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 petitioners 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 which was enacted by the legislature itself. The Court found that the Explanations sought to extend the applicability of erstwhile Sections 148, 149, and 151, but not Section 147, which empowers revenue to reopen 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 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 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, unlike Section 4. The Court found that the Explanations sought to give effect to the erstwhile Sections 148, 149, and 151 but did not cover Section 147. Consequently, 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. Moreover, the amended Section 147 is subject to Sections 148 to 153, which include 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 subsequent years. Therefore, 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 was in respectful agreement with the views taken by the Allahabad, Rajasthan, Delhi, and Madras High Courts.

The High Court held that Section 3 of the Relaxation Act, which falls under Chapter II titled ‘Relaxation of Certain Provisions of Specified Act’, is a provision dealing with time limits and does not empower the Central Government to revive repealed substantive provisions of the Income Tax Act. In contrast, Section 4 of the Relaxation Act, which falls under Chapter III titled ‘Amendments to the Income Tax Act, 1961’, contains legislative amendments. Therefore, the Court agreed with the assessee that only Section 4 amended the Act, and Section 3 did not envisage amendments to substantive provisions. The Court further held that even if the Explanations in the notifications were valid, 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 mandatory procedure under Section 148A. The Court also noted that the Relaxation Act was not applicable for Assessment Years 2015-2016 onwards. Consequently, the Explanations to Notification No. 20/2021 and Notification No. 38/2021 were declared ultra vires, bad in law, and null and void. 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. No issue was expressly left undecided.

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. Furthermore, 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 recognizes the concept of 'reason to believe' for assuming jurisdiction. The Court also noted that the procedure under Section 148A, which is part of the amended provisions, 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, 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 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 notices were bad in law for multiple reasons: (a) the Explanations did not cover the erstwhile Section 147, which was essential for assuming jurisdiction; (b) the assumption of jurisdiction was 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 for Assessment Years 2015-2016 or subsequent years. Consequently, all impugned notices issued under Section 148 were quashed. The Assessing Officers were permitted 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. 20/2021 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 for time limits and did not empower the Central Government to amend substantive provisions of the Income Tax Act; only Section 4 did. The Court found that the impugned notices were bad in law for multiple reasons: (a) the Explanations did not cover Section 147, which requires compliance with Sections 148 to 153, including Section 148A, and the procedure under Section 148A was not followed; (b) the assumption of jurisdiction was based on the 'reason to believe' criterion, which is no longer recognized in the amended Section 147; and (c) 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 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' 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. Section 4 of the Relaxation Act, which did amend the Act, was distinct and made by the legislature itself. Furthermore, the Court found that the impugned notices were bad in law even if the Explanations were considered valid, as they failed to comply with the amended Section 147 by relying on the 'reason to believe' concept and not following 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 Court was in respectful agreement with the High Courts of Allahabad, Rajasthan, Delhi, and Madras on these points.

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, 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 amend the 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 invalid for multiple reasons: (a) the Explanations sought to revive repealed provisions without legislative backing; (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, even if the Explanations were considered valid; 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 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 the substantive provisions of the Income Tax Act. Section 4 of the Relaxation Act, which falls under Chapter III titled 'Amendments to the Income Tax Act, 1961', is where legislative amendments were made. 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 valid, the notices were bad in law because they were issued based on the 'reason to believe' concept from the erstwhile Section 147, which is no longer recognized in the amended Section 147, and the mandatory procedure under the amended Section 147 and Section 148A was not followed. 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, with liberty to the Assessing Officers to initiate fresh proceedings in accordance with the amended 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 assessee's submission that Section 3 of the Relaxation Act was only a relaxation provision dealing with time limits and did not empower amendments to the substantive provisions of the Income Tax Act, unlike Section 4. The Court found that the notices were also bad in law because they were issued based on the erstwhile Section 147 ('reason to believe') and failed to comply with the mandatory procedure under the amended Section 147, including Section 148A. Additionally, the Court noted that the Relaxation Act was not applicable to 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.

