Bombay High Court Judgments — 2022

The High Court held that the Explanations to Notification No. 20/2021 and Notification No. 38/2021 were ultra vires and therefore bad in law and null and void. The Court agreed with the assessee's submission that Section 3 of the Relaxation Act was only a provision for relaxing time limits and did not empower the Central Government to amend the substantive provisions of the Income Tax Act. Section 4 of the Relaxation Act was the provision that amended the Act. The Court further found that even if the Explanations were considered valid, the notices were still invalid because they did not cover Section 147, which is subject to Sections 148 to 153, including the mandatory procedure under Section 148A, which was not followed. The Court also noted that the Relaxation Act was not applicable to Assessment Years 2015-2016 onwards. Consequently, all impugned notices issued under Section 148 were quashed and set aside. The Court allowed the Assessing Officers to initiate fresh reassessment proceedings in accordance with the amended provisions of the Act, strictly complying with the statutory requirements.

The High Court held that the Explanations to Notification No. 20 of 2021 and Notification No. 38 of 2021 were ultra vires, bad in law, and null and void. The Court agreed with the petitioners that Section 3 of the Relaxation Act was a relaxation provision dealing with time limits and did not empower amendments to substantive provisions of the Act, unlike Section 4. The Court found that the impugned notices were bad in law for multiple reasons: (a) they were issued based on the erstwhile Section 147's 'reason to believe' which is no longer recognized in the amended Section 147; (b) the mandatory procedure under Section 148A was not followed, even if the Explanations were considered valid; and (c) the Relaxation Act was not applicable to Assessment Years 2015-2016 and subsequent years, as the time limits for these years were not expiring within the period for which Section 3(1) of the Relaxation Act was applicable. Consequently, all impugned notices issued under Section 148 were quashed and set aside. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the amended provisions of the Act, strictly complying with the statutory requirements.

The High Court held that the Explanations to Notification No. 20 of 2021 and Notification No. 38 of 2021 were ultra vires and therefore bad in law and null and void. The Court agreed with the petitioners' submission that Section 3 of the Relaxation Act was a relaxation provision dealing with time limits and did not empower the Central Government to amend the substantive provisions of the Income Tax Act. Section 4 of the Relaxation Act was the provision that amended the Act, and it was done by the Legislature itself. The Court further held that even if the Explanations were considered valid, the impugned notices were bad in law because they did not comply with the amended Section 147, which no longer recognizes the concept of 'reason to believe', and the mandatory procedure under Section 148A was not followed. Additionally, the Court found that the Relaxation Act was not applicable for Assessment Years 2015-2016 or any subsequent year, as the time limit for issuing notices for these years was not expiring within the period for which Section 3(1) of the Relaxation Act was applicable. Consequently, all the impugned notices issued under Section 148 of the Act were quashed and set aside. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the amended provisions of the Act, strictly complying with the statutory requirements.

The High Court held that the Explanations to Notification No. 20/2021 and Notification No. 38/2021 are ultra vires and therefore bad in law and void. The Court agreed with the assessee's submission that Section 3 of the Relaxation Act was only a relaxation provision dealing with time limits and did not empower the Central Government to amend substantive provisions of the Income Tax Act. Section 4 of the Relaxation Act, which did amend provisions, was enacted by the legislature itself. The Court further noted that even if the Explanations were considered valid, they did not cover Section 147 of the Act, and the mandatory procedure under the amended Section 147 and Section 148A had not been followed. Additionally, the Relaxation Act was not applicable to Assessment Years 2015-2016 onwards. Consequently, all impugned notices issued under Section 148 of the Act were quashed and set aside. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the relevant provisions of the Act as amended by the Finance Act, 2021, strictly complying with the statutory procedures.

The High Court held that the Explanations to Notification No. 20/2021 and Notification No. 38/2021 were ultra vires, bad in law, and null and void. The Court agreed with the petitioners that Section 3 of the Relaxation Act was a provision dealing with time limits and did not empower the Central Government to revive repealed substantive provisions of the Income Tax Act. Section 4 of the Relaxation Act, which amended the Act, was distinct and did not grant such powers. Furthermore, even if the Explanations were considered valid, the reassessment notices were invalid because they did not comply with the amended Section 147, which no longer recognized the concept of 'reason to believe' for assumption of jurisdiction, and failed to follow the mandatory procedure under Section 148A. The Court also noted that the Relaxation Act was not applicable to Assessment Years 2015-2016 onwards. Consequently, all impugned notices issued under Section 148 were quashed and set aside. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the amended provisions of the Act.

The High Court held that the Explanations to Notification No. 20/2021 and Notification No. 38/2021 were ultra vires and therefore bad in law and null and void. The Court agreed with the petitioners' submission that Section 3 of the Relaxation Act was merely a relaxation provision for time limits and did not grant the power to amend the substantive provisions of the Income Tax Act, which power was vested in the legislature under Section 4. The Court found that the Explanations sought to extend the applicability of erstwhile Sections 148, 149, and 151 but did not cover Section 147, which empowers reopening subject to Sections 148 to 153, including Section 148A. Therefore, even if the Explanations were valid, the procedure under Section 148A was not followed, rendering the notices invalid. The Court also held that the Relaxation Act was not applicable for Assessment Years 2015-2016 or any subsequent year, as the time limit for issuing notices under Section 148 for these years was not expiring within the period for which Section 3(1) of the Relaxation Act was applicable. Consequently, all impugned notices issued under Section 148 were quashed and set aside. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the relevant amended provisions of the Act, strictly complying with the statutory procedures.

