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Judgment
ORDER
PER SUDHIR KUMAR JM:
The Revenue preferred the appeal, challenging the order dated 21-11-2025 passed by The National Faceless Appeal Centre Delhi (in short Ld. NFAC) passed by Assessment Unit dated 08-03-2024 for A.Y. 2015-16 under the section 147 r.w.s 143(3) read with section144B of the Income Tax Act, 1961(In short “the Act”).
The revenue following grounds in appeal:
1.Whether on the facts and in the circumstances of the case and in law the Ld. CIT(A) was justified in quashing the reassessment proceedings by holding that notice issued u/s 148 dated 07-04-2022 for A.Y.2015-16 was barred by limitation without properly appreciating the amendment provisions of section 149, 148 read with section 148A of the Income-tax Act 1961.
2.Whether the Ld. CIT(A) has erred in law in understanding the concession made by the ld. Additional Solicitor General before the Hon’ble Supreme Court in Rajiv Bansal vs. Union of India without going the provisions of section 149 of the Income Tax Act.
The brief facts of the case are that the assessee did not file her return of income under section 139(1) of the Act for A.Y. 2015-16 as the income was below the taxable limit. The Assessing Officer received the information that the assessee has carried out substantial transaction through her account with Axis Bank Account no. 914010026637287 during the year under consideration but not filed return of Income. The case of assessee was reopened for assessment under section 147 of the Act. Notice under section 148 of the Act was issued to the assessee on 07-04-2022. In the response of the notice the assessee filed her return of income declaring total income Rs.1,09,350/-. Further, notices were issued on various dates calling various details and documents from the assessee. According to Assessing Officer the assessee has failed to explain the source of cash deposit. The assessee has not submitted any documentary evidence. The Assessing Officer completed the assessment after making the addition of Rs.60,55,000/- under section 69A of the Act.
Being aggrieved with the order of the AO, the assessee filed the appeal before the Ld. NFAC, who vide his order dated 21-11-2025 allowed the appeal of the assessee.
Aggrieved the order of the Ld. NFAC, the Revenue is in appeal before the tribunal.
The ld. CIT(A) has observed in his order as under:
Since the revenue has conceded that for the A.Y. 2015-16 all notices issued on or after 01-04-2021 will have to be dropped as they do not fall for completion during the period prescribed under TOLA, the present assessment cannot survive and has become bad in law.
In the result, the appeal is allowed
The Ld. DR has submitted that notice was issued within time and the assessment order was quashed without appreciating the amended provisions of section 149, 148 r. w. s.148 A of the Act. He further submitted that the decision of the Hon’ble Supreme Court was wrongly applied in this case.
The Ld. AR of the assessee submitted that notice was issued on 07-04-2022 which was time barred, and the Ld. NFAC rightly quashed the assessment order relying the decision in the case of Union of India v. Rajeev Bansal Taxmann.com 70 (SC). He further submitted that as per section 149 of the Act the notice u/s 148 of the Act could be issued within a period of six years from the end of the relevant assessment year i.e. 2015-2016. The limitation of issuing notice expired on 31-03-2022. In the present case the notice u/s 148 of the Act was issued on 07-04-2022 which is beyond time. Reliance has been placed on the decisions of Union of India & Ors. Vs. Rajeev Bansal 2024 (10) TMI 264 Supreme Court (LB) and relevant parts whereof are reproduced as under:
“e” The Finance Act 2021 (2021) 432 ITR (Stat) 52) substituted the old regime for reassessment with a new regime. The first proviso to section 149 does not expressly bar the application of Taxation and other Laws (Relaxation and Amendment of Certain Provision) Act,2020 Section 3 of the Taxation and other Laws (Relaxation and Amendment of Certain Provision) Act, 2020 applies to the entire Income Tax Act, including section 149 and 151 of the new, regime. Once the first proviso to section 149(1) (b) is read with Taxation and other, Laws (Relaxation and Amendment of Certain Provision) Act, 2020 then all the notices issued between April1,2021 and June 30,2021 pertaining to the assessment years 2013-14, 2014-15, 2015-16, 2016-17 and 2017-18 will be within the period of limitation as explained in the tabulation below:
Assessment year Within 3 years Expiry of Limitation read with TOLA for (2) (3) Within six years(4) Expiry of Limitation read with TOLA for (4)(5) 2013-14 31-03-2017 TOLA not applicable 31-03-2020 30-06-2021 2014-15 31-03-2018 TOLA not applicable 31-03-2021 30-06-2021 2015-16 31-03-2019 TOLA not applicable 31-03-2022 TOLA not applicable 2016-17 31-03-2020 30-06-2021 31-03-2023 TOLA not applicable 2017-18 31-03-2021 30-06-2021 31-03-2024 TOLA not applicable (f)The revenue concedes that for the assessment year 2015-16 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”
In the above cited case, the revenue concedes that for the assessment year 2015-16, all notices issued on or after 1st April 2021 will have to be dropped as they will not fall for completion during the period prescribed under TOLA.
We have heard the revival contention of the parties and gone through the material available on record. In view of the observation of the Hon’ble Supreme Court in the case of Rajeev Bansal (Supra) insofar as assessment year 2015-16 is concerned, the Hon’ble Supreme Court has noticed that Revenue concedes that in respect of the A.Y.205-16, all assessment notices issued on or after 01-04-2021 will have to be dropped. We thus find that the notice in the present case issued on 07-04-2022 was invalid, since, the notice is u/s 148 of the Act is issued on 07-04-2022 is invalid, the Ld. NFAC rightly quashed the reassessment order relying the decision of the Hon’ble Supreme Court. We do not find any reason to interfere with the findings of the Ld. NFAC, thus, the he appeal of the Revenue is liable to be dismissed.
In the result the appeal of the Revenue is dismissed.