Case Note & Summary
The petitioner, Kartik Sureshchandra Gandhi, a businessman, filed a writ petition under Article 226 of the Constitution of India before the Bombay High Court challenging a reassessment notice dated 12th April 2023 issued under Section 148 of the Income Tax Act, 1961 for Assessment Year 2019-2020, along with the order passed under Section 148A(d) of the Act. The petitioner contended that the notice was wholly without jurisdiction as it did not meet the requirements of law, particularly the limitation period prescribed under Section 149 of the Act. The court examined the provisions of Sections 148, 148A, 149, and 151 of the Income Tax Act. The court noted that for Assessment Year 2019-2020, the time limit for issuing a reassessment notice under Section 149(1)(b) expired on 31st March 2023 (four years from the end of the relevant assessment year). The notice was issued on 12th April 2023, which was beyond the prescribed period. The court also observed that the conditions for invoking the extended period of limitation (e.g., escaped income of Rs. 50 lakhs or more) were not satisfied or properly recorded. Additionally, the court found that the sanction under Section 151 was not properly granted. Consequently, the court held that the reassessment notice was without jurisdiction and liable to be quashed. The petition was allowed, and the impugned notice and order were set aside.
Headnote
A) Income Tax - Reassessment - Limitation - Section 148, 149, 151 of Income Tax Act, 1961 - Notice issued beyond four-year limitation period from end of relevant assessment year without satisfying conditions for extended period - Held that reassessment notice for AY 2019-2020 issued on 12.04.2023 is beyond the time limit prescribed under Section 149(1)(b) and therefore without jurisdiction (Paras 2-5). B) Income Tax - Reassessment - Sanction - Section 151 of Income Tax Act, 1961 - Sanction for issuance of notice under Section 148 must be granted by specified authority based on material on record - Held that in absence of proper sanction, the notice is invalid (Para 4).
Issue of Consideration
Whether the reassessment notice dated 12th April 2023 for Assessment Year 2019-2020 issued under Section 148 of the Income Tax Act, 1961 is barred by limitation and without jurisdiction
Final Decision
The petition is allowed. The reassessment notice dated 12th April 2023 under Section 148 of the Income Tax Act, 1961 and the order under Section 148A(d) of the Act are quashed and set aside. Rule made absolute.
Law Points
- Reassessment notice under Section 148 of Income Tax Act
- 1961 must be issued within time limit prescribed under Section 149
- proper sanction under Section 151 is mandatory
- notice issued beyond limitation period is without jurisdiction
