Facts of the Case

The petitioner, Banyan Capital Advisors LLP, filed a writ petition challenging the original notice dated 30.06.2021 issued under Section 148, the subsequent order dated 30.06.2022 passed under Section 148A(d), and the fresh notice dated 30.06.2022 issued under Section 148 of the Income-tax Act, 1961, all pertaining to Assessment Year 2015–16. The primary challenge was that the reassessment proceedings were barred by limitation under Section 149 and that the Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020 (TOLA) did not extend limitation for AY 2015–16.

Issues Involved

Whether reassessment notices issued under Section 148 for Assessment Year 2015–16 after 01.04.2021 were barred by limitation under Section 149, whether TOLA was applicable to extend the limitation period for such reassessment, and whether the impugned notices and proceedings were liable to be set aside.

Petitioner’s Arguments

The petitioner contended that the issue was squarely covered by the judgment of the Supreme Court in Union of India vs. Rajeev Bansal and by subsequent Delhi High Court decisions including MakeMyTrip India Private Limited and Ibibo Group Private Limited. It was argued that for AY 2015–16, the Revenue had conceded before the Supreme Court that TOLA was not applicable and that all reassessment notices issued on or after 01.04.2021 were liable to be dropped as time-barred. Since the impugned notice dated 30.06.2022 was clearly beyond limitation, the entire proceedings were void.

Respondent’s Arguments

The Revenue did not dispute the applicability of the judgment in Rajeev Bansal as followed by the Delhi High Court in MakeMyTrip India Private Limited. It was fairly conceded that if the said judgments applied, the impugned reassessment notice could not be sustained.

Court Order / Findings

The Delhi High Court noted that the impugned notice under Section 148 dated 30.06.2022 was admittedly issued beyond the limitation period prescribed under Section 149(1) of the Income-tax Act, 1961. The Court relied upon the Supreme Court’s decision in Rajeev Bansal, wherein the Revenue had conceded that TOLA was not applicable for reopening assessments for AY 2015–16, and upon subsequent Delhi High Court decisions consistently following the said position. The Court held that since TOLA did not apply, the impugned notice was clearly time-barred and liable to be set aside.

Important Clarification

The Court clarified that for Assessment Year 2015–16, all reassessment notices issued on or after 01.04.2021 are barred by limitation, as the benefit of TOLA is unavailable. Where the issue stands conclusively settled by the Supreme Court and followed by the jurisdictional High Court, reassessment proceedings cannot be sustained.

Final Outcome

The writ petition was allowed. The impugned notice issued under Section 148 dated 30.06.2022, the order passed under Section 148A(d), and all proceedings emanating therefrom were set aside. The petition along with pending applications, if any, was disposed of in favour of the petitioner and against the Revenue.

 

Link to Download Order- https://www.mytaxexpert.co.in/uploads/1769594606_BANYANCAPITALADVISORSLLPVsINCOMETAXOFFICERWARD42DELHI.pdf

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