Case Note & Summary
The present petition under Article 226 of the Constitution of India was filed by the assessee challenging a reassessment notice under Section 148 of the Income Tax Act, 1961 dated 25.08.2022 and the order under Section 148A(d) dated 17.08.2022 for Assessment Year 2016-2017 on the ground that the notice was time-barred. The original notice under Section 148 was issued on 30.06.2021 during the extended period as per the Taxation and Other Laws (Relaxation of Certain Provisions) Ordinance, 2020. Following the Supreme Court decision in Union of India v. Ashish Agarwal, this notice was deemed a show-cause notice under Section 148A(b). Pursuant to the directions in Ashish Agarwal, the Assessing Officer provided relevant information to the assessee on 24.05.2022. The petitioner filed a reply on 13.06.2022. The order under Section 148A(d) was passed on 17.08.2022 and intimation of notice under Section 148 was issued on 25.08.2022. Applying the law laid down by the Supreme Court in Union of India v. Rajeev Bansal, the surviving time for issuance of the reassessment notice under the new regime, computed from the date of original notice (30.06.2021) to 30.06.2021 and the procedural timeline, expired on 20.06.2022. The notice was issued after that date. The High Court, relying on its earlier decision in Dhanraj Govindram Kella v. Income Tax Officer and the principles set out in Rajeev Bansal, held that any notice issued beyond the surviving time is time-barred and invalid. The court found that the respondent could not controvert the computation. Accordingly, the impugned order dated 17.08.2022 and notice dated 25.08.2022 were quashed along with all consequential proceedings. The rule was made absolute with no order as to costs.
Headnote
A) Income Tax - Reassessment - Validity of Notice Issued After Surviving Time - Income Tax Act, 1961, Sections 148, 148A(d); Taxation and Other Laws (Relaxation of Certain Provisions) Ordinance, 2020, Section 3(1) - Reassessment notice issued on 25.08.2022 for AY 2016-2017, following deeming of earlier notice under old regime as Section 148A(b) notice - Surviving time expired on 20.06.2022 - Notice issued beyond surviving time held invalid and set aside along with consequential proceedings - Held: Notice is time-barred. (Paras 7-10)
Issue of Consideration
Whether the reassessment notice under Section 148 of the Income Tax Act, 1961 issued on 25.08.2022 is beyond the surviving time limit and thus invalid and time-barred.
Final Decision
The impugned order dated 17.08.2022 and notice dated 25.08.2022 are quashed and set aside, and all consequential proceedings are also quashed and set aside. Rule is made absolute.
Law Points
- Notice issued under old regime between 01.04.2021 and 30.06.2021 deemed as Section 148A(b) notice
- reassessment notice under Section 148 under new regime must be issued within surviving time
- notice issued beyond surviving time is time-barred and invalid
Case Details
2026 LawText (GUJ) (03) 515
R/Special Civil Application No. 20749 of 2022
A.S. Supehia, Pranav Trivedi
Dhinal A Shah (for the petitioner), Aaditya D Bhatt (for the respondent)
Deputy Commissioner of Income Tax, Circle 3(1)(1), Ahmedabad
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Nature of Litigation
Writ petition under Article 226 of the Constitution of India challenging the reassessment notice under Section 148 of the Income Tax Act, 1961 as time-barred.
Remedy Sought
The petitioner sought quashing of the notice under Section 148 dated 25.08.2022 and the order under Section 148A(d) dated 17.08.2022.
Filing Reason
The notice was issued beyond the surviving time limit as per the Supreme Court decisions in Ashish Agarwal and Rajeev Bansal.
Previous Decisions
The original notice under old regime issued on 30.06.2021 was deemed a show-cause notice under Section 148A(b) by the Ashish Agarwal decision, and the Assessing Officer had passed an order under Section 148A(d) on 17.08.2022.
Issues
Whether the reassessment notice under Section 148 of the Income Tax Act, 1961 issued on 25.08.2022 is beyond the surviving time limit and thus invalid.
Submissions/Arguments
The petitioner argued that the notice is time-barred and invalid as per the decision in Rajeev Bansal.
The respondent's counsel verified the dates and could not controvert the computation of the surviving time.
Ratio Decidendi
A reassessment notice under Section 148 of the Income Tax Act, 1961, issued pursuant to the procedure laid down in Ashish Agarwal, must be issued within the surviving time, i.e., the time limit remaining from the date of issuance of the original notice under the old regime until 30.06.2021; notices issued beyond that period are time-barred and invalid.
Judgment Excerpts
The impugned notice dated 25.08.2022 (only intimation was issued, but notice was not serve) under Section 148 of the Act be invalid notice as the said notice is issued after 20.06.2022 as per the decision of Hon’ble Apex Court in case of Ashish Agarwal (supra). (Para 9)
In view of foregoing reasons, impugned order dated 17.08.2022 and notice dated 25.08.2022 is hereby quashed and set aside and all consequential proceedings are also quashed and set aside. Rule is made absolute. (Para 10)
All notices issued beyond the surviving period are time barred and liable to be set aside. (Para 9 quoting Rajeev Bansal, (2024) 469 ITR 46 (SC), para 114(h))
Procedural History
The original notice under Section 148 was issued on 30.06.2021 for AY 2016-2017 under the old regime as per TOLA. Following the Ashish Agarwal decision, this notice was deemed as a show-cause notice under Section 148A(b). The Assessing Officer provided relevant information to the assessee on 24.05.2022. The petitioner filed a reply on 13.06.2022. The order under Section 148A(d) was passed on 17.08.2022. Intimation of notice under Section 148 was issued on 25.08.2022. The petitioner filed the present writ petition challenging the order and notice. The High Court allowed the petition on 03.03.2026, quashing the order and notice.
Acts & Sections
- Income Tax Act, 1961: 148, 148A(b), 148A(d)
- Taxation and Other Laws (Relaxation of Certain Provisions) Ordinance, 2020: 3(1)
- Constitution of India: 226
