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Judgment
Per Raj Kumar Chauhan, Judicial Member:
The appeal of the assessee is directed against the order dated 25.11.2025 of Id. Commissioner of Income Tax (Appeals)/National Faceless Appeal Centre, Delhi (hereinafter referred to as the "CIT(A)/NFAC") passed u/s 250 of the Income Tax Act, 1961 (hereinafter referred to as "the Act") wherein the best judgment Assessment Order u/s 144 of the Act dated 30.05.2023 was set aside.
The facts in brief as culled out from para 3 of the impugned order are as under:
Assessee filed his Income tax return on dt. 27.09.2013 declaring an income of Rs. 11,37,620/-. After that notice u/s 148 was issued on dt. 22.06.2021 which as per the provisions of section 149, as amended by Finance Act, 2021, the Revenue will have no jurisdiction to issue notices for assessment years 2014-15, as the time limit for issuance of notices for the said assessment years is barred in terms of sub sections (a) and (b), read with the first proviso to section 149. Later on, notice u/s 148(b) has been issued on dt. 19.05.2022 in consequence to Hounrable supreme court order dt. 04.05.2022. Assessee filed reply in response to said notice that that assessee has not received any accommodation entry from Pradeep Kumar Jindal during the AY 2013-14 nor received any loyalty bonus income from Kassa Finvest Pvt Ltd on the basis of which said notice u/s 148A(b) has been issued and prayed to drop the proceedings initiated u/s 148A(b) of the Act. Further, AO has not applied his mind before issuing notice u/s 148A(b). AO passed order u/s 148A(d) dt. 31.07.2022 overlooking the submission of the assessee. Thereafter, notice u/s 148 was issued dt. 31.07.2022 without DIN. Assessee filed return u/s 148 on dt. 20.01.2023 declaring an income of Rs. 11,37,620/. Thereafter, AO issued various notices u/s 142(1) which have been duly replied. Assessment unit issued show cause notice dt. 13.02.2023 proposing variation that assessee has received accommodation entry amounting Rs. 3,28,50,000 from Pradeep Kumar Jindal during the AY 2013-14 and received loyalty bonus income amounting Rs. 11,46,679 from Kassa Finvest Pvt Ltd. In response, assessee filed reply dt. 18.02.2023, Video Conferencing dt. 17.03.2023, Reply dt. 21.03.2023 and reply dt. 17.05.2023 that assessee has not received any accommodation entry from Pradeep Kumar Jindal during the AY 2013-14 on the basis of which proposed variation has been issued. Assessee submitted bank statement alongwith bank ledger explaining each and every entry for the period FY 2012-13 wherein in said bank statement, there is none receipt from Sh. Pradeep Kumar Jindal or its related concern. Further submitted that proceedings u/s 148 has also been opened for AY 2014-15 and 2015-16 to explain the amount of Rs. 3,28,50,000/- received from Pradeep Kumar Jindal i.e. amount received Rs. 1,80,00,000/-from Pradeep Kumar Jindal in AY 201415 and Rs. 1,48,50,000/- from Pradeep Kumar Jindal in AY 2015-16. Thus the Page 3 of 11AAFPA1811Q- AMISH AGARWAL A.Y. 2013-14 ITBA/NFAC/S/250/2025-26/1082991252(1) said amount of Rs. 3,28,50,000/- matches with impugned year query of Rs. 3,28,50,000 and prayed to drop the proposed variation. As regard loyalty bonus income from Kassa Finvest Pvt Ltd, assessee submitted that the letter from Ashok Kumar Managing Director of M/s Kassa Finvest Pvt. Ltd which is base of said addition, is a fraud who has siphoned of hard earned money of many people to the tune of more than 80 Crores. Secondly, there is no written agreement between assessee and M/s Kassa Finvest Pvt Ltd for payment of 2.25 percent p.m. during the year. Confirmation from M/s Kassa Finvest Pvt Ltd has been submitted wherein they specifically mentioned that there is no loyalty bonus payable/paid during the AY 2013-14 to assessee. Further, assessee has done share trading (F and O activity) with Kassa Finvest Pvt Ltd. and Kassa Holding and Consultants Pvt Ltd earned profit of Rs. 15,56,825 during the year which has been shown as income in Profit and Loss account under the head Profit on F and O activity, copy of Audited Profit and Loss Account submitted alongwith Ledger account of F and O Profit. AO overlooking the replies and video conferencing confirmed the proposed variation and added receipt of Rs. 3,28,50,000 from related concerns of Pradeep Kumar Jindal as unexplained money u/ s 69A and loyalty bonus of Rs. 11,46,679 as business receipts as per the section 28(iv) of the Act. On the aforesaid facts and circumstances of the case and the material on record the prayer is for adjudicating the controversy in pursuance to the grounds of appeal having been raised separately to the present appeal and detailed submission will be submitted at the time of hearing along with documents."
