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, bad in law, and null and void. The Court agreed with the petitioners' 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 the substantive provisions of the Income Tax Act. It noted that Section 4 of the Relaxation Act was the provision that amended the Act, and these amendments were made by the legislature. 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 is subject to Sections 148 to 153, including the procedure under Section 148A. The 'reason to believe' concept, which was the basis for issuing the notices, is no longer recognized in the amended Section 147. 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 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, bad in law, and null and void. The Court agreed with the petitioners that Section 3 of the Relaxation Act, which falls under Chapter II titled ‘Relaxation of Certain Provisions of Specified Act’, only deals with time limits and does not empower the Central Government to amend substantive provisions of the Income Tax Act. Chapter III of the Relaxation Act, specifically Section 4, is where amendments to the Income Tax Act were made by the legislature itself. The Court found that the Explanations in the notifications sought to extend the applicability of erstwhile Sections 148, 149, and 151 but did not cover Section 147. Consequently, the notices were invalid as they were issued based on the repealed 'reason to believe' criterion under the erstwhile Section 147 and failed to comply with the mandatory procedure under the amended Section 147 and Section 148A. The Court also held that the Relaxation Act was not applicable to Assessment Years 2015-2016 and subsequent years. 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 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 a provision for relaxing 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 effected amendments to the Act. The Court further found that even if the Explanations were considered valid, the impugned notices were still bad in law because they were issued based on the erstwhile Section 147 (requiring 'reason to believe') and failed to comply with the mandatory procedure under the amended Section 147, which includes 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 relevant amended provisions of the Act, strictly complying with the procedure.

The High Court allowed the writ petitions. It held that Section 3 of the Relaxation Act, which falls under the chapter titled 'Relaxation of Certain Provisions of Specified Act', was only a relaxation provision dealing with time limits and did not empower the Central Government to amend the substantive provisions of the Income Tax Act. The amendments to the Act were made by the Legislature itself under Section 4 of the Relaxation Act. Therefore, the Explanations to Notification Nos. 20 of 2021 and 38 of 2021 were declared ultra vires, bad in law, null, and void. The Court agreed with the submissions that even if the Explanations were considered valid, the notices were still invalid as they did not comply with the amended Section 147, which requires adherence to Sections 148 to 153, including the procedure under Section 148A. Furthermore, the Relaxation Act was not applicable to Assessment Years 2015-2016 and subsequent years. Consequently, all impugned notices issued under Section 148 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 therefore bad in law 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 and did not grant the power to amend substantive provisions of the Income Tax Act. This power was vested in the legislature itself, as seen in Chapter III of the Act, which dealt with amendments. The Court agreed with the petitioners that only Section 4 of the Relaxation Act amended the Act, not Section 3. Furthermore, the Court found that even if the Explanations were valid, the impugned notices were still bad in law because they were issued based on the erstwhile 'reason to believe' concept, which is not recognized in the amended Section 147, and because 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 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, 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 the Relaxation Act and therefore bad in law 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 grant the power to amend substantive provisions of the Income Tax Act, unlike Section 4. The Court found that the Explanations sought to give effect to the repealed provisions, including the 'reason to believe' clause in Section 147, which is no longer valid under the amended Act. Furthermore, the Court noted that the procedure under the amended Section 147, including Section 148A, was not followed. 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 Bombay 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 solely a provision dealing with time limits and did not grant power to amend substantive provisions of the Income Tax Act, unlike Section 4 which did amend the Act. The Court found that the Explanations sought to extend the applicability of erstwhile Sections 148, 149, and 151 but did not cover Section 147. Consequently, the assumption of jurisdiction by Assessing Officers was 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 procedure under Section 148A, which was not followed. The Court also noted that the Relaxation Act was not applicable for Assessment Years 2015-2016 onwards. 