D.Tamilselvi Vs ITO (Madras High Court)
Summary: The Madras High Court disposed of six writ petitions filed by D. Tamil Selvi and MJR Hospitality and Services Apartments challenging reassessment proceedings, assessment orders and consequential penalty notices for Assessment Years 2016-17 to 2018-19. The central issue concerned reassessment notices issued around the transition from the old reassessment regime to the regime introduced with effect from 01.04.2021, and the effect of the Supreme Court decisions in Union of India Vs. Ashish Agarwal and Union of India Vs. Rajeev Bansal.
The Court considered the legal fiction created by Ashish Agarwal, under which certain Section 148 notices issued under the old regime between 01.04.2021 and 30.06.2021 were deemed to be show-cause notices under Section 148A(b) of the substituted regime. It also considered the surviving limitation period explained in Rajeev Bansal, including exclusion of the period during which the deemed show-cause notices were effectively stayed and the two-week period allowed to assessees to respond. The Court noted that reassessment notices under the new regime had to be issued within the surviving period under Section 149 read with the Taxation and other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020, and that the specified authority under Section 151 had to grant the required prior approval before issuance of the Section 148 notice.
