly states that the prayers made by the petitioner are required to be allowed as the same are covered by the concession made by the Revenue before the Supreme Court in Union of India and Others vs. Rajeev Bansal: 2024 SCC OnLine SC 2693, 2024 INSC 754, as recorded in paragraph 19 (f) of the said decision. He also submits that the Coordinate Bench of this Court had, after noting the aforesaid concession, allowed a similar petition Ibibo Group Pvt. Ltd. vs. Assistant Commissioner of Income Tax Circle: W.P.(C) 17639/2022 by order dated 13.12.2024.
It is relevant to note paragraph 19 (e) and (f) of the decision of the Supreme Court in Union of India and Others vs. Rajeev Bansal, 2024 SCC OnLine SC 2693. The same are set out as under: "(e) The Finance Act, 2021 (2021) ((2021) 432 ITR (Stat) 52) 5 substituted the fold regime for reassessment with a new regime. The first provisio to section 149 does not expressly bar the application of Taxation and other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020, Section 3 of the Taxation and other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020 applies to the entire Income-tax Act, including sections 149 and 151 of the new regime. Once the first proviso to section 149(1)(b) is read with Taxation and other Laws (Relxation and Amendment of Certain Provisions) Act, 2020, then all the notices issued between April 1, 2021 and June 30, 2021 pertaining to the assessment years 2013-2014. 2014-2015, 2015- 2016, 2016-2017, and 2017-2018 will be within the period of limitation as explained in the tabulation below :
Assessment Within Years Expiry of Within Six Expiry of Year Limitation Years Limitation read with read with TOLS for (4) TOLA for (2) (3) (4) (5) 2013-2014 31.03.2017 TOLA not 31.03.2020 30.06.2021 applicable; 2014-2015 31.03.2018 TOLA not 31.03.2021 30.06.2021 applicable. 2015-2016 31.03.2019 TOLA not 31.03.2022 TOLA not applicable; applicable. 2016-2017 31.03.2020 TOLA not 31.03.2023 TOLA not applicable. applicable. 2017-2018 31.03.2021 TOLA not 31.03.2024 TOLA not applicable. applicable.
(f) The Revenue concedes that for the assessment year 2015-2016, all notices issued on or after April 1, 2021 will have to be dropped as they will not fall for completion during the period prescribed under the Taxation and other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020."
4. In view of the aforesaid, the impugned order dated 19.07.2022 issued under Section 148(A)(d) of the Income Tax Act, 1961 (hereafter the Act) as well as the notice dated 19.07.2022 issued under Section 148 of the Act in respect of AY 2015-16 are liable to be set aside. It is so directed.
5. The petition is allowed in the aforesaid terms.
Pending application also stands disposed of.”,Unquote.
3.4 Similarly, Hon’ble Delhi High Court in the case of Neera Gupta Vs. ITO WP(C) 17352/2024 vide order dated 17/12/2024 allowed the petition of the assessee.
3.5 The facts of the Pratishta Garg case (supra) and Neera Gupta Case (supra) are identical to the assessee under consideration. In the case of the Pratishtha Garg the Order u/s.148A(d) was passed on 19/07/2022 and notice u/s 148 was issued on 19/07/2022 for A.Y.2015-16. In the case of the Assessee also the order u/s.148A(d) was passed on 26/07/2022 and notice u/s.148 was issued on 26/07/2022 for AY 2015-16.
3.6 No decision of Hon’ble Jurisdictional High Court has been brought to our notice. Therefore, in absence of decision of Hon’ble Jurisdictional High Court the law laid down by Hon’ble Delhi High Court is binding on us.
3.7 Similarly in the case of Vishnu Subhash Agarwal Vs. ITO in - A.Y. 2015-16, ITAT Pune has quashed notice u/s.148 for A.Y. 2015-16 3.8 Therefore, respectfully following the decision of Hon’ble Delhi High Court (supra), ITAT Pune and the submission made by Ld. Additional Solicitor General before Hon’ble Supreme Court, the Order u/s.148A(d) and the notice u/s.148 in the instant case are hereby quashed. Since we have held that notice u/s.148 is bad in law the consequential assessment order is also void ab-initio.
3.9 Accordingly, the legal ground raised by the assessee is answered affirmative. We do not intend to comment on the merits of the addition.
In the result, the appeal filed by the assessee is allowed.
Order pronounced in the open Court on 28th August, 2025. s