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TMI Blog2025 (1) TMI 176X X X X Extracts X X X X X X X X Extracts X X X X ..... ?" 2. Whether on the facts and circumstances of the case and in law, the CIT(A) has erred in deleting the disallowance of fictitious loss of Rs. 1,28,98,090/-, through M/s. Goodluck Securities and Rs. 89,17,682/-, through M/s. APAR Finance Ltd. 2 by trading in equity derivatives, without appreciating that the disallowance was made, after analyzing credible information received from Investigation Wing, wherein it was proved beyond doubt that manipulated transactions are being executed to avail artificial losses?" 3. "Whether on the facts and circumstances of the case and in law, the Ld.CIT(A) was right in deleting the entire disallowance addition made by AO, without appreciating the fact that, during the survey proceedings of Investigation wing, Mrs. Mausami Deb Roy, proprietor of M/s. Goodluck securities, admitted in her statement on oath that her firm was involved in creating artificial profits and for losses to the clients through trades in equity derivatives by trading with dummy companies, who were paper companies which had no existence physically and has no business income except certain amount of commission, receive from providing accommodation entries to beneficiaries?" ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ination is not an absolute right, as it was held in the case of Nath International Sales Vs UOI, AIR 1992(Del.) 295, and in the case of M/s. Meghna Towers Pvt Ltd 87 taxmann.com 329 ITAT Delhi Bench, was held that where Income-Tax Department had bused racket of bogus accommodation entries and name of assessee was discovered as one of the beneficiaries of alleged racket and further amounts were actually found in the books of assessee to be credited in the name of alleged entry operators, burden was on assessee 10 prove that it was not a beneficiary of racket and did not allow the ground of appeal of the assessee that the AO had erred in not making available the said entry operators for his cross examination? 9. "Whether on the facts and circumstances of the case and in law, the order of Ld.CIT(A) was perverse in holding that re-assessment proceedings are invalid based on decision of Hon'ble Bombay High Court in case of M/s. Hexaware Technologies Limited Vs ACIT [2024] 162 taxmann.com 225, without appreciating the latest order of Hon'ble Bombay High Court in case of JD Printers Pvt. Ltd Vs ITO, which was already pronounced, when this judgment by CIT(A) was delivered and the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cause notice u/s. 148A(b) of the Act). 29/06/2021 Issue Letter/deemed notice u/s. 148A(b) providing relevant material and information to the assessee. 26/05/2022 Issue Letter issued u/s. 148A(b) providing additional information. 01/06/2022 Response filed by assessee to the above issue letter. 30/06/2022 Order u/s. 148A(d) and notice u/s. 148 (under new law) 27/07/2022 7. At the outset, it has been submitted that as per the Revenue's admission before the Hon'ble Supreme Court in the case of Rajeev Bansal, A.Y.2015-16 does not fall during the period prescribed under TOLA. The time limit for issuance of notice u/s.148 for A.Y.2015-16 expires on 31/03/2022. The Hon'ble Supreme Court clearly held that TOLA will apply to the Income Tax Act after 01/04/2021 if any action or proceeding specified under substituted provisions of the Income Tax Act falls for completion between 20/03/2020 and 31/03/2021. For the A.Y.2015-16, the time limit for issuance of notice u/s.148 was 31/03/2022 and therefore, it was qua this time limit, the Revenue had conceded before the Hon'ble Supreme Court that TOLA will not apply for the A.Y.2015-16. For the sake of ready reference para 19 of the said jud ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1-3-2024 TOLA not applicable f. The Revenue concedes that for the assessment year 2015-16, all notices issued on or after 1 April 2021 will have to be dropped as they will not fall for completion during the period prescribed under TOLA: g. Section 2 of TOLA defines "specified Act" to mean and include the Income-tax Act. The new regime, which came into effect on 1 April 2021, is now part of the Income-tax Act. Therefore, TOLA continues to apply to the Income T a x Act even after 1 April 2021; and h. Ashish Agarwal (supra) treated Section 148 notices issued by the Revenue between 1 April 2021 and 30 June 2021 as show-cause notices in terms of Section 148A(b). Thereafter, the Revenue issued notices under section 148 of the new regime between July and August 2022. Invalidation of the Section 148 notices issued under the new regime on the ground that they were issued beyond the time limit specified under the Income-tax Act read with TOLA will completely frustrate the judicial exercise undertaken by this Court in Ashish Agarwal (supra). 8. This stand of the department and concession given by the Revenue before the Hon'ble Supreme Court has been dealt by the Hon'ble Delhi High Cou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aforesaid, it is evident that the impugned reassessment action for AY 2015-16 would not sustain.
4.The writ petition is accordingly allowed. The impugned order under Section 148A(d) of the Act dated 23 July 2022 and consequential notice referable to Section 148 of even date are hereby quashed and set aside."
9. Thus, the notice u/s.148 issued on 27/07/2022 is clearly barred by limitation. The reason being the test for checking the time limit and the validity of notices issued u/s.148 under new regime applicable from A.Y. 2021-22 and prior regime is, whether period of six years had expired at the time of issue of such notice or not. In the case of assessee, the period of six years had expired on 31/03/2022 and consequently, the notice dated 27/07/2022 is clearly barred by limitation and on this ground, the assessment proceedings u/s.147 is hereby quashed. Accordingly, the cross objection filed by the assessee is allowed and all the grounds raised by the Revenue are dismissed as infructuous.
10. In the result, appeal filed by the Revenue is dismissed as infructuous and Cross Objection of the assessee is allowed.
Order pronounced on 31st December, 2024. X X X X Extracts X X X X X X X X Extracts X X X X
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