Facts of the Case

The petitioner, Kum Kum Kohli, an individual assessee, filed a writ petition impugning the order dated 23.07.2022 passed under Section 148A(d) of the Income-tax Act, 1961 and the consequential notice dated 23.07.2022 issued under Section 148 for Assessment Year 2015–16.

The petitioner had filed her return of income for AY 2015–16 on 02.08.2016 declaring income of ₹4,50,180/-. The Assessing Officer issued a notice dated 28.06.2021 under Section 148 under the unamended reassessment regime, without following the procedure prescribed under Section 148A. Subsequently, by communication dated 25.05.2022, relying on the Supreme Court judgment in Union of India & Ors. vs. Ashish Agarwal, the said notice was treated as a notice under Section 148A(b), and certain information was supplied to the petitioner. No reply was filed by the petitioner to the said communication. Thereafter, the Assessing Officer passed the impugned order under Section 148A(d) and issued the notice dated 23.07.2022 under Section 148.

Issues Involved

Whether reassessment proceedings for Assessment Year 2015–16 initiated pursuant to notices issued on or 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 contended that the impugned proceedings were 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 within the period prescribed under the Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020. Since the impugned notice under Section 148 was issued on 23.07.2022, it was argued to be ex facie unsustainable.

Respondent’s Arguments

The Revenue did not dispute the applicability of the concession recorded in Union of India vs. Rajeev Bansal. Reliance was also placed on the subsequent judgment of the Supreme Court in Deepak Steel and Power Ltd. vs. Central Board of Direct Taxes, wherein similar reassessment notices were set aside on the basis of the same concession.

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 categorical 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 quashed.

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 23.07.2022 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/1769676677_KUMKUMKOHLIVsASSISTANTCOMMISSIONEROFINCOMETAXCIRCLE281ANR..pdf

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