Aggrieved by the impugned assessment order, the assessee filed appeal before the Ld. CIT(A) who has dismissed the same and confirmed the addition made in the assessment order.
Aggrieved by the impugned order of the Id. CIT(A), the assessee is in appeal before the Tribunal and raising following grounds:
'1. Because the action for initiation, continuation and conclusion of reassessment proceedings u/s 147 r.w.s 144B at an amount of Rs 3,51,34,299 is being challenged on facts and law.
2.Because the action for initiation, of reassessment proceedings u/s 148 is being challenged since as per the provisions of section 149, as amended by Finance Act, 2021, the Revenue will have no jurisdiction to issue notices for assessment years 2013-14, as the time limit for issuance of notices for the said assessment years is barred by limitation as specified u/s 149 of the Act.
3.Because the action for initiation of re-assessment proceedings is unreasonable since the basis of approval for initiation of the proceedings lacks judicial application of mind as being influenced by the information from Investigation Wing which ipso facto does not result in concealed income, further CRIU information are vague, lacking tangible material/reasonable cause and justification.
4.Because the action for addition of loyalty bonus receipt amounting Rs 11,46,679 as business receipts u/s 28(iv) is being challenged on facts and law as assessee has not received any loyalty bonus from Kassa finvest Pvt Ltd.
5.Because the action for addition of Rs 3,28,50,000 as unexplained money u/s 69A is being challenged on facts and law as there is no receipt in bank account from Pradeep Kumar Jindal or its related concern during the year.
6.For any consequential relief and/or legal claim arising out of tins appeal and for any addition, deletion, amendment and modification in the grounds of appeal before the disposal of the same in the interest of substantial justice to the assessee."
We have heard the Ld. AR and Ld. DR and also examined the record. At the very outset, Ld. AR has referred page No. 3 of the paper book filed before us containing the table for calculation of time barred notice u/s 148 of the Act. It was argued that the case is covered by the judgment of Hon'ble Supreme court of India in Union of India & Ors. vs. Rajeev Bansal (2024) 469 ITR 46. (SC). It was therefore argued that since neither AO nor the Ld. CIT(A) has considered the said aspects regarding the notice u/s 148 of the Act was barred by limitation, therefore, the appeal be allowed and the assessment order be quashed.
We have also heard the Ld. DR who was supplied with the paper book, and after going through Page No. 3 containing the table for the calculation of time-barred notice u/s 148 of the Act, the Ld. DR has submitted that the Bench may consider the submissions with respect to the applicability of the judgment of Hon’ble Supreme Court in Rajiv Bansal case (supra) in its own discretion and has prayed for restoring the file to the AO for deciding the matter afresh.
We have considered the rival submissions and have perused the material on record. Page no. 3 of the paper book containing the details in respect of notice dated 31.07.2022 u/s 148 of the Act being time barred is extracted as under:
| S.No. | Documents | ||
|---|---|---|---|
| 1 | Assessment Year | 2013-14 | |
| 2 | Period of limitation u/s 149 [3 years or 6 years] | 6 years | |
| 3 | Original period of limitation | 31.03.2020 | |
| 4 | Extended period of limitation as per IT Act read with TOLA | 30.06.2021 | |
| 5 | Sanction to be obtained u/s 151 till 30.06.2021 [within 6 years] | PCIT | |
| 6 | Date of original notice u/s 148 - deemed SCN u/s 148A(b) | 22.06.2021 | Original notice u/s 148 at Pg. 11 |
| 7 | Time surviving from date of issuance of deemed SCN till expiry of period as extended by TOLA [from 22.06.2021 till 30.06.2021] | 9 days | |
| 8 | Period of deemed stay to be excluded as per 3rd proviso to section 149 [Date of Original 148 till date of filing of reply by assessee] | 22.06.2021 to 13.06.2022 | Reply at Pg. 12- 20 |
| 9 | Last date for issuing notice u/s 148 [i.e., 13.06.2022+9 days] | 22.06.2022 | |
| 10 | Actual date of issuance of notice u/s 148 | 31.07.2022 | Order u/s 148A(d) and Notice u/s 148 under new provision at Pg. 5-10 |
| Notice u/s 148 issued under new regime is beyond time limit prescribed |
Before us, the learned counsel for the assessee pressed legal ground, challenging the jurisdiction of the Assessing Officer to initiate reassessment proceedings as the notice u/s 148 of the Act is barred by limitation. It was submitted that in view of the judgment of the Union of India & Ors. vs. Rajeev Bansal (2024) 469 ITR 46. (SC), the re-assessment proceedings initiated under the old or un-amended provisions of section 148, read with the extensions granted under the Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020 ("TOLA"), are without authority of law.
