2022 (5) TMI 420 - HC - Income Tax

Reopening of assessment u/s 147 - Period of limitation to initiate reopening - notice issued time barred - HELD THAT - In view of the facts admitted by the respondents in the short counter affidavit that the date and time of triggering of email automatedly by ITBA technical servers is at 01/04/2021 05 30 08 a.m., the impugned notice under Section 148 of the Income Tax Act, 1961 dated 31.03.2021 is without jurisdiction, inasmuch as it has been issued by the respondents on 01.04.2021, i.e., after expiry of the limitation for issuing notice. The controversy involved in this petition is concluded by our judgment in Daujee Abhushan Bhandar Pvt. Ltd. vs. Union of India 2 Ors. 2022 (3) TMI 784 - ALLAHABAD HIGH COURT - Reassessment notice set aside - WP allowed.

Summary

Issues:
1. Validity of notice under Section 148 of the Income Tax Act, 1961 for Assessment Year 2013-14.
2. Jurisdiction of the court regarding the issuance of the notice.
3. Interpretation of the date and time of triggering of email by ITBA technical servers.
4. Impact of the limitation period on the notice under Section 148.

Analysis:
1. The petition challenged the notice dated 31.03.2021 issued under Section 148 of the Income Tax Act, 1961 for the Assessment Year 2013-14, claiming it was time-barred. The court noted the issuance date discrepancy and directed the respondents to file a counter affidavit with relevant documents. The respondents produced instructions showing the email was sent on 01.04.2021 at 05:30:08 AM, after the limitation date of 31.3.2021.

2. A counter affidavit revealed details from the ITBA technical team stating the notice was generated on 31/03/2021 but triggered via email on 01/04/2021 at 05:30:08 AM. The court found the notice issued after the limitation period, rendering it without jurisdiction. The judgment referred to a prior case, Writ-Tax No.78 of 2022, to conclude the controversy.

3. The court relied on the technical details provided by the ITBA team to determine the actual triggering time of the email, emphasizing that the term 'issued' in the system-generated notes referred to the generation of a document in ITBA. This clarification was crucial in establishing the timeline of events and the implications for the notice's validity.

4. Based on the findings and the precedent set in a previous judgment, the court allowed the writ petition, quashing the impugned notice under Section 148 of the Income Tax Act dated 31.03.2021 and the subsequent re-assessment order for Assessment Year 2013-14. The decision was made due to the notice being issued after the limitation period, leading to a lack of jurisdiction.

This detailed analysis of the judgment highlights the key issues, legal interpretations, and conclusions reached by the court regarding the validity of the notice under Section 148 of the Income Tax Act, 1961.