The High Court held that the Explanations to Notification No. 20/2021 and Notification No. 38/2021 were ultra vires and therefore bad in law and null and void. The Court agreed with the assessee that Section 3 of the Relaxation Act was a provision for relaxing time limits and did not empower the Central Government to amend substantive provisions of the Income Tax Act, unlike Section 4. The Court found that the notices were invalid for multiple reasons: (a) the Explanations did not cover Section 147, which empowers reopening subject to Sections 148 to 153 (including Section 148A), meaning the procedure under Section 148A was not followed; (b) the assumption of jurisdiction was based on the 'reason to believe' concept, which is no longer recognized in the amended Section 147; and (c) the Relaxation Act was not applicable for Assessment Years 2015-2016 or subsequent years. Consequently, all impugned notices issued under Section 148 were quashed and set aside. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the amended provisions of the Act, strictly complying with the law.

The High Court held that the Explanations to Notification No. 20 of 2021 and Notification No. 38 of 2021 were ultra vires and therefore bad in law and void. The Court agreed with the petitioners that Section 3 of the Relaxation Act was a relaxation provision dealing with time limits and did not empower the Central Government to amend substantive provisions of the Income Tax Act. It noted that Section 4 of the Relaxation Act, which amended the Act, was distinct from Section 3. The Court found that the impugned notices were bad in law because they were issued based on the 'reason to believe' concept, which was no longer recognized in the amended Section 147, and because the procedure under Section 148A, which is part of the amended provisions, was not followed. The Court also held that the Relaxation Act was not applicable to the assessment years in question, thus the question of extending limitation periods did not arise. Consequently, all impugned notices were quashed and set aside. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the amended provisions of the Act.

The High Court held that the Explanations to Notification No. 20/2021 and Notification No. 38/2021 were ultra vires and therefore bad in law and void. The Court agreed with the petitioners that Section 3 of the Relaxation Act was a provision for relaxing time limits and did not grant the power to amend the substantive provisions of the Income Tax Act. It noted that Section 4 of the Relaxation Act, which amended the Act, was distinct from Section 3. The Court further found that even if the Explanations were considered valid, the impugned notices were invalid because the Assessing Officers had assumed jurisdiction based on the 'reason to believe' concept, which is obsolete under the amended Section 147, and had failed to follow the mandatory procedure under Section 148A. The Court also held that the Relaxation Act was not applicable to Assessment Years 2015-2016 onwards. Consequently, all the impugned notices issued under Section 148 of the Act were quashed and set aside. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the amended provisions of the Act.

The High Court held that the Explanations to Notification No. 20 of 2021 and Notification No. 38 of 2021 were ultra vires and therefore bad in law and void. The Court agreed with the petitioners' submission that Section 3 of the Relaxation Act was a relaxation provision dealing with time limits and did not empower the Central Government to amend substantive provisions of the Income Tax Act. Section 4 of the Relaxation Act, which made amendments, was enacted by the legislature itself. The Court found that the notices were invalid for multiple reasons: (a) the Explanations were ultra vires; (b) the notices were issued based on the 'reason to believe' concept, which is no longer recognized in the amended Section 147; (c) the procedure under Section 148A was not followed; and (d) the Relaxation Act was not applicable to Assessment Years 2015-2016 onwards. Consequently, all impugned notices were quashed and set aside, with liberty to the Assessing Officers to initiate fresh proceedings in accordance with the amended provisions of the Act.

The High Court held that the Explanations to Notification No. 20/2021 and Notification No. 38/2021 are ultra vires and therefore bad in law and null and void. The Court agreed with the assessee's submission that Section 3 of the Relaxation Act was a provision for relaxation of time limits and did not empower the Central Government to amend the substantive provisions of the Income Tax Act. Such amendments were made by the legislature itself under Section 4 of the Relaxation Act. Furthermore, even if the Explanations were considered valid, the notices were still invalid because they did not comply with the amended Section 147, which requires adherence to Sections 148 to 153, including the procedure under Section 148A. The Court also noted that the Relaxation Act was not applicable for Assessment Years 2015-2016 onwards. Consequently, all impugned notices issued under Section 148 were quashed and set aside. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the amended provisions of the Act, strictly complying with the statutory requirements.

The High Court held that the Explanations to Notification No. 20 of 2021 and Notification No. 38 of 2021 are ultra vires, bad in law, and null and void. The Court agreed with the assessee's submission that Section 3 of the Relaxation Act is a relaxation provision dealing with time limits and does not empower the Central Government to amend the substantive provisions of the Income Tax Act. Section 4 of the Relaxation Act, which amends the Act, was made by the legislature itself. The Court further found that even if the Explanations were valid, the impugned notices were bad in law because they did not comply with the amended Section 147, which is subject to Sections 148 to 153, including the procedure under Section 148A. The 'reason to believe' standard, applicable under the erstwhile Section 147, was not followed. The Court also noted that the Relaxation Act was not applicable for Assessment Years 2015-2016 onwards, as the time limits for those years were not expiring within the period for which Section 3(1) of the Relaxation Act was applicable. Consequently, all impugned notices issued under Section 148 were quashed and set aside. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the amended provisions of the Act.

The High Court held that the Explanations to Notification No. 20/2021 and Notification No. 38/2021 were ultra vires and therefore bad in law and null and void. The Court agreed with the assessee's contention that Section 3 of the Relaxation Act was a relaxation provision dealing with time limits and did not empower the Central Government to amend or revive substantive provisions of the Income Tax Act. Section 4 of the Relaxation Act, which did amend provisions, was distinct. Furthermore, the Court found that even if the Explanations were considered valid, the impugned notices were still bad in law because they failed to comply with the amended Section 147 of the Act, specifically by relying on the 'reason to believe' criterion and not following the procedure under Section 148A. The Court also noted that the Relaxation Act was not applicable to assessment years from 2015-2016 onwards. Consequently, all impugned notices issued under Section 148 of the Act were quashed and set aside. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the amended provisions of the Act, strictly complying with the statutory requirements.