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 held that the Explanations to Notification No. 20/2021 and Notification No. 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, which falls under Chapter II titled ‘Relaxation of Certain Provisions of Specified Act’, only deals with time limits and does not grant power to amend substantive provisions of the Income Tax Act. Chapter III, specifically Section 4, deals with amendments to the Income Tax Act, and such amendments were made by the Legislature itself, not delegated to the Central Government. Furthermore, even if the Explanations were considered valid, the Court found that the impugned notices were still invalid because they did not comply with the amended Section 147 and the procedural requirements of Section 148A, which is part of the amended provisions. 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, holding that the Explanations to Notification No. 20/2021 and Notification No. 38/2021 were ultra vires and therefore null and void. The Court reasoned that Section 3 of the Relaxation Act, which was in Chapter II titled 'Relaxation of Certain Provisions of Specified 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. This power was vested in the Legislature through Section 4 of the Relaxation Act. The Court agreed with the petitioners that the notices were bad in law as they were issued based on the repealed 'reason to believe' criterion under the erstwhile Section 147 and failed to comply with the mandatory procedure under the amended Section 147 and Section 148A. Furthermore, the Court 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, 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 only 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 make amendments. The Court found that the notices were bad in law because they were issued based on the 'reason to believe' principle from the erstwhile Section 147, which is no longer applicable under the amended Section 147. Additionally, the procedure under the amended Section 147, including the mandatory compliance with Section 148A, was not followed. 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 relevant provisions of the Act as amended by the Finance Act, 2021, 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' submission 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 was the section that amended the Act. The Court found that the Explanations sought to revive the repealed provisions of Sections 148, 149, and 151 but did not cover Section 147, which is the power to reopen. Consequently, the notices issued under Section 148 were bad in law because they were based on the repealed provisions and did not comply with the amended Section 147, which includes the mandatory procedure under Section 148A. The Court also held that the Relaxation Act was not applicable to Assessment Years 2015-2016 and subsequent years as the time limits for these years did not fall within the scope of Section 3(1) of the Relaxation Act. The Court quashed and set aside all impugned notices issued under Section 148 of the Act, allowing 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 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 and did not grant the Central Government the power to amend substantive provisions of the Income Tax Act or revive repealed sections. In contrast, Section 4 of the Relaxation Act, which amended provisions of the Act, fell under Chapter III. The Court agreed with the Assessee that only Section 4 amended the Act, not Section 3. Furthermore, even if the Explanations were valid, the Court found that the impugned notices were bad in law because they did not comply with the amended Section 147 (which no longer recognizes 'reason to believe') and failed to follow 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 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 petitioners' submission 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 grant the Central Government the power to amend substantive provisions of the Income Tax Act. It distinguished this from Section 4, which falls under Chapter III titled 'Amendments to the Income Tax Act, 1961' and was enacted by the legislature. 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, particularly the requirement to follow the procedure under Section 148A, and relied on the 'reason to believe' concept which is no longer applicable. 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 relevant amended provisions of the Act, strictly complying with the 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 void. The Court agreed with the assessee's submission 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. Section 4 of the Relaxation Act was the provision that amended the Act, and it did so through the Legislature itself, not by delegation. The Court found that the Explanations sought to give effect to the erstwhile Sections 148, 149, and 151 but did not cover the erstwhile Section 147. Crucially, even if the Explanations were valid, the notices were still invalid because the Assessing Officers had assumed jurisdiction based on the 'reason to believe' concept, which is no longer recognized in the amended Section 147, and the mandatory procedure under Section 148A had not been followed. The Court also noted that 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 statutory requirements.

