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2025 Supreme(Online)(Mad) 76747
IN THE HIGH COURT OF JUDICATURE AT MADRAS
C. Saravanan, J
Nataraja Gounder Kanakasabapathy – Appellant
Versus
Deputy Commissioner of Income Tax – Respondent
W.P.No.23842 of 2022
Important Points
Subject
Taxation Law - Income Tax Reassessment
Act Referred
Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020: S.3
Constitution of India: Art.226
Headnote
Facts of the case:
The petitioner challenged an order passed under Section 148A(d) and a notice issued under Section 148, both dated 29.07.2022, regarding the assessment year 2013-14. The petitioner claimed the reassessment initiation was procedurally and temporally flawed under the new income tax regime effective from 01.04.2021.
Findings of Court:
The court observed that the reassessment proceedings were within the statutory limitation period after accounting for extensions granted under TOLA 2020 and the exclusion of time for procedural compliance as per the Supreme Court guidelines. The court remanded the matter back for a fresh order, providing the petitioner an opportunity to file a reply to the initial show-cause notice within 14 days.
Issues: Whether the reassessment notice issued under the new regime for the Assessment Year 2013-14 was time-barred, and whether the respondent followed the procedural mandates regarding show-cause notices as established in judicial precedents.
Ratio Decidendi: Notices issued under the old regime of the Income Tax Act between 01.04.2021 and 30.06.2021 are deemed as show-cause notices under Section 148A(b) of the new regime. The limitation for issuance of reassessment notices is extended by TOLA 2020, and time spent on procedural compliance should be excluded from limitation calculations. Result : Writ petition disposed of by remitting the matter to the respondent for fresh determination upon the petitioner filing a reply.
For the Appellants/Petitioners: T.Vasudevan
For the Respondents: B.Ramasamy
| Table of Content |
|---|
| 1. challenge to reassessment proceedings under section 148/148a. (Para 1 , 2) |
| 2. application of supreme court guidelines in ashish agarwal and rajeev bansal. (Para 3 , 4 , 5 , 6 , 7 , 8) |
| 3. limitation calculation under the new regime and tola 2020. (Para 9 , 10 , 11 , 12 , 13 , 14 , 15 , 16) |
| 4. analysis of statutory limitation timelines for reassessment. (Para 17 , 18 , 19 , 20 , 21 , 22 , 23) |
| 5. procedural compliance for passing orders under section 148a(d). (Para 24 , 25 , 26 , 27 , 28) |
| 6. remand of proceedings to the assessing officer for fresh determination. (Para 29 , 30 , 31 , 32 , 33) |
Prayer: Writ Petition filed under Article 226 of the Constitution of India, praying for the issuance of a direction in the nature of Writ of Certiorari, calling for the records of the respondent in DIN & Order No.ITBA/COM/F/17/2022-23/1044267746(1) dated 29.07.2022 for the Assessment Year 2013-14 and quash the same and pass such further orders.
O R D E R
In this Writ Petition, the Petitioner has challenged the Order dated 29.07.2022 passed by the respondent under Section 148A (d) of the Act under the regime and the Notice dated 29.07.2022 issued by the respondent under Section 148 of the Act under the new regime for the Assessment Year 2013 - 2014.
2. Heard Mr. T.Vasudevan, learned counsel for the Petitioner and Dr.B.Ramasamy, learned Senior Standing Counsel for the Respondents.
3. Have perused the documents and the list of dates and events qua Paragraph No.28 from the decision of the Hon’ble Supreme Court in Union of India Vs. Ashish Agarwal , (2023) 1 SCC 617 and Paragraph Nos.112 and 114 from the decision of the Hon’ble Supreme Court in Union of India Vs. Rajeev Bansal , 2024 SCC Online SC 2993.
4. It will therefore be useful to refer to passage from Paragraph No.28 from Ashish Agarwal case (cited supra) and Paragraph Nos.112 and 114 from Rajeev Bansal case (cited supra).
5. For the sake of clarity, Paragraph No.28 from Ashish Agarwal case (cited supra) is reproduced below:-
“28. In view of the above and for the reasons stated above, the present Appeals are allowed in part. The impugned common judgments and orders passed by the High Court of Judicature at Allahabad in W.T. No. 524/2021 and other allied tax appeals/petitions, is/are hereby modified and substituted as under:
(i) The impugned section 148 notices issued to the respective assessees which were issued under unamended section 148 of the IT Act, which were the subject matter of writ petitions before the various respective High Courts shall be deemed to have been issued under section 148A of the IT Act as substituted by the Finance Act, 2021 and construed or treated to be show cause notices in terms of section 148A(b). The assessing officer shall, within thirty days from today provide to the respective assessees information and material relied upon by the Revenue, so that the assessees can reply to the show cause notices within two weeks thereafter;
(ii) The requirement of conducting any enquiry, if required, with the prior approval of specified authority under section 148A(a) is hereby dispensed with as a onetime measure visàvis those notices which have been issued under section 148 of the unamended Act from 01.04.2021 till date, including those which have been quashed by the High Courts. Even otherwise as observed hereinabove holding any enquiry with the prior approval of specified authority is not mandatory but it is for the concerned Assessing Officers to hold any enquiry, if required;
(iii) The assessing officers shall thereafter pass orders in terms of section 148A(d) in respect of each of the concerned assessees; Thereafter after following the procedure as required under section 148A may issue notice under section 148 (as substituted);
(iv) All defences which may be available to the assesses including those available under section 149 of the IT Act and all rights and contentions which may be available to the concerned assessees and Revenue under the Finance Act,
