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Judgment
ORDER
Per Raj Kumar Chauhan, Judicial Member: The appeal o f the assessee is dir ected against the order dated 10.11.2025 of ld. C IT(A)/NFAC, Delhi passe d u/s 250 of the Income Tax Act, 1961 (hereinafter referred to as “the Act”) wherein the best judgment Assessment Order u/s 147 r.w .s. 144B of the Act dated 25.05.2023 was dismissed.
The facts in brief as culled out fro m para 1 of the assessment order are as under:
“The assessee, M/s A ttractive Impex Pvt. Ltd. (PAN: AAGCA6445E) filed its ITR for A.Y. 2013-14 declaring income of Rs. NIL on 30.09.2013. The r eturn was proc ess ed u/s 143(1) of the IT Act 1961. Further no assessment was made i n t hi s case u/s 143(3). As per i nformati on recei ved from the I.T. O., Ward-22(4), Ne w Del hiit has been inti mated that duri ng the c ours e of assessment proceedi ng i n the cas e of M/s Syndicate B ui ldwell Private L imited for assessment year 2013-14 it has been note d t hat M/s S yndicate buildwell Pri vate Limited has received unsecured l oan f rom M/s At tracti ve Impex Private L imited (PA N: AAGCA6445E) of Rs. 1,74,00,000/-.After exami nation of the said i nformation, a Show C ause Notice u/s.148A(b) was iss ued to t he assessee company on 27/5 /2022 providing t he informati on and material to the assessee company and fixing t wo we eksti me to s ubmi t its response. B ut no reply was f ur nished by the ass essee company i n respons e to Show Cause Notice u/s.148A(b) as i ssued on 27/5/2023. As t he assess ee compa ny was unabl e to explaín t he source of transacti ons amounti ng to Rs.1,74,00,000/-duri ng t he F. Y. 2012-13 relevant to A .Y . 2013-14, the case has been i nitiate d for R e-ass essment Proc eedi ngs u/s .147 o f t he I. T. Act, 1961. After obtai ni ng approval from the Competent A utho rity, Order u/s .148A(d) of the I.T. Act, 1961 was issued to the assesse e company on 21/07/2022 initiati ng the Re-assessment Pr oce eding u/s .147 of the I. T. Act, 1961 for the A.Y. 2013-14 by issui ng notice u/s.148. No Ret urn of Incom e has been furnished by the a ssessee c ompany in respons e to N otice u/s .148. S ubsequently, Notic e u/s.142(1) has been issued on 5/1/2023 and 23/1/2023 and served electr onically upon the assess ee c ompa ny on t he same day . B ut no reply has been filed by the assess ee company in r espo nse t o Noti ce u/s.142(1). Thereafter, a communic ati on dated 8 /2/2023 ha s be en sent to t he assessee company i n re spect of non-compli ance of initial notice u/s.142[1] of the I.T . Act, 1961 aski ng the assessee c ompany to fur nish reply wit hi n five days of rec eipt of t his mail. But still no respons e has been rec eiv ed from the assess ee company. Ther eaft er, a S how Caus e N otic e u/s. 144 has bee n i ssued on 17/2/2023 as king the assesse e company as yo u have neither fil ed Retur n of Inc ome i n respo nse to Notice u/s.148 nor furnished any repl y i n r espons e to notic es as served upon you. Hence, you are hereby s how cause as t o why your case should not be passed u/s.147 r.w.s . 144 r.w.s. 144B of the I .T. Ac t, 1961. In respons e to Show C ause Notice u/s .144 of t he I.T. Act, 1961 dated 17 /2/2023, t he assessee co mpany furnis hed a part compliance. Later on, Notic e u/s.142[1] has been issue d on 9/3 /2023 and 4/5/2023 seeki ng some docume nts, but t he assessee company did not furnish any documents whic h were requisitio ned. H owever , fi nal S how Caus e Notice dated 16/5/2023 has been i ssued to t he ass essee company stati ng that you are hereb y gi ven an opportunity t o s how cause as to why the abo ve pay ment of Rs.1,74,00,000/-shoul d not be treat ed as bogus tr ansac ti on and a dded bac k wi th your total i nc ome. The ass essee company furnished its r epl y i n respons e to above S how Caus e Notic e whi ch is not acceptabl e.”
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 asse ssment order.
