VIKASH AGARWAL,KOLKATA vs. ITO WARD-3(1), KOLKATA

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ITA 1810/KOL/2025Status: DisposedITAT Kolkata20 January 2026AY 2013-145 pages

In favour of the assessee: the assessee's appeal was allowed. From the AI summary of this appeal.

AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the notice issued under Section 148 of the Income Tax Act, 1961, for Assessment Year 2013-14 was indeed barred by limitation. The Tribunal noted that the last day for issuing a notice under Section 148, considering the surviving period and the applicability of TOLA, expired on 01.07.2022. The notice in question was issued on 30.07.2022, which falls beyond this extended period. The Tribunal relied on the Supreme Court's decision in Union of India Vs. Rajeev Bansal, particularly paragraph 114, which clarifies how the limitation period is to be computed in light of TOLA. The reasoning was that the TOLA extended the time limits for certain actions, but any notice issued beyond the surviving period, as computed under the Act read with TOLA, would be time-barred. Consequently, the assessment framed by the AO was deemed invalid and bad in law. The Tribunal quashed the assessment. No issue was expressly left undecided.

What were the facts?

The assessee, Vikash Agarwal, filed an appeal against the order of the National Faceless Appeal Centre, Delhi, for Assessment Year 2013-14. The core of the dispute revolves around the validity of the notice issued under Section 148 of the Income Tax Act, 1961, and the subsequent reassessment proceedings. The assessee contended that the notice was barred by limitation, citing the Supreme Court's decision in Union of India and others Vs. Rajeev Bansal. The notice under Section 148 was initially issued on 19.06.2021, followed by various communications and notices under Section 148A(b) and an order under Section 148A(d). The final notice under Section 148 was issued on 30.07.2022. The Assessing Officer (AO) contended that the notice was not barred by limitation.

What were the issues?

1. Whether the notice issued under Section 148 of the Income Tax Act, 1961, for Assessment Year 2013-14 is barred by limitation, considering the provisions of the Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020 (TOLA) and the Supreme Court's decision in Union of India Vs. Rajeev Bansal. Assessee's Contention: The assessee argued that the notice under Section 148 was issued beyond the surviving period of limitation, making it a nullity and bad in law, relying on the Supreme Court's decision in Union of India Vs. Rajeev Bansal. They contended that the assessment framed by the AO should be quashed. Revenue's Contention: The revenue argued that the notice was not barred by limitation and was validly issued on 30.07.2022.

Which sections of the Income-tax Act were involved?

Section 148,Section 148A,Section 149,Section 151

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “D” BENCH, KOLKATA

Before: SHRI RAJESH KUMAR, AM & SHRI PRADIP KUMAR CHOUBEY, JM

For Appellant: Shri V.K. Shahoo, AR
For Respondent: Shri S.B. Chakraborthy, DR
Hearing: 14.01.2026Pronounced: 20.01.2026

This is an appeal preferred by the assessee against the order of the National Faceless Appeal Centre, Delhi (hereinafter referred to as the “Ld. CIT(A)”] dated 11.06.2025 for the AY 2013-14.

2.

In ground no.1 the assessee has challenged the notice issued u/s 148 of the Act and re-assessment proceedings to be barred by limitation in view of the decision of Hon'ble Apex Court in the case of Union of India and other Vs. Rajeev Bansal [2024] 469 ITR 46 (SC), dated 03.10.2024 and therefore, the notice u/s 148 of the Act as well as the assessment framed by the ld. AO are nullity and bad in law.

3.

The facts in brief are that the notice u/s 148 of the Act was issued on 19.06.2021. The assessee requested the ld. AO/JAO on 06.01.2022

4.

The ld. AR vehemently argued that the notice u/s 148 of the Act was issued beyond surviving period i.e. 01.07.2022 and therefore in terms of Para no.114 of the Hon'ble Apex Court decision in Union of India Vs. Rajeev Bansal (supra), the notice is barred by limitations and accordingly, the assessment framed by the ld. AO is also nullity and bad in law and may kindly be quashed.

5.

The ld. DR on the other hand, vehemently submitted that the notice is not barred by limitation and it was validly issued on 30.07.2022.

6.

After hearing the rival contentions and perusing the materials available on record, we find that in this case the assessment year is 2013-14 and the last day for issue of notice in terms of Provisions of Section 149(1)(b) of the Act on 31.03.2020. We note that the notice was issued on 19.06.2021. We further note that due to covid pandemic Other laws (relaxation and amendment of certain provisions) Act, 2020 (TOLA) was brought out, which overrides the Income Tax Act to the extent of relaxing time limit for issuance of reassessment notices,

“114. In view of the above discussion, we conclude that: a. After 1 April 2021, the Income-tax Act has to be read along with the substituted provisions; b. TOLA will continue to apply to the Income-tax Act after 1 April 2021 if any action or proceeding specified under the substituted provisions of the Income-tax Act falls for completion between 20 March 2020 and 31 March 2021; c. Section 3(1) of TOLA overrides Section 149 of the Income-tax Act only to the extent of relaxing the time limit for issuance of a reassessment notice under section 148; d. TOLA will extend the time limit for the grant of sanction by the authority specified under section 151. The test to determine whether TOLA will apply to Section 151 of the new regime is this: if the time limit of three years from the end of an assessment year falls between 20 March 2020 and 31 March 2021, then the specified authority under section 151(i) has extended time till 30 June 2021 to grant approval; e. In the case of Section 151 of the old regime, the test is: if the time limit of four years from the end of an assessment year falls between 20 March 2020 and 31 March 2021, then the specified authority under section 151(2) has extended time till 31 March 2021 to grant approval; f. The directions in Ashish Agarwal (supra) will extend to all the ninety thousand reassessment notices issued under the old regime during the period 1 April 2021 and 30 June 2021;

7.

In the result, the appeal of the assessee is allowed.

Order pronounced in the open court on 20.01.2026.

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