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Facts
The assessee, a Non-Agri Thrift and Credit Co-Op. Society, filed its return for AY 2015-16. A notice under Section 148 was issued on 24.06.2021, followed by other notices and an assessment order dated 22.05.2023, which upheld an addition of Rs. 3,07,74,424/- u/s 69A. The assessee contended that the notices were issued beyond the prescribed time limits and were therefore bad in law.
Held
The Tribunal held that the notice issued under Section 148 of the Act dated 27.07.2022 was beyond the period of limitation. It was observed that the Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020 (TOLA) was not applicable for reopening assessments for AY 2015-16, as conceded by the Revenue.
Key Issues
Whether the notice issued under Section 148 of the Act for AY 2015-16 was barred by limitation, considering the applicability of TOLA provisions.
Sections Cited
148, 148A, 69A, 149
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Income Tax Appellate Tribunal, DELHI BENCH ‘E’: NEW DELHI
Before: SHRIS. RIFAUR RAHMAN & SHRI RAJ KUMAR CHAUHAN
O R D E R PER RAJ KUMAR CHAUHAN (J.M.): 1. This appeal is filed by the assessee /appellant against the order of Learned Commissioner of Income Tax (Appeals) / National Faceless The Hisar Leading Bank Co-op Non Agri Thrift & Credit Society Appeal Centre (NFAC), Delhi, passed under section 250 of the Income Tax Act, 1961 [hereinafter referred to as “the Act”] dated 30.06.2025 wherein the assessment order dated 22.05.2023 was upheld and addition of Rs. 3,07,74,424/- u/s 69A of the Act was confirmed.
The facts in brief as set out in para No. 4 of the impugned order are extracted as under:
4. That appellant is a Non-Agri Thrift and Credit Co-Op. Society, ITR for the A.Y. 2015-16 u/s.139(1) was not filed. Notice u/s.148 of the Act was issued on 24-06-21. Thereafter, as per directions of the Hon'ble Supreme Court in its Judgment dated 04.05.2022 (2022 SCC Online SC 543) in the case of Union of India Vs. Ashish Aggarwal, the notice u/s 148 of the IT Act issued between 01.04.21 to 30.06.21 is deemed to be the show cause notice issued under clause (b) of the Section 148A of the IT Act. Without closure of proceedings of notice u/s 148 dated 24-06-21, notice issued u/s.148A(b) dated 27-05-22, notice again issued u/s 148 dated 27- 07-22 are not according to law. Notice u/s.148A(b) was issued on 27/05/22 without providing material, information and documents and which has not been served as per Rule 127 of the Income-tax Rules. Without providing proper opportunity order u/s.148A(d) of the Act has been passed on 27/07/22. Notice u/s. 148 was issued on 148 of the Act was issued on 30.07.22. Notice u/s.148 dated 27-07-22 is without digital signature and it has not been issued as per procedure and formats and standards for ensuring secured transmission of Electronic Communication. Notice u/s.148 dated 27-07-22 has also not been issued in faceless manner. We had filed income tax return in response to notice u/s. 148 of the Act on 28-11-22 declaring an income Rs.42,990/-. Reply in response to notice u/s.142(1) of the Act dated 10/01/23 and 17/01/23 was submitted on 03-02-2023 along with statutory Audit report, balance sheet, Profit & Loss A/c, annexures, cash book, computation of income. Notice u/s 142(1) dated 06- 04- The Hisar Leading Bank Co-op Non Agri Thrift & Credit Society was not served on my e-mail ID, which have been served on e- mail IDpan_2010_reg@yahoo.combut our mail ID as per ITR filed is casksiwach@gmail.com. Without affording proper opportunity and without service of notice Ld. Assessment Unit, Income Tax Department has framed assessment on 22/05/23 after making an addition of Rs.3,07,74,424/- on account of cash deposited in J & K Bank. Without considering the documents, reply and ITR, assessment farmed is bad in law and may please be quashed. Addition made by Ld. Assessment Unit, Income Tax Department is bad in law and may please be deleted and order dated 22-05-23 may please be quashed. This order has been challenged in appeal.
Aggrieved by the assessment order, the assessee filed appeal before the Ld. CIT(A) and has raised the grounds stating that the notice issued under section 148 of the Act dated 27.07.2022 was bad in law and liable to be quashed. The Ld. CIT(A) has dismissed the appeal but has not decided ground No. 5 to 9 with respect to the validity of the notice u/s 148 of the Act stating that the ground No. 5 to 9 are procedure in nature and in absence of any submission in that regard, the same are dismissed. The relevant finding of the Ld. CIT(A) is extracted as below:
“7. DECISION: At the outset, it is important to note that this appeal has been filed with a delay of 283 days. Regarding the delay the appellant has contended that appellant did not receive assessment order which was passed on 22.5.2023. Further, due to lack of knowledge and due to illness of secretary appeal could not be filed in time. Although, the appellant did The Hisar Leading Bank Co-op Non Agri Thrift & Credit Society not file any documentary evidence in support of reasons of delay but on the basis of principles of natural justice, the said delay is condoned.