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 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 so. The Court found that the impugned notices were bad in law for multiple reasons: (a) the assumption of jurisdiction was based on the 'reason to believe' concept, which is no longer recognized in the amended Section 147; (b) the procedure under Section 148A, which is part of the amended provisions governing reassessment, 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 covered by Section 3(1) of the Relaxation Act. 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 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. It noted that 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 impugned notices were still invalid because they were issued based on the erstwhile 'reason to believe' criterion under Section 147, which is no longer recognized in the amended Section 147, and 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 petitioners 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. It noted that Section 4 of the Relaxation Act, which amended the Act, was legislatively enacted and not delegated. The Court found that the impugned notices were bad in law for several reasons: (a) they were issued based on the 'reason to believe' which is no longer recognized in the amended Section 147; (b) the amended Section 147 is subject to Sections 148 to 153, including the procedure in Section 148A, which was not followed; (c) there was no saving clause for the applicability of erstwhile Sections 147 to 151, meaning the amended provisions would apply from April 1, 2021; and (d) the Relaxation Act was not applicable for Assessment Years 2015-2016 or subsequent years as the time limits for issuing notices were not expiring within the period of applicability of Section 3(1) of the Relaxation Act. 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 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 amendments to substantive provisions of the Income Tax Act, unlike 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 noted that 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 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 merely 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 was the provision that amended the Act, and this was done by the legislature itself, not delegated to the Central Government. Furthermore, the Court found that the impugned notices were invalid because they relied on the 'reason to believe' concept, which was no longer recognized in the amended Section 147, and failed to comply with the procedure under the amended Section 147, including Section 148A. The Court also noted that the Relaxation Act was not applicable to Assessment Years 2015-2016 onwards. 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 notice dated 30.03.2021 issued under Section 148 of the Act and the order dated 13.12.2021 rejecting the objections are quashed and set aside. The Court found that the Assessing Officer had all material facts before him during the original assessment, and the issue of deduction under Section 80-IA was considered. The affidavit-in-reply indicated that the erstwhile AO specifically asked about the Section 80-IA(4) deduction and the assessee submitted requisite documents, after which the deduction was allowed. The Court relied on its decision in Ananta Landmark Pvt. Ltd. vs. Deputy Commissioner of Income Tax, which states that after four years, an AO cannot reopen an assessment unless there is tangible material showing escapement of income due to the assessee's failure to disclose material facts. In this case, the Court observed that there was no whisper in the reasons for reopening about what was not disclosed. Instead, the reopening appeared to be based on a change of opinion by the Assessing Officer regarding the computation and deduction under Section 80-IA, which is not permissible. Therefore, the petition was allowed.

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 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 did amend the Act, was enacted by the legislature. The Court also found that the impugned notices were bad in law because they were issued based on the erstwhile Section 147's 'reason to believe' concept, which is no longer recognized in the amended Section 147. Moreover, the procedure under the amended Section 147, including Section 148A, was not followed. The Court further 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 petitioners' 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 the 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 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 no longer recognized in the amended Section 147. Additionally, the amended Section 147 is subject to Sections 148 to 153, including the procedure under Section 148A, which was not followed. The Court also found 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 reassessment 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 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 only 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 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 still bad in law because they did not comply with the amended Section 147, which no longer recognized the 'reason to believe' criterion, and the mandatory procedure under Section 148A had not been followed. The Court also found that the Relaxation Act was not applicable to the assessment years in question. 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 assessee's submission that Section 3 of the Relaxation Act was merely a relaxation provision for time limits and did not empower the Central Government to amend substantive provisions of the Income Tax Act, which was instead done by Section 4 of the Relaxation Act. The Court further found that even if the Explanations were considered valid, the impugned notices were still invalid because they were issued based on the erstwhile Section 147 ('reason to believe') and failed to comply with the amended Section 147 and 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 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 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. The Court further 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 no longer relies on the 'reason to believe' basis for reassessment, and crucially, the procedure under 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 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 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 amendment of 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 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 the 'reason to believe' concept, which is no longer recognized in the amended Section 147; 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 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 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 did amend provisions, was enacted by the legislature itself. The Court further noted that even if the Explanations were considered valid, the notices were still bad in law because they were issued based on the 'reason to believe' concept, which is no longer recognized in the amended Section 147, and the mandatory procedure under Section 148A was not followed. Additionally, the Court 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 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 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 made amendments. The Court further found that even if the Explanations were considered valid, the impugned notices were still invalid because they were issued based on the erstwhile Section 147 (requiring 'reason to believe') and failed to comply with the amended Section 147, which is subject to Sections 148 to 153, including the mandatory procedure under Section 148A. 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 Nos. 20/2021 and 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 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, rendering the notices invalid. 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 procedure.