The High Court held that the Explanations to Notification Nos. 20/2021 and 38/2021 are ultra vires and consequently bad in law and void. The Court agreed with the assessee's submission that Section 3 of the Relaxation Act is a relaxation provision dealing with time limits and does not empower the Central Government to amend substantive provisions of the Income Tax Act. Section 4 of the Relaxation Act, which amends the Income Tax Act, was made by the legislature itself. The Court further noted that even if the Explanations were considered valid, they did not cover Section 147, and the mandatory procedure under the amended Section 147, including Section 148A, was not followed. Additionally, the Court found that the Relaxation Act was not applicable for Assessment Years 2015-2016 onwards. Consequently, all impugned notices issued under Section 148 of the Act were quashed and set aside. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the amended provisions of the Act.

The High Court held that the Explanations to Notification No. 20/2021 and Notification No. 38/2021 were ultra vires and therefore bad in law and null and void. The Court agreed with the petitioners that Section 3 of the Relaxation Act was a relaxation provision dealing with time limits and did not empower the Central Government to amend substantive provisions of the Income Tax Act. Section 4 of the Relaxation Act, which amended the Act, was distinct. The Court found that the impugned notices were invalid for multiple reasons: (a) the Explanations to the notifications were declared void; (b) even if the Explanations were valid, they did not cover Section 147, and the procedure under the amended Section 147 and Section 148A had not been followed; and (c) the Relaxation Act was not applicable to Assessment Years 2015-2016 onwards. Consequently, all impugned notices issued under Section 148 were quashed and set aside. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the amended provisions of the Act. The ratio decidendi is that legislative power to amend substantive provisions of the Income Tax Act cannot be delegated to the executive through notifications under a relaxation provision, and procedural compliances under amended law must be strictly followed.

The High Court held that the Explanations to Notification No. 20/2021 and Notification No. 38/2021 are ultra vires and therefore bad in law and null and void. The Court agreed with the assessee's submission that Section 3 of the Relaxation Act was only a relaxation provision dealing with time limits and did not empower the Central Government to amend substantive provisions of the Income Tax Act. Such amendments were to be made by the Legislature itself, as seen in Section 4 of the Relaxation Act. Furthermore, the Court found that even if the Explanations were considered valid, the notices were still bad in law because they did not comply with the amended Section 147, which requires adherence to Sections 148 to 153, including the procedure under Section 148A. The 'reason to believe' basis for assumption of jurisdiction was also noted as obsolete under the amended provisions. The Court also held that the Relaxation Act was not applicable for Assessment Years 2015-2016 onwards. Consequently, all impugned notices issued under Section 148 were quashed and set aside. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the amended provisions of the Act.

The High Court held that the Explanations to Notification No. 20/2021 and Notification No. 38/2021 were ultra vires and therefore bad in law and null and void. The Court agreed with the assessee's submission that Section 3 of the Relaxation Act was a relaxation provision dealing with time limits and did not empower the Central Government to amend the substantive provisions of the Income Tax Act. Section 4 of the Relaxation Act, which amended certain provisions, was distinct and made by the legislature itself. The Court also found that the impugned notices were bad in law because they were issued based on the 'reason to believe' concept, which is no longer recognized in the amended Section 147. Furthermore, the amended Section 147 is subject to Sections 148 to 153, including the mandatory procedure under Section 148A, which was not followed. The Court also noted that the Relaxation Act was not applicable for Assessment Years 2015-2016 or any subsequent year, as the time limit for issuing notices under Section 148 for these years was not expiring within the period for which Section 3(1) of the Relaxation Act was applicable. Consequently, all impugned notices issued under Section 148 were quashed and set aside. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the amended provisions of the Act.

The High Court held that the Explanations to Notification No. 20/2021 and Notification No. 38/2021 were ultra vires and therefore bad in law and void. The Court agreed with the assessee that Section 3 of the Relaxation Act was a relaxation provision dealing with time limits and did not empower the Central Government to amend substantive provisions of the Income Tax Act, unlike Section 4 which contained legislative amendments. The Court found that the impugned notices were bad in law for multiple reasons: (a) the Explanations were invalid; (b) even if the Explanations were valid, they did not cover Section 147, and the procedure under the amended Section 147 and Section 148A had not been followed; and (c) the Relaxation Act was not applicable to Assessment Years 2015-2016 and subsequent years. Consequently, all the impugned notices issued under Section 148 of the Act were quashed and set aside. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the relevant provisions of the Act as amended by the Finance Act, 2021, after strictly complying with the statutory provisions. The Court was in respectful agreement with the views taken by the Allahabad, Rajasthan, Delhi, and Madras High Courts in similar matters.

The High Court held that the Explanations to Notification No. 20/2021 and Notification No. 38/2021 were ultra vires and therefore bad in law and void. The Court agreed with the petitioners that Section 3 of the Relaxation Act was a relaxation provision dealing with time limits and did not empower the Central Government to amend the substantive provisions of the Income Tax Act. Section 4 of the Relaxation Act, which did amend the Act, was a legislative amendment and not a delegation of power. The Court further found that even if the Explanations were considered valid, the impugned notices were invalid because they were issued based on the 'reason to believe' concept, which is no longer recognized under the amended Section 147, and the mandatory procedure under Section 148A was not followed. Additionally, the Court noted that the Relaxation Act was not applicable for Assessment Years 2015-2016 or subsequent years. Consequently, all impugned notices under Section 148 were quashed and set aside. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the amended provisions of the Act.

