Facts of the Case

The petitioner, Chandra Prakash Srivastava, ex-director of Aten Portfolio Managers Private Limited (now dissolved), filed a writ petition challenging the order dated 28.07.2022 passed under Section 148A(d) of the Income-tax Act, 1961 and the consequential notice dated 28.07.2022 issued under Section 148 for Assessment Year 2015–16.

The return of income for AY 2015–16 had been filed on 30.09.2015 declaring a loss. The Assessing Officer initially issued a notice dated 28.06.2021 under Section 148 under the unamended reassessment regime, without following the procedure prescribed under Section 148A. Subsequently, relying on the Supreme Court decision in Union of India vs. Ashish Agarwal, the said notice was treated as a notice under Section 148A(b), and information was furnished to the petitioner by communication dated 25.05.2022. The petitioner submitted a reply on 06.06.2022, following which the impugned order and notice dated 28.07.2022 were issued.

Issues Involved

Whether reassessment proceedings for Assessment Year 2015–16 initiated pursuant to notices issued after 1 April 2021 were liable to be dropped in view of the concession made by the Revenue before the Supreme Court in Union of India vs. Rajeev Bansal, and whether the impugned notice under Section 148 could be sustained in law.

Petitioner’s Arguments

The petitioner submitted that the controversy was squarely covered by the concession recorded by the Supreme Court in Union of India vs. Rajeev Bansal, wherein the Revenue conceded that for Assessment Year 2015–16, all notices issued on or after 1 April 2021 would have to be dropped as they would not fall for completion during the period prescribed under the Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020. It was argued that since the impugned notice was issued on 28.07.2022, it was ex facie unsustainable.

Respondent’s Arguments

The Revenue did not dispute the applicability of the concession recorded in Union of India vs. Rajeev Bansal. The Court also noted the subsequent decision of the Supreme Court in Deepak Steel and Power Ltd. vs. Central Board of Direct Taxes, wherein the same concession was applied to allow appeals arising from similar reassessment notices.

Court Order / Findings

The Delhi High Court referred to paragraphs 19(e) and 19(f) of the Supreme Court decision in Union of India vs. Rajeev Bansal, recording the clear concession by the Revenue that for Assessment Year 2015–16, all notices issued on or after 1 April 2021 were liable to be dropped. The Court further relied on the Supreme Court’s decision in Deepak Steel and Power Ltd., where reassessment notices issued after the cut-off date were set aside on the same ground.

The Court observed that the issue was also covered by its own decision in MakeMyTrip India Pvt. Ltd. vs. Deputy Commissioner of Income Tax, Circle 16(1), Delhi & Anr. In view of the settled legal position, the Court held that the impugned notice and proceedings could not be sustained.

Important Clarification

The Court clarified that once the Revenue has conceded before the Supreme Court that reassessment notices for a particular assessment year issued after a specified date are liable to be dropped, such concession is binding and must be uniformly applied by all authorities and courts without reopening the issue on merits.

Final Outcome

The writ petition was allowed. The Delhi High Court quashed the impugned notice dated 28.07.2022 issued under Section 148 of the Income-tax Act, 1961 for Assessment Year 2015–16 and set aside all proceedings initiated pursuant thereto. All pending applications were disposed of accordingly.

Link to download the order - https://www.mytaxexpert.co.in/uploads/1769676453_CHANDRAPRAKASHSRIVASTAVAEXDIRECTOROFATENPORTFOLIOMANAGERSPRIVATELIMITEDNOWDISSOLVEDVsINCOMETAXOFFICERWARD11DELHIORS..pdf

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