Case Law Details
Late Shri Rafiq Ahmed Querashi Vs Central Board Of Direct Taxes (Rajasthan High Court)
Rajasthan High Court in the case of Late Shri Rafiq Ahmed Querashi Vs Central Board of Direct Taxes addressed a petition challenging the validity of reassessment proceedings initiated under Section 148 of the Income Tax Act, 1961. The petitioner contended that the reassessment notice issued for the assessment year (AY) 2015-16 on July 28, 2022, was time-barred as per the amendments introduced by the Finance Act, 2021. The petition sought to quash the notice under Section 148 and the related order under Section 148A(d) of the Act.
The case hinged on the compliance with procedural requirements following the Supreme Court’s decision in Union of India & Ors. Vs. Ashish Agarwal (2023 1 SCC 617), where notices issued under the unamended Section 148 were deemed to have been issued under the amended provisions. It was mandated that Assessing Officers must provide material and information to the assessee within thirty days under Section 148A(b). Although the procedural requirements were complied with, the petitioner argued that the reassessment notice was issued after the limitation period for AY 2015-16 had expired on March 31, 2022.
The petitioner relied on the Supreme Court’s ruling in Union of India & Ors. Vs. Rajeev Bansal (2024 469 ITR 46), where the Court held that reassessment proceedings for AYs barred by limitation could not be pursued. The petitioner emphasized that the same principle should apply in the present case as the reassessment notice for AY 2015-16 was issued nearly four months after the limitation period. The respondents failed to distinguish the present case from the Rajeev Bansal ruling, which further bolstered the petitioner’s argument.
The Court observed that while other issues were raised in the petition, the matter could be resolved solely on the basis that the reassessment proceedings were time-barred. Concluding that the impugned notices were issued beyond the permissible timeframe, the Rajasthan High Court allowed the writ petition and quashed the reassessment proceedings for AY 2015-16.
This ruling underscores the critical importance of adhering to procedural and temporal limitations for reassessment under the amended Income Tax Act provisions. Judicial precedents like Ashish Agarwal and Rajeev Bansal play a pivotal role in determining the validity of such proceedings, reaffirming that any deviation from statutory timelines renders reassessment notices invalid.
Taxpayer was represented by Mr. Siddharth Ranka with Mr. Rohan Chatter
FULL TEXT OF THE JUDGMENT/ORDER OF RAJASTHAN HIGH COURT
1. This petition is filed seeking quashing of order dated 28.07.2022 passed under Section 148A(d) of the Income Tax Act, 1961 (for short ‘the Act’). Further prayer is for quashing of notice dated 28.07.2022 issued under Section 148 of the Act.
2. The brief facts are that the petitioner had filed returns for assessment year 2015-16 declaring income of Rs. 5,69,630/-. On 12.04.2021 notice was issued under Section 148 of the Act. The issue as to whether after Finance Act, 2021, the notice could have been issued under unamended Section 148 of the Act without following the procedure laid down under Section 148A of the Act was subject matter of challenge before the Supreme Court in the case of Union of India & Ors. Vs. Ashish Agarwal reported in 2023(1)SCC 617. It was directed that notices issued under Section 148 of the Act shall be deemed to be under Section 148A (b) and Assessing Officer shall within thirty days provide information and material to assessee. The direction of the supreme court were complied vide notice dated 26.05.2022. The objections filed by the petitioner were rejected on 28.07.2022 and the notice under Section 148 of the Act was issued. Hence, the present petition.
3. Learned counsel for the petitioner relies upon the decision of the Supreme Court in the case of Union of India & ors. Vs. Rajeev Bansal reported in (2024) 469 ITR 46.It is argued that the limitation for assessment year 2015-16 expired on 31.03.2022. Contention is that concession for dropping proceeding for assessment year 2015-16 was given by respondent before the supreme court in the case of Rajeev Bansal (supra). Argument is that for assessment year 2015-16 the limitation expired on 31.03.2022 whereas the notice under Section 148 of the Act was issued on 28.07.2022.
4. Learned counsel for the respondents submits that there are other issues raised in this petition but is not in a position to distinguish the present case from the case of Rajeev Bansal (supra).
5. The contention that there are other issues raised in this petition need not be addressed as the petition deserves acceptance on the single issue that the re-assessment for assessment year 2015-16 has been rendered time barred and impugned notices are liable to be quashed on this ground alone.
6. In view of the above, the writ petition is allowed.
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