Rajasthan High Court Judgments — 2022

The tribunal allowed the withdrawal of the appeal. The court noted that the appellant's counsel relied on the circular and stated that the case did not fall within any exceptions, thus praying for withdrawal.

The High Court held that the conclusions of the ITAT were based on an assessment of the evidence on record and were purely factual in nature. The Tribunal had confirmed the CIT(A)'s view that the additions made by the AO were unsustainable. The ITAT observed that the companies through which the assessees allegedly indulged in bogus accommodation entries were not managed or controlled by the alleged kingpin, Mr. Anand Sharma, and there was no link found in the documents and financial statements of the concerned companies. The assessee had produced affidavits, complied with notices under Sections 131 and 133(6), and the director of one company had confirmed the loan transaction. The ITAT further observed that the assessment order was passed solely on the report of the Investigation Wing, Kolkata, and the AO had only the statement of Anand Sharma. The ITAT was of the opinion that the AO could not have made additions based on the Investigation Wing's report without the assessee being privy to it and without granting an opportunity for cross-examination. The High Court noted that in some cases, the ITAT had also held reassessment to be invalid. Since no question of law arose from the deletion of additions, the High Court did not examine the correctness of the ITAT's view on the validity of reassessment. All appeals were dismissed.

The High Court held that the conclusions reached by the ITAT were based on a thorough assessment of the evidence on record and were purely factual in nature. The Tribunal had confirmed the view of the CIT(A) that the additions made by the Assessing Officer were not sustainable. The Tribunal observed that the companies involved in alleged bogus accommodation entries were not managed or controlled by the alleged kingpin, and there was no link found between the documents and the financial statements of the companies. The assessee had produced affidavits, and the creditors had complied with notices under Sections 131 and 133(6). The statement of a director of one company confirmed the loan transaction. The Tribunal also noted that the assessment order was based solely on a report from the Investigation Wing, Kolkata, without the assessee being privy to it or having an opportunity to cross-examine the persons whose statements were recorded. Since no question of law arose from the deletion of additions, the Court did not examine the correctness of the ITAT's view on the validity of reassessment. Therefore, the appeals were dismissed.

The High Court allowed the Civil Misc. Restoration Application. The Court considered the grounds mentioned in the application and, in the interest of justice, ordered the restoration of S.B. Civil Writ Petition No. 10516/2018 to its original number. This restoration is subject to the petitioner depositing a cost of Rs. 1,000/- with the Rajasthan High Court Munshi Association, Jaipur. The judgment does not delve into the merits of the original writ petition or any specific issues that were to be decided therein; it solely addresses the procedural aspect of restoring the dismissed petition.

The High Court held that the conclusions of the ITAT were based on an assessment of the evidence on record, making them purely factual. The ITAT had confirmed the CIT(A)'s view that the additions were not sustainable. The Tribunal observed that the companies involved in alleged bogus accommodation entries were not managed or controlled by the alleged kingpin, Mr. Anand Sharma, and there was no link found between the documents and the financial statements of these companies. The assessee had produced affidavits and complied with notices under Sections 131 and 133(6), and the creditors had complied. The statement of a director confirming a loan transaction was also recorded. The ITAT found that the AO's assessment order was based solely on a report from the Investigation Wing, Kolkata, to which the assessee was not privy and was not given an opportunity to cross-examine the individuals whose statements were recorded. The Court noted that in some cases, the ITAT had also held reassessment to be invalid. Since no question of law arose from the deletion of additions, the High Court did not examine the correctness of the ITAT's view on the validity of reassessment. Therefore, all appeals were dismissed.

The High Court held that reassessment notices issued after April 1, 2021, must comply with the newly substituted provisions of the Income Tax Act, 1961, introduced by the Finance Act, 2021. The Court found no indication that the legislature intended for the old reassessment provisions to survive the substitution. The Court specifically addressed the proviso to Section 149(1) of the Act, which clarifies that no notice under Section 148 can be issued if it could not have been issued at that time due to being beyond the time limit specified under the old provisions. This proviso indicates that the new, extended time limits under Section 149(1)(b) cannot be used to revive time-barred assessments for past periods. Therefore, notices issued after April 1, 2021, without following the procedure under Section 148A, are invalid. The Court quashed the impugned notices, agreeing with the view taken by the Allahabad and Delhi High Courts and some Single Judges, and disagreed with the Chhattisgarh High Court's contrary view regarding notifications deferring the application of Section 148.

The Tribunal held that reassessment notices issued after April 1, 2021, must comply with the reassessment provisions as substituted by the Finance Act, 2021, even for assessment years prior to April 1, 2021. The Court reasoned that the original provisions stood repealed upon substitution by the Finance Act, 2021, and unless a different intention was discernible, the repeal did not revive anything not in force. The Court found no indication in the scheme of the statute that the old provisions would continue to apply after substitution. The judgment in Sudesh Taneja vs. ITO was extensively quoted, emphasizing that the new scheme under Section 148A and modified time limits under Section 149 are applicable. The Court disagreed with the Chhattisgarh High Court's view that notifications deferred the application of Section 148, stating that the amendments came into effect on April 1, 2021. Consequently, notices issued without following the procedure under Section 148A were deemed invalid. The ratio decidendi is that post-amendment reassessment notices must adhere to the new procedural framework introduced by the Finance Act, 2021. The impugned notices were quashed and set aside.