Aggrieved by the impugned order of the ld. CIT(A), the assessee is in appeal before the Tribunal and raising fo llowing grounds:
“1 . T hat C IT (A ppeals) erred i n sus tai ni ng t he allegation of Assessi ng Officer that t here is no evidence on recor d of any communication was made by assess e for treating the filing of i ncome tax ret urn under secti on 139 of Income tax act should be treated as it filed under s ection 148 of Inco me Tax Act, 1961. In fact, the as sesse had dul y requested t he assessi ng offic er to tr eat the r etur n alre ady filed under s ecti on 139 as return filed under section 148 of t he Act.
2.That the Ld . CIT (A ppeals) erred i n accepti ng the allegati on of AO that the ass esse had not filed nor complied with, the requisiti on of the ass essi ng officer . In fact, t he assesse had dul y filed the compl ete reply al ong with desire d documents and details to t he assess ing offic er.
3.That t he Ld. CIT (A ppeals) erred in as much as by accepti ng t he allegati on of the assessi ng officer that t he re-openi ng of t he case under sectio n 148 is bas ed on credible i nformation and i n accordanc e wi th the l aw without co nsideri ng the reply of t he assesse with regard to the re-openi ng of t he case under sec tion 148 of t he Act.
4.That the Ld. CIT (Appeals) erred in law as well as on facts t o s ustai n the additions of Rs.1,74,00,000/- as made by Assessi ng officer on account of undisclosed income for a loan rec eiv ed by company which is wrong and illegal wi thout any basis and evide nce made i n t he assessment .
5.That the Ld. CIT (Appeals ) erred i n law by acce pting the c ontenti on of the assessi ng offi cer t hat the assesse fail ed t o explai n t he na ture and sourc e of funds out of whic h t he alleged loan was gr anted and the onus under section 68 not been disc harged by the asse sse befo re t he assessi ng officer . In this connecti on, it is stated t hat t he assesse d uly es tablished the identity, creditwort hi ness of the s ourc e and genui neness of the transaction of Rs.1,74,00,000/-. All the d esir ed i nformatio n and doc uments dul y submitted d uring t he co urse of assessment pr oce edings and ar e av ailable on record as it filed through i nc ome tax e filing portal. The por tions of the reply/s ubmiss ion of the ass esse also pasted in the assessment order by the assessing officer itself.
6.That the Ld. CIT (Appeal s) has not given cl ear finding against proposed penalty by Assessing offic er under section 271(1)(c) of the Income Tax Act ,1961, whic h is wrong.
7.That the Ld. C IT (Appeals) as well as assessi ng offi cer fail ed to consider the newly enacted provisions of s ection 251(1)(a) of t he Act under whi ch a reaso nable and prop er opport unity must be provided t o the assesse before passing any order under secti o n 144 of the Act.”
The assessee also raised the following admission of additio nal legal grounds under Rule 11 of the Income Tax (AT) Rule s, 1963:
Additiona l Grounds sought to be r aise d
“That on the facts and circumstanc es of the c ase and in law, the re ass ess ment or der passe d under sec tion 147 read with secti ons 144/144B of the Income-t ax Act, 1961 is without j urisdiction and void ab initi o, si nce the notice under s ecti on 148 dated 21.07.2022, issued under t he substitute d provisi ons of the Act for Assessment Year 2013-14, is barred by limitati on under section 149 of t he Act read with the Taxati on and Other Laws (R elaxation and A mend ment of Certai n Provisions) Act, 2020, as inte rpret ed by the Ho n’bl e Sup reme Court in Uni on of Indi a & Ors. v. Rajee v Bansal, 2024 INSC 754 / (2024) 469 ITR 46 (SC). ”
We have heard the ld. AR and the ld. DR on admission of the additional grounds. In support of his application seeking permission to raise additional grounds, it is arg ued that it is purely a legal ground and the necessary facts are already on record and therefore relying upon the case of National Thermal Power Company Ltd. Vs. CIT reported in 229 ITR 383(SC), it is submitted that additional grounds may be admitted and adjudicated in favour of the assessee. In view of the judgment of the Ho n’ble Apex Court, the additional grounds taken up by the assessee are hereby admitted.