As per the assessment order and submissions of the appellant it is seen that appellant is a Non-Agri Thrift & Credit Co-operative Society. It was found that appellant's bank account in the J & K Bank had huge cash deposits and the assessment order also allude to these facts. Further, it is also noticed that appellant had not filed it return of income within the stipulated time as per the provisions of section 139(1) of Income Tax Act.”
We have heard the Ld. AR for the Assessee and Ld. Sr. DR on behalf of the Revenue. Ld. AR, at the very outset, submitted that the notice issued dated 27.07.2022 is barred by limitation and the case of the assessee is covered by Hon’ble Supreme Court case Union of India v. Rajiv Bansal [(2024) 167 taxmann.com 70 (SC)]. The Ld. AR has relied upon the case of Jurisdictional Tribunal in Honeywell Exim Private Limited, order dated 15.10.2025.
The Ld. DR on the other hand, supported the judgment of the Ld. CIT(A) and prayed for dismissal of the appeal.
We have considered the rival submission and have examined the record. The Ld. AR for the assessee has submitted the chart of the dates in paper book at page no. 1 extracted as below:
The Hisar Leading Bank Co-op Non Agri Thrift & Credit Society Since, the last notice was issued on 27.07.2022 on the same identical facts, the assessee relied upon the decision of the Jurisdictional Tribunal in the cases of Honeywell Exim Private Limited (supra), which squarely covers the facts of the present case, as the notice u/s 148 of the Act in that case in hand also and issued on the same date i.e. The Hisar Leading Bank Co-op Non Agri Thrift & Credit Society 27.07.2022. Hence, the relevant findings of the Ld. Co-ordinate Bench are extracted as under: “4. Learned Authorized Representative for the appellant/assessee submitted that assessee company has filed its ITR dated 09.09.2015, declaring total income of Rs. 32,87,600/- . The initial notice under the un- amended Section 148 was issued on 30.06.2021. In view of the Hon'ble Supreme Court's decision in Union of India vs. Ashish Agarwal, the notice u/s 148 dated 30.06.2021 is deemed to have been issued u/s 148A(b) of the amended law. The said notice is invalid, illegal, non-est, and liable to be quashed as it has been issued beyond the prescribed time limits. Further, via notice under Section 148A(b) dated 16.05.2022, assessee was served with the material and information relied upon by Ld. AO as per the directions of Hon'ble Supreme Court in the case of Union of India & Ors. vs. Ashish Agarwal. Thereafter, notice under section 148 was issued along with the order passed u/s 148A(d) dated 30.06.2022 with the prior approval from the Principal Chief Commissioner of Income Tax, New Delhi. 4.1 Learned Authorized Representative, further submitted that notice issued under Section 148 of the Act dated 30.06.2022 is barred by limitation and therefore, the reassessment order is liable to be quashed, as A.Y. 2015-16 is otherwise time-barred in view of the decision of the Hon'ble Supreme Court in Union of India & Ors. Vs. Rajeev Bansal, 2024 (10) TMI 264-SC (LB) dated 03.10.2024, wherein the Hon'ble Apex Court, noting the statement of the Ld. ASG, recorded the concession that notices issued on or after 01.04.2021 for A.Y. 2015-16 will not survive, even after applying the extended time limits under TOLA. Said judgment has been applied by the jurisdictional High Court in the case of Makemytrip India Pvt. Ltd. Vs. DCIT, Circle 16(1), Delhi & Anr., 2025 (4) TMI 46 – Delhi High Court dated 24.03.2025. Reliance was placed on following decisions: 1. ITO, Ward-62(1) Vs. Girish Kumar Gupta, Delhi and (Vice-Versa), 2025(7) TMI 506 – Income Tax Appellate Tribunal Delhi, dated May 27,2025; 2. Pritam Kumar Vs. DCIT, Central Circle-19(1) New Delhi. 2025(7) TMI 1748 – ITAT, Delhi, dated 18.07.2025; The Hisar Leading Bank Co-op Non Agri Thrift & Credit Society 3. ACIT, Circle 19(1) & Ors. Vs. Nehal Ashit Shah, 2025(4) TMI 1095 – SC Order, dated 04.04.2025; 4. Pratishtha Garg Vs. ACIT, Central Circle-25, Delhi, 2024 (12) TMI 1540 – Delhi High Court, Dated 19.12.2024; 5. M/s. H.A. Share And Brokers Pvt.Ltd. Vs. ITO, Ward-11(1) & Ors. 2025 (7) TMI 1056 – Delhi High Court, Dated July 4, 2025; 5. Learned Authorized Representative for the Department of Revenue submitted that the appellant/assessee has been habitual defaulter.