The High Court granted the permission sought by the petitioners. The Court held that the writ petitions could be disposed of as withdrawn. The principle established is that parties can withdraw their petitions before the High Court to pursue their remedies before the assessing officer, especially in the context of reassessment proceedings, provided such withdrawal does not prejudice their rights to raise all contentions before the lower authority. The operative direction was to dispose of the writ petitions as withdrawn, allowing the petitioners to pursue their case before the assessing officer.

The High Court granted permission to the petitioners to withdraw the writ petitions. The court noted that the learned counsel for the petitioners sought this permission with the explicit understanding that all contentions would remain open to be raised before the assessing officer in the reassessment proceedings. Consequently, the writ petitions were disposed of as withdrawn. The court did not delve into the merits of any substantive tax dispute. The ratio decidendi is that parties have the right to withdraw their petitions, preserving their rights for future adjudication before the appropriate forum, provided such withdrawal is permitted by the court.

The High Court granted permission to the petitioners to withdraw the writ petitions. The court's decision was based on the request made by the petitioners' counsel to withdraw the petitions while reserving all contentions to be raised before the assessing officer in the reassessment proceedings. Consequently, the writ petitions were disposed of as withdrawn. The court did not delve into the merits of any substantive tax issue, and therefore, no specific tax principles were established or ratios laid down for future citation. The operative direction was solely to permit the withdrawal of the petitions.

The High Court held that the notices of re-assessment impugned in the writ petitions were invalid and bad in law. The Court followed its earlier judgment in Sudesh Taneja vs. Income Tax Officer and others. The Court found that the explanations introduced by the CBDT notifications dated March 31, 2021, and April 27, 2021, which sought to clarify that the pre-amendment provisions of Section 148 would apply for issuing notices under Section 148, exceeded the delegated powers. The Court reasoned that subordinate legislation cannot travel beyond the powers vested by the parent Act and cannot amend the provisions of the parent Act under the guise of clarification. Therefore, these explanations were declared unconstitutional and invalid. Consequently, the notices issued without following the procedure under Section 148A were quashed. The Court explicitly stated that the substitution of reassessment provisions by the Finance Act, 2021, were not deferred by these notifications and the amendments came into effect from April 1, 2021. All writ petitions were allowed.

The High Court held that the original provisions for reassessment, upon their substitution by the Finance Act, 2021, stood repealed and had no existence thereafter, unless a different intention appeared. The court referred to Section 6 of the General Clauses Act, 1897, to support the principle that repeal does not revive anything not in force. The court found that the new scheme of reassessment under the Finance Act, 2021, represented a major departure, with changed time limits and a modified concept of escaped income. The court also declared the explanations in the CBDT circulars dated March 31, 2021, and April 27, 2021, as unconstitutional and invalid. The court reasoned that these explanations, in the guise of clarification, exceeded the delegated powers of the CBDT by attempting to alter the statutory provisions. The court disagreed with the view of the Chhattisgarh High Court that the notifications deferred the application of the new provisions. Consequently, the notices impugned in the writ petitions were held to be invalid and bad in law, and were quashed and set aside. The learned Single Judge's decision to quash these notices was upheld.

The Tribunal held that the notices impugned in the petitions were invalid and bad in law. On the first issue, it was held that the original provisions for reassessment stood repealed upon their substitution by the Finance Act, 2021, and had no existence thereafter. Section 6 of the General Clauses Act, 1897, was referred to, stating that repeal shall not revive anything not in force. The Court found no indication in the statutory provisions that the old scheme would continue to apply after substitution. The first proviso to Section 149(1) was interpreted to mean that notices issued after April 1, 2021, must be in accordance with the substituted Section 149(1), but without breaching the upper time limit provided in the original Section 149(1). Therefore, a notice that had become time-barred prior to April 1, 2021, could not be revived. On the second issue, the Tribunal held that the explanations in the CBDT circulars dated March 31, 2021, and April 27, 2021, were unconstitutional and invalid. The Court found that the CBDT, in issuing these explanations, exceeded its jurisdiction as subordinate legislation, as the power granted under the Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020, did not extend to providing clarifications that altered the basis of statutory provisions. The ratio is that reassessment notices issued after April 1, 2021, must follow the new procedure under the Finance Act, 2021, and subordinate legislation cannot override parent statutes. The notices were quashed and set aside.

The Tribunal held that there was no infirmity in the order passed by the CIT(A). The assessee maintained separate receipts for corpus donations, and these receipts indicated specific directions from the donors for the use of the funds towards corpus donations, often containing the donor's signatures. The Tribunal found that these corpus donations could not be treated as revenue receipts in light of Section 11(1)(d) of the Act. The High Court agreed with the CIT(A) and the Tribunal, finding no error in their views. The Court noted that the CIT(A) and the Tribunal had concluded that the assessee maintained separate receipts for corpus donations, which showed donor directions for specific purposes and included donor signatures. Therefore, such donations could not be seen as lacking specific directions towards corpus funds and were correctly not treated as revenue receipts. The High Court found no question of law arising and dismissed the appeal.

