2022 (5) TMI 419 - HC - Income Tax

Validity of reopening of assessment u/s 147 - Period of limitation to initiate reopening - notice issued time barred - HELD THAT - As the notice under Section 148 of the Income Tax Act, 1961 was issued by the respondent no. 2 to the petitioner on 01.04.2021 at 05 30 08 AM which was delivered on the same date at 05 30 11 AM. Limitation available to the respondents to issue notice under Section 148 of the Act, 1961 for the assessment year 2013-14 was available only till 31.3.2021.In view of the aforesaid, we direct the respondents to file a counter affidavit within two days annexing therewith all the relevant papers showing issue of notice as well as copy of the order-sheet either physical or online. Put up as a fresh case on 7.4.2022 at 10 00 AM. As an interim measure, it is provided that all further and consequential proceedings pursuant to the impugned notice under Section 148 of the Act, 1961 shall remain stayed until further orders of the Court.

Summary

Issues:
1. Timeliness of the notice issued under Section 148 of the Income Tax Act, 1961 for the Assessment Year 2013-14.

Analysis:
The High Court initially noted that the notice dated 31.03.2021 was issued to the petitioner on 01.04.2021, which prima facie appeared to be time-barred. The Court granted the Standing Counsel a week's time to obtain instructions or file a counter affidavit. Subsequently, the Standing Counsel produced instructions showing that the notice was sent via email on 01.04.2021 at 05:30:08 AM and delivered the same day at 05:30:11 AM. The Court highlighted that the limitation for issuing the notice had expired on 31.3.2021. In response, the Court directed the respondents to file a counter affidavit within two days, including all relevant documents demonstrating the issuance of the notice and a copy of the order-sheet. The case was scheduled for a fresh hearing on 7.4.2022 at 10:00 AM. As an interim measure, the Court ordered that all further proceedings related to the notice under Section 148 of the Act, 1961 would remain stayed until further orders.

This judgment primarily revolves around the timeliness of the notice issued under Section 148 of the Income Tax Act for the Assessment Year 2013-14. The Court carefully examined the sequence of events, including the date and time of the notice's issuance and delivery, to determine whether the notice was within the statutory limitation period. The respondent's submission of email proof played a crucial role in establishing the timeline of the notice, leading to the Court's decision to direct the filing of a counter affidavit with supporting documents. The Court's interim order to stay further proceedings reflects a cautious approach pending a comprehensive review of the case. The judgment underscores the significance of adherence to statutory timelines in legal proceedings, particularly concerning notices under the Income Tax Act.