Genpact India Private Limited Vs ACIT (Delhi High Court)
Conclusion: The action for reassessment which was commenced pursuant to the Section 148A(b) notice dated 27 May 2022 could not be countenanced and was liable to be quashed as there were no reasons underlying the formation of opinion that income had escaped assessment. Moreover, reassessment action infracting the First Proviso to Section 149(1) and being barred by the prescription of limitation which applied
Held: Assessee-company was engaged in the business of providing a host of business process outsourcing services, data modelling and analytics support, managed IT services, software solutions and e-learning. Assessee challenged the reassessment action infracting the First Proviso to Section 149(1) and being barred by the prescription of limitation which applied. A reassessment action for AY 2015-16 could have been initiated only up to 31 March 2022. It was thus contended that the action for reassessment which was commenced pursuant to the Section 148A(b) notice dated 27 May 2022 could not be countenanced and was liable to be quashed. It was held that although assessee had while responding to the original Section 148 notice dated 30 June 2021 alluded to the amended statutory regime which had come into existence and had placed AO on notice of an obligation to follow the procedure as prescribed under Section 148A, however, no legal challenge seeking to impugn the action commenced by virtue of the notice dated 30 June 2021 was ever instituted. The reassessment action also did not come to be interdicted by any order or injunction passed by a court. This was, therefore, clearly not a case where the substitution of original notices was one which Ashish Agarwal had provisioned for in respect of notices which had been impugned before various High Courts and had come to be quashed. No fetter operated upon AO to take remedial steps and follow or adopt the procedure as prescribed by Section 148A prior to 31 March 2022. This aspect assumed added significance in light of assessee itself having drawn the respondents attention to the amended procedure for reassessment. Thus, even though the AO was duly apprised and placed on notice of the aforesaid aspects, it failed to take any corrective action. Assessee had merely asserted that the notice of 30 June 2021 was liable to be withdrawn as opposed to being placed in abeyance. In fact in case the notice of 30 June 2021 was proposed to be proceeded with, they should be provided the reasons underlying the formation of opinion that income had escaped assessment. It had also furnished a return pursuant to that notice. Accordingly, the impugned notice referable to Section 148A(b), order under Section 148A(d), notice referable to Section 148 and all consequential proceedings thereto was quashed.