The Tribunal held that the explanations introduced by the CBDT notifications dated 31.03.2021 and 27.04.2021 were unconstitutional and invalid. The reasoning was that the power delegated to the Central Government under Section 3(1) of the Relaxation Act, 2020, was solely to extend time limits for actions and compliances. Issuing an explanation that dictated the applicability of Section 148 provisions, by stating that pre-amendment provisions would apply, plainly exceeded the CBDT's jurisdiction as a subordinate legislation. Subordinate legislation cannot travel beyond the powers vested by the parent Act. The Tribunal found it doubtful that an explanation, even if termed clarificatory, could alter the plain meaning of statutory provisions or amend the parent Act. The Tribunal respectfully disagreed with the view of the Chhattisgarh High Court, holding that the CBDT notifications did not defer the substitution of reassessment provisions framed under the Finance Act, 2021, and their effective date remained 01.04.2021. Consequently, the impugned notices were declared invalid and bad in law. The Tribunal quashed all the impugned notices and allowed the writ petitions.

The Tribunal held that the explanations introduced by the CBDT in the notifications dated 31.03.2021 and 27.04.2021 were unconstitutional and invalid. The reasoning was that the power delegated to the Central Government under Section 3(1) of the Relaxation Act, 2020, was limited to extending time limits for actions and compliances. Issuing an explanation that provided a clarification on the applicability of Section 148 provisions, effectively altering the basis of statutory provisions or amending the parent Act, plainly exceeded the delegated jurisdiction. Subordinate legislation must operate within the confines of the powers vested by the parent Act and cannot travel beyond them. The Tribunal found it doubtful that an explanation, even in the guise of clarification, could change the fundamental basis of statutory provisions. The ratio decidendi is that subordinate legislation cannot amend the provisions of a parent Act and must yield to plenary legislation. Consequently, the impugned notices issued under Section 148 were quashed and set aside. The appeals of the revenue were dismissed.

The High Court held that the explanations introduced by the CBDT through notifications dated 31.03.2021 and 27.04.2021 were unconstitutional and invalid. The Court reasoned that the power granted under Section 3(1) of the Relaxation Act, 2020, was limited to extending time limits for actions and compliances. Issuing an explanation that altered the applicability of statutory provisions, particularly by stating that pre-amendment provisions would apply, went beyond this delegated power. The Court found that the subordinate legislation (CBDT notifications) could not travel beyond the powers vested in it by the parent Act and that an explanation, even if termed 'clarificatory', could not amend the provisions of the parent Act if their plain meaning was clear. The Court disagreed with the Chhattisgarh High Court's reasoning in Palak Khatuja, stating that the substitution of reassessment provisions by the Finance Act, 2021, was not deferred and that the amendments came into effect from 01.04.2021. Consequently, the notices impugned in the writ petitions were declared invalid and quashed. The appeals of the revenue were dismissed.

The High Court held that the explanations introduced by the CBDT notifications dated 31.03.2021 and 27.04.2021 were unconstitutional and invalid. The Court reasoned that the Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020, specifically Section 3(1), only empowered the Central Government to extend time limits for actions and compliances. Introducing an explanation that clarified that pre-amendment provisions of Section 148 and 149 would apply for issuing notices under Section 148 plainly exceeded the delegated jurisdiction. Subordinate legislation cannot travel beyond the powers vested by the parent Act. The Court found it doubtful that an explanation, even in the guise of clarification, could change the plain meaning of statutory provisions or amend the parent Act. The Court disagreed with the view that the notifications deferred the substitution of reassessment provisions under the Finance Act, 2021, stating that the amendments came into effect on 01.04.2021. Consequently, the notices impugned in the writ petitions were declared invalid and quashed.

The High Court held that the notifications dated 31.03.2021 and 27.04.2021 issued by the CBDT, particularly the explanation introduced therein, were unconstitutional and invalid. The Court reasoned that the Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020, only empowered the Central Government to extend time limits for actions and compliances. The CBDT, as a subordinate legislation, exceeded its jurisdiction by introducing an explanation that effectively altered the basis of statutory provisions concerning reassessment under Section 148 and Section 149/151. The Court found that such an explanation could not amend the parent Act or change the plain meaning of statutory provisions. The Court disagreed with the view taken by the Chhattisgarh High Court in Palak Khatuja (supra), stating that the substitution of reassessment provisions under the Finance Act, 2021, which came into effect from 01.04.2021, could not be deferred by these notifications. Consequently, the notices impugned in the writ petitions were quashed and set aside. The appeals of the revenue were dismissed.

The High Court held that the explanations introduced by the CBDT through notifications dated 31.03.2021 and 27.04.2021 were unconstitutional and invalid. The Court reasoned that under Section 3(1) of the Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020, the Central Government was empowered only to extend time limits for actions and compliances, not to issue explanations that altered the interpretation or application of statutory provisions. The CBDT, as a subordinate legislation, exceeded its jurisdiction by introducing an explanation that provided a clarification which, in effect, changed the basis of the statutory provisions concerning reassessment notices. The Court found that subordinate legislation cannot travel beyond the powers vested by the parent Act and cannot amend the provisions of the parent Act under the guise of clarification. The Court respectfully disagreed with the view taken by the Chhattisgarh High Court, holding that the substitution of reassessment provisions by the Finance Act, 2021, was not deferred by the CBDT notifications. Consequently, the impugned notices under Section 148 were found to be invalid and bad in law and were quashed and set aside. All writ petitions were allowed, and the appeals of the revenue were dismissed.