It was contended that for Assessment Year 2013-14, the limitation for issuance of notice under the amended provisions of section 148, as saved by the third proviso to section 149, expired on 13.06.2022. Therefore, the Assessing Officer could not have resorted to the old provisions by invoking TOLA. Admittedly, in the present case, the notice u/s 148 pursuant to section 148A(d) was issued on 31.07.2022, well beyond the permissible limitation.
We have heard rival submissions of the parties including the challenge to the jurisdiction of the Assessing Officer to issue notices u/s 148 of the Act beyond the limitation period. The controversy lies in a narrow compass—whether the notice issued u/s 148 on 31.07.2022 for A.Y. 2013-14 is barred by limitation. The Hon’ble Supreme Court in Union of India vs. Rajeev Bansal (supra) has conclusively interpreted the interplay between the amended provisions of sections 148 and 149, the old regime, and TOLA. Significantly, the Revenue itself conceded before the Hon’ble Supreme Court that for A.Y. 2015-16, all notices issued on or after 01.04.2021 are liable to be dropped, as they would not fall for completion within the period prescribed under TOLA.
The Hon’ble Supreme Court further held that the extended ten-year limitation u/s 149(1)(b), as amended, operates prospectively, and for earlier assessment years, the test is whether the six-year period under the old regime was still alive on the date of issuance of notice. Applying the aforesaid test to the facts of the present case, it is undisputed that the six-year limitation for A.Y. 2013-14 expired on 30.06.2021. The notice under section 148 having been issued on 31.07.2022, the same is clearly barred by limitation.
We also note that identical issues have been examined and decided by Co-ordinate Bench of the Delhi Tribunal in the case of Sh. Deepak Agarwal vs. DCIT order dated 23.07.2025 passed in ITA No. 2307/Del/2025 wherein notices issued on 31.07.2022 for A.Y. 2015-16 was quashed as time-barred, following Rajeev Bansal (supra). For ready reference, findings of the Co-ordinate Bench of the Tribunal is reproduced as under:
'2. The Ld. Counsel for the assessee, at the outset, submits that in the case of the assessee a notice u/s 148 was issued on 30.07.2022 under new law which is barred by limitation since the provisions of taxation and other laws (relaxation and amendment of certain provisions) (TOLA) are not applicable for the AY 2015-16 as held by the Hon'ble Jurisdictional High Court in the case of Make My Trip (India) Pvt. Ltd. in WP(c) 2558/2023 dated 24.03.2025.
3.Ld. Counsel further submits that recently the Hon'ble Supreme Court in the cases of Deepak Steels & Power Ltd. Vs. CBDT and Others in Civil Appeal No.5177/2025 dated 02.04.2025 noted that the Revenue made a concession before the Hon'ble Supreme Court while disposing off the appeal in the case of Union of India & Others Vs. Rajiv Bansal (2024) (SCC) Online SC 2693, that for the AY 2015-16 notices issued on or after 01.04.2021 will have to be dropped as they would not fall for completion during the period prescribed under the TOLA. Ld. Counsel also submitted that similar view has been taken by the Hon'ble Supreme Court in the case of ACIT Vs. Nehal Rashid Shah in SLP (Civil) Diary No. (S) 57209/2024 dated 4.4.2025. Therefore, it is submitted that in the light of these decisions the reassessment framed for the AY 2015-16 based on the notice issued u/s 148 of the Act dated 30.07.2022, is time barred and bad in law.
4.Ld. DR supported the orders of the Assessing Officer.
