Safiya Malik

The Division Bench of the Bombay High Court at Goa, comprising Justice A.S. Chandurkar and Justice Nivedita P. Mehta, held that the reassessment notice issued by the Income Tax Department to the petitioner as time-barred under the amended provisions of Section 149 of the Income Tax Act, 1961. The Court quashed both the notice dated July 29, 2022, under Section 148 and the consequential assessment order dated May 29, 2023.

The petitioner, Gurpreet Singh, aged 51, represented through his Power of Attorney holder, Mr. Vipin Kumar, challenged the reassessment proceedings initiated by the Income Tax Department for Assessment Year (AY) 2013-14. The primary grievance was that the notice under Section 148 and the assessment order were issued beyond the permissible time limits post the Finance Act, 2021, amendments.

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The petitioner filed his original return on March 31, 2014, declaring an income of Rs. 37,17,840. The assessment was completed under Section 143(3) on February 23, 2016, determining an assessed income of Rs. 60,60,370. Subsequent to the Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020 (TOLA), time limits for actions under the Income Tax Act were extended.

On June 29, 2021, a notice under the erstwhile Section 148 was issued, deemed to be under Section 148A(b) post the Supreme Court’s judgement in Union of India vs. Ashish Agarwal (2022). Despite several replies and objections raised by the petitioner, the Income Tax Department passed an order under Section 148A(d) on July 29, 2022, and issued a reassessment notice on the same date.

The petitioner contended that the reassessment was time-barred under the amended Section 149 and relied upon the Supreme Court’s decisions in Ashish Agarwal and Rajeev Bansal vs. Union of India (2024), as well as the Delhi High Court judgment in Ram Balram Buildhome Pvt Ltd vs. ITO (2025).

The Income Tax Department argued that the reassessment proceedings were valid, having been initiated within the extended period provided under TOLA and subsequent notifications. It maintained that the reassessment was conducted in accordance with the new legal framework and within statutory timelines.

The Court carefully analysed the sequence of events, statutory provisions, and judicial precedents. It observed that: "The period for subject reassessment in terms of Section 149 of the old regime is deemed to be extended till 30/06/2021 under the TOLA. The notice dated 29/06/2021 would be deemed to be notice under Section 148A(b)."

Applying the Supreme Court's decision in Rajeev Bansal, the Bench noted that the surviving period for reassessment was only two days beyond June 30, 2021, which expired on July 2, 2021.

The Court further recorded: "The notice under Section 148 dated 29/07/2022 is time-barred. The order under Section 148A(d) as well as the notice issued under Section 148 are dated 29/07/2022, which is much after the surviving period which expired on 21/07/2022."

It rejected the Revenue’s contention that the timeline under Section 148A(d) extended the limitation period under Section 149, holding: "Section 148A(d) does not govern the computation of time as contemplated in terms of Section 149 of the IT Act. A notice issued under Section 148 beyond the time stipulated under Section 149(1) is non-compliant and invalid."

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The Court also referenced the Delhi High Court’s judgement in Ram Balram Buildhome Pvt Ltd, where under identical facts, the reassessment notice was quashed as time-barred.

The Court quashed the reassessment notice dated July 29, 2022, and the consequential assessment order dated May 29, 2023. It recorded:

"For all these reasons, we hold that the notice dated 29/07/2022, issued by Respondent No.1 under Section 148 of the IT Act is beyond the time period specified under Section 149(1) of the IT Act. It is therefore quashed. Consequently, the impugned assessment order dated 29/05/2023 passed on the basis of the impugned notice also stands quashed and set aside. Rule is made absolute in aforesaid terms with no order as to costs."

Advocates Representing the Parties

Advocate for the Petitioner: Mr. Gauravvardhan A. S. Nadkarni

Advocate for the Respondents: Ms. Amira Razaq

Case Title: Gurpreet Singh vs. Deputy Commissioner of Income Tax & Others

Neutral Citation: 2025: BHC-GOA:868-DB

Case Number: Writ Petition No. 315 of 2023

Bench: Justice A.S. Chandurkar, Justice Nivedita P. Mehta

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