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Facts
The assessee challenged the Final Assessment Order for Assessment Year 2015-16, passed under Section 147 read with Section 144C(13) of the Income-tax Act, 1961. The appeal contended that the re-assessment proceedings, initiated by a notice under Section 148 dated 29.07.2022 (following an original notice on 08.04.2021), were bad in law and time-barred.
Held
Relying on Supreme Court decisions in UOI vs. Rajeev Bansal and Deepak Steel and Power Ltd., the Tribunal noted the Revenue's concession that all reassessment notices for AY 2015-16 issued on or after April 1, 2021, must be dropped as they are time-barred under the Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020 (TOLA). Since the Section 148 notice for AY 2015-16 was issued on 08.04.2021, it was held to be bad in law, and the consequential assessment order was quashed.
Key Issues
Whether reassessment proceedings initiated for Assessment Year 2015-16 by a notice under Section 148 of the Income-tax Act, 1961, issued after April 1, 2021, are time-barred, considering the Supreme Court's pronouncements on the Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020 (TOLA).
Sections Cited
147, 148, 148A, 144C(13), 149, 151
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Income Tax Appellate Tribunal, DELHI BENCH, D: NEW DELHI
Before: SHRI VIKAS AWASTHY & SHRI BRAJESH KUMAR SINGH
This appeal has been preferred by the assessee against the Final Assessment Order dated 11.03.2025 passed by the Learned Assessing Officer (AO) under Section 147 read with Section 144C(13), of the Income-tax Act, 1961 (“the Act”), pursuant ITA No.- 3480/Del/2025 Genpact Services LLC to the directions of the Hon'ble Dispute Resolution Panel-2, New Delhi (DRP) order dated 18.02.2025 for the Assessment Year 2015-16.
2. At the outset, the Ld. AR relied upon Ground no. 3 and 4 of the appeal and submitted that, in the present case, the reopening of the assessment vide notice issued u/s 148 dated 29.07.2022 was bad in law. The ground nos. 3 and 4 of the appeal are reproduced as under: “3. That on facts and circumstances of the case and in law, the re- assessment proceedings initiated under section 147/148/148A of the Act are bad in law and hence, the order passed in consequence thereof is liable to be quashed. 4. That on facts and circumstances of the case and in law, the notice issued under section 148 of the Act is barred by limitation thereby making the initiation of reassessment proceedings and order passed in consequence thereof bad in law and liable to be quashed.”
2.1 In support of this contention, the Ld. AR placed reliance on the decision of the Hon’ble Apex Court in the case of UOI vs. Rajeev Bansal [2024] 469 ITR 46 (SC) which has been followed in many cases as listed in his written submission. In this regard, the written submission filed by the assessee is reproduced as under: “ 3. In Re: Ground No(s), 3 and 4: Re-assessment proceedings under section 148 of the Act are barred by limitation 3.1. A brief summary of timeline is provided below: Particulars Date Reference Original notice under section April 08, 2021 Refer pages 1 of the 148 of the Act (as per compilation unamended law) issued to the Appellant 2 ITA No.- 3480/Del/2025 Genpact Services LLC Notice/letter under section June 01, 2022 Refer pages 11-20 of the 148A(b) of the Act to the compilation Petitioner pursuant to the decision of Hon'ble Supreme Court in the case of UOI vs. Ashish Agarwal: [2022] 444 ITR 1 (SC) Reply filed by the Appellant June 13, 2022 and Refer pages 21-23 and 24- June 29, 2022 42 of the compilation impugned order passed July 29, 2022 Refer pages 43-55 of the under section 148A(d) of the compilation Act Impugned notice under July 29, 2022 Refer pages 57 of the section 148 of the Act compilation (Intimation at page 56) 3.2. At the outset, it is submitted that in light of the judgment of the Hon'ble Supreme Court in case of UOI vs Rajeev Bansal: [2024] 469 ITR 46 (SC)/CA No. 8629, 8631 of 2024, impugned notice(s) dated July 29, 2022 issued under section 148 of the Act, are barred by limitation under section 149 of the Act. Relevant extract of the decision is reproduced below: "19. (1) 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" 3.3. This position has been consistently upheld in following decisions holding that re- assessment proceedings for AY 2015-16 initiated after April 1, 2021, are barred by limitation and therefore invalid and liable