The High Court held that the Explanations to Notification No. 20/2021 and Notification No. 38/2021 were ultra vires and therefore bad in law and null and void. The Court agreed with the petitioners that Section 3 of the Relaxation Act was a relaxation provision for time limits and did not empower the Central Government to amend substantive provisions of the Income Tax Act. It noted that Section 4 of the Relaxation Act was the provision that amended the Act. The Court found that the impugned notices were bad in law for multiple reasons: (a) the Explanations were invalid; (b) even if the Explanations were valid, they did not cover Section 147, and the procedure under the amended Section 147 and Section 148A was not followed; (c) the Relaxation Act was not applicable to Assessment Years 2015-2016 onwards, as the time limits for these years were not expiring within the period of applicability of Section 3(1) of the Relaxation Act. Consequently, all impugned notices issued under Section 148 of the Act were quashed and set aside. The Assessing Officers were granted liberty to initiate fresh reassessment proceedings in accordance with the amended provisions of the Act.

The High Court held that the Explanations to Notification No. 20 of 2021 and Notification No. 38 of 2021 were ultra vires and therefore bad in law and null and void. The Court agreed with the petitioners' submission that Section 3 of the Relaxation Act was a provision for relaxing time limits and did not empower the Central Government to amend or revive substantive provisions of the Income Tax Act, 1961. Section 4 of the Relaxation Act, which did amend the Act, was a legislative amendment and not a delegation. Furthermore, the Court found that even if the Explanations were considered valid, the impugned notices were still invalid because they did not comply with the amended Section 147, which is subject to Sections 148 to 153, including the mandatory procedure under Section 148A. The Court also noted that the Relaxation Act was not applicable for Assessment Years 2015-2016 onwards. Consequently, all impugned notices issued under Section 148 of the Act were quashed and set aside, with liberty to the Assessing Officers to initiate fresh reassessment proceedings in accordance with the amended provisions.

The High Court held that the Explanations to Notification No. 20/2021 and Notification No. 38/2021 are ultra vires and therefore bad in law and null and void. The Court agreed with the petitioners' submission that Section 3 of the Relaxation Act pertains to relaxation of time limits and does not grant the power to amend substantive provisions of the Income Tax Act, unlike Section 4 which was enacted by the legislature. The Court also found that even if the Explanations were considered valid, the impugned notices were invalid because they were issued based on the 'reason to believe' criterion from the erstwhile Section 147, which is no longer applicable, and the mandatory procedure under the amended Section 147, including Section 148A, was not followed. Additionally, the Court noted that the Relaxation Act was not applicable to Assessment Years 2015-2016 onwards. Consequently, all impugned notices issued under Section 148 were quashed and set aside. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the amended provisions of the Act, strictly complying with the statutory requirements. The Court relied on decisions from the Allahabad High Court, Rajasthan High Court, Delhi High Court, and Madras High Court.

The High Court held that the Explanations to Notification No. 20 of 2021 and Notification No. 38 of 2021 were ultra vires, bad in law, and null and void. The Court agreed with the assessee's submission that Section 3 of the Relaxation Act was a relaxation provision dealing with time limits and did not empower the Central Government to amend the substantive provisions of the Income Tax Act. Section 4 of the Relaxation Act, which did amend provisions, was distinct. The Court further found that even if the Explanations were considered valid, the notices were still bad in law because they did not comply with the amended Section 147, which no longer recognizes the 'reason to believe' concept, and crucially, the procedure under the newly introduced Section 148A was not followed. The Court also noted that the Relaxation Act was not applicable for Assessment Years 2015-2016 onwards. Consequently, all impugned notices were quashed and set aside, with liberty to the Assessing Officers to initiate fresh proceedings in accordance with the amended provisions of the Act.

The High Court held that the Explanations to Notification No. 20/2021 and Notification No. 38/2021 were ultra vires and therefore bad in law and null and void. The Court agreed with the assessee's submission that Section 3 of the Relaxation Act was a relaxation provision dealing with time limits and did not empower the Central Government to amend the substantive provisions of the Income Tax Act, 1961. Such amendments were only provided for under Section 4 of the Relaxation Act. Furthermore, the Court found that even if the Explanations were considered valid, the impugned notices were still invalid because they did not comply with the amended Section 147 of the Act, which requires adherence to Sections 148 to 153, including the procedure under Section 148A. The Court also noted that the Relaxation Act was not applicable for Assessment Years 2015-2016 onwards. Consequently, all impugned notices issued under Section 148 of the Act were quashed and set aside, with liberty to the Assessing Officers to initiate fresh reassessment proceedings in accordance with the amended provisions of the Act.

The High Court held that the Explanations to Notification No. 20/2021 and Notification No. 38/2021 were ultra vires and consequently bad in law and void. The Court agreed with the assessee's submission that Section 3 of the Relaxation Act was a provision for relaxing time limits and did not grant the power to amend substantive provisions of the Income Tax Act. Section 4 of the Relaxation Act, which did amend provisions, was distinct. The Court found that the Explanations attempted to revive repealed provisions (erstwhile Sections 148, 149, and 151) without legislative backing. Furthermore, even if the Explanations were considered valid, the notices were still invalid because the procedure under the amended Section 147, including the mandatory compliance with Section 148A, was not followed. The Court also noted that the Relaxation Act was not applicable for assessment years 2015-2016 onwards. Consequently, all impugned notices issued under Section 148 were quashed and set aside, with liberty to the Assessing Officers to initiate fresh proceedings in accordance with the amended provisions of the Act.