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. 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 did not comply with the amended Section 147, which requires adherence 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 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 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, unlike Section 4 which made legislative amendments. The Court found that the Explanations sought to give effect to the repealed provisions of Section 148, 149, and 151, but did not cover Section 147, which is subject to Sections 148 to 153, including Section 148A. Consequently, the notices issued were invalid for non-compliance with the amended Section 147 and the procedural requirements of Section 148A. The Court also noted that the Relaxation Act was not applicable for Assessment Years 2015-2016 onwards. 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 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 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 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 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 procedural 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 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 of the Act, was distinct from Section 3. Furthermore, the Court found that even if the Explanations were considered valid, the impugned notices were invalid because they 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 the assessment years in question. 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. It held that the Explanations to Notification No. 20 of 2021 and Notification No. 38 of 2021 were ultra vires, bad in law, and void. The Court reasoned that Section 3 of the Relaxation Act, which fell under the chapter 'Relaxation of Certain Provisions of Specified Act', was 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 distinct from Section 4 of the Relaxation Act, which contained legislative amendments. The Court agreed with the petitioners that only Section 4 amended the Act, not Section 3. Furthermore, the Court found that the impugned notices were invalid because they were issued based on the repealed 'reason to believe' concept under the erstwhile Section 147 and failed to comply with the mandatory 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 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 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. Only Section 4 of the Relaxation Act introduced amendments to 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 Section 147 (requiring 'reason to believe') and failed to comply with the mandatory procedure under the amended Section 147 and 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 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 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 revenue to reopen subject to Sections 148 to 153, including Section 148A. Therefore, even if the Explanations were valid, the procedure of 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 to issue 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, the Court quashed and set aside all impugned notices issued under Section 148. It was open to the Assessing Officers to initiate fresh reassessment proceedings in accordance with the amended provisions of the Act. The Court was in respectful agreement with the High Courts of Allahabad, Rajasthan, Delhi, and Madras.

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 revival of repealed substantive provisions. It noted that Section 4 of the Relaxation Act was the provision that amended the Act itself. 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 adherence to Section 148A, a procedure that 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 given the 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. 20/2021 and Notification No. 38/2021 were ultra vires, 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 provision for relaxing time limits and did not grant the power to amend substantive provisions of the Income Tax Act, which was the domain of Section 4. The Court found that the notices were also invalid because they were issued based on the repealed 'reason to believe' concept under Section 147 and failed to comply with the mandatory procedure under Section 148A. Additionally, the Court noted that 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. 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 allowed the writ petitions. It 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. The Court found that the notices were invalid for multiple reasons: (a) the reliance on the repealed 'reason to believe' under Section 147; (b) the non-compliance with the mandatory procedure under the amended Section 147 and Section 148A; and (c) the inapplicability of the Relaxation Act for Assessment Years 2015-2016 onwards, meaning the time limits for these years could not be extended by the impugned notifications. 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 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 amendments to substantive provisions of the Income Tax Act, unlike Section 4. The Court found that the Assessing Officer's assumption of jurisdiction was based on the 'reason to believe' concept, which is no longer recognized under the amended Section 147. Moreover, 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 is 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 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 only a relaxation provision dealing with time limits and did not envisage amendments to the 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 revenue to reopen 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 any subsequent year. 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, 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 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, which was in a different chapter, contained legislative amendments. 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' principle from the erstwhile Section 147, which is no longer recognized in the amended Section 147. Additionally, the mandatory procedure under the amended Section 147, 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 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 allowed the writ petitions. It held that the Explanations to Notification No. 20 of 2021 and Notification No. 38 of 2021 were ultra vires, bad in law, 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 the substantive provisions of the Income Tax 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 repealed 'reason to believe' provision of Section 147, whereas the amended Section 147 did not recognize this concept; (b) the amended Section 147 is subject to Sections 148 to 153, which include the mandatory procedure under Section 148A, a procedure that was not followed; and (c) the Relaxation Act was not applicable to Assessment Years 2015-2016 or subsequent years, meaning the notifications extending the limitation period for these years were irrelevant. 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 reasoned that Section 3 of the Relaxation Act, which fell under Chapter II titled ‘Relaxation of Certain Provisions of Specified Act’, was 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 distinct from Section 4 of the Act, which did amend provisions. The Court agreed with the petitioners that only Section 4 amended the Act, not Section 3. 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 no longer recognized the concept of 'reason to believe' for assumption of jurisdiction, and the mandatory procedure under Section 148A 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 those 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, with liberty to the Assessing Officers to initiate fresh proceedings in accordance with the amended provisions.