to be quashed: a) Deepak Steel and Power Ltd. vs CBDT: [2025] 174 taxmann.com 144/Civil Appeal No. 5177 of 2025 (SC) b) ACIT vs Nehal Ashit Shah: [2025] WP No. 1201 of 2023 (SC) c) ITO vs R.K. Build Creation (P.) Ltd.: [2025] SLP (C) Diary No. 59625 of 2024 (SC) d) Bhagwan Sahai Sharma vs DCIT: (2025) 174 taxmann.com 14/WP No. 2211 of 2023 (Delhi) e) Makemytrip India (P.) Ltd. vs DCIT: [2025] 173 taxmann.com 497/W.P. (C) No. 2557 of 2023 (Delhi) f) Pratishtha Garg vs. ACIT: [2025] 171 taxmann.com 264/W.P. (C) No. 16878 of 2024 (Delhi) g) Nationalist Congress Party vs. DCIT: [2025] 175 taxmann.com 19/WP (C) No. 39 of 2023 (Delhi) h) Lalit Gulati vs. ACIT: [2025] 174 taxmann.com 273/W.P. (C) No. 6216 of 2023 (Delhi) 3 ITA No.- 3480/Del/2025 Genpact Services LLC i) Veena Jain vs. ITO: [2025] 175 taxmann.com 101/W.P. (C) No. 7666 of 2023 (Delhi) j) Ibibo Group (P.) Ltd. Vs ACIT: [2024] W.P. (C) No. 17639 of 2022 (Delhi) k) ITO vs Girish Kumar Gupta: [2025] 175 taxmann.com 1037/ITA No. 5366 of 2024 (Del. -Trib.) Thus, the impugned notice dated July 29, 2022 issued under section 148 of the Act and subsequent proceedings ought to be quashed.”
3. The Ld. CIT(DR) relied upon the orders of the authorities below.
We have heard both the parties and perused the material available on record. In this case, the original notice under section 148 of the Act, as per the unamended law was issued on 08.04.2021. Pursuant to the decision of Hon'ble Supreme Court in the case of UOI vs. Ashish Agarwal: [2022] 444 ITR 1 (SC), notice/letter under section 148A(b) of the Act was issued to the to the assessee on 01.06.2022, wherein after considering the reply of the assessee filed on 13.06.2022 and 29.06.2022, the AO passed the order u/s 148A(d) of the Act on 29.07.2022 and also issued the notice u/s 148 of the Act on 29.07.2022. In this regard, the relevant extract of the order of the Hon’ble Apex Court in the cited case wherein the revenue has conceded that for the assessment years 2015-16, all notices issued on or after 01.04.2021 will have to be dropped as they will not fall for completion during the period prescribed under TOLA, is reproduced as under: “ 19. Mr. N Venkataraman, learned Additional Solicitor General of India, made the following submissions on behalf of the Revenue: a. Parliament enacted TOLA as a free-standing legislation to provide relief and relaxation to both the assesses and the Revenue during the time of COVID- 19. 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; ITA No.- 3480/Del/2025 Genpact Services LLC b. Section 149 of the new regime provides three crucial benefits to the assesses: (i) 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 six years, and (iii) the monetary threshold of Rupees fifty lakhs will apply to the re assessment for previous assessment years: c. The relaxations provided under section 3(1) of TOLA apply "notwithstanding anything contained in the specified Act." Section 3(1), therefore, overrides the time limits for issuing a notice under section 148 read with Section 149 of the Income-tax Act; d. TOLA does not extend the life of the old regime. It merely provides a relaxation for the completion or compliance of actions following the procedure laid down under the new regime; 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 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 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 Expiry of Within six Expiry of Year 3 Limitation years Limitation years read with ready with TOLA for TO:A for (4) (2) (1) (2) (3) (4) (5) 2013- 31.03.2017 TOLA not 31.03.2020 30-06-2021 14 applicable 2014- 31.03.2018 TOLA not 31.03.2021 30-06-2021 15 applicable 2015- 31.03.2019 TOLA not 31.03.2022 TOLA not 16 applicable applicable 2016- 31.03.2020 30-06-2021 31.03.2023 TOLA not 17 applicable 2017- 31.03.2021 30-06-2021 31.03.2024 TOLA not 18 applicable 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;” (emphasis supplied by us)
ITA No.- 3480/Del/2025 Genpact Services LLC 4.1 Further, similar view has been taken by the Hon’ble Apex Court in the case of Deepak Steel and Power Ltd. vs. Central Board of Direct Taxes [2025] 174 taxmann.com 144 (SC), in which the Hon’ble Court observed that nothing required to be adjudicated in this matter as the notices so far as the present litigation is concerned is dated 25.06.2021 and the Hon’ble Apex Court quashed and set aside the impugned notice. The relevant extract of the said order is reproduced as under: “ 1. Leave granted.