The High Court held that the explanations introduced by the CBDT notifications dated 31.03.2021 and 27.04.2021 were unconstitutional and invalid. The Court reasoned that the Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020, only empowered the Central Government to extend time limits for compliances, not to issue explanations that altered the basis of statutory provisions. The CBDT, as a subordinate legislation, exceeded its jurisdiction by introducing an explanation that effectively sought to amend the provisions of the Income Tax Act, 1961, by stating that pre-amendment provisions would apply. The Court found that the subordinate legislation could not travel beyond the powers vested in it by the parent Act. The Court disagreed with the view of the Chhattisgarh High Court in Palak Khatuja, stating that the notifications did not defer the substitution of reassessment provisions framed under the Finance Act, 2021, and the amendments came into effect from 01.04.2021. Consequently, the reassessment notices impugned in the petitions were declared invalid and quashed. All writ petitions were allowed, and appeals of the revenue were dismissed.

The High Court held that the notifications dated 31.03.2021 and 27.04.2021 issued by the CBDT, which introduced an explanation stating that the pre-amendment provisions of Section 148, 149, and 151 would apply, were unconstitutional and invalid. The Court reasoned that the Relaxation Act, 2020, only empowered the Central Government to extend time limits for compliances, not to issue explanations that altered the substantive provisions of the Income Tax Act. The CBDT, as a subordinate legislation, had exceeded its jurisdiction by introducing such an explanation, which effectively sought to amend the parent Act. The Court found that the subordinate legislation could not travel beyond the powers vested by the parent Act and that an explanation could not change the plain meaning of statutory provisions. The Court disagreed with the view that the notifications deferred the substitution of reassessment provisions. Consequently, the notices impugned in the writ petitions were quashed and set aside as invalid and bad in law. All writ petitions were allowed, and the revenue's appeals were dismissed.

The High Court held that the explanations introduced by the CBDT notifications dated 31.03.2021 and 27.04.2021 were unconstitutional and invalid. The Court reasoned that the power vested in the Central Government under Section 3(1) of the Relaxation Act, 2020, was limited to extending time limits for actions and compliances. Issuing an explanation that dictated the applicability of Section 148 provisions, as they stood before the Finance Act, 2021, went beyond the scope of this delegated power. The Court emphasized that subordinate legislation cannot travel beyond the powers conferred by the parent Act and cannot amend the provisions of the parent Act under the guise of clarification. The Court disagreed with the Chhattisgarh High Court's view, stating that the substitution of reassessment provisions by the Finance Act, 2021, which came into effect on 01.04.2021, could not be deferred by these notifications. Consequently, the notices impugned in the writ petitions were declared invalid and bad in law, and were quashed and set aside. The Court explicitly stated that the learned Single Judge committed no error in quashing these notices.

The High Court held that the explanations introduced by the CBDT in its notifications dated March 31, 2021, and April 27, 2021, were unconstitutional and invalid. The Court reasoned that the Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020, under which the notifications were issued, only empowered the Central Government to extend time limits for actions and compliances. The introduction of an explanation that provided for the application of pre-amendment provisions of Section 148, by way of clarification, plainly exceeded the jurisdiction of the CBDT as a subordinate legislation. The Court emphasized that subordinate legislation cannot travel beyond the powers vested in it by the parent Act and cannot amend the provisions of the parent Act under the guise of a clarification. The Court noted that while the Chhattisgarh High Court had taken a different view, it was unable to persuade itself to accept that analysis. Consequently, the notices impugned in the respective petitions were found to be invalid and bad in law, and were quashed and set aside. The Court affirmed the decision of the learned Single Judge in quashing these notices.

The High Court held that the explanations introduced by the CBDT notifications dated 31.03.2021 and 27.04.2021 were unconstitutional and invalid. The Court reasoned that the Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020, only empowered the Central Government to extend time limits for actions and compliances, not to issue explanations that altered the substantive provisions of the Income Tax Act. The CBDT, as a subordinate legislation, exceeded its jurisdiction by introducing an explanation that effectively sought to apply the pre-amended Section 148 provisions beyond the intended scope of the parent Act. The Court found it doubtful that an explanation, even if termed clarificatory, could change the plain meaning of statutory provisions or amend the parent Act. The Court disagreed with the view taken by the Chhattisgarh High Court in Palak Khatuja (supra), finding that the substitution of reassessment provisions under the Finance Act, 2021, which came into effect from 01.04.2021, could not be deferred by these notifications. Consequently, the notices impugned in the petitions were quashed and set aside as invalid and bad in law. The writ petitions were allowed, and the revenue's appeals were dismissed.

The High Court held that the explanations introduced by the CBDT notifications dated 31.03.2021 and 27.04.2021 were unconstitutional and invalid. The Court reasoned that the Taxation and other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020, under which the notifications were issued, only empowered the Central Government to extend time limits, not to issue explanations that altered the basis of statutory provisions. The Court found that these explanations, by stating that pre-amendment provisions of Section 148 would apply, plainly exceeded the jurisdiction of subordinate legislation and could not amend the parent Act. The Court disagreed with the view that the notifications deferred the substitution of reassessment provisions under the Finance Act, 2021, stating that the amendments came into effect on 01.04.2021. Consequently, the notices impugned in the writ petitions were declared invalid and quashed. The Court allowed all the writ petitions and dismissed the appeals of the revenue.

