ACT-19(3) Vs Sahjanand Diamonds (ITAT Mumbai)
In a case before the Mumbai Bench of the Income Tax Appellate Tribunal (ITAT), the Revenue challenged the order of the Commissioner of Income Tax (Appeals) [CIT(A)] for Assessment Year 2013-14, while the assessee filed a cross objection contesting the validity of reassessment proceedings initiated under Sections 147 and 148 of the Income-tax Act, 1961.
The Revenue argued that the reassessment notice issued on 07.06.2021 was not barred by limitation because the limitation period stood extended under the Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020 (TOLA) during the COVID-19 pandemic. It further contended that the Supreme Court’s ruling in the case of Union of India v. Ashish Agarwal (2022) preserved such reassessment notices as show-cause notices under Section 148A(b), and that reassessment could validly continue under the amended provisions. The Revenue also submitted that the escaped income exceeded Rs.50 lakh, thereby attracting the extended ten-year reassessment period under amended Section 149(1)(b).
The assessee, through its cross objection, argued that the reassessment proceedings were barred by limitation because the original assessment under Section 143(3) had already been completed on 28.01.2016 and there was no allegation by the Assessing Officer (AO) that the assessee had failed to fully and truly disclose all material facts necessary for assessment. The assessee also challenged the validity of the notices issued under Section 148 on 07.06.2021 and 24.07.2022, contending that both notices were time-barred. Additional objections were raised on the grounds that the notice dated 24.07.2022 did not contain a Document Identification Number (DIN) and was issued by the Jurisdictional Assessing Officer instead of the Faceless Assessing Officer.
