High Court Quashes Notice and Orders under Section 148 as Time-barred

The petition was directed against the reassessment proceedings initiated for AY 2015-16 through notice dated 06.04.2022 issued under Section 148, order dated 06.04.2022 under Section 148A(d), and an assessment order dated 04.03.2024 passed under Section 147 read with Section 144B. The challenge rested on the ground that these actions were barred by limitation in view of the amended statutory framework, the extended timelines under the Taxation and Other Laws (Relaxation of Certain Provisions) Act, and the authoritative pronouncements of the Supreme Court. It was pointed out that the substituted provisions of Sections 147-151 imposed clear restrictions on initiation of reassessment, and that any proceedings commenced after 01.04.2021 for AY 2015-16 could not be sustained.

Issue Raised: Whether reassessment proceedings initiated under AY 2015-16 by notice dated 06.04.2022 and consequential orders were tenable in law when put to test on limitation under TOLA and rulings of the Supreme Court.

HC’s Ruling: The Court noted that the binding order of the Supreme Court in Rajeev Bansal explained the stand that, for AY 2015-16, reassessment notices dated on or after 01.04.2021 were not legally valid even after taking the benefit of TOLA extensions. Following this rule, the Court ruled that the notice given on 06.04.2022 under Section 148, the order passed on 06.04.2022 under Section 148A(d), and the consequential assessment order passed on 04.03.2024 were all barred by limitation and hence, without authority of law.
Therefore, the writ petition was granted. The orders and the impugned notice were quashed, as well as all pending applications disposed of. The Court therefore held that reassessment proceedings are required to strictly follow the statutory timelines and cannot subsist if issued beyond the time period identified in law.

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