Acropolis Realty Pvt. Ltd Vs ITO (Delhi High Court)
Delhi High Court held that initiation of reassessment proceedings beyond period of 3 years from end of relevant A.Y. quashed since escaped assessment is below threshold limit of Rs. 50 Lakhs. Thus, petition allowed and order quashed.
Facts- The petitioner filed its return of income for AY 2019-20 on 20.03.2020 declaring ‘NIL’ income. The petitioner did not receive any intimation regarding its return at the material time.
AO sought to reopen the assessment by initiating proceedings u/s. 148A of the Income Tax Act, 1961. Accordingly, the AO issued a notice dated 01.04.2023 u/s. 148A(b) of the Act alleging that he had information, which suggests that the petitioner’s income for the relevant AY 2019-20 had escaped assessment. The impugned notice indicated that the quantum of income that has escaped assessment was ascertained at ₹4,86,300/-.
Conclusion- Held that the reassessment proceedings could not have been initiated beyond the period of three years from the end of the relevant assessment year (AY 2019-20) as the income in respect of which the AO has information to suggest that it has escaped assessment, is below the threshold limit of ₹50,00,000/-. Thus, the petition is accordingly allowed and the impugned notices dated 01.04.2023 and 17.04.2023 as well as the impugned orders dated 17.04.2023 and 01.08.2024 are set aside.