The High Court allowed the writ petitions. It held that the Explanations to Notification No. 20/2021 and Notification No. 38/2021 were ultra vires and therefore bad in law and void. The Court agreed with the assessee's submission that Section 3 of the Relaxation Act was only a relaxation provision dealing with time limits and did not empower the Central Government to amend substantive provisions of the Income Tax Act. Section 4 of the Relaxation Act, which amended the Act, was distinct and made by the legislature itself. Furthermore, the Court found that even if the Explanations were considered valid, the impugned notices were still bad in law because they did not comply with the amended Section 147, which requires compliance with Sections 148 to 153, including the procedure under Section 148A. The assumption of jurisdiction based on 'reason to believe' was also noted as a defect. The Court also found that the Relaxation Act was not applicable to Assessment Years 2015-2016 onwards. Consequently, all impugned notices issued under Section 148 were quashed and set aside. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the amended provisions of the Act.

The High Court held that the Explanations to Notification No. 20/2021 and Notification No. 38/2021 are ultra vires and therefore bad in law and null and void. The Court agreed with the assessee's submission that Section 3 of the Relaxation Act was a provision for relaxation of time limits and did not empower the Central Government to amend the substantive provisions of the Income Tax Act, 1961. Such amendments were only provided for under Section 4 of the Relaxation Act, which was enacted by the legislature itself. Furthermore, even if the Explanations were considered valid, the impugned notices were still invalid because they did not comply with the amended Section 147, which requires compliance with Sections 148 to 153, including the procedure under Section 148A. The Court also noted that the Relaxation Act was not applicable to Assessment Years 2015-2016 onwards. Consequently, all impugned notices issued under Section 148 of the Act were quashed and set aside. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the amended provisions of the Act, strictly complying with the statutory requirements.

The High Court held that the Explanations to Notification No. 20/2021 and Notification No. 38/2021 are ultra vires and therefore bad in law and null and void. The Court agreed with the petitioners that Section 3 of the Relaxation Act was a provision for relaxing time limits and did not grant the power to amend substantive provisions of the Income Tax Act, 1961. Such amendments were made by the Legislature itself under Section 4 of the Relaxation Act. Furthermore, the Court found that even if the Explanations were considered valid, the notices were still invalid as they did not comply with the amended Section 147, which does not recognize the 'reason to believe' basis for reassessment, and the mandatory procedure under Section 148A was not followed. The Court also noted that the Relaxation Act was not applicable to Assessment Years 2015-2016 onwards. Consequently, all impugned notices issued under Section 148 were quashed and set aside. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the amended provisions of the Act, strictly complying with the statutory requirements.

The High Court allowed the writ petitions, holding that the Explanations to Notification No. 20 of 2021 and Notification No. 38 of 2021 were ultra vires, bad in law, and null and void. The Court agreed with the petitioner's submission that Section 3 of the Relaxation Act was a relaxation provision dealing with time limits and did not empower the Central Government to amend the substantive provisions of the Income Tax Act. Only Section 4 of the Relaxation Act amended the Act. Furthermore, the Court found that even if the Explanations were considered valid, the impugned notices were invalid because they did not comply with the amended Section 147, which requires adherence to Sections 148 to 153, including the procedure under Section 148A. The 'reason to believe' basis for assuming jurisdiction was also deemed obsolete under the amended provisions. The Court also noted that the Relaxation Act was not applicable to Assessment Years 2015-2016 onwards. Consequently, all impugned notices issued under Section 148 were quashed and set aside. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the amended provisions of the Act, strictly complying with the statutory requirements.

The High Court held that the Explanations to Notification No. 20/2021 and Notification No. 38/2021 were ultra vires and therefore bad in law and null and void. The Court agreed with the petitioners that Section 3 of the Relaxation Act was a relaxation provision dealing with time limits and did not empower the Central Government to amend substantive provisions of the Income Tax Act; only Section 4 of the Relaxation Act did so. The Court found that the impugned notices were bad in law because they were issued based on the erstwhile Section 147, which was no longer recognized in the amended Section 147, and that the mandatory procedure under Section 148A had not been followed. Furthermore, the Court held that the Relaxation Act was not applicable to assessment years 2015-2016 onwards. Consequently, all impugned notices issued under Section 148 were quashed and set aside. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the amended provisions of the Act.

The High Court held that the Explanations to Notification Nos. 20/2021 and 38/2021 were ultra vires and therefore bad in law and null and void. The Court agreed with the petitioners' submission that Section 3 of the Relaxation Act was a relaxation provision dealing with time limits and did not grant the power to amend substantive provisions of the Income Tax Act, 1961. Section 4 of the Relaxation Act, which did amend provisions, was distinct. The Court found that the impugned notices were invalid for multiple reasons: (a) the Explanations to the notifications were declared ultra vires; (b) even if the Explanations were valid, they did not cover Section 147, and the procedure under the amended Section 147 and Section 148A was not followed; (c) the 'reason to believe' clause, which was the basis for assuming jurisdiction, was no longer recognized under the amended Section 147; and (d) the Relaxation Act was not applicable to Assessment Years 2015-2016 and subsequent years. Consequently, all impugned notices were quashed and set aside. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the amended provisions of the Act. The ratio decidendi is that legislative power to amend substantive provisions of the Income Tax Act cannot be delegated to the executive through notifications under a relaxation provision, and procedural compliances under the amended Act are mandatory.

The High Court held that the Explanations to Notification No. 20 of 2021 and Notification No. 38 of 2021 are ultra vires and therefore bad in law and null and void. The Court agreed with the assessee's submission that Section 3 of the Relaxation Act was a relaxation provision dealing with time limits and did not empower the Central Government to amend substantive provisions of the Income Tax Act. Section 4 of the Relaxation Act was the provision that amended the Act. The Court found that the impugned notices were bad in law for multiple reasons: (a) the Explanations were declared ultra vires; (b) even if the Explanations were valid, the notices did not comply with the amended Section 147, as the 'reason to believe' concept was no longer recognized, and the procedure under Section 148A was not followed; and (c) the Relaxation Act was not applicable to assessment years 2015-2016 onwards. Consequently, all impugned notices issued under Section 148 of the Act were quashed and set aside. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the amended provisions of the Act, strictly complying with the statutory procedures.

The High Court held that the Explanations to Notification No. 20 of 2021 and Notification No. 38 of 2021 were ultra vires, bad in law, and null and void. The Court agreed with the petitioners that Section 3 of the Relaxation Act was a relaxation provision for time limits and did not empower the Central Government to amend substantive provisions of the Income Tax Act. Section 4 of the Relaxation Act, which amended the Act, was distinct and did not grant such powers. The Court found that the notices were invalid for multiple reasons: (a) the Explanations were invalid; (b) even if the Explanations were valid, they did not cover Section 147, and the procedure under the amended Section 147 and Section 148A was not followed; and (c) the Relaxation Act was not applicable for Assessment Years 2015-2016 onwards. Consequently, all impugned notices issued under Section 148 were quashed and set aside. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the amended provisions of the Act.

The High Court held that the Explanations to Notification No. 20/2021 and Notification No. 38/2021 were ultra vires and therefore bad in law and null and void. The Court agreed with the assessee's submission that Section 3 of the Relaxation Act was a relaxation provision dealing with time limits and did not empower the Central Government to amend the substantive provisions of the Income Tax Act. Section 4 of the Relaxation Act, which did amend the Act, was enacted by the legislature. The Court found that the Explanations sought to extend the applicability of erstwhile Sections 148, 149, and 151, but did not cover Section 147, which requires compliance with Sections 148 to 153, including Section 148A. Therefore, even if the Explanations were valid, the procedure under Section 148A was not followed, making the notices invalid. Furthermore, the Court noted that the Relaxation Act was not applicable for Assessment Years 2015-2016 and subsequent years. Consequently, all impugned notices issued under Section 148 of the Act were quashed and set aside. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the relevant provisions of the Act as amended by the Finance Act, 2021, after strictly complying with the statutory provisions.

The High Court held that the Explanations to Notification No. 20/2021 and Notification No. 38/2021 were ultra vires and therefore bad in law and null and void. The Court agreed with the petitioners that Section 3 of the Relaxation Act was a relaxation provision dealing with time limits and did not empower the Central Government to amend substantive provisions of the Income Tax Act, unlike Section 4 which contained legislative amendments. The Court found that the impugned notices were bad in law for multiple reasons: (a) the Explanations did not cover Section 147, which empowers revenue to reopen subject to Sections 148 to 153 (including Section 148A), meaning the procedure under Section 148A was not followed; (b) the assumption of jurisdiction was based on the 'reason to believe' concept, which is no longer recognized in the amended Section 147; and (c) the Relaxation Act was not applicable for Assessment Years 2015-2016 or subsequent years as the time limits for issuing notices for these years were not expiring within the period for which Section 3(1) of the Relaxation Act was applicable. Consequently, all impugned notices issued under Section 148 were quashed and set aside. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the amended provisions of the Act, strictly complying with the law.

The High Court held that the Explanations to Notification No. 20/2021 and Notification No. 38/2021 are ultra vires and therefore bad in law and null and void. The Court agreed with the assessee's submission that Section 3 of the Relaxation Act was a relaxation provision dealing with time limits and did not empower the Central Government to amend substantive provisions of the Income Tax Act; only Section 4 of the Relaxation Act amended the Act. Furthermore, the Court found that even if the Explanations were valid, the impugned notices were invalid as they did not comply with the amended Section 147, which no longer uses the 'reason to believe' criterion, and crucially, failed to follow the mandatory procedure under Section 148A. The Court also noted that the Relaxation Act was not applicable for Assessment Years 2015-2016 onwards. Consequently, all impugned notices issued under Section 148 were quashed and set aside. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the amended provisions of the Act, strictly complying with the statutory requirements.

The High Court held that the Explanations to Notification No. 20/2021 and Notification No. 38/2021 were ultra vires and therefore bad in law and null and void. The Court agreed with the petitioners that Section 3 of the Relaxation Act was a relaxation provision for time limits and did not empower the Central Government to amend substantive provisions of the Income Tax Act; only Section 4 did so. The Court found that the impugned notices were bad in law for multiple reasons: (a) the Explanations were invalid; (b) even if valid, they did not cover Section 147, and the procedure under the amended Section 147 and Section 148A was not followed; (c) the 'reason to believe' standard, no longer recognized in the amended Section 147, was used; and (d) the Relaxation Act was not applicable to Assessment Years 2015-2016 onwards. Consequently, all impugned notices issued under Section 148 were quashed and set aside. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the amended provisions of the Act.

The High Court held that the Explanations to Notification No. 20/2021 and Notification No. 38/2021 were ultra vires and therefore bad in law and null and void. The Court agreed with the petitioners that Section 3 of the Relaxation Act was a provision for relaxing time limits and did not empower the Central Government to amend the substantive provisions of the Income Tax Act. It noted that Section 4 of the Relaxation Act was the section that amended the Act. The Court found that the notices were invalid for multiple reasons: (a) the Explanations were ultra vires; (b) even if the Explanations were valid, they did not cover Section 147 of the Act, and the procedure under the amended Section 147 and Section 148A was not followed; and (c) the Relaxation Act was not applicable for Assessment Years 2015-2016 onwards. Consequently, all impugned notices issued under Section 148 of the Act were quashed and set aside. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the amended provisions of the Act, strictly complying with the statutory requirements. The Court was in respectful agreement with the views taken by the Allahabad, Rajasthan, Delhi, and Madras High Courts.

