DCIT Vs Rajan Kumar (ITAT Delhi)
Reassessment Notice Time-Barred Despite Ashish Agarwal Relief – ITAT Delhi Applies Rajeev Bansal Ratio
The Bench of the ITAT dismissed the Revenue’s appeal for AY 2013-14 and upheld the quashing of reassessment proceedings on the ground of limitation under section 149, even in cases covered by the Supreme Court’s decision in Ashish Agarwal.
In this case, the original notice under section 148 (old regime) was issued on 17.06.2021. Pursuant to Ashish Agarwal, the notice was deemed to be a show-cause notice under section 148A(b), and the assessee submitted its reply on 26.06.2022. The AO thereafter issued a fresh notice under section 148 (new regime) on 19.07.2022.
Relying on the Supreme Court judgment in Union of India v. Rajeev Bansal (03.10.2024), the Tribunal held that only the “surviving time” between the date of original notice and 30.06.2021 could be utilised by the AO after receipt of the assessee’s reply. In the present case, the surviving period was 14 days (17.06.2021 to 30.06.2021). Accordingly, the AO could issue the fresh notice only up to 09.07.2022. Since the notice was issued on 19.07.2022, it was clearly barred by limitation.
The ITAT held that the benefit of Ashish Agarwal does not override statutory limitation under section 149 and that reassessment notices issued beyond the surviving period are invalid. Consequently, the reassessment proceedings were rightly quashed and the Revenue’s appeal was dismissed
FULL TEXT OF THE ORDER OF ITAT DELHI
