IL & FS Pradip Refinery Water Ltd. Vs DCIT (ITAT Chennai)
Summary: The assessee, a company, challenged the order of the CIT(A)/NFAC, Delhi dated 23.05.2025 for AY 2015-16. It had filed its return on 30.11.2015 declaring a loss of Rs. 103,10,24,166/-. After scrutiny assessment under section 143(3), the Assessing Officer issued a notice under section 148 dated 17.06.2021. Following the directions of the Hon’ble Supreme Court in Union of India vs. Ashish Agarwal, a notice under section 148A(b) was issued on 24.05.2022, followed by an order under section 148A(d) dated 29.07.2022 and a fresh notice under section 148 dated 31.07.2022. The reassessment under section 147 determined income at Rs. 12,35,53,260/-, against which the CIT(A) granted partial relief. The assessee contended that the 31.07.2022 notice was beyond the six-year limitation applicable under the unamended section 149(1), relying principally on the Supreme Court’s decision in Union of India vs. Rajeev Bansal. The Revenue argued that the reassessment was within limitation by applying TOLA and excluding the period arising from the Supreme Court’s directions in Ashish Agarwal, also relying on D. Tamilselvi v. ITO. The Tribunal examined the limitation framework under section 149 and the authorities cited. It noted that for AY 2015-16 the six-year limitation under the unamended section 149 expired on 31.03.2022 and that TOLA was not applicable. It further noted the Revenue’s concession recorded in Rajeev Bansal that notices for AY 2015-16 issued on or after 01.04.2021 would have to be dropped, as well as the subsequent reiteration of that position in ACIT vs. Nehal Ashit Shah, Deepak Steel and Power Ltd. vs. CBDT and ITO vs. Shri Sai Kumar Mateti. The Tribunal held that the deemed-stay period arising from Ashish Agarwal could not enlarge the statutory limitation applicable to AY 2015-16. Accordingly, it held that the notice under section 148 dated 31.07.2022 was barred by limitation, rendering the consequential reassessment proceedings and reassessment order bad in law and liable to be quashed. The assessee’s appeal was therefore allowed. The order was pronounced on 19.08.2026 at Chennai.
