Anand Cine Services Private Limited Vs ACIT (Madras High Court)
The Madras High Court considered a writ petition challenging a notice dated 25.05.2022 issued under Section 148A(b) of the Income Tax Act, 1961, under the reassessment regime effective from 01.04.2021 for Assessment Year 2014-15.
The petitioner company had taken over the business of M/s. Anand Cine Services Private Limited, a partnership firm, after its incorporation with effect from 11.08.2017. The partnership firm had originally filed its return of income on 28.11.2014 for Assessment Year 2014-15, following which the case was selected for scrutiny and an assessment order under Section 143(3) was passed on 27.12.2016 in the firm’s name.
Subsequently, a notice under Section 148 was issued on 30.06.2021 under the reassessment provisions existing prior to 01.04.2021. The petitioner participated in those reassessment proceedings, which culminated in an assessment order dated 28.03.2022 under Section 147 of the Act for Assessment Year 2014-15.
Thereafter, following the Supreme Court’s decision in Union of India and others v. Ashish Agarwal, later clarified in Union of India v. Rajeev Bansal, the department issued a fresh notice dated 25.05.2022 under Section 148A(b) under the new reassessment regime.
The petitioner relied upon the decisions of the Madras High Court in Vellore Institute of Technology, Represented by its Chairman and Managing Trustee v. Assistant Commissioner of Income Tax (Exemptions), Chennai and M/s. Merton v. The Deputy Commissioner of Income Tax, Chennai and another. It was contended that once reassessment proceedings initiated under the old regime had already culminated in an assessment order dated 28.03.2022 based on the return originally filed on 28.11.2014, the department could not reopen the same assessment under the new regime by issuing a fresh notice under Section 148A(b).