The High Court held that the explanations introduced by the CBDT notifications dated 31.03.2021 and 27.04.2021 were unconstitutional and invalid. The Court reasoned that the Relaxation Act, 2020, under Section 3(1), only empowered the Central Government to extend time limits for actions and compliances, not to issue explanations that altered the interpretation or application of statutory provisions like those in Section 148 of the Income Tax Act. The CBDT, as a subordinate legislation, exceeded its jurisdiction by introducing these explanations, which travelled beyond the powers vested by the parent Act. The Court found it doubtful that an explanation, even if termed clarificatory, could change the plain meaning of a statutory provision. The Court disagreed with the view taken by the Chhattisgarh High Court in Palak Khatuja (supra), stating that the substitution of reassessment provisions under the Finance Act, 2021, were not deferred by the notifications, and their effective date remained 01.04.2021. Consequently, the notices impugned in the writ petitions were declared invalid and quashed. All writ petitions were allowed, and the revenue's appeals were dismissed.

The High Court held that the explanations introduced by the CBDT notifications dated 31.03.2021 and 27.04.2021 were unconstitutional and invalid. The Court reasoned that the CBDT, as a subordinate legislation, exceeded its delegated powers under Section 3(1) of the Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020. The parent Act only authorized the extension of time limits, not the introduction of explanations that altered the fundamental basis of statutory provisions like Section 148. The Court found that these explanations, in the guise of clarification, attempted to amend the parent Act, which is impermissible for subordinate legislation. The Court disagreed with the view that the notifications deferred the substitution of reassessment provisions under the Finance Act, 2021, stating that the amendments came into effect on 01.04.2021. Consequently, the notices impugned in the respective petitions were found to be invalid and bad in law. The Court quashed and set aside these notices. The ratio decidendi is that subordinate legislation cannot exceed the scope of the parent Act and cannot amend statutory provisions through explanatory notes.

The High Court held that the explanations introduced by the CBDT notifications dated March 31, 2021, and April 27, 2021, were unconstitutional and invalid. The Court reasoned that the Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020, only empowered the Central Government to extend time limits for actions and compliances, not to issue explanations that altered statutory provisions. The CBDT, as a subordinate legislation, exceeded its jurisdiction by introducing an explanation that effectively sought to amend the provisions of the Income Tax Act, which it could not do. The Court found it doubtful that an explanation, even if termed clarificatory, could change the plain meaning of a statutory provision. The Court disagreed with the view of the Chhattisgarh High Court, stating that the substitution of reassessment provisions by the Finance Act, 2021, could not have been deferred by these notifications, and the amendments came into effect from April 1, 2021. Consequently, the notices impugned in the writ petitions were declared invalid and quashed. The Court allowed all the writ petitions and dismissed the appeals of the revenue.

The High Court held that the explanations introduced by the CBDT notifications dated March 31, 2021, and April 27, 2021, were unconstitutional and invalid. The Court reasoned that under Section 3(1) of the Relaxation Act, 2020, the Central Government was empowered only to extend time limits for actions and compliances, not to issue explanations that altered the interpretation or application of statutory provisions of the Income Tax Act. The CBDT, in introducing an explanation that provided for the application of pre-amendment provisions of Section 148 and Section 149, plainly exceeded its jurisdiction as a subordinate legislation. The Court found that subordinate legislation cannot travel beyond the powers vested by the parent Act and that an explanation cannot amend the provisions of the parent Act. The Court disagreed with the view taken by the Chhattisgarh High Court in Palak Khatuja, stating that the substitution of reassessment provisions by the Finance Act, 2021, were not deferred by the notifications. Consequently, the notices impugned in the respective petitions were found to be invalid and bad in law. The Court quashed and set aside these notices. All writ petitions were allowed, and appeals of the revenue were dismissed.

The High Court held that the notices impugned in the respective petitions were invalid and bad in law, and consequently quashed and set aside. The Court reasoned that the CBDT notifications dated March 31, 2021, and April 27, 2021, which introduced an explanation stating that for the purposes of Section 148 notices, the provisions as they stood on March 31, 2021, would apply, plainly exceeded the jurisdiction of subordinate legislation. The Court found that the power granted under Section 3(1) of the Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020, was only to extend time limits, not to issue explanations that altered the basis of statutory provisions. The Court emphasized that subordinate legislation cannot travel beyond the powers vested by the parent Act and cannot amend the provisions of the parent Act under the guise of clarification. The Court disagreed with the view taken by the Chhattisgarh High Court in Palak Khatuja (supra), finding that the substitution of reassessment provisions under the Finance Act, 2021, could not have been deferred by the CBDT notifications. The ratio decidendi is that subordinate legislation, including notifications and explanations issued thereunder, must strictly adhere to the scope and powers granted by the parent Act and cannot alter or circumvent statutory provisions. All writ petitions were allowed, and pending applications were disposed of.

The High Court held that the explanations introduced by the CBDT notifications dated March 31, 2021, and April 27, 2021, were unconstitutional and invalid. The Court reasoned that the Relaxation Act, 2020, under Section 3(1), only empowered the Central Government to extend time limits for actions and compliances, not to issue explanations that altered the substantive provisions of the Income Tax Act. The CBDT, as a subordinate legislation, exceeded its jurisdiction by introducing an explanation that provided a clarification contrary to the plain meaning of the statutory provisions and effectively amended the parent Act. The Court disagreed with the view that the notifications deferred the substitution of reassessment provisions under the Finance Act, 2021, stating that the amendments came into effect on April 1, 2021. Consequently, the notices impugned in the respective petitions were declared invalid and quashed. The Court noted that while a Single Judge of the Chhattisgarh High Court had taken a different view, it was unable to persuade itself to accept that analysis. The Court expressly left undecided any issue not covered by this finding.