The High Court held that the Explanations to Notification No. 20/2021 and Notification No. 38/2021 were ultra vires and therefore bad in law and null and void. The Court agreed with the assessee's submission that Section 3 of the Relaxation Act was a relaxation provision dealing with time limits and did not empower the Central Government to amend the substantive provisions of the Income Tax Act. Only Section 4 of the Relaxation Act amended the Act. Furthermore, even if the Explanations were considered valid, the impugned notices were still invalid because they did not comply with the amended Section 147, which no longer recognizes the concept of 'reason to believe', and the mandatory procedure under Section 148A was not followed. The Court also found that the Relaxation Act was not applicable for Assessment Years 2015-2016 and subsequent years. Consequently, all the impugned notices issued under Section 148 of the Act were quashed and set aside. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the amended provisions of the Act, strictly complying with the statutory requirements.

The High Court held that the Explanations to Notification No. 20 of 2021 and Notification No. 38 of 2021 are ultra vires and therefore bad in law and null and void. The Court agreed with the assessee's submission that Section 3 of the Relaxation Act is a relaxation provision dealing with time limits and does not empower the Central Government to amend substantive provisions of the Income Tax Act. Section 4 of the Relaxation Act, which amends provisions, was made by the Legislature itself. The Court found that the impugned notices were bad in law for multiple reasons: (a) the Explanations did not cover Section 147, which empowers reopening subject to Sections 148 to 153, including Section 148A; (b) the procedure under Section 148A was not followed; (c) the assumption of jurisdiction was based on 'reason to believe,' a concept no longer recognized in the amended Section 147; and (d) the Relaxation Act was not applicable for Assessment Years 2015-2016 onwards. Consequently, all impugned notices issued under Section 148 were quashed and set aside. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the amended provisions of the Act, strictly complying with the statutory requirements.

The High Court held that the Explanations to Notification No. 20/2021 and Notification No. 38/2021 were ultra vires and therefore bad in law and null and void. The Court agreed with the assessee that Section 3 of the Relaxation Act was a relaxation provision dealing with time limits and did not empower the Central Government to amend the substantive provisions of the Income Tax Act. Only Section 4 of the Relaxation Act contained such amendments made by the legislature. Furthermore, even if the Explanations were considered valid, the impugned notices were still bad in law because they did not comply with the amended Section 147 of the Act. Specifically, the notices were based on the 'reason to believe' concept, which is no longer recognized, and the mandatory procedure under Section 148A was not followed. The Court also found that the Relaxation Act was not applicable to assessment years 2015-2016 and subsequent years. Consequently, all impugned notices issued under Section 148 of the Act were quashed and set aside. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the amended provisions of the Act, strictly complying with the statutory requirements.

The High Court held that the Explanations to Notification No. 20/2021 and Notification No. 38/2021 were ultra vires and therefore bad in law and null and void. The Court reasoned that Section 3 of the Relaxation Act, which falls under Chapter II titled ‘Relaxation of Certain Provisions of Specified Act’, was only a relaxation provision dealing with time limits. In contrast, Section 4 of the Relaxation Act, falling under Chapter III titled ‘Amendments to the Income Tax Act, 1961’, was the provision that amended the Act, and no such power to amend was delegated to the Central Government under Section 3. The Court further noted that even if the Explanations were considered valid, they did not cover Section 147, and the mandatory procedure under the amended Section 147 and Section 148A was not followed. Additionally, the Court found that the Relaxation Act was not applicable for Assessment Years 2015-2016 or subsequent years. Consequently, all impugned notices issued under Section 148 of the Act were quashed and set aside. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the amended provisions of the Act.

The High Court held that the Explanations to Notification No. 20/2021 and Notification No. 38/2021 were ultra vires and consequently bad in law and void. The Court agreed with the petitioners' submission that Section 3 of the Relaxation Act was a relaxation provision dealing with time limits and did not empower the Central Government to amend substantive provisions of the Income Tax Act. It noted that Section 4 of the Relaxation Act was the provision that amended the Act, and no such power was delegated to the Central Government. The Court further held that even if the Explanations were considered valid, the impugned notices were invalid because they did not comply with the amended Section 147, which no longer recognizes the 'reason to believe' concept, and failed to adhere to the procedure prescribed under Section 148A. The Court also found that the Relaxation Act was not applicable to Assessment Years 2015-2016 and subsequent years, as the time limits for these years were not expiring within the period of applicability of Section 3(1) of the Relaxation Act. Consequently, all impugned notices issued under Section 148 were quashed and set aside. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the amended provisions of the Act, strictly complying with the statutory requirements. The Court was in respectful agreement with the views taken by the Allahabad, Rajasthan, Delhi, and Madras High Courts.

The High Court held that the Explanations to Notification No. 20/2021 and Notification No. 38/2021 were ultra vires and therefore bad in law and null and void. The Court agreed with the petitioners that Section 3 of the Relaxation Act was a relaxation provision dealing with time limits and did not empower the Central Government to amend substantive provisions of the Income Tax Act. Section 4 of the Relaxation Act was the provision that amended the Act. The Court found that the impugned notices were bad in law for multiple reasons: (a) they were issued based on the repealed concept of 'reason to believe' under Section 147, which is no longer recognized in the amended Section 147; (b) the amended Section 147 is subject to Sections 148 to 153, including the mandatory procedure under Section 148A, which was not followed; and (c) the Relaxation Act was not applicable for Assessment Years 2015-2016 or subsequent years as the time limits for issuing notices for these years were not expiring within the period for which Section 3(1) of the Relaxation Act was applicable. Consequently, all impugned notices were quashed and set aside. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the relevant provisions of the Act as amended by the Finance Act, 2021, strictly complying with the statutory provisions.