We have heard the Ld. AR and Ld. DR regarding additional grounds and also examined the record. At t he very outset, Ld. AR has referred page No. 2 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 judgme nt of Hon’ ble Supreme court of India in Union of Ind ia & Ors. vs. Rajeev Bansal (2024) 469 IT R 46. (SC). It was therefore arg ued that since ne ither 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 he ard the Ld. DR who was supplied with the paper book, and after going thro ugh Page No. 2 containing the tab le 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 o f the judgment of Hon’ble Supreme Court in Rajeev 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 o n record . Page no. 2 of the paper book containing the details in respect of notice dated 21.07.2022 u/s 148 of the Act be ing time barred is extracted as under:
| P a r t i c u l a r s | D e t a i l s |
|---|---|
| A s s e s s m e n t Y e a r | 2 0 1 3 - 1 4 |
| L a s t d a t e t o i s s u e n o t i c e u n d e r s e c t i o n 1 4 8 a s p e r o l d l a w s e c t i o n 1 4 9 , i . e . , s i x y e a r s f r o m t h e e n d o f t h e r e l e v a n t a s s e s s m e n t y e a r | 3 1 . 0 3 . 2 0 2 0 |
| E x t e n d e d d e a d l i n e t o i s s u e n o t i c e u n d e r s e c t i o n 1 4 8 a s p e r T O L A a n d n o t i f i c a t i o n s i s s u e d t h e r e u n d e r | 3 0 . 0 6 . 2 0 2 1 |
| N o t i c e i s s u e d u n d e r s e c t i o n 1 4 8 o f t h e e r s t w h i l e p r o v i s i o n s | 2 5 . 0 6 . 2 0 2 1 / 3 0 . 0 6 . 2 0 2 1 |
| H o n ’ b l e S u p r e m e C o u r t o r d e r d a t e d 0 4 . 0 5 . 2 0 2 2 i n U n i o n o f I n d i a v . A s h i s h A g a r w a l d e e m i n g n o t i c e s i s s u e d u n d e r t h e e r s t w h i l e l a w a s n o t i c e s u n d e r s e c t i o n 1 4 8 A ( b ) o f t h e n e w l a w a n d d i r e c t i n g t h a t m a t e r i a l / i n f o r m a t i o n b e s u p p l i e d w i t h i n 3 0 d a y s f r o m t h e s a i d o r d e r a n d a s s e s s e e s b e a l l o w e d t w o w e e k s t h e r e a f t e r t o f i l e r e p l y | 0 4 . 0 5 . 2 0 2 2 |
| N o t i c e / l e t t e r u n d e r s e c t i o n 1 4 8 A ( b ) p r o v i d i n g m a t e r i a l i n p u r s u a n c e o f t h e H o n ’ b l e S u p r e m e C o u r t o r d e r i n A s h i s h A g a r w a l | 2 7 . 0 5 . 2 0 2 2 |
| T i m e l i m i t t o f i l e r e p l y | 1 0 . 0 6 . 2 0 2 2 |
| R e p l y f i l e d b y t h e A s s e s s e e | - |
| T i m e e x c l u d e d a s p e r t h i r d p r o v i s o t o s e c t i o n 1 4 9 ( 1 ) a s e x p l a i n e d b y t h e H o n ’ b l e S u p r e m e C o u r t i n R a j e e v B a n s a l , i . e . , f r o m t h e d e e m e d s h o w c a u s e s t a g e t i l l s u p p l y o f m a t e r i a l a n d t h e t i m e a l l o w e d t o t h e a s s e s s e e t o f i l e r e p l y | 2 5 . 0 6 . 2 0 2 1 t o 1 0 . 0 6 . 2 0 2 2 |
| T i m e t h a t w a s a v a i l a b l e / l e f t t o i s s u e n o t i c e u n d e r s e c t i o n 1 4 8 a s p e r s e c t i o n 1 4 9 r e a d w i t h T O L A | 5 d a y s / 0 d a y ; ( 2 5 . 0 6 . 2 0 2 1 / 3 0 . 0 6 . 2 0 2 1 t o 3 0 . 0 6 . 2 0 2 1 ) |
| E x t e n d e d t i m e t o b e g i v e n a s p e r f o u r t h p r o v i s o t o s e c t i o n 1 4 9 ( 1 ) | 7 d a y s |
| T i m e l i m i t t o i s s u e n o t i c e u n d e r s e c t i o n 1 4 8 a s p e r s e c t i o n 1 4 9 a s a m e n d e d b y F i n a n c e A c t , 2 0 2 1 , a s p e r R a j e e v B a n s a l | 1 7 . 0 6 . 2 0 2 2 ; ( 7 d a y s f r o m 1 0 . 0 6 . 2 0 2 2 ) |
| D a t e o f n o t ice u n d e r s ec t i o n 1 4 8 | 2 1 . 0 7 . 2 0 2 2 |
Before us, the learned counsel for the assessee pressed legal ground, challeng ing the jurisdictio n of the Assessing Officer to initiate reassessme nt proceedings as the no tice u/s 148 of the Act is barred by limitation. It w as sub mitted that in view of the judgment o f the Union o f India & Ors. vs. Rajeev Bansal (2024) 469 ITR 46. (SC), the re-assessme nt proceedings initiated under the old or un-amended provisions of se ctio n 148, read with the extensions granted under the Taxation and Other Laws (Re laxation and Amendment of Certain Provisions) Act, 2020 (“TOLA”), are witho ut author ity of law .