The High Court held that the explanations introduced by the CBDT in its notifications dated 31.03.2021 and 27.04.2021 were unconstitutional and invalid. The Court reasoned that the CBDT, as a subordinate legislative authority, had exceeded its jurisdiction by introducing an explanation that went beyond the scope of the power delegated by Section 3(1) of the Relaxation Act, 2020. The parent Act only empowered the government to extend time limits, not to issue explanations that altered the fundamental provisions of the Income Tax Act. The Court found that these explanations, in the guise of clarification, attempted to amend the parent Act, which subordinate legislation cannot do. The Court disagreed with the view taken by the Chhattisgarh High Court in Palak Khatuja (supra), stating that the substitution of reassessment provisions under the Finance Act, 2021, could not have been deferred by these notifications. Consequently, the notices impugned in the writ petitions were declared invalid and quashed. The appeals of the revenue were dismissed.

The High Court held that the explanations introduced by the CBDT notifications dated 31.03.2021 and 27.04.2021 were unconstitutional and invalid. The Court reasoned that the Relaxation Act, 2020, specifically Section 3(1), only granted the Central Government the power to extend time limits for actions and compliances. Issuing an explanation that provided a clarification on the applicability of Section 148, Section 149, or Section 151, by stating that the provisions as they stood on 31.03.2021 before the commencement of the Finance Act, 2021, would apply, plainly exceeded the jurisdiction of the CBDT as a subordinate legislation. The subordinate legislation could not travel beyond the powers vested in it by the parent Act. The Court also noted that an explanation, even if intended as a clarification, cannot amend the provisions of the parent Act if the plain meaning of the statutory provision is clear. The Court disagreed with the view of the Chhattisgarh High Court in Palak Khatuja (supra) that the notices were valid because the application of Section 148 was deferred. The High Court found the impugned notices to be invalid and bad in law and quashed them. All writ petitions were allowed, and the appeals of the revenue were dismissed.

The High Court held that the explanations introduced by the CBDT notifications dated 31.03.2021 and 27.04.2021 were unconstitutional and invalid. The Court reasoned that the Relaxation Act, 2020, under Section 3(1), only empowered the Central Government to extend time limits for actions and compliances, not to issue explanations that altered the interpretation or applicability of substantive provisions of the Income Tax Act. The CBDT, as a subordinate legislation, exceeded its jurisdiction by introducing an explanation that provided clarification on the applicability of Section 148, thereby attempting to amend the parent Act's provisions indirectly. The Court found it doubtful that an explanation, even if termed clarificatory, could change the plain meaning of statutory provisions. The Court disagreed with the view taken by the Chhattisgarh High Court, stating that the substitution of reassessment provisions under the Finance Act, 2021, which came into effect from 01.04.2021, could not have been deferred by these notifications. Consequently, the notices impugned in the writ petitions were declared invalid and quashed.

The High Court held that the explanations introduced by the CBDT notifications dated 31.03.2021 and 27.04.2021 were unconstitutional and invalid. The Court reasoned that the Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020, only empowered the Central Government to extend time limits for actions and compliances, not to issue explanations that altered the interpretation or application of statutory provisions. The CBDT, as a subordinate legislation, exceeded its jurisdiction by introducing an explanation that provided a clarification contrary to the plain meaning of the statutory provisions and effectively sought to amend the parent Act. The Court found it doubtful that an explanation, even if termed clarificatory, could change the basis of statutory provisions. The High Court disagreed with the view taken by the Chhattisgarh High Court in Palak Khatuja, stating that the notifications did not defer the substitution of reassessment provisions under the Finance Act, 2021, and the amendments came into effect from 01.04.2021. Consequently, the notices impugned in the writ petitions were declared invalid and quashed. All writ petitions were allowed, and the appeals of the revenue were dismissed.

The High Court held that the explanations introduced by the CBDT notifications dated 31.03.2021 and 27.04.2021 were unconstitutional and invalid. The Court reasoned that the Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020, under Section 3(1), only empowered the Central Government to extend time limits for action and compliance, not to issue explanations that altered the fundamental provisions of the Income Tax Act. The CBDT, as a subordinate legislation, exceeded its jurisdiction by introducing an explanation that provided a clarification which, in effect, changed the basis of the statutory provisions regarding reassessment notices. The Court found it doubtful that an explanation, even if termed clarificatory, could alter the plain meaning of statutory provisions or amend the parent Act. The Court respectfully disagreed with the view of the Chhattisgarh High Court, stating that the substitution of reassessment provisions by the Finance Act, 2021, was not deferred by the CBDT notifications, and the amendments were effective from 01.04.2021. Consequently, the notices impugned in the respective petitions were declared invalid and bad in law, and were quashed and set aside. All writ petitions were allowed.