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 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. It noted that Section 4 of the Relaxation Act was the provision that amended the Act. The Court found that the Assessing Officers had assumed jurisdiction based on the 'reason to believe' that income had escaped assessment, a concept no longer recognized under the amended Section 147. Furthermore, even if the Explanations were considered valid, the procedure under the amended Section 147, which is subject to Sections 148 to 153 (including Section 148A), had not been 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 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 and therefore bad in law 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’, only deals with relaxation of time limits and does not grant the power to amend substantive provisions of the Income Tax Act. This power was not delegated to the Central Government. In contrast, Section 4 of the Relaxation Act, which falls under Chapter III titled ‘Amendments to the Income Tax Act, 1961’, was enacted by the legislature itself to amend the Act. Therefore, the Court agreed with the assessee that only Section 4 amended the Act, not Section 3. Furthermore, the Court found that even if the Explanations were valid, the impugned notices were still bad in law. This was because the Assessing Officers assumed jurisdiction based on the erstwhile 'reason to believe' concept under Section 147, which is no longer recognized in the amended Section 147. Additionally, the amended Section 147 is subject to Sections 148 to 153, including the procedure in Section 148A, which was not followed. The Court also noted that the Relaxation Act was not applicable to 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 of 2021 and Notification No. 38 of 2021 were ultra vires, 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 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 under Section 3. The Court further held that even if the Explanations were considered valid, the impugned notices were invalid because they were issued based on the 'reason to believe' under the erstwhile Section 147, which is not recognized in the amended Section 147. Additionally, the mandatory procedure under the amended Section 148A was not followed. The Court also 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 relevant provisions of the Act as amended by the Finance Act, 2021, strictly complying with the statutory provisions. The Court was in respectful agreement with the views taken by the Allahabad High Court, Rajasthan High Court, Delhi High Court, and Madras High Court.

The High Court held that the Explanations to Notification No. 20/2021 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 did amend provisions, 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 invalid because they were issued based on the 'reason to believe' concept, which was no longer recognized in the amended Section 147, and because the mandatory procedure under Section 148A had not been followed. The Court also held that the Relaxation Act was not applicable to Assessment Years 2015-2016 and subsequent years, as the time limits for these years did not fall within the scope 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 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 provision for relaxing time limits and did not grant the power to amend substantive provisions of the Income Tax Act. It noted that Section 4 of the Relaxation Act was the one that amended the Act. The Court found that the impugned notices were bad in law for multiple reasons: (a) the Explanations did not cover the erstwhile Section 147, which is the basis for assuming jurisdiction; (b) the notices were issued based on 'reason to believe,' a concept no longer recognized in the amended Section 147; (c) the procedure under Section 148A was not followed, even if the Explanations were considered valid; and (d) the Relaxation Act was not applicable for Assessment Years 2015-2016 onwards. 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, strictly complying with the 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 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. Only Section 4 of the Relaxation Act contained legislative amendments. 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' principle, which is no longer applicable under the amended Section 147, and because 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, rendering the notifications irrelevant for those years. 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 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 Act, was a legislative amendment. The Court further 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 compliance with 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. 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 petitioners' 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 the substantive provisions of the Income Tax Act. Section 4 of the Relaxation Act, which did amend provisions, was made by the Legislature itself. Furthermore, the Court found that the impugned notices were bad in law for several reasons: (a) the assumption of jurisdiction was based on the 'reason to believe' concept, 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 to the Assessment Years 2015-2016 and subsequent years, as the time limits for issuing notices were not expiring within the applicable period of Section 3(1) of the Relaxation Act. 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 null and void. The Court agreed with the assessee's submission that Section 3 of the Relaxation Act was merely a relaxation provision for time limits and did not grant the power to amend substantive provisions of the Income Tax Act, unlike Section 4. The Court found that the Explanations sought to give effect to 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 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 law. The Court relied on decisions from the Allahabad, Rajasthan, Delhi, and Madras High Courts.

