UCB Developers LLP Vs ACIT (Delhi High Court)
The Delhi High Court considered a writ petition challenging notices dated 12.08.2024, 31.08.2024 and 17.06.2025 issued under Section 148 of the Income Tax Act, 1961 for Assessment Year (AY) 2015-16. The petitioner contended that the reassessment proceedings were barred by limitation under the second proviso to Section 149(1), as the notice was issued beyond the permissible ten-year period. Reliance was placed on earlier Division Bench decisions of the Court where similar notices for AY 2015-16 were held time-barred. The Revenue attempted to distinguish those decisions but was unable to do so.
The Court examined the statutory scheme and noted that the notice under Section 148A(b) was issued on 12.08.2024, followed by an order under Section 148A(d) on 31.08.2024. Since the assessment year relevant to the notice date was AY 2025-26, counting ten years backwards would reach only up to AY 2016-17. Consequently, issuance of notice for AY 2015-16 exceeded the limitation period prescribed by law. Finding the facts identical to the earlier rulings, the Court held the impugned notice to be clearly barred by limitation. Accordingly, the writ petition was allowed and the notice dated 31.08.2024 along with all consequential proceedings were quashed.
FULL TEXT OF THE JUDGMENT/ORDER OF DELHI HIGH COURT
1. By way of the present writ petition, the petitioner challenged the notices dated 12.08.2024, 31.08.2024 & 17.06.2025 so also the consequent proceedings initiated under Section 148 of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act of 1961’), by the respondents for Assessment Year (AY) 2015-16.
2. Learned counsel for the petitioner submitted that the impugned notice is clearly barred by limitation as per second proviso to Section 149 of the Act of 1961, inasmuch as the same is beyond the prescribed period of limitation i.e. 10 years. He relied upon the judgment of Division Bench of this Court rendered in W.P.(C) 12091/2023 titled Dinesh Jindal v. Assistant Commissioner of Income Tax, Central Circle 20, Delhi & Ors. decided on 27.05.2024 so also the judgment rendered in the W.P.(C) 317/2025 titled Pankaj Jain v. Assistant Commissioner of Income Tax, Central Circle 3, Delhi & Anr. decided on 14.01.2025.
3. Taking the Court through the judgment of Pankaj Jain (supra), learned counsel for the petitioner submitted that the facts therein are exactly identical to the facts involved in the present case inasmuch as the relevant AY in both the cases is 2015-16. The only change, which too has no bearing on the case is that in the case of Pankaj Jain (supra), the notice was issued on 30.08.2024 while in the instant case the same was issued on 31.08.2024.
4. Mr. Abhishek Maratha, learned SSC for the respondents-Department though tried to distinguish the facts of the present case from the facts involved in Pankaj Jain (supra), but he could not.
5. Even without referring to the judgments cited by the learned counsel for the petitioner, if the basic provision contended, i.e. the second proviso to Section 149(1) of the Act of 1961 is taken into consideration, in the factual background of the present case, it is clear that 148A(b) notice was issued on 12.08.2024, whereafter, notice under Section 148A(d) came to be issued on 31.08.2024 for the AY 2025-26.
6. Needless to record that the assessment year in which the notice dated 31.08.2024 was issued is, 2025-26. If period of 10 years backwards is counted, then the same would naturally be, the AY 2016-17. As has been explained by the Division Bench in judgment in the case of Dinesh Jindal (supra), so also Pankaj Jain (supra).
7. Hence, notice dated 31.08.2024 issued for AY 2015-16 is clearly barred by limitation.
8. If the facts of Pankaj Jain (supra) are considered, they are exactly identical to the present case, with a minor but insignificant difference. (in the case of the Pankaj Jain (supra) the notice was issued on 30.08.2024 while the notice in the case in hands was issued on 31.08.2024)
9. In view of the discussions foregoing, the present writ petition is allowed, the impugned notice dated 31.08.2024 so also the consequential proceedings are hereby quashed and set aside.
10. All the pending applications are disposed of.
