Vatti Prakash Reddy Vs ITO (ITAT Hyderabad)
ITAT Hyderabad held that limitation for issuing notice under section 148 of the Income Tax Act would be only 3 years from the end of the assessment year since material suggesting escapement is less than Rs. 50 Lakhs. Hence, notice issued u/s. 148 is beyond period of limitation of three years hence quashed.
Facts- The present appeal has been preferred by the appellant. It is mainly contested that notice under section 148 of the Income Tax Act was issued beyond the limitation period as prescribed under the erstwhile section 149(1)(b). It is also contested that AO has not fulfilled the mandatory conditions prescribed under section 147, 148, 148A and 149 of the Income Tax Act.
Conclusion- Held that once the total deposits without even considering the source at the stage of passing the Order u/sec.148A(d) and issuing notice u/sec.148 of the Act is less than Rs.50 lakhs, then, the limitation as per the provisions of sec.149 of the Act would be only 03 years from the end of the assessment year. Hence, in the facts and circumstances, prima facie when it is manifest and evident from the bank account transactions that the total deposit made in the bank account during the year without even considering the source explained by the assessee is less than Rs.50 lakhs, then, the notice issued u/sec.148 of the Act on 27.04.2022 is beyond the period of limitation i.e., 03 years from the end of the assessment year under consideration and consequently, the said notice is bad in law and liable to be quashed. We Order accordingly.