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 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. It noted that Section 4 of the Relaxation Act was the one that amended the Act. The Court further held that even if the Explanations were considered valid, the impugned notices were bad in law because they were issued based on the erstwhile Section 147 ('reason to believe') and failed to comply with the amended Section 147 and the mandatory procedure under Section 148A. 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 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. It noted that Section 4 of the Relaxation Act, which did amend provisions, was distinct. The Court found that the impugned notices were bad in law for multiple reasons. Firstly, they were issued based on the 'reason to believe' concept, which is no longer part of the amended Section 147. Secondly, the procedure under the amended Section 147, which is subject to Sections 148 to 153 (including Section 148A), was not followed. The Court also held that the Relaxation Act was not applicable for Assessment Years 2015-2016 and subsequent years as the time limits for issuing notices for these years were not expiring within the period covered by Section 3(1) of the Relaxation Act. Consequently, all impugned notices 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.

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 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 Act, was made by the Legislature itself. The Court further found 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. 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. 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 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's contention that Section 3 of the Relaxation Act was merely a relaxation provision dealing with time limits and did not grant the power to amend substantive provisions of the Income Tax Act. It noted that Section 4 of the Relaxation Act, which did amend the Act, was a legislative amendment and not a delegated power. Furthermore, the Court found that even if the Explanations were considered valid, the reassessment 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 held 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 relied on decisions from the Allahabad, Rajasthan, Delhi, and Madras High Courts.

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 Income Tax Act, unlike Section 4 which did amend the Act. The Court found that the notices issued under Section 148 were invalid because they were based on the repealed provisions of Section 147, which required a 'reason to believe' that income had escaped assessment, a concept no longer recognized in the amended Section 147. Moreover, 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 held that the Relaxation Act was not applicable to Assessment Years 2015-2016 and subsequent years, as the time limits for issuing notices for these years did not fall within the scope of Section 3(1) of the Relaxation Act. 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, 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. It was noted that Section 4 of the Relaxation Act, which dealt with amendments, was distinct from Section 3. The Court found that the notices were bad in law because the Assessing Officers assumed jurisdiction based on the repealed 'reason to believe' concept under Section 147 and failed to comply with the amended Section 147, which is subject to Sections 148 to 153, including the mandatory procedure under Section 148A. Furthermore, the Court held that the Relaxation Act was not applicable for Assessment Years 2015-2016 or any subsequent year, 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 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 provisions. 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 of 2021 and Notification No. 38 of 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 a provision for relaxing time limits and did not grant the power 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 further found that the impugned notices were bad in law because they were issued based on the 'reason to believe' clause, which is no longer recognized under the amended Section 147, and because 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 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, unlike Section 4 which did amend the Act. The Court found that the impugned notices were bad in law for multiple reasons. Firstly, the assumption of jurisdiction by the Assessing Officer was based on the 'reason to believe' concept, which is no longer recognized in the amended Section 147. Secondly, 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 held that the Relaxation Act was not applicable to 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, the Court quashed and set aside all the impugned notices issued under Section 148 of the Act. It was open to 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. 20/2021 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 the substantive provisions of the Income Tax Act; only Section 4 of the Relaxation Act did so. The Court found that the Explanations sought to extend the applicability of erstwhile Sections 148, 149, and 151, but not Section 147, which is 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. Additionally, the Court noted that 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. 20/2021 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 dealing with time limits and did not empower the Central Government to amend substantive provisions of the Income Tax Act or revive repealed provisions. Section 4 of the Relaxation Act, which amended the Act, was distinct and did not delegate amendment powers to the Central Government. The Court also found that the impugned notices were invalid because they were issued based on the erstwhile Section 147's 'reason to believe' concept, which is no longer recognized in the amended Section 147, and because the mandatory procedure under Section 148A was not followed. Additionally, the Court noted that 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 covered by Section 3(1) of the Relaxation Act. 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 Nos. 20/2021 and 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 made amendments. The Court found that the Assessing Officers had assumed jurisdiction based on the 'reason to believe' concept, which is no longer recognized under the amended Section 147. Additionally, the procedure under the amended Section 147, which is subject to Sections 148 to 153 (including 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, strictly complying with the law. The Court relied on decisions from 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, 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 for 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 Assessing Officers had assumed jurisdiction based on the 'reason to believe' concept, which is no longer recognized in the amended Section 147, and had failed to follow the mandatory procedure under Section 148A. Additionally, the Court held 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 covered by 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 and by strictly complying with the statutory procedures.