Time Limit for Issuing Notice u/s 148 Extended Till 30-06-2021 is Not Applicable to AY 2013-14 | Bombay HC

Case Details: New India Assurance Company Ltd. v. ACIT - [2024] 158 taxmann.com 367 (Bombay)

Judiciary and Counsel Details

• • K.R. Shriram & Dr. Neela Gokhale, JJ.
  • P.J. Pardiwalla, Sr. Adv. Harsh Kapadia & Atul K. Jasani for the Petitioner.
  • Akhileshwar Sharma for the Respondent.

Facts of the Case

The assessee filed the instant writ petition challenging the issue of section 148 notice for the Assessment Year 2013-14. Assessee contended that the reopening notice was issued beyond the period of limitation.

Assessee also contended that CBDT’s Instruction 1/2022 to revive notice issued under the old regime was beyond jurisdiction, illegal, contrary to directions of the Apex Court given in the case of Ashish Agarwal v. ITO [2022] 130 taxmann.com 246 (SC).

High Court Held

The Bombay High Court held that a notice under section 148 could not be issued to reopen the assessment in a case where the right to reopen the assessment was already barred under the pre-amended Act on the date when new legislation came into force.

Therefore, where the limitation under Act (erstwhile section 149) for reopening the assessment for assessment year 2013-14 expired on 31-3-2020, notice issued in June 2021 in case of the assessee was barred by limitation. Thus, reassessment proceedings initiated pursuant to the judgment in Ashish Agarwal v. ITO [2022] 130 taxmann.com 246 (SC) will also be regarded as beyond the time limit.

Since the limitation under erstwhile section 149 for reopening the assessment for the assessment year 2013-14 expired on 31-3-2020, CBDT Notification No.20/2021 would not apply to facts of the present case and even relate back theory of AO could not safeguard reassessment proceedings initiated after 1-4-2021.

Accordingly, section 148 notice dated 28-7-2022 issued pursuant to Ashish Agarwal v. ITO [2022] 130 taxmann.com 246 (SC) and CBDT Instruction No. 1/2022 to revive notice issued under the old regime was to be quashed and set aside.