The High Court held that the explanations introduced by the CBDT notifications dated March 31, 2021, and April 27, 2021, were unconstitutional and invalid. The Court reasoned that the CBDT, as a subordinate legislation, had exceeded its jurisdiction by introducing an explanation that altered the basis of statutory provisions. The parent Act, the Relaxation Act, 2020, only empowered the government to extend time limits, not to issue explanations that could be construed as amending the Income Tax Act. The Court found it doubtful that an explanation, even if termed clarificatory, could change the plain meaning of statutory provisions or amend the parent Act. The Court disagreed with the view that the notifications deferred the substitution of reassessment provisions under the Finance Act, 2021, stating that the effective date of amendments remained April 1, 2021. Consequently, the reassessment notices impugned in the petitions were declared invalid and quashed. The Court noted that while a Single Judge of the Chhattisgarh High Court had taken a different view, it was unable to persuade itself to accept that analysis. The ratio decidendi is that subordinate legislation cannot travel beyond the powers vested in it by the parent Act, and an explanation cannot amend or override statutory provisions.

The High Court held that the explanations introduced by the CBDT notifications dated March 31, 2021, and April 27, 2021, were unconstitutional and invalid. The Court reasoned that the power delegated to the Central Government under Section 3(1) of the Relaxation Act, 2020, was limited to extending time limits for action and compliances, and did not include the power to issue explanations that altered the interpretation or application of statutory provisions of the Income Tax Act. The Court found that the CBDT, by introducing the explanation, had plainly exceeded its jurisdiction as a subordinate legislation, as it attempted to amend the parent Act rather than merely clarify it. The Court disagreed with the view of the Chhattisgarh High Court in Palak Khatuja, stating that the substitution of reassessment provisions under the Finance Act, 2021, which came into effect from April 1, 2021, could not have been deferred by these notifications. Consequently, the notices impugned in the writ petitions were declared invalid and quashed. All writ petitions were allowed, and appeals of the revenue were dismissed.

The High Court held that the explanations introduced by the CBDT notifications dated March 31, 2021, and April 27, 2021, were unconstitutional and invalid. The Court reasoned that the power granted under Section 3(1) of the Relaxation Act, 2020, was limited to extending time limits for action and compliance, and did not include the power to issue explanations that altered the substantive provisions of the Income Tax Act. The Court found that the CBDT, by introducing an explanation that clarified that the provisions as they stood on March 31, 2021, before the commencement of the Finance Act, 2021, would apply for the purpose of issuing notices under Section 148, had plainly exceeded its jurisdiction as a subordinate legislation. Such an explanation could not amend the provisions of the parent Act. The Court disagreed with the view of the Chhattisgarh High Court, stating that the substitution of reassessment provisions under the Finance Act, 2021, were not deferred by the notifications, and their effective date remained April 1, 2021. Consequently, the notices impugned in the respective petitions were found to be invalid and bad in law and were quashed and set aside. The Court allowed all the writ petitions and dismissed the appeals of the revenue.

The High Court held that the explanations introduced by the CBDT notifications dated 31.03.2021 and 27.04.2021 were unconstitutional and invalid. The Court reasoned that the Relaxation Act, 2020, under Section 3(1), only empowered the Central Government to extend time limits for action and compliance, not to issue explanations that altered the interpretation or application of statutory provisions. The CBDT, as a subordinate legislation, had exceeded its jurisdiction by introducing an explanation that provided a clarification contrary to the plain meaning of the statutory provisions and effectively amended the parent Act. The Court found it doubtful that an explanation, even in the guise of clarification, could change the basis of statutory provisions. The Court disagreed with the view taken by the Chhattisgarh High Court in Palak Khatuja (supra), stating that the substitution of reassessment provisions by the Finance Act, 2021, could not have been deferred by these notifications, and the amendments were effective from 01.04.2021. Consequently, the notices impugned in the petitions were declared invalid and quashed. All writ petitions were allowed.

The High Court held that the explanations introduced by the CBDT notifications dated 31.03.2021 and 27.04.2021 were unconstitutional and invalid. The Court reasoned that the Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020, under Section 3(1), only empowered the Central Government to extend time limits for actions and compliances, not to issue explanations that altered the substantive provisions of the Income Tax Act. The CBDT, as a subordinate legislation, had plainly exceeded its jurisdiction by introducing an explanation that provided a clarification contrary to the plain meaning of the statutory provisions and effectively sought to amend the parent Act. The Court disagreed with the view of the Chhattisgarh High Court in Palak Khatuja (supra), finding that the notifications did not defer the substitution of reassessment provisions framed under the Finance Act, 2021, and the amendments were effective from 01.04.2021. Consequently, the notices impugned in the respective petitions were declared invalid and bad in law, and were quashed and set aside. The Court allowed all the writ petitions and dismissed the appeals of the revenue.

The High Court held that the explanations introduced by the CBDT notifications dated 31.03.2021 and 27.04.2021 were unconstitutional and invalid. The Court reasoned that the Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020, specifically Section 3(1), only empowered the Central Government to extend time limits for actions and compliances. Issuing an explanation that provided a clarification on the applicability of Section 148 provisions, as they stood before the Finance Act, 2021, went beyond this delegated power. The Court found that the subordinate legislation (CBDT notifications) had exceeded its jurisdiction by attempting to alter the basis of statutory provisions, which it could not do. The Court disagreed with the view taken by the Chhattisgarh High Court in Palak Khatuja (supra), which held that the notices were valid because the notifications deferred the application of amended Section 148. The High Court concluded that the substitution of reassessment provisions under the Finance Act, 2021, was not deferred by these notifications, and their effective date remained 01.04.2021. Consequently, the impugned notices were quashed and set aside as invalid and bad in law. All writ petitions were allowed.

