> v. Assessment Unit, Incometax Department And Ors

$~2 *IN THE HIGH COURT OF DELHI AT NEW DELHI+W.P.(C) 2899/2025 and CM APPLs. 13794-95/2025SHRI DEVENDER MEHTA.....Petitioner .....PetitionerThrough:Mr Prateek Gattani, Advocate.versus ASSESSMENT UNIT, INCOMETAX DEPARTMENT AND ORS. .....RespondentsThrough:Mr Anurag Ojha with Ms HemlataRawatandMrV.K.Saksena,Advocates. CORAM:HON'BLE MR. JUSTICE VIBHU BAKHRUHON'BLE MR. JUSTICE TEJAS KARIAO R D E R18.03.2025 % 1.The petitioner has filed the present petition impugning an assessmentorder dated 03.02.2025 [the impugned assessment order] in respect ofAssessment Year (AY) 2019-20. The assessment order has been passed inreassessment proceedings under Section 147 of the Income Tax Act, 1961[the Act], which were commenced by issuance of a notice dated 13.04.2023[impugned notice] issued under Section 148 of the Act.It is thepetitioner’s case that the impugned notice – which was issued on 13.04.2023– was beyond the period of three years as stipulated under Section 149(1)(a)of the Act. It is contended that since the initiation of reassessmentproceedings was barred by limitation, the impugned assessment order is required to be set aside. 2.The learned counsel appearing for the petitioner contends that theimpugned notice was preceded by a notice under Section 148A(b) of theAct, which was issued on 28.03.2023. In terms of the said notice thepetitioner was afforded time till 06.04.2023 to file his reply to theinformation, which according to the Assessing Officer (AO) was suggestiveof the petitioner’s income escaping assessment. 3.The petitioner responded on 06.04.2023. The petitioner contends thatthe order under Section 148A(d) of the Act as well as the notice underSection 148 was required to be issued within a period of four daysthereafter. The learned counsel submits that the period of seven days, asmentioned in the third proviso to Section 149(1) of the Act, is required to becomputed after accounting for the three days’ period which remained till theend of the financial year, which ended on 31.03.2023. Thus, the AO hadonly four days after 06.04.2023 to issue a notice under Section 148 of theAct. The relevant extract of Section 149(1) reads as under: “Time limit for notice. – 149.(1) No notice under section 148 shall be issued forthe relevant assessment year,— (a)if three years have elapsed from the end of therelevant assessment year, unless the case falls underclause (b);relevant assessment year, unless the case falls underclause (b); (b)if three years, but not more than ten years, haveelapsed from the end of the relevant assessment yearunless the Assessing Officer has in his possessionbooks of account or other documents or evidencewhich reveal that the income chargeable to tax,elapsed from the end of the relevant assessment yearunless the Assessing Officer has in his possessionbooks of account or other documents or evidencewhich reveal that the income chargeable to tax, represented in the form of— (i)an asset; (ii)expenditure in respect of a transaction orin relation to an event or occasion; orin relation to an event or occasion; or (iii)an entry or entries in the books ofaccount,account, which has escaped assessment amountsto or is likely to amount to fifty lakhrupees or more: ****** *** Provided also that where immediately after the exclusionof the period referred to in the immediately precedingproviso, the period of limitation available to the AssessingOfficer for passing an order under clause (d) of Section148A does not exceed seven days, such remaining periodshall be extended to seven days and the period of limitationunder this sub-section shall be deemed to be extendedaccordingly.” 4.A plain reading of the proviso indicates that where the time periodavailable for the AO to pass an order under Clause (d) of the Section 148Ais less than seven days, the remaining period shall be extended to sevendays, and the period of limitation shall be extended accordingly. A noticeunder Section 148 of the Act is required to be accompanied by an orderunder Section 148A(d) of the Act. ****** *** Provided also that where immediately after the exclusionof the period referred to in the immediately precedingproviso, the period of limitation available to the AssessingOfficer for passing an order under clause (d) of Section148A does not exceed seven days, such remaining periodshall be extended to seven days and the period of limitationunder this sub-section shall be deemed to be extendedaccordingly.” 4.A plain reading of the proviso indicates that where the time periodavailable for the AO to pass an order under Clause (d) of the Section 148Ais less than seven days, the remaining period shall be extended to sevendays, and the period of limitation shall be extended accordingly. A noticeunder Section 148 of the Act is required to be accompanied by an orderunder Section 148A(d) of the Act. 5.In terms of Section 149(1)(a) of the Act, no notice under Section 148can be issued after expiry of a period of three years from the end of theassessment year. Thus, the notice under Section 148 of the Act was requiredto be issued on or before 31.03.2023. 6.However, the procedure required the AO to issue a notice underSection 148A(b) of the Act and a minimum time of seven days to respond tothe said notice. In terms of the third proviso, if the time available for theAO to pass an order under Section 148A(d) – which was required to beaccompanied with a notice under Section 148 of the Act – is less than sevendays, a period of seven days was required to be provided to the AO to passsuch an order. In view of the above, the limitation for issuing a notice underSection 148 of the Act stood extended by a period of seven days from06.04.2023 being the last date on which the petitioner was required to file aresponse to the notice dated 28.03.2023 issued under Section 148A(b) of theAct. 7.In the present case, the impugned notice was issued within the periodof limitation as the same was issued on 13.04.2023. In view of the above,the petitioner’s contention that the impugned notice under Section 148 of theAct was issued beyond the period of limitation, and therefore, theassessment order for AY 2019-20 is barred by limitation is unmerited. 8.The learned counsel appearing for the petitioner states that apart fromthe said issue there is no other issue that is required to be addressed in thispetition. 9.In view of the above, the petition is dismissed. Pending applicationsshall also stand disposed of. VIBHU BAKHRU, J TEJAS KARIA, JMARCH 18, 2025/trClick here to check corrigendum, if any