TMI Blog2023 (2) TMI 1081X X X X Extracts X X X X X X X X Extracts X X X X ..... n to the same (quashed by this Court). Similarly extension in time as per the plain provision of clause (A)(a)(b) of the Notification No. 38 dated 27.4.2021 ignoring Explanation to it, may be granted as and when the said extensions are applicable for issuance of notice under Section 148 as per the time limit specified in Section 149 or sanctions under Section 151 of the Income Tax Act as amended by the Finance Act, 2021, after making all compliances, as required under the Income Tax Act, 1961 (amended provisions). As profitably be noted, at this stage, that it is settled law that a taxing statute must be interpreted in the light of what is clearly expressed. It is not permissible to import provisions in a taxing statute so as to supply any assumed deficiency. In interpreting a taxing statute, equitable considerations are out of place. Nor can taxing statutes be interpreted on any presumptions or assumptions. The court must look squarely at the words of the statute and interpret them; Interpreting taxing statute in the light of what is clearly expressed: it cannot imply anything which is not expressed. Before taxing any person it must be shown that he falls within the ambit of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... /2022,WTAX/1283/2022, WTAX/1284/2022,WTAX/1300/2022,WTAX/1293/2022,WTAX/1298/2022,WTAX/1148/2022, WTAX/1305/2022,WTAX/1303/2022,WTAX/1115/2022,WTAX/1079/2022,WTAX/1173/2022, WTAX/1235/2022 ORDER HON'BLE VIPIN CHANDRA DIXIT,J. 1. Heard Sri Abhinav Mehrotra, Sri Rahul Agarwal, Sri Ashish Bansal, Sri Shubham Agarwal, Sri Ankur Agarwal, Sri Suyash Agarwal, Sri V.K. Sabarwal, Sri R.B. Gupta and Sri Krishna Vyas learned counsels for the petitioners in the bunch cases; Sri Gaurav Mahajan, Sri Krishna Agarwal, Sri Ashish Agarwal, Sri Manu Ghildyal, learned counsels appearing for the respondent Revenue, Sri Anant Kumar Tiwari, Sri Gopal Verma and Sri N.C. Gupta, learned counsels for the Union of India. Introduction:- 2. The writ petitions in this bunch are directed against the orders passed by the Assessing Authority under Section 148-A(d) of the Income Tax Act' 1961 (hereinafter referred as Act' 1961) and the consequential notices issued under Section 148 of the Act' 1961. The dispute pertains to the assessment years 2013-14, 2014-15, 2015-16, 2016-17 and 2017-18. The disputed notices having been issued on or after 01.04.2021, the period concerned is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of compliances or fulfillment of requirements by the revenue as per Section 149(1)(b) and the first proviso to Section 149(1) inserted by the amendment under the Finance Act' 2021, wef 01.04.2021. 6. Before proceeding further, it may be noticed as a clarification at this stage itself, that there is no dispute about the fact that the notices issued under Section 148 after the amendment brought by the Finance Act' 2021 i.e. on or after 01.04.2021 be treated as notices under Section 148-A as per the amended provisions. It has also been agreed by the counsel for the parties that the date of issuance of notice under Section 148 of the Income Tax Act (as per pre-amended provisions) shall be treated as the date of issuance of notice under Section 148-A (post amendment) and all notices issued under Section 148 of the Income Tax Act after 01.04.2021 shall be treated to be the notices under Section 148-A of the Income Tax Act, inserted by the Finance Act 2021, w.e.f. 01.04.2021. The jurisdictional notice under Section 148 after the amendment brought by the Finance Act 2021 will have to be issued after conclusion of the preliminary enquiry required under Section 148-A. Legisla ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... A) or subsection (5) of that section, on or after the 1st day of April, 2021, in the case of the assessee; or (iii) the Assessing Officer is satisfied, with the prior approval of the Principal Commissioner or Commissioner, that any money, bullion, jewellery or other valuable article or thing, seized or requisitioned under section 132 or section 132A in case of any other person on or after the 1st day of April, 2021, belongs to the assessee; or (iv) the Assessing Officer is satisfied, with the prior approval of Principal Commissioner or Commissioner, that any books of account or documents, seized or requisitioned under section 132 or section 132A in case of any other person on or after the 1st day of April, 2021, pertains or pertain to, or any information contained therein, relate to, the assessee, the Assessing Officer shall be deemed to have information which suggests that the income chargeable to tax has escaped assessment in the case of the assessee for the three assessment years immediately preceding the assessment year relevant to the previous year in which the search is initiated or books of account, other documents or any assets are requisitioned or survey is condu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nder section 132A, on or after the 1st day of April, 2021, in the case of the assessee; or (ii) a survey is conducted under section 133A,other than under sub section (2A) or subsection (5) of that section, on or after the 1st day of April, 2021, in the case of the assessee; or (iii) the Assessing Officer is satisfied, with the prior approval of the Principal Commissioner or Commissioner, that any money, bullion, jewellery or other valuable article or thing, seized or requisitioned under section 132 or section 132A in case of any other person on or after the 1st day of April, 2021, belongs to the assessee; or (iv) the Assessing Officer is satisfied, with the prior approval of Principal Commissioner or Commissioner, that any books of account or documents, seized or requisitioned under section 132 orsection 132A in case of any other person on or after the 1st day of April, 2021, pertains or pertain to, or any information contained therein, relate to, the assessee, the Assessing Officer shall be deemed to have information which suggests that the income chargeable to tax has escaped assessment in the case of the assessee for the three assessment years immediately preceding t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... here completion or compliance of such action has not been made within such time, then, the time limit for completion or compliance of such action shall, notwithstanding anything contained in the specified Act, stand extended to the 31st day of March, 2021, or such other date after the 31st day of March, 2021, as the Central Government may, by notification, specify in this behalf: Provided that the Central Government may specify different dates for completion or compliance of different actions: 11. The relevant notifications issued by Central Government dated 31.03.2021 and 27.04.2021 are quoted hereunder: MINISTRY OF FINANCE (Department of Revenue) (CENTRAL BOARD OF DIRECT TAXES) NOTIFICATION New Delhi, the 31st March, 2021 S.O. 1432(E). In exercise of the powers conferred by sub section (1) of section 3 of the Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020 (38 of 2020) (hereinafter referred to as the said Act), and in partial modification of the notification of the Government of India in the Ministry of Finance, (Department of Revenue) No.93/2020 dated the 31st December, 2020, published in the Gazette of India, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l stand extended. [Notification No. 20/2021/F. No. 370142/35/2020TPL] SHEFALI SINGH, Under Secy., Tax Policy and Legislation Division Note: The principal notification was published in the Gazette of India, Extraordinary, Part II, Section 3, Sub section (ii) vide S.O. No. 4805 dated 31 December, 2020. ................................................ MINISTRY OF FINANCE (Department of Revenue) (CENTRAL BOARD OF DIRECT TAXES) NOTIFICATION New Delhi, the 27th April, 2021 S.O. 1703(E). In exercise of the powers conferred by sub section (1) of section 3 of the Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020 (38 of 2020) (hereinafter referred to as the said Act), and in partial modification of the notifications of the Government of India in the Ministry of Finance, (Department of Revenue) No. 93/2020 dated the 31 December, 2020, No. 10/2021 dated the 27th February, 2021 and No. 20/2021 dated the 31 March, 2021, published in the Gazette of India, Extraordinary, Part II, Section 3, Sub section (ii), vide number S.O. 4805(E), dated the 31 December, 2020, vide number S.O. 966(E) dated the 27thFebruary, 2021 and vid ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 70142/35/2020 TPL] RAJESH KUMAR BHOOT, Jt. Secy. Tax Policy Legislation Division Note: The principal notification was published in the Gazette of India, Extraordinary, Part II, Section 3, Sub section (ii) vide S.O. No. 4805 dated 31st December, 2020 12. These petitions are offshoot of the decision of the Coordinate Bench of this High Court in Writ Tax No.524 of 2021 Ashok Kumar Agarwal Vs. Union of India [2021 ILR ALL 816] , affirmed by the Apex Court in the judgement and order dated 04.05.2022 in Civil Appeal No.3005 to 3017, 3019-3020 of 2022 Union of India Vs. Ashish Agarwal [AIR 2022 SC 2781] . 13. Before proceeding further, we are, thus, require to note the history of litigation inter-se parties. History of Litigation:- (i) Coordinate Bench Decision in Ashish Agarwal (supra) 14. Upon enforcement of the Finance Act' 2021, the pre-existing Sections 147 to 151 had been repealed and replaced by new provisions, bringing changes in the entire statutory scheme of initiating, enquiring, conducting and concluding the reassessment proceedings. The validity of the reassessment proceeding initiated against individual assessees, after 01.04.2021, came u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ecame wholly unenforceable or unacceptable to the proceedings that would arise under the latter Act, i.e. the substituted provisions of Section 147 to 151 of the Income Tax Act' 1961, upon enactment of the Finance Act' 2021 on or after 01.04.2021. 