Cognyte Technologies Israel Limited v. Assistant Commissioner Of Income Tax & Ors

$~40 *IN THE HIGH COURT OF DELHI AT NEW DELHI +W.P.(C) 5373/2023 CM APPL. 20996/2023 COGNYTE TECHNOLOGIES ISRAEL LIMITED .....Petitioner Through:Mr Aditya Vohra and Mr ShasvatDhamija, Advocates. versus ASSISTANT COMMISSIONER OF INCOME TAX & ORS. .....Respondents Through:Mr Ruchir Bhatia, SSC, Mr AnantMann, JSC Ms Aditi Sabharwal andMr Abhishek Anand, Advocates. CORAM: HON'BLE MR. JUSTICE VIBHU BAKHRUHON'BLE MR. JUSTICE TEJAS KARIAO R D E R%16.04.2025 1.The petitioner [Assessee] has filed the present petition, inter alia,impugning a notice dated 29.07.2022 [the impugned notice] issued underSection 148 of the Income Tax Act, 1961 [the Act] in respect of theAssessment Year 2014-15. It is the Assessee’s case that the impugnednotice has been issued beyond the prescribed period of limitation. 2.The initial notice under Section 148 of the Act for AY 2014-15 wasissued on 17.06.2021. The said notice was unsustainable as it was issued inaccordance with the statutory regime as stood prior to 31.03.2021. Thiscourt in the case of Mon Mohan Kohli v. Assistant Commissioner ofIncome Tax & Anr.: Neutral Citation No.: 2021:DHC:4181-DB had setaside such notices that were issued after 31.03.2021 without following theprocedure as prescribed under Section 148A of the Act. However, theSupreme Court in the case of Union of India & Ors. v. Ashish Agarwal:(2023) 1 SCC 617, issued directions for considering the said notices as thenotices issued under Section 148A(b) of the Act and further granted time tothe Assessing Officer to supply the material on which such notices werepremised. 3.In compliance with the directions issued by the Supreme Court in thecase of Union of India & Ors. v. Ashish Agarwal (supra), the AssessingOfficer provided information and material to the Assessee on31.05.2022. The Assessee was granted two weeks’ time to respond to thesaid notice. The Assessee responded to the notice dated 31.05.2022 by aletter dated 13.06.2022. 4.The AO passed an order under Section 148A(d) of the Act on28.07.2022. According to the Assessee, the same was beyond the period asstipulated. 5.In the present case, the period of six years from the end of theassessment year for issuing a notice under Section 148 of the Act expired on31.03.2021. Thus, in terms of Section 149 of the Act, a notice under Section148 of the Act could not be issued. However, the said period was extended by the Taxation and Other Laws (Relaxation and Amendment of CertainProvisions) Act, 2020 . Consequently, the time limit for issuingsuch a notice was extended to 30.06.2021. The original notice under Section148 of the Act was issued on 17.06.2021, which was thirteen (13) daysbefore the expiry of the period of limitation. 6.As noted above, the said notice was deemed to be a notice underSection 148A(b) of the Act by virtue of the decision of the Supreme Court inUnion of India & Ors. v. Ashish Agarwal (supra). The Supreme Court alsogranted further time to provide the material, which was required toaccompany such notice. As explained by the Supreme Court in the case ofUnion of India v. Rajeev Bansal: 2024 SCC OnLine SC 2693, the periodfrom the date of the issuance of the notice till 04.05.2022, the date on whichthe Supreme Court had rendered the decision in Union of India & Ors. v.Ashish Agarwal (supra) is required to be excluded. Additionally, the timeprovided till the date of providing the material, which should haveaccompanied a notice under Section 148A(b) of the Act, as well as the timeavailable to the assessee to respond to the said notice was also required to beexcluded by virtue of the Third Proviso to Section 149(1) of the Act, asapplicable at the material time. 7.In the present case, the AO had thirteen (13) days to issue the noticeunder Section 148 of the Act after receipt of the reply of the Assessee. Thesaid time expired on 26.06.2022. However, the impugned notice was issuedon 29.07.2022, which is beyond the said period. Thus, the notice wasbeyond the period of limitation. 7.In the present case, the AO had thirteen (13) days to issue the noticeunder Section 148 of the Act after receipt of the reply of the Assessee. Thesaid time expired on 26.06.2022. However, the impugned notice was issuedon 29.07.2022, which is beyond the said period. Thus, the notice wasbeyond the period of limitation. 8.Concededly, the said controversy is covered in favour of the Assessee by the decision of this court in Ram Balram Buildhome Pvt. Ltd. v. IncomeTax Officer and Anr.: Neutral Citation No.: 2025:DHC:547-DB. 9.The present petition is, accordingly, allowed and all proceedingsinitiated pursuant thereto are set aside. The pending application is alsodisposed of. VIBHU BAKHRU, J APRIL 16, 2025M TEJAS KARIA, J Click here to check corrigendum, if any