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 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. It noted that Section 4 of the Relaxation Act, which amended the Act, was enacted by the legislature itself, 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 invalid 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. The Court also 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, 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. 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: (a) the Explanations were invalid; (b) even if valid, they did not cover Section 147, which requires compliance with Sections 148 to 153, including Section 148A, which 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 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 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 assessee 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. The Court found that the Explanations sought to give effect to the erstwhile provisions of 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 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 provision dealing with time limits and did not empower the revival of repealed substantive provisions of the Income Tax Act. It distinguished Section 3 from Section 4 of the Relaxation Act, noting that Section 4 contained legislative amendments, whereas Section 3 did not delegate power to amend the Act to the Central Government. 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. 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 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 Section 3 of the Relaxation Act fell under Chapter II titled 'Relaxation of Certain Provisions of Specified Act' and was solely a relaxation provision dealing with time limits. In contrast, Section 4 of the Relaxation Act, which fell under Chapter III titled 'Amendments to the Income Tax Act, 1961', was the provision that amended the Act. The Court agreed with the assessee that Section 3 did not empower the Central Government to amend substantive provisions of the Act. The Court also found that the impugned notices were bad in law because the Explanations in the notifications did not cover Section 147, which empowers revenue to reopen assessments subject to Sections 148 to 153, including Section 148A. The procedure under Section 148A had not been followed. Additionally, the Court noted that the Relaxation Act was not applicable to assessment years 2015-2016 or subsequent years 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, the Explanations to Notification No. 20/2021 and 38/2021 were declared ultra vires, bad in law, and null and void. 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 reasoned that Section 3 of the Relaxation Act, which falls under Chapter II titled 'Relaxation of Certain Provisions of Specified Act', was a relaxation provision dealing with time limits and did not grant power to amend substantive provisions of the Income Tax Act. In contrast, Section 4 of the Relaxation Act, which amended provisions of the Act, fell under Chapter III, 'Amendments to the Income Tax Act, 1961', and was made by the legislature itself. The Court agreed with the petitioners that only Section 4 amended the Act. Furthermore, the Court found that even if the Explanations were valid, the notices were invalid because they did not comply with the amended Section 147, which no longer recognized the 'reason to believe' concept, and the mandatory procedure under Section 148A 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 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, strictly complying with the statutory requirements.

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 assessee's submission that Section 3 of the Relaxation Act was only 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) the Explanations did not cover the erstwhile Section 147, which empowered reopening subject to Sections 148 to 153, including Section 148A; (b) the Assessing Officers assumed jurisdiction based on 'reason to believe,' a concept 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 for Assessment Years 2015-2016 or subsequent 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 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 a provision dealing with time limits and did not grant the power to amend substantive provisions of the Income Tax Act. This power was exercised by the Legislature itself through Section 4 of the Relaxation Act, which falls under Chapter III, ‘Amendments to the Income Tax Act, 1961’. The Court agreed with the assessee that Section 3 did not envisage amendments to substantive provisions. Furthermore, even if the Explanations were considered valid, they did not cover Section 147 of the Act, which empowers revenue to reopen, and the mandatory procedure under the amended Section 147, including 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 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 provision for relaxation of time limits and did not grant the power to amend substantive provisions of the Income Tax Act, which was instead done by Section 4 of the same Act. The Court found that the Explanations sought to give effect to the repealed provisions and did not cover Section 147, which is the enabling section for reassessment. Consequently, the notices issued under Section 148 were bad in law as they 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 for Assessment Years 2015-2016 onwards. 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 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 grant the power to amend 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 is the enabling provision for reopening. Consequently, the notices were bad in law for failing to comply with the amended Section 147 and 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. 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 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. 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 is subject to Sections 148 to 153, including the mandatory procedure under Section 148A. The Court also observed that the Relaxation Act was not applicable to 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 Court was in respectful agreement with the views of 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 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 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 envisage amendments to substantive provisions of the Income Tax Act, unlike Section 4 which did amend the Act. The Court found that the Explanations sought to apply the 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. 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 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 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 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) the Explanations were ultra vires; (b) the notices were issued based on the erstwhile Section 147 ('reason to believe') which is no longer recognized in the amended Section 147; (c) the procedure under the amended Section 147, which is subject to Sections 148 to 153 (including Section 148A), was not followed; 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.

