Issuance of Sec. 148A(b) Notice for AY 2015-16, Not in Continuation of Sec. 148 Notice, Was Time-Barred | Delhi HC

Case Details: Genpact India (P.) Ltd. vs. ACIT - [2024] 166 taxmann.com 256 (Delhi)

Judiciary and Counsel Details

• Yashwant Varma & Ravinder Dudeja, JJ
• Sachit Jolly, Ms Disha Jham, Ms Soumya Singh, Rishabh Malhotra, Devansh Jain, Raghav Dutt, Aditya Rathore & Abhudaya Shankar, Advs. for the Petitioner
• Gaurav Gupta, SSC, Shivendra Singh & Yojit Pareek, Advs. for the Respondent.

Facts of the Case

The assessee-company was engaged in providing business process outsourcing services, data modelling and analytics support, managed IT services, software solutions and e-learning. The reassessment proceedings were initiated for the relevant assessment year based on the information received pursuant to a survey carried out at the assessee’s premises. In response to the notice under section 148, the assessee furnished its return of income for the relevant assessment year.

Subsequently, contending that the notice under section 148A(4) to be issued to comply with the directions of the Supreme Court in the case of Ashish Agarwal & Others [2022] 138 taxmann.com 64 (SC), the Assessing Officer (AO) issued a notice under section 148A(4) for the same assessment year.

The assessee filed a writ petition to the Delhi High Court contending that the reassessment proceedings were barred by limitation.

High Court Held

The High Court held that the notice under section 148 was issued in continuation of the original notice dated 30-06-2021. However, by the time the notice under section 148A was issued, the terminal point for the commencement of reassessment, i.e., 31-03-2022, had already passed.

There was no declaration of invalidity that came to be rendered in respect of the notice issued to the assessee. There was no judgment rendered inter partes, which may have struck down the reassessment notice as being invalid or contrary to the statutory regime that came into effect from 01-04-2021. The notice of 30-06-2021 remained unscathed and unimpacted. Consequently, there arose no need for its revival or resuscitation.

Ashish Agarwal had mandated a revival of notices that had been struck down by various High Courts and modified the judgments rendered in respect of those notices. Consequent to the decision of the Supreme Court, those judgments came to be modified with the notices being revived and ordained to be treated as having been issued under Section 148A( b).

The assessee had not instituted any legal proceedings before any court to assail the notice dated 30-6-2021, nor was it a party to the batch of the writ petition, which came to be ultimately allowed by the Court. Thus, the notice issued on 27-05-2022 was not a continuation or substitution of the original notice dated 30-06-2021. Therefore, the notice issued on 27-05-2022 was in contravention of the First Proviso to section 149(1) and was barred by prescription of limitation.

List of Cases Referred to

• Ors. v. Ashish Agarwal (2023) 1 SCC 617 (para 3).