It was co ntended that for Assessment Year 2013-14, the limitation fo r issuance of notice under the amend ed provisions of se ction 148, as saved by the third proviso to section 149. Therefore, the Assessing O fficer could not have resorted to the old provisions by invoking TOLA. Admitted ly, in the present case, the no tice u/s 148 pursuant to section 148A(d) was issued o n 21 .07.2022, well beyond the permissible limitatio n.
We have heard rival submissions of the parties including the challenge to the jur isdiction of the Assessing Officer to issue notices u/s 148 of the Act beyond the limitation period. The controversy lies in a narrow compass—whe ther the notice issued u/s 148 on 21.07.2022 for A.Y . 2013-14 is barred by limitation. T he Hon’ble Supreme Court in Union of India vs. Rajeev Bansal (supra) has conclusively interpre ted 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 comp letio n 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 ame nded, operates prospectively, and for earlier assessment years, the test is whether the six-year period under the o ld regime was still alive on the date o f issuance of notice. Applying the afo resaid 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 14 8 having been issued on 21.07.2 022, the same is clearly barred by limitatio n.
We also no te that identical issues have been examined and decided by Co-ordinate Bench of the Delhi Tribunal in the case of Sh. Dee pak Agarwal vs. DCIT order dated 23.07.2025 passed in ITA No. 2307/Del/202 5 where in no tices issued on 30.07.2022 for A.Y. 2015-16 was quashed as time-barred, following Rajeev Bansal (supra) . For ready refer ence, findings of the Co-ordinate Be nch of the Tribunal is reproduced as under:
“2 . The Ld. Counsel for the assesse e, at t he outset, submits t hat in the case of the assessee a notice u/s 148 was issued on 30.07.2022 under ne w law which is bar red by limi tation si nce the provisi ons of taxati on and ot her laws (rel axati on and amendment of certai n provisions ) (TOLA) are not applicable for the AY 2015-16 as held by the Hon’bl e Juri sdictional Hi gh Cour t in the case of Ma ke My Trip (India ) Pvt. Ltd. i n WP(c) 2558/2023 dated 24.03.2025.
3.Ld. Counsel further submits t hat recently t he Ho n’bl e Supr eme Co ur t i n the cases of Dee pak Steels & Power Ltd. Vs. CBDT a nd Others in Civil Appeal No .5177/2025 dated 02.04.2025 noted t hat the R ev enue made a co ncessi on befor e t he H on’bl e Supr eme Co urt whil e disposi ng of f t he appeal in the cas e of Uni on of Indi a & Others Vs. Rajiv Bansal (2024) (SCC ) O nli ne SC 2693, that for the AY 2015-16 notices issued on or after 01.04.2021 will have t o b e dropped as the y would not fall for com pletion during the peri od p res cribed unde r t he TOLA. Ld. C ounsel als o submitted t hat similar view has bee n take n by the H on’bl e S uprem e Co urt i n the case of ACIT Vs . Nehal Rashid S hah i n SLP (Civil) Diar y No. (S) 57209/2024 dated 4.4.2025. T herefore, it i s submitted tha t i n the light of thes e decisions the reassessme nt framed for the A Y 2015-16 base d on t he notic e issued u/s 148 of the Act dat ed 30.07.2022, is tim e barred and bad i n law.
4.Ld. DR suppor ted t he ord ers of the Assessi ng Officer.
5.He ard ri val contentio ns, perused t he orders of the aut horities belo w. Admitt edly i n t hi s case notice u/s 148 was issue d on 30. 07.2022 under new law based on whic h the reassessment for the A Y 2015-16 was framed by t he AO on 31.5.2023. The reassess ment was challe nged before the Ld. C IT(Appe als) and the Ld. C IT(Appeals) dismissed the appeal for non-prosecuti on by t he assessee.
6.In the cas e of Make My Tri p (Indi a) Pvt . Ltd. Vs. DCIT (supra) the Jurisdictional Hi gh Court co nsidered whether reassessment compl eted for the A Y 2015-16 bas ed on a notice issued u/s 148 and the viz a viz t he applicability of the provisi ons of TOLA and base d o n the concession of t he Revenue that for the AY 2015-16 all the notices iss ued on or after 1.4.2 021 wi ll have to be drop ped as the y will not fall f or completion duri ng t he perio d pr esc ribed und er t he TOLA, held that the no tice issued under 148 was beyond the period of limitation and consequently t he s ame is li able t o be s et aside.
