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2023 (8) TMI 93 - HC - Income TaxValidity of Reopening of assessment - period of limitation - As argued notice u/s 148A(b) was dispatched on 16.07.2021 while the limitation period already stood expired on 30.06.2021 itself - HELD THAT - The documents annexed as Annexure A to the petition are the notice dated 30.06.2021 u/s 148 addressed to the petitioner; email communication dated 16.07.2021 regarding delivery of the notice u/s 148; and a screenshot of the e-filing portal of the Income Tax Department reflecting uploading of the notice 16.07.2021. It would be significant to observe that although the notice dated 30.06.2021 u/s 148 bears an endorsement at the foot of the page that it has been digitally signed, it is inchoate, in the sense that it is not accompanied by a date. The date would have revealed when the digital signatures were appended on the notice. Admittedly, the said notice was never physically delivered to the petitioner/assessee. As such, the fact remains that service of the said notice u/s 148 of the Act was affected on the petitioner only on 16.07.2021 through email, though the limitation period had already expired on 30.06.2021. In the cases titled M/s Vinayak Services Pvt. Ltd . 2022 (12) TMI 1424 - DELHI HIGH COURT ; Pawan Kumar Gupta 2023 (2) TMI 1172 - DELHI HIGH COURT and Usha Gupta 2023 (2) TMI 1171 - DELHI HIGH COURT under similar circumstances, allowed the writ petitions and quashed the notices u/s148A(b) as well as orders u/s148A(d) of the Act, impugned therein. The impugned notice under Section 148A(b) and the impugned order under Section 148A(d) of the Act are quashed - Decided in favour of assessee.
Issues involved:
The issues involved in this case include the validity of the notice dated 30.06.2021 under Section 148A(b) of the Income Tax Act, the communication of relevant material through the notice dated 13.05.2022, and the order dated 27.07.2022 under Section 148A(d) pertaining to the Assessment Year 2014-15. Additionally, the validity of Instruction No. 1 dated 11.05.2022 issued by the Central Board of Direct Taxes (CBDT), the constitutionality of sections 147 and 148 of the Act in light of Article 14 of the Constitution, and the stay of reassessment proceedings initiated under sections 147/148 are also in question. Validity of Notice under Section 148A(b): The petitioner challenged the notice dated 30.06.2021, contending that it was dispatched on 16.07.2021, beyond the window available for issuance. The petitioner argued that the notice was time-barred as it was served after the expiration of the limitation period. The Senior Standing Counsel for the respondent/revenue admitted the delay in issuance was due to technical glitches. The court noted that the digital signature on the notice was inchoate, lacking a date, and was never physically delivered to the petitioner. Despite the digital signature, service was only affected through email on 16.07.2021, after the limitation period had expired on 30.06.2021. Validity of Instruction No. 1 dated 11.05.2022: The petitioner assailed Instruction No. 1 dated 11.05.2022 issued by the CBDT as ultra vires, contending it was contrary to the provisions of the Act and violated the law laid down by the Supreme Court in a specific case. The petitioner invoked Article 14 of the Constitution to challenge the vires of sections 147 and 148 of the Act, alleging them to be highly arbitrary and violative of the Constitution and substantive provisions of the Act. Stay of Reassessment Proceedings: The petitioner sought a stay of the reassessment proceedings initiated under sections 147/148 through the impugned notice dated 27.07.2022. The petitioner argued that since the notice was served after the limitation period, the proceedings were time-barred. The court, citing similar cases, allowed the writ petition, quashing the impugned notice under Section 148A(b) and the order under Section 148A(d), thereby disposing of the application. Conclusion: The High Court quashed the notice under Section 148A(b) and the order under Section 148A(d) of the Act, based on the delay in service and technical glitches, as well as the inchoate digital signature on the notice. The court upheld the petitioner's arguments regarding the time-barred nature of the proceedings, leading to the disposal of the writ petition and the application under consideration.
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