The High Court held that the Explanations to Notification No. 20 of 2021 and Notification No. 38 of 2021 are ultra vires and consequently bad in law and void. The Court agreed with the assessee's submission that Section 3 of the Relaxation Act was a relaxation provision dealing with time limits and did not empower the Central Government to amend the substantive provisions of the Income Tax Act. Section 4 of the Relaxation Act, which amended the Act, was distinct. Furthermore, the Court found that even if the Explanations were considered valid, the impugned notices were still bad in law because they failed to comply with the amended Section 147 of the Act, which no longer recognizes the 'reason to believe' clause, and also failed to follow the mandatory procedure under Section 148A. The Court also noted that the Relaxation Act was not applicable for Assessment Years 2015-2016 and subsequent years. Therefore, all impugned notices issued under Section 148 of the Act were quashed and set aside. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the amended provisions of the Act.

The High Court held that the Explanations to Notification No. 20/2021 and Notification No. 38/2021 were ultra vires and therefore bad in law and void. The Court reasoned that Section 3 of the Relaxation Act falls under Chapter II titled 'Relaxation of Certain Provisions of Specified Act' and deals with time limits, whereas Section 4, which amends provisions of the Act, falls under Chapter III. The Court agreed with the assessee that only Section 4 amended the Act, and Section 3 did not grant power to amend substantive provisions or revive repealed ones. Furthermore, the Court found that even if the Explanations were valid, they did not cover Section 147, and the mandatory procedure under the amended Section 147 and Section 148A was not followed. The Court also noted that the Relaxation Act was not applicable for assessment years 2015-2016 onwards. Consequently, all impugned notices issued under Section 148 were quashed and set aside, with liberty to the Assessing Officers to initiate fresh proceedings in accordance with the amended provisions of the Act.

The Bombay High Court held that the Explanations to Notification No. 20 of 2021 and Notification No. 38 of 2021 were ultra vires and therefore bad in law and void. The Court agreed with the petitioners' submission that Section 3 of the Relaxation Act was a provision dealing with time limits and did not empower the Central Government to amend substantive provisions of the Income Tax Act. Section 4 of the Relaxation Act was the provision that amended the Act, and no such power was delegated to the Central Government under Section 3. The Court further found that even if the Explanations were considered valid, the impugned notices were invalid because they did not comply with the amended Section 147, which no longer recognized the concept of 'reason to believe' for assuming jurisdiction, and crucially, the mandatory procedure under Section 148A was not followed. The Court also noted that the Relaxation Act was not applicable for Assessment Years 2015-2016 onwards. Consequently, all impugned notices issued under Section 148 were quashed and set aside. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the amended provisions of the Act.

The High Court held that the Explanations to Notification No. 20/2021 and Notification No. 38/2021 were ultra vires and therefore bad in law and null and void. The Court agreed with the assessee's submission that Section 3 of the Relaxation Act was a relaxation provision dealing with time limits and did not grant the power to amend substantive provisions of the Income Tax Act. Section 4 of the Relaxation Act, which did amend provisions, was enacted by the legislature itself. The Court also noted that the Explanations did not cover Section 147, and even if they were valid, the procedure under the amended Section 147 and Section 148A had not been followed. Furthermore, the Relaxation Act was not applicable to Assessment Years 2015-2016 onwards. Consequently, all impugned notices issued under Section 148 were quashed and set aside, with liberty to the Assessing Officers to initiate fresh proceedings in accordance with the amended provisions of the Act.

The High Court allowed the writ petitions. It held that Section 3 of the Relaxation Act, which falls under Chapter II titled ‘Relaxation of Certain Provisions of Specified Act’, only deals with relaxation of time limits and does not empower the Central Government to amend substantive provisions of the Income Tax Act or revive repealed sections. Section 4 of the Relaxation Act, which amends the Income Tax Act, falls under Chapter III and was enacted by the legislature itself. Therefore, the Explanations to Notification No. 20 of 2021 and Notification No. 38 of 2021 were declared ultra vires, bad in law, and null and void. The Court further noted that even if the Explanations were considered valid, they did not cover Section 147 of the Act, and the mandatory procedure under the amended Section 147 and Section 148A had not been followed. Consequently, all impugned notices issued under Section 148 of the Act were quashed and set aside. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the amended provisions of the Act.

The High Court held that the Explanations to Notification No. 20/2021 and Notification No. 38/2021 are ultra vires and therefore bad in law and null and void. The Court agreed with the assessee's contention that Section 3 of the Relaxation Act was merely a relaxation provision dealing with time limits and did not empower the Central Government to amend substantive provisions of the Income Tax Act, unlike Section 4 which did. The Court further found that even if the Explanations were considered valid, the impugned notices were bad in law because they did not comply with the amended Section 147, which requires compliance with Sections 148 to 153, including the procedure under Section 148A. The Court also noted that the Relaxation Act was not applicable to Assessment Years 2015-2016 onwards. Consequently, all impugned notices issued under Section 148 of the Act were quashed and set aside. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the amended provisions of the Act, strictly complying with the statutory requirements. The Court was in respectful agreement with the views taken by various High Courts on this matter.