7.Further the Hon’ble Supr eme Court in t he case of Deepak S teel & Power L td. Vs. CBDT & Others (s upra) quashed the notices issued u/s 148 obse rvi ng as under: -
“2 . Thes e appeal s ari se fro m 't he order pass ed by t he High Court of Orissa at Cuttack in Writ Petiti on (C) Nos. 2446 of 2823, 2543 of 2023 date d 1.2.2023 and 2544 of 2023 dated 10.02.2023 respectivel y by whic h the High Court disposed of the ori ginal writ petitions in t he followi ng terms:-
"1 . The memo of appea rance filed by Mr. S. S. Mohapa tra, learne d Seni or S tanding Counsel f or R ev enue Departme nt on be half of O pposite Parti es is taken on rec ord.
2.In view of t he or de r passed by this Co urt on 1s t December , 2022 in a batch of writ petiti ons of which W.P. (C) Mo.9191 of 2022 (Kailash Kedia v. Income T ax Officer) was a le ad ma tter and the subseque nt or der dat ed 10t h January, 2023 passed i n W.P.(C) Mo.36314 of 2022 (S hiv Mettalicks Pvt. Ltd., R ourkela v. Pri nci pal Commissi o ner of Income Tax , Sambalpur), t he Co urt decli nes t o entertain the pr esent writ petition, but leaves it open to the Pe ti tioner to raise all gr ounds available to the Petitioner in accord ance with law incl udi ng t he grounds urge d in t he present petitio n at the a ppropriate stage as explai ned by the Court in thos e orders.
3.The writ petition is disposed of i n t he above ter ms. "
3.We heard Mr. Saswat Kumar Ac harya, the l earned counsel appeari ng for the appellants (a ss essee) and Mr. Chandras hekhar , the lear ned counsel appearing for t he rev enue.
4.The learned co unsel appe ari ng for the rev enue with his usual fai rness invited t he attentio n of this Co urt to a thr ee j udge bench decision of this C ourt i n U ni on o f India and O rs. v. Raj eev Bansal , repor ted in 2024 SCC OnL ine SC 2693, more particularly, pa ragraph 19(f ) which reads thus :-
"19.(f) The Revenue co ncedes that f or t he ass essment ye ar 2015- 2016, al l notices issued o n or after Apri l 1, 2021 will have to be dropped as the y will not fall for compl etion duri ng the peri od presc ribed under t he Taxation and other L aws (Rel axati on and Amendment of Certain Pr ovisions) Act , 2020."
5.As the revenue made a concession in t he af ores aid deci sion that is for the assess ment ye ar 2015-2016, all notices iss ued on or after 1st April, 2 021 will have t o be dropped as they wo uld not fall for compl etion duri ng the peri od presc ribed under t he taxati on and ot her laws (Relaxati on and Amendm ent of certai n Provisions Act, 2020). Nothi ng furt her is requi red to b e adj udicated in this mat ter as the notic es so f ar as the present litigation is c oncerned is dated 25.6.2021.
6.In view of the aforesaid, i n such circumstances ref erred t o above the ori gi nal writ petiti on nos.2446 of 2023, 2543 of 2023 and 2544 of 2 023 r esp ectively fil ed before t he Hi gh C ourt of O rissa at cuttac k stands allowed.
7.The impugned notice t herei n sta nds quashe d and set aside.”
8.Above decisions squarely appl ies to the fac t situati on of the assessee and ther efo re respec tfully followi ng t he above decisions, we hold that the noti ces issued u/s 148 on or after 1.4.2021 for r eopeni ng t he assessment for the A Y 2015-16 are barred by limitation and consequently the r eassessment mad e bas ed on such notices are bad i n law and void ab initi o. T hus, t he impugned reassessment order havi ng been made purs uant t o no tice issued u/s 148 dated 30.07.2022 the reass essme nt order is her eby held to be bad i n law and the sam e is quashed. Ground Nos . B, C & D of grounds of a ppeal of the as sessee are allo wed.”
Considering the above facts and circumstances and also applying the ratio laid down by the Hon’b le Supr eme Court in the case of Rajeev Bansal (sup ra) and re spectfully following the co-ordinate Bench decisio n in Sh. Deepak Agarwal (supra), we are of the opinion that the no tice issued u/s 148 of the Act dated 21.07 .2022 is b arred by limitation as having been issued beyond the perio d specified u/s 149 of the Act. Conseque ntly, the re-assessment proceedings initiated thereupon is hereby quashed.
In the result, the appeal of the assessee is allowed.