17. The submissions advanced by the learned counsel for the petitioners therein to challenge the validity of the notice under Section 148 of the Act' 1961 after 01.04.2021, have been extracted pointwise in paragraph No.'63' as under:- (i) By substituting the provisions of the Act by means of the Finance Act, 2021 with effect from 01.04.2021, the old provisions were omitted from the statute book and replaced by fresh provisions with effect from 01.04.2021. Relying on the principle substitution omits and thus obliterates the pre-existing provision, it has been further submitted, in absence of any saving clause shown to exist either under the Ordinance or the Enabling Act or the Finance Act 2021, there exists no presumption in favour of the old provision continuing to operate for any purpose, beyond 31.03.2021. (ii) The Act is a dynamic enactment that sustains through enactment of the Finance Act every yea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al change to the reassessment procedure, by enacting section 151 A to the Act. It then enacted the Finance Act, 2021 to change the substantive and procedural law governing the reassessment proceedings. That having been done, together with introduction of section 148 A to the Act, legislative field stood occupied, leaving the delegate with no room to manipulate the law except as to the time lines with respect to proceedings that may have been initiated under the Act (both prior to and after enforcement of the Finance Act, 2021). To bolster their submission, learned counsel for the petitioners also rely on the principle the delegated legislation can never defeat the principal legislation. (vi) Last, it has also been asserted, the non obstante clause created under section 3(1) of the Enabling Act must be read in the context and for the purpose or intent for which it is created. It cannot be given a wider meaning or application as may defeat the other laws. 18. On the effect of amendment brought by the Finance Act 2021, it was observed therein that undeniably on 01.04.2021 by virtue of plain/unexcepted effect of Section 1(2)(a) of the Finance Act' 2021, the provisions o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e exercise of power, by the delegates of the Parliament (Central Government). Hence, no extension could be made under Section 3(1) of the Enabling Act read with the notifications thereunder. 21. It was, thus, concluded in paragraph Nos.72, 73, 75, 76, 79 and 80 by this Court as under:- 72. Reference to reassessment proceedings with respect to pre-existing and now substituted provisions of Sections 147 and 148 of the Act has been introduced only by the later Notifications issued under the Act. Therefore, the validity of those provisions is also required to be examined. We have concluded as above, that the provisions of Sections 147, 148, 148A, 149, 150 and 151 substituted the old/pre-existing provisions of the Act w.e.f. 01.04.2021. We have further concluded, in absence of any proceeding of reassessment having been initiated prior to the date 01.04.2021, it is the amended law alone that would apply. We do not see how the delegate i.e. Central Government or the CBDT could have issued the Notifications, plainly to over reach the principal legislation. Unless harmonized as above, those Notifications would remain invalid. 73. Unless specifically enabled under any law and un ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ions of, either the Enabling Act or the Finance Act, 2021 and to read and interpret the provisions of Finance Act, 2021 as inoperative in view of the fact circumstances arising from the spread of the pandemic COVID 19. Practicality of life de hors statutory provisions, may never be a good guiding principle to interpret any taxation law. In absence of any specific clause in Finance Act, 2021, either to save the provisions of the Enabling Act or the Notifications issued thereunder, by no interpretative process can those Notifications be given an extended run of life, beyond 31 March 2020. They may also not infuse any life into a provision that stood obliterated from the statute with effect from 31.03.2021. Inasmuch as the Finance Act, 2021 does not enable the Central Government to issue any notification to reactivate the pre-existing law (which that principal legislature had substituted), the exercise made by the delegate/Central Government would be de hors any statutory basis. In absence of any express saving of the pre-existing laws, the presumption drawn in favour of that saving, is plainly impermissible. Also, no presumption exists that by Notification issued under the Enabling A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e reassessment notices issued by the revenue under Section 148 of the Act' 1961, in view of the amendment by the Finance Act' 2021, and that approximately 90,000/- such reassessment notices were issued by the revenue under Section 148 of the unamended Income Tax Act' 1961 after 01.04.2021. It was held therein that the order passed in the said appeal, arising out of the common judgement and order passed by this High Court shall govern all other judgements and orders passed by various High Court on the similar issue. The revenue need not to file separate individual appeals which may be more than 90,000/- in number. 