The High Court held that the explanations introduced by the CBDT notifications dated March 31, 2021, and April 27, 2021, were unconstitutional and invalid. The Court reasoned that the Relaxation Act, 2020, under Section 3(1), only empowered the Central Government to extend time limits for actions and compliances by issuing notifications. Introducing an explanation that provided for the application of pre-amendment provisions for issuing notices under Section 148 plainly exceeded the CBDT's jurisdiction as a subordinate legislation. The subordinate legislation could not travel beyond the powers vested by the parent Act. The Court found it doubtful that an explanation, even if termed clarificatory, could change the basis of statutory provisions or amend the parent Act. The Court disagreed with the view of the Chhattisgarh High Court that the notifications deferred the substitution of reassessment provisions. The Court concluded that the notices impugned in the writ petitions were invalid and bad in law. Accordingly, the notices were quashed and set aside. All the writ petitions were allowed, and the appeals of the revenue were dismissed.

The High Court held that the explanations introduced by the CBDT notifications dated March 31, 2021, and April 27, 2021, were unconstitutional and invalid. The Court reasoned that the Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020, only empowered the Central Government to extend time limits for actions and compliances, not to issue explanations that altered the basis of statutory provisions. The CBDT, as a subordinate legislation, had exceeded its jurisdiction by introducing these explanations, which attempted to clarify or modify the application of Section 148 and Section 149 of the Income Tax Act, 1961, in a manner inconsistent with the parent Act and the commencement date of the Finance Act, 2021. The Court found that these explanations could not change the plain meaning of the statutory provisions. The High Court disagreed with the view taken by the Chhattisgarh High Court in Palak Khatuja (supra), which had held such notices to be valid. The Court concluded that the notices impugned in the respective petitions were invalid and bad in law. Accordingly, the notices were quashed and set aside, and all the writ petitions were allowed.

The High Court held that the explanation introduced by the CBDT notifications dated March 31, 2021, and April 27, 2021, was unconstitutional and invalid. The Court reasoned that the Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020, specifically Section 3(1), empowered the Central Government to extend time limits for actions and compliances. However, this delegation did not include the power to issue explanations that altered the fundamental provisions of the Income Tax Act, 1961, particularly concerning the issuance of Section 148 notices. The Court found that the CBDT, as a subordinate legislation, had plainly exceeded its jurisdiction by introducing an explanation that effectively sought to amend the parent Act's provisions. The Court distinguished this from the power to extend time limits. It noted that while subordinate legislation can be questioned on grounds of manifest arbitrariness or inconsistency with the parent Act, it cannot alter the parent Act's core provisions. The Court disagreed with the view taken by the Chhattisgarh High Court in Palak Khatuja, finding that the notifications did not defer the substitution of reassessment provisions under the Finance Act, 2021, and that the amendments came into effect from April 1, 2021. Consequently, the notices impugned in the writ petitions were quashed and set aside. The Court explicitly left no issue undecided.

The High Court held that the notices impugned in the respective petitions are invalid and bad in law. The Court reasoned that the Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020, empowered the Central Government to extend time limits for actions and compliances, but not to issue explanations that altered the basis of statutory provisions. The CBDT notifications dated March 31, 2021, and April 27, 2021, by introducing an explanation that effectively applied the pre-amended Section 148 provisions, exceeded the delegated authority. Such subordinate legislation cannot travel beyond the powers vested by the parent Act and cannot amend the provisions of the parent Act under the guise of clarification. The Court found the explanations in the notifications to be unconstitutional and invalid. The High Court disagreed with the view of the Chhattisgarh High Court, stating that the substitution of reassessment provisions under the Finance Act, 2021, could not have been deferred by these notifications. Consequently, all the writ petitions were allowed, and the notices were quashed and set aside. The appeals of the revenue were dismissed.

The High Court held that the explanation introduced by the CBDT notifications dated 31.03.2021 and 27.04.2021 was unconstitutional and invalid. The Court reasoned that the Relaxation Act, 2020, only empowered the Central Government to extend time limits for actions and compliances, not to issue explanations that altered the basis of statutory provisions. The CBDT, as a subordinate legislation, exceeded its jurisdiction by introducing an explanation that effectively sought to amend the Income Tax Act's provisions, particularly concerning the reassessment regime introduced by the Finance Act, 2021. The Court found it doubtful that an explanation, even if termed clarificatory, could change the plain meaning of a statutory provision. The Court disagreed with the view taken by the Chhattisgarh High Court, stating that the notifications did not defer the substitution of reassessment provisions framed under the Finance Act, 2021, and the amendments came into effect from 01.04.2021. Consequently, the notices impugned in the writ petitions were quashed and set aside.

The High Court held that the explanations introduced by the CBDT notifications dated March 31, 2021, and April 27, 2021, were unconstitutional and invalid. The Court reasoned that the power granted under Section 3(1) of the Relaxation Act, 2020, was limited to extending time limits for actions and compliances, and did not include the power to issue explanations that altered the substantive provisions of the Income Tax Act. The CBDT, as a subordinate legislature, could not travel beyond the powers vested in it by the parent Act. Introducing an explanation that changed the basis of statutory provisions, especially when the plain meaning was clear, was not permissible. The Court disagreed with the view that the notifications deferred the substitution of reassessment provisions under the Finance Act, 2021. Consequently, the notices impugned in the respective petitions were found to be invalid and bad in law and were quashed and set aside. All writ petitions were allowed, and appeals of the revenue were dismissed.