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' submission that Section 3 of the Relaxation Act was merely a relaxation provision dealing with time limits and did not empower the revival of repealed 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 give effect to the erstwhile Sections 148, 149, and 151 but did not cover Section 147, which is the primary provision for reopening. Consequently, the Assessing Officers could not have assumed jurisdiction based on the old 'reason to believe' criterion under the amended Section 147, nor could they bypass the mandatory procedure under Section 148A. 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. The Assessing Officers were permitted to initiate fresh reassessment proceedings in accordance with the amended provisions of the Finance Act, 2021, strictly complying with 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 petitioners that Section 3 of the Relaxation Act was a relaxation provision for time limits and did not authorize amendments to the substantive provisions of the Income Tax Act, unlike Section 4. The Court found that the Assessing Officers' assumption of jurisdiction was based on the 'reason to believe' concept, which is no longer recognized in the amended Section 147. Furthermore, even if the Explanations were valid, 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 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 statutory requirements. The ratio decidendi is that legislative amendments to the Income Tax Act, particularly concerning reassessment procedures, must be followed, and executive notifications cannot override or circumvent these amendments by giving retrospective effect to repealed provisions or by failing to comply with mandatory procedural 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, which falls under 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 substantive provisions of the Income Tax Act. Section 4 of the Relaxation Act, which amended the Act, fell under Chapter III. The Court found that the notices were invalid because the Assessing Officer 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, which include the procedure in Section 148A, and this procedure was not followed. The Court also held that the Relaxation Act was not applicable to 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 were quashed and set aside. The Assessing Officers were given the 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 relaxation provision dealing with time limits and did not empower amendments to substantive provisions of the Income Tax Act. Section 4 of the Relaxation Act, which amended the Act, was distinct. 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 the procedure under Section 148A. As Section 148A was not followed, the notices were 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.

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 petitioners that Section 3 of the Relaxation Act did not empower the Central Government to amend substantive provisions of the Income Tax Act, and that Section 4 was the only provision that amended the Act. The Court found that the notices were invalid for multiple reasons: (a) the Explanations were declared ultra vires; (b) even if the Explanations were valid, they did not cover Section 147, which requires compliance with Sections 148 to 153, including Section 148A, and this procedure was not followed; 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 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 after 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 bad in law. 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. 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 bad in law because the Assessing Officers assumed jurisdiction based on the 'reason to believe' concept, which is not recognized under the amended Section 147, and the mandatory procedure under Section 148A was not followed. Additionally, the Court held that the Relaxation Act was not applicable to assessment years 2015-16 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 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 amendments to substantive provisions of the Act, unlike Section 4. The Court found that the notices were invalid for multiple reasons: (a) they were based on the repealed 'reason to believe' concept under the erstwhile Section 147, whereas the amended Section 147 did not recognize this; (b) the procedure under the newly inserted Section 148A, which is part of the scheme of Sections 148 to 153, was not followed; and (c) 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 covered by 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 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 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 the Act, was a legislative amendment. The Court found that the impugned notices were invalid for multiple reasons: (a) the Explanations were invalid; (b) even if valid, they did not cover Section 147, and the procedure under Section 148A was not followed; and (c) the Relaxation Act was not applicable to the relevant assessment 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 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 the substantive provisions of the Income Tax Act. Only Section 4 of the Relaxation Act contained such amendments. 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 requires adherence to Sections 148 to 153, including the mandatory procedure under Section 148A. The Court also noted that 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 proceedings in accordance with the amended provisions of the Act.

The High Court allowed the writ petitions, declaring the Explanations to Notification No. 20/2021 and Notification No. 38/2021 as ultra vires, bad in law, and void. The Court reasoned that Section 3 of the Relaxation Act, which falls under the chapter 'Relaxation of Certain Provisions of Specified Act', was a 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 Section 4, which was enacted by the legislature itself. The Court agreed with the assessee that only Section 4 amended the Act, not Section 3. Furthermore, the Court held that even if the Explanations were considered valid, the impugned notices were invalid because they failed to comply with the amended Section 147 (which removed the 'reason to believe' requirement) and the mandatory procedure 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 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 void. The Court agreed with the assessee's submission that Section 3 of the Relaxation Act, 2020, dealt with time limits and did not empower the Central Government to amend substantive provisions of the Income Tax Act, 1961. 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 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. Additionally, 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 and 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 Court relied on decisions from the Allahabad, Rajasthan, Delhi, and Madras High Courts.