DCIT Vs Vinay Agrawal (ITAT Raipur)
Income Tax Appellate Tribunal (ITAT), Raipur Bench, has set aside reassessment orders against individual assessee Vinay Agrawal for the assessment years 2014-15 and 2015-16. The tribunal’s decision, issued on cross-appeals from the revenue and cross-objections by the assessee, hinged primarily on the finding that the reassessment notices issued under Section 148 of the Income Tax Act, 1961, were beyond the statutory period of limitation.
The case for Assessment Year 2014-15, serving as the lead case, stemmed from information indicating that Vinay Agrawal had engaged in alleged “bogus purchases” amounting to Rs. 91,37,500. The Assessing Officer (AO) initiated reassessment proceedings, initially issuing a notice under Section 148 of the ‘old regime’ on June 9, 2021.
However, the legal landscape for reassessment underwent a significant change with the introduction of the new reassessment regime by the Finance Act, 2021, effective April 1, 2021. This led to a period of uncertainty regarding notices issued during the transition. The Supreme Court of India, in its landmark judgment Union of India & Ors. vs. Ashish Agarwal (2022) 444 ITR 1 (SC), addressed this by directing that all notices issued under the old Section 148 between April 1, 2021, and June 30, 2021, should be treated as show-cause notices under Section 148A(b) of the new regime. The Apex Court further stipulated that assessing officers must provide the assessee with relevant information within 30 days and allow two weeks for a response, before proceeding with an order under Section 148A(d) and a fresh notice under Section 148.
