Ashok Kumar Agarwal Vs Union of India and 2 Others (Allahabad High Court)
Ashok Kumar Agarwal (the Petitioner) had filed a Petition to challenge the initiation of re-assessment proceedings under Section 148 of the Income Tax Act, 1961 (the IT Act) for different Assessment Years (AYs).
The Petitioners contended that all the impugned re-assessment proceedings had been initiated upon notices issued after April 01, 2021 and the Finance Act, 2021 had made certain substitutions regarding the procedures of reassessment. The Petitioners therefore prayed that the reassessment proceedings are invalid and cannot be undertaken by the Tax Authorities.
After taking all the facts and evidences into perusal, the Honorable Allahabad High Court (“Allahabad HC”) held that there is no conflict in the application and enforcement of the IT Act and the Finance Act, 2021. Just aposed, if the Finance Act, 2021 had not made the substitution to the reassessment procedure, the Tax Authorities would have been within their rights to claim an extension of time, under the IT Act.
However, upon that sweeping amendment made by the Parliament, by necessary implication or implied force, limited the applicability of the IT Act and the power to grant time extensions thereunder, to only such reassessment proceedings as had been initiated till March 31, 2021.
Consequently, the impugned Notifications had no applicability to the reassessment proceedings initiated from April 01, 2021 onwards.
FULL TEXT OF THE JUDGMENT/ORDER OF ALLAHABAD HIGH COURT
Heard Sri Rakesh Ranjan Agarwal, learned Senior Advocate, assisted by Sri Suyash Agarwal, Sri Shambhu Chopra, learned Senior Advocate, assisted by Ms. Mahima Jaiswal, Sri Abhinav Mehrotra, Sri Akhilesh Kumar along with Sri Ashish Bansal, Sri Divyanshu Agarwal along with Sri Ankit Saran, Sri Deepak Kapoor along with Sri Shubham Agarwal, Sri V.K. Sabarwal and Shri R.B. Gupta along with Sri Rishi Raj Kapoor, Sri Shakeel Ahmad, Sri Parv Agarwal, Sri Salil Kapoor along with Sri Anuj Srivastava & Ms Soumya Singh alongwith Sri Satya Vrat Mehrotra, Sri Ankur Agarwal, Sri Krishna Deo Vyas, Sri Ashok Shankar Bhatnagar & Sri Harshul Bhatnagar, Sri Pranchal Agarwal, Sri V.K. Sabharwal, Sri R.B. Gupta, Ms. Shalini Goel and Ms. Rupal Agarwal, learned counsel for the petitioners; Sri Shashi Prakash Singh, learned Additional Solicitor General of India assisted by Sri Gopal Verma, Sri Dinesh Kumar Mishra, Sri Gaya Prasad Singh, Sri Sudarshan Singh, Sri Santosh Kumar Singh Paliwal, Sri Ajai Singh, Sri Gaurav Kumar Chand and Sri Krishna Agarwal, learned counsel appearing for the Union of India; Sri Gaurav Mahajan, Sri Praveen Kumar, Sri Krishna Agarwal, Sri Ashish Agarwal and Sri Manu Ghildyal, learned Standing Counsel for the revenue authorities.
2. This writ petition along with the other petitions mentioned in paragraph 4 below, have been filed by individual petitioners, to challenge initiation of re-assessment proceedings under Section 148 of the Income Tax Act, 1961 for different assessment years. All reassessment proceedings have been initiated upon notices issued after the date 01.04.2021.
3. These petitions had been entertained and interim protection granted. Pursuant to earlier orders passed in the leading petitions – Writ Tax Nos. 524 of 2021 and 521 of 2021 and other matters, the revenue and the Union of India were required to file counter affidavits in those cases. Copies of such counter affidavits were, under a direction of this Court, served on all learned counsel for the petitioners. Replies by way of rejoinder affidavits have also been received in some of the cases. Those affidavits thus filed, have been read in all the writ petitions.
4. Since, the dispute arising in the present writ petitions is purely legal, with respect to the validity of the re-assessment proceedings initiated against the individual petitioners, after 01.04.2021, having resort to the provisions of the Income Tax Act, 1961 (hereinafter referred to as the ‘Act’) as they existed, read with the provisions of Act No. 38 of 2020 and the notifications issued thereunder, the peculiar fact pleadings of each case are not material to the adjudication of the legal issues involved here. However, for the purposes of convenience, the basic relevant facts, obtaining in each individual case are recorded in the below given chart:
