Lombard Portfolio Pvt. Ltd. Vs DCIT (ITAT Delhi)
148 Notice Beyond 7-Day Grace Period Void: ITAT Delhi Quashes Reassessment- Reopening Hit by Limitation – Tribunal Follows SC Ashish Agarwal Ruling to Strike Down 148 Notice- Jurisdictional Defect: ITAT Delhi Quashes ₹62.5 Lakh Addition in Reassessment
Lombard Portfolio Pvt. Ltd. filed appeal before Tribunal against NFAC order arising from reassessment framed u/s 147 r.w.s. 144B for AY 2013-14.
AO reopened case based on information that Assessee was engaged in providing accommodation entries through shell companies & added ₹62,50,000 as unexplained credit u/s 68 r.w.s. 115BBE. CIT(A) upheld the addition.
Before Tribunal, Assessee argued that reassessment itself was void since notice u/s 148 dated 30.07.2022 was issued beyond limitation prescribed under SC ruling in Union of India Vs Ashish Agarwal (CA No.3005/2022, dated 04.05.2022). As per law laid down, fresh notice u/s 148 had to be issued within 7 days from filing of reply to notice u/s 148A(b) dated 02.06.2022. Assessee had filed reply on 27.06.2022, making 04.07.2022 the last permissible date. However, notice was issued only on 30.07.2022.
Tribunal held that limitation under amended law is mandatory & delay is fatal. Since notice u/s 148 was beyond 7-day grace period, it was void & without jurisdiction. Consequently, reassessment proceedings & addition of ₹62,50,000 were quashed. Appeal of Assessee was allowed.
