The main legal point established in the judgment is that the amended provisions of the Income Tax Act, specifically relating to the time limit for issuing notices and the scope of reassessment proceedings, were correctly interpreted and applied by the court.

JUDGMENT :

Deepak Roshan, J.

Both these writ applications have been preferred for the same and similar reliefs i.e., praying therein for quashing and setting aside the Notice bearing ITBA/AST/S/148_1/2022-23/1051809259(1) dated 31.03.2023 & ITBA/AST/S/148_1/2022-23/1051808276(1) dated 31.03.2023, respectively in case of respective petitioners issued by the respondent no.2 under Section 148 of the Income Tax Act, 1961 for A.Y. 2013-14, on the ground of being illegal and beyond jurisdiction inter alia for the reason that the same is beyond the limitation prescribed under Section 149 of the Income Tax Act, (hereinafter to be referred as ‘the Act’).

2. Since both these writ applications involves common question of law as such both are heard together and disposed of by this common order.

3. The brief fact of the case is that Mr. Naresh Kumar Kejriwal, the Petitioner in W.P. (T) No. 2651/2023 is an individual and chartered accountant by profession.

Devika Constructions Pvt. Ltd., the Petitioner in W.P. (T) 2650/2023, is a company registered under the Companies Act, 1956 and is engaged primarily in the construction and development of residential flats, commercial establishments and schools.

The genesis of the present dispute relates to issuance of notice dated 31.03.2023 to the respective Assessees issued under section 148 of the Act by the Respondent. The basis of issuance of the aforesaid notices was stated to be search and seizure operations conducted on the business premises of Mr. Naresh Kumar Kejriwal on 09.06.2022. Pertinently, Devika Constructions was only subjected to survey under section 133A of the Act.

Thus, in both these writ applications the petitioners have challenged the jurisdiction for issuance of notice under Section 148 of the Act.

4. Ms. Kavita Jha, learned counsel assisted by Ms. Lavanya Gadodia appearing for the Assessee in both these writ applications made following submissions: -

(i) The legislative intent behind introduction of Finance Act, 2021 was to reduce the time limit in ordinary cases to three years and to increase the threshold amount of income having escaped assessment to Rs.50 lakhs for invoking extended time limit of ten years was to reduce litigation and compliance burden, remove discretion, impart certainty and promote ease of doing business.

(ii) The Grandfathering clause in the form of Proviso, incorporated in section 149 of the Act, is in built safeguard to put quietus to those assessment years which had already become time-barred prior to introduction of Financial Amendment.

(iii) Pursuant to introduction of Finance Act, 2021, section 153A/153C was no longer applicable in cases where search had been conducted on or after 01.04.2021, and the same is to be governed by the provisions of section 147/148 of the Act.

(iv) Subsequent retrospective amendment to section 149 of the Act by way of Finance Act 2022, cannot revive the period of limitation that has already lapsed, pursuant to introduction of Finance Act, 2021.

(v) The respective impugned notices issued under Section 148 of the Act involved in both these writ applications have been issued by the respondent on factually incorrect premise rendering the impugned reassessment proceeding beyond the jurisdiction as the mandatory provision has not been followed.

(vi) The impugned reassessment proceedings are time barred by limitation in terms of Section 149 of the Act.

(vii) The extended time limit under Section 149(1)(b) is not applicable in the present case, since, the allegation, if at all, on the basis of so-called information, does not result in any income escaping assessment in a hand of respective petitioners represented in the form of any “ASSET”.

Relying upon the aforesaid grounds and several provisions of the Act, learned counsel submits that the respective notices involved in both the writ applications should be quashed and set aside as it is time barred. In support of her contentions, learned counsel relied upon following decisions:-

(a) S.S. Gadgil v