High Court Quashes Reassessment Notice u/s 148 for AY 2015-2016 as Time-Barred
The petitioner approached the Court challenging the notice issued under Section 148 of the Income-tax Act, 1961 for AY 2015-2016. The grievance was that the impugned notice, preceded by the order under Section 148A(d), was issued beyond the time allowed in law and was thus without jurisdiction. The petition pointed out that after the time limit in law for reopening an assessment had expired, no valid proceedings could be initiated thereafter, and any order or notice beyond such limitation would be ex facie illegal. The petition was opposed by the respondents but they were unable to challenge the factual chronology of issuance of the impugned notice. The impugned order and notice were thus set aside and quashed. The Court, after examining the records, found that the notice forming the very foundation of reassessment was not issued within the surviving limitation period.
Issue Raised: Whether the reassessment notice issued under Section 148 for AY 2015–2016 and the consequential order under Section 148A(d) were sustainable when the statutory limitation period had already expired.
HC’s Order: The Court held that the petitioner’s challenge was well-founded.It was emphasized that limitation is a substantive safeguard under the law, and once it is crossed, no authority remains vested in the Assessing Officer to proceed with reassessment. The issuance of notice beyond the limitation period deprived the Assessing Officer of jurisdiction and, consequently, all steps taken thereafter, including the order under Section 148A(d) stood invalid. The Court observed that the petitioner could not be subjected to proceedings that lacked legal authority from inception, and such action was required to be struck down.
The Court itself held that the notice issued under Section 148 for AY 2015-2016 was ex facie time-barred. Thus, the consequential order issued under Section 148A(d) also could not survive in law. Once the underlying jurisdiction to reopen the assessment was missing, all consequent proceedings necessarily fell to the ground. In short, the Court issued the writ petition and held the rule absolute. In invalidating the notice and the order under Section 148A(d), the Court protected the petitioner from illegal reassessment proceedings which had been issued without authority of law.
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