These appeals arise from the order passed by the High Court of Orissa at Cuttack in Writ Petition (C) Nos. 2446 of 2023/Deepak Steel and Power Ltd v. Central Board of Direct Taxes [2025] 174 taxmann.com 143 (Orissa), 2543 of 2023 dated 1.2 2023 and 2544 of 2023 dated 10.02.2023 respectively by which the High Court disposed of the original writ petitions in the following terms: "1. The memo of appearance filed by Mr. S. S. Mohapatra, learned Senior Standing Counsel for Revenue Department on behalf of Opposite Parties is taken on record 2. In view of the order passed by this Court on 1st December, 2022 in a batch of writ petitions of which W.P(C) No.9191 of 2022 (Kallush Kedia v. Income Tax Officer) was a lead matter and the subsequent order dated 10th January, 2023 passed in W.PIC) No 36314 of 2022 (Shiv Mettalicks Pvt. Ltd. Rourkela v. Principal Commissioner of Income Tax Sambalpur), the Court declines to entertain the present writ petition, but leaves it open to the Petitioner to raise all grounds available to the Petitioner in accordance with law including the grounds urged in the present petition at the appropriate stage as explained by the Court in those orders.
The writ petition is disposed of in the above terms.
ITA No.- 3480/Del/2025 Genpact Services LLC 3. We heard Mr. Saswat Kumar Acharya, the learned counsel appearing for the appellants(assessee) and Mr. Chandrashekhar, the learned counsel appearing for the revenue.
4. The learned counsel appearing for the revenue with his usual fairness invited the attention of this Court to a three judge bench decision of this Court in Union of India v. Rajeev Bansal 2024 SCC OnLine SC 2693/[2024] 167 taxmann.com 70/301 Taxman 238/469 ITR 46 (SC), more particularly, paragraph 19(f) which reads thus:- "19. (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."
5. As the revenue made a concession in the aforesaid decision that is for the assessment year 2015-2016: all notices issued on or after 1 April, 2021 will have to be dropped as they would not fall for completion during the period prescribed under the taxation and other laws (Relaxation and Amendment of certain Provisions Act, 2020). Nothing further is required to be adjudicated in this matter as the notices so far as the present litigation is concerned is dated 25.6.2021.
In view of the aforesaid, in such circumstances referred to above the original writ petition nos.2446 of 2023, 2543 of 2023 and 2544 of 2023 respectively filed before the High Court of Orissa at cuttack stands allowed.
The impugned notice therein stands quashed and set aside.” (emphasis supplied by us)
4.2 Therefore, in view of the above decisions of the Hon’ble Apex Court as the notice u/s 148 of the Act in this case for A.Y. 2015-16 was issued on 08.04.2021, which is after 01.04.2021, we hold that the impugned notice is bad in law. Consequently, the assessment order passed u/s 147 r.w.s. 144C(13) of the Act, dated 7 ITA No.- 3480/Del/2025 Genpact Services LLC 11.03.2025 in pursuance of the said notice is also bad in law and hence quashed. Ground nos. 3 and 4 of the appeal are allowed. In view of this, the other grounds of the appeal become academic and are kept upon in this case.
In the result, appeal of the assessee is allowed. Order pronounced in the open court on 31st December, 2025.