6. From examination of record in light of aforesaid rival contentions, it is crystal clear that initial notice dated 30.06.2021 under Section 148 of the Act was issued which is on page 37 of the paper books. Notice under Section 148A(b) of the Act dated 16.05.2022 at pages 40 and 41 of the paper books were issued as per directions of Hon'ble Supreme Court. Notice under Section 148 of the Act was issued along with order dated 30.06.2022 under Section 148A(d) of the Act with prior approval of Ld. PCIT at pages 62 to 67 of the paper books. Notice under Section 148 dated 30.06.2022 was barred by limitation as per decision of Hon'ble Supreme Court in UOI vs. Rajeev Bansal, cited supra. 6.1 Hon'ble Delhi High Court in the case of Makemytrip India Pvt. Ltd. vs. DCIT, decided on 24.03.2025 in paras 8, 11 & 12 held as under: “8. In a subsequent decision in Union of India and Others v. Rajeev Bansal: 2024 INSC 754, the Supreme Court considered the manner of applicability of the provisions of Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020 [TOLA]. During the said proceedings it was conceded on behalf of the Revenue that TOLA was not applicable for reopening the assessments for AY 2015-16. The said concession was recorded in paragraph 19 (f) of the said decision. Paragraphs 19 (e) and 19 (f) of the said decision are relevant and are set out below: - The Hisar Leading Bank Co-op Non Agri Thrift & Credit Society "(e) The Finance Act 2021 substituted the old regime for re- assessment with a new regime. The first proviso to Section 149 does not expressly bar the application of TOLA. Section 3 of the TOLA 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 TOLA, then all the notices issued between 1 April 2021 and 30 June 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 3 Expiry Within six Expiry of Year (1) Years (2) Limitation Years (4) Limitation read with read with TOLA for (2) TOLA for (4) (3) (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 30.06.2021 31.03.2023 TOLA not applicable 2017-2018 31.03.2021 30.06.2021 31.03.2024 TOLA not applicable (f) The Revenue concedes that for the assessment year 2015-2016, 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 the TOLA.
11. In the present case the impugned notice was issued on 27.07.2022, which was admittedly beyond the period of limitation as prescribed under Section 149 (1) of the Act. Since TOLA was not applicable in respect of the said notices under Section 148 of the Act for AY 2015-16 as conceded by the Revenue in the case of Union of India v. Rajeev Bansal: 2024 INSC 754 (supra), the impugned notice is liable to be set aside. 12. ………………………..” The Hisar Leading Bank Co-op Non Agri Thrift & Credit Society 7. A Co-ordinate Bench of the ITAT in in the case of Pritam Kumar Vs. DCIT, Central Circle-19(1), New Delhi has held as under: “9. We have heard the revival contention of the parties and gone through the material available on record.In, the present case the notice was issued for the A.Y. 2015-2016 on 23-07-2022 beyond the period of limitation. Respectfully following the decision of the Hon’ble Supreme Court, we hold that the notice issued to the assessee dated 23-07-2022 u/s 148 of the Act for the A.Y.2015-16 is time barred. The legal issue raised by the assessee is allowed. 10 Since we have decided the legal ground in favour of the assessee, the other grounds have become academic and keep them open for adjudication.
In the result the appeal of the assessee is allowed”.
In view of above material facts and judicial precedents, respectfully following the same, it is held that the impugned notice was issued on 30.06.2022, which was admittedly beyond the period of limitation as prescribed under Section 149(1) of the Act. Since TOLA was not applicable in respect of the said notices under Section 148 of the Act for the assessment year 2015-16 as conceded by the Revenue in the case of UOI vs. Rajeev Bansal 2024 INSC 754 (supra), the impugned notice is liable to be set aside. Accordingly, ground of appeal
no.3 is allowed.
9. In view of decision of ground no.3 in favour of assessee, the other grounds of appeal being academic in nature, need not be adjudicated upon.
10. In the result, the appeal of the assessee is allowed.
7. Considering the above facts and circumstances and also applying the ratio laid down by the Hon’ble Supreme Court in the case of Rajeev Bansal (supra) and respectfully following the co-ordinate Bench decision in Honeywell Exim Private Limited (supra), we are of the opinion that the notice issued u/s 148 of the Act dated 27.07.2022 is barred by the