5.Heard rival contentions, perused the orders of the authorities below. Admittedly in this case notice u/s 148 was issued on 30.07.2022 under new law based on which the reassessment for the AY 2015-16 was framed by the AO on 31.5.2023. The reassessment was challenged before the Ld. CIT(Appeals) and the Ld. CIT(Appeals) dismissed the appeal for non-prosecution by the assessee.
6.In the case of Make My Trip (India) Pvt. Ltd. Vs. DCIT (supra) the Jurisdictional High Court considered whether reassessment completed for the AY 2015-16 based on a notice issued u/s 148 and the viz a viz the applicability of the provisions of TOLA and based on the concession of the Revenue that for the AY 2015-16 all the notices issued on or after 1.4.2021 will have to be dropped as they will not fall for completion during the period prescribed under the TOLA, held that the notice issued under 148 was beyond the period of limitation and consequently the same is liable to be set aside.
7.Further the Hon'ble Supreme Court in the case of Deepak Steel & Power Ltd. Vs. CBDT & Others (supra) quashed the notices issued u/s 148 observing as under: -
'2. These appeals arise from 'the order passed by the High Court of Orissa at Cuttack in Writ Petition (C) Nos. 2446 of 2823, 2543 of 2023 dated 1.2.2023 and 2544 of 2023 dated 10.02.2023 respectively by which the High Court disposed of the original writ petitions in the following terms:-
'1. The memo of appearance filed by Mr. S. S. Mohapatra, learned Senior Standing Counsel for Revenue Department on behalf of Opposite Parties is taken on record.
2.In view of the order passed by this Court on 1st December, 2022 in a batch of writ petitions of which W.P. (C) Mo.9191 of 2022 (Kailash Kedia v. Income Tax Officer) was a lead matter and the subsequent order dated 10th January, 2023 passed in W.P.(C) Mo.36314 of 2022 (Shiv Mettalicks Pvt. Ltd., Rourkela v. Principal Commissioner of Income Tax, Sambalpur), the Court declines to entertain the present writ petition, but leaves it open to the Petitioner to raise all grounds available to the Petitioner in accordance with law including the grounds urged in the present petition at the appropriate stage as explained by the Court in those orders.
3.The writ petition is disposed of in the above terms."
3.We heard Mr. Saswat Kumar Acharya, the learned counsel appearing for the appellants (assessee) and Mr. Chandrashekhar, the learned counsel appearing for the revenue.
4.The learned counsel appearing for the revenue with his usual fairness invited the attention of this Court to a three judge bench decision of this Court in Union of India and Ors. v. Rajeev Bansal, reported in 2024 SCC OnLine SC 2693, more particularly, paragraph 19(f) which reads thus:-
'19. (f) The Revenue concedes that for the assessment year 2015- 2016, all notices issued on or after April 1, 2021 will have to be dropped as they will not fall for completion during the period prescribed under the Taxation and other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020."
5.As the revenue made a concession in the aforesaid decision that is for the assessment year 2015-2016, all notices issued on or after 1st April, 2021 will have to be dropped as they would not fall for completion during the period prescribed under the taxation and other laws (Relaxation and Amendment of certain Provisions Act, 2020). Nothing further is required to be adjudicated in this matter as the notices so far as the present litigation is concerned is dated 25.6.2021.
6.In view of the aforesaid, in such circumstances referred to above the original writ petition nos.2446 of 2023, 2543 of 2023 and 2544 of 2023 respectively filed before the High Court of Orissa at cuttack stands allowed.
7.The impugned notice therein stands quashed and set aside."
Above decisions squarely applies to the fact situation of the assessee and therefore respectfully following the above decisions, we hold that the notices issued u/s 148 on or after 1.4.2021 for reopening the assessment for the AY 2015-16 are barred by limitation and consequently the reassessment made based on such notices are bad in law and void ab initio. Thus, the impugned reassessment order having been made pursuant to notice issued u/s 148 dated 30.07.2022 the reassessment order is hereby held to be bad in law and the same is quashed. Ground Nos. B, C & D of grounds of appeal of the assessee are allowed."
Considering the above facts and circumstances and also applying the ratio laid down by the Hon'ble Supreme Court in the case of Rajeev Bansal (supra) and respectfully following the co-ordinate Bench decision in Sh. Deepak Agarwal (supra), we are of the opinion that the notice issued u/s 148 of the Act dated 31.07.2022 is barred by limitation as having been issued beyond the period specified u/s 149 of the Act. Consequently, the re-assessment proceedings initiated thereupon is hereby quashed.
In the result, the appeal of the assessee is allowed.