ACIT Vs Bhageria Industries Limited (ITAT Mumbai)
Revenue Misses Seven-Day Window: Mumbai ITAT Quashes AY 2014-15 Reassessment as Time-Barred
In Bhageria Industries Ltd. v. ACIT, the assessee challenged the validity of reassessment for AY 2014-15 on the ground that the notice under section 148 was issued beyond the permissible limitation period.
The original notice under the old reassessment regime was issued on 23 June 2021, when only seven days remained until the extended TOLA deadline of 30 June 2021. Following the Supreme Court’s decision in Union of India v. Ashish Agarwal, the Assessing Officer issued a fresh notice under section 148A(b) on 25 May 2022 and granted two weeks to respond. The assessee submitted its reply on 7 June 2022.
Applying the limitation computation laid down by the Supreme Court in Union of India v. Rajeev Bansal, the Tribunal held that after excluding the response period, the Revenue had only the surviving seven-day period to issue the reassessment notice. Accordingly, the last permissible date was 15 June 2022.
However, the order under section 148A(d) and the consequential notice under section 148 were issued only on 20 July 2022, well beyond the surviving limitation period.
The Mumbai ITAT therefore quashed the notice under section 148 and the consequential reassessment as time-barred and invalid. Since the assessment itself was annulled, the Revenue’s appeal on the merits became infructuous.
List of Cases Discussed / Relied Upon
- Bhageria Industries Ltd. v. ACIT
- Union of India v. Rajeev Bansal, reported in 469 ITR 46 (SC)
- Union of India v. Ashish Agarwal, [2022] 444 ITR 1 (SC)
- ACIT vs. Ramchand Thakurdas Jhamtani, reported in (2025) 174 taxmann.com 783 (Mumbai-Trib.)
FULL TEXT OF THE ORDER OF ITAT MUMBAI
This appeal and cross-objection are filed by the Revenue and assessee, respectively, against the order of the learned Commissioner of Income Tax (Appeals)-NFAC, Delhi, [ “Ld. CIT(A)” ], dated 24.11.2025 for the assessment year 2014-15.
2. The cross-objection was filed by the assessee challenging the very validity of the assessment on the ground that the same is barred by limitation in view of the decision of the Hon’ble Supreme Court in the case of Union of India vs. Rajeev Bansal, reported in 469 ITR 46 (SC).
3. Since the assessee has challenged the very validity of the issue of notice u/s 148 of the Act and the consequential assessment as time-barred and bad in law in view of the decision of the Hon’ble Supreme Court in the case of Union of India vs. Rajeev Bansal (supra), we first proceed to dispose off the cross-objection filed by the assessee.
4. Learned counsel for the assessee submitted that originally the notice was issued on 23.06.2021 u/s 148 of the Act under the pre-amended regime and this was validated by virtue of the decision of Union of India v. Ashish Agarwal, [2022] 444 ITR 1 (SC). Subsequently, a notice was issued u/s 148A(b) of the Act on 25.05.2022, granting two weeks’ time to furnish the reply. Learned counsel submitted that the reply was filed by the assessee on 07.06.2022 and after allowing a surviving period of 7 days, the last permissible date for issue of notice u/s 148 of the Act was 15.06.2022. However, the notice u/s 148A(d) of the Act was issued on 20.07.2022, which is placed at page 6 of the paper book. Therefore, the proceedings are barred by limitation by virtue of the decision of the Hon’ble Supreme Court in the case of Union of India vs. Rajiv Bansal (supra). Consequently, the assessment framed pursuant to such time-barred notice is also bad in law. The Ld. Counsel also placed reliance on the decision of the Coordinate Bench of the Mumbai Tribunal in the case of ACIT vs. Ramchand Thakurdas Jhamtani, reported in (2025) 174 taxmann.com 783 (Mumbai-Trib.).
5. Learned DR supported the orders of the authorities below.
6. Heard rival contentions and perused the orders of the authorities below. We have perused the material placed before us in the form of paper book. The sequence of events are as under:
| Sr No. | Particulars | Date / Period |
|---|---|---|
| 1. | Date of First Notice issued U/s. 148 under old. Pre- amended regime | 23.06.2021 |
| 2. | Extended limitation period as per TOLA (Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act,2020) | 30.06.2021 |
| 3. | Surviving / balance time available to Revenue (i.e., time remaining in the original limitation period as on the date of extension) From 23.06.2021 to 30.06.2021 | 7 days |
| 4. | Ashish Agarwal Decision on 04.05.2022 | |
| 5. | Date of notice u/s 148A(b) issued under the new regime | 25.05.2022 |
| 6. | Time granted to assessee to file reply | 2 Weeks |
| 7. | Reply filed by assessee | 07.06.2022 |
| 8. | Last permissible date for issuance of notice u/s 148 under the new regime considering the surviving time of 7 days | 15.06.2022 |
| 9. | Date of order u/s 148A(d) passed by the Assessing Officer and notice u/s 148 on | 20.07.2022 i.e. after surveying period (15.06.2022) |
7. The dates mentioned in the above table are matching with the notices issued u/s 148/148A(b)/148A(d) of the Act. Therefore, the final order passed u/s 148A(d) of the Act and the notice issued u/s 148 are beyond the surviving period as specified in the judgment of the Hon’ble Supreme Court in the case of Union of India vs. Rajeev Bansal, (supra)
8. Thus, respectfully following the said decision, we quash the notice issued u/s 148 and the consequential assessment framed for the assessment year 2014-15 based on such notice as bad in law. The cross-objection filed by the assessee is allowed.
9. Since the reassessment framed pursuant to the notice issued u/s 148 of the Act is quashed, the appeal of the Revenue against the order passed by the learned CIT(A) on merits becomes infructuous.
10. In the result, the cross-objection filed by the assessee is allowed and the appeal filed by the Revenue is dismissed as infructuous.
Order pronounced in the open court on 21/08/2026