24. On the merits of the challenge, the Apex Court had taken note of pre and post amendment regime of Sections 147 to 151 of the Income Tax Act and also the Enabling Act/TOLA 2020. It was observed in paragraph Nos. '6, 6.1 to 6.6' of the judgement as under:- 6. It cannot be disputed that by substitution of sections 147 to 151 of the Income Tax Act (IT Act) by the Finance Act, 2021, radical and reformative changes are made governing the procedure for reassessment proceedings. Amended sections 147 to 149 and section 151 of the IT Act prescribe the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , with the approval of specified authority, with respect to the information which suggests that the income chargeable to tax has escaped assessment; (ii) provide an opportunity of being heard to the assessee, with the prior approval of specified authority; (iii) consider the reply of the assessee furnished, if any, in response to the showcause notice referred to in clause (b); and (iv) decide, on the basis of material available on record including reply of the assessee, as to whether or not it is a fit case to issue a notice under section 148 of the IT Act and (v) the AO is required to pass a specific order within the time stipulated. 6.5 Therefore, all safeguards are provided before notice under section 148 of the IT Act is issued. At every stage, the prior approval of the specified authority is required, even for conducting the enquiry as per section 148A(a). Only in a case where, the assessing officer is of the opinion that before any notice is issued under section 148A(b) and an opportunity is to be given to the assessee, there is a requirement of conducting any enquiry, the assessing officer may do so and conduct any enquiry. Thus if the assessing officer is of the opini ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r as ultimately it is the public exchequer which would suffer.................. ..................................... 10. In view of the above and for the reasons stated above, the present Appeals are ALLOWED IN PART. The impugned common judgments and orders passed by the High Court of Judicature at Allahabad in W.T. No. 524/2021 and other allied tax appeals/petitions, is/are hereby modified and substituted as under: (i) The impugned section 148 notices issued to the respective assessees which were issued under unamended section 148 of the IT Act, which were the subject matter of writ petitions before the various respective High Courts shall be deemed to have been issued under section 148A of the IT Act as substituted by the Finance Act, 2021 and construed or treated to be show-cause notices in terms of section 148A(b). The assessing officer shall, within thirty days from today provide to the respective assessees information and material relied upon by the Revenue, so that the assesees can reply to the show-cause notices within two weeks thereafter; (ii) The requirement of conducting any enquiry, if required, with the prior approval of specified authority under se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the Apex Court provided that the decision of the Apex Court would apply to all such cases where extended reassessment notices have been issued, irrespective of the fact whether such notices have been challenged or not. 29. In the opening paragraph of the said Instruction, it is noted that the reassessment notices issued by the Assessing Officers during the period beginning on 01.04.2021 and ending with 30.06.2021, within the time extended by TOLA 2020 and various notification issued thereunder, shall be referred as extended reassessment notices . It was then directed in paragraph '6' of the Instruction that the operation of the new Section 149 of the Act where fresh notices under Section 148 of the Act can be issued, may be seen as under:- 6. Operation of the new section 149 of the Act to identify cases where fresh notice under section 148 of the Act can be issued. 6.1 With respect of operation of new section 149 of the Act, the following may be seen: Hon ble Supreme Court has held that the new law shall operate and all the defences available to assessees under section 149 of the new law and whatever rights are available to the Assessing Officer un ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion (1) of new section 149 of the Act, since they are within the period of three years from the end of the relevant assessment year. Specified authority under section 151 of the new law in this case shall be the authority prescribed under clause (i) of that section. 30. In cases where the Assessing Officer is required to provide an information and material relied upon, it was directed in clause 7.1 therein as under:- 7.1 Hon ble Supreme Court has directed that information and material is required to be provided in all cases within 30 days. However, it has also been noticed that notices cannot be issued in a case for AY 2013 14, AY 2014 15 and AY 2015 16, if the income escaping assessment, in that case for that year, amounts to or is likely to amount to less than fifty lakh rupees. Hence, in order to reduce the compliance burden of assessees, it is clarified that information and material may not be provided in a case for AY 2013 14, AY 2014 15 and AY 2015 16, if the income escaping assessment, in that case for that year, amounts to or is likely to amount to less than fifty lakh rupees. Separate instruction shall be issued regarding procedure for disposing these cases. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e on the assessee a notice under section 148 after obtaining the approval of the specified authority under section 151 of the new law. The copy of the order passed under clause (d) of section 148A of the Act shall also be served with the notice u/s 148. If it is not a fit case to issue a notice under section 148 of the Act, the order passed under clause (d) of section 148A to that effect shall be served on the assessee. 32. Before proceeding further, we may record that in some of the writ petitions, the challenge to the offending clauses of the Instruction dated 11.05.2022 issued by CBDT, in exercise of its power under Section 119 of the Act, has been raised on the ground that the same is in direct conflict/contravention of the observations and directions issued by the Apex Court in the case of Ashish Agarwal (supra). Arguments of the counsels on behalf of the petitioners:- 33. The arguments of all the learned counsels for the petitioners are being noted, collectively, hereunder:- (I) After the amendment brought by the Finance Act' 2021, new/amended provisions will apply to reassessment proceedings. (ii) Enabling Act (TOLA 2020) will not extend the ti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessment, amount to or is likely to amount to Rs.50 lacs rupees or more for that year. (x) It was submitted that the monetary threshold for opening of assessment after elapse of three years for the period upto ten years has, thus, been put in place. (xi) Further, first proviso to sub-section (1) of Section 149 has been placed to assert that the cases wherein notices were not issued within the period of six years as per clause (b) of sub-section (1) of Section 149 under the unamended provision, reassessment notices cannot be issued on or after 01.04.2021 after the commencement of the Finance Act 2021, as such cases have become time barred. (xii) It was argued that such cases cannot be reopened by giving extension in the time limit by applying the provisions of Enabling Act (TOLA 2020). (xiii) It was argued that the Finance Act 2021 had limited the applicability of the Enabling Act (TOLA 2020) and after amendment, the compliances/conditions under the amended provisions have to be fulfilled. 34. In the crux, it was argued by the learned counsels for the assessees that the Apex Court in Ashish Agarwal (supra) has categorically provided that all defences which may be av ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... yer higher than what the Act itself as a true interpretation envisages. However, the departmental circular/Instructions beneficial to the assessee and if it tone down the rigors of the law issued in exercise of the statutory powers under Section 119 of the Act or under corresponding provisions of the Act, are binding on the revenue in the administration of the Act. 37. The offending clauses of the Instruction dated 11.05.2022, have been placed before us to assert that the direction issued in (clause 6.1, in third bullet point) that the decision of the Apex Court read with the time extension provided by TOLA, will allow extended reassessment notices to travel back in time to their original date when such notices were to be issued and then new Section 149 of the Act is to be applied at that point, is based on the wrong interpretation of the judgement of the Apex Court and the High Court. In clause 6.2 (i) of the Circular, it is provided that reassessment notices for assessment years 2013-14 and 2014-15 can be issued with the approval of the specified authority, if the case falls under clauses (b) of sub section (1) of Section 149 amended by the Finance Act 2021. The submission i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rom all angles, the revenue cannot be permitted to argue that after the decision of this Court affirmed by the Apex Court, it can issue notices under the amended section 148 without making compliances of the amended provisions of Section 149 of the I.T. Act. It cannot seek extension of the time limit for taking action under the unamended provision by seeking relaxation under TOLA 2020, in turn, for further extension of the time limit under the amended Section 149 brought by the Finance Act 2021. All notices under Section 148 which were issued on or after 01.04.2021, with respect to the assessment years 2013-14 to 2017-18, therefore, have to comply with the requirements of Section 149 amended by the Finance Act' 2021. Arguments of the Counsels on behalf of the Revenue:- 40. Sri Gaurav Mahajan learned Advocate for the revenue, in rebuttal, would submit that the Enabling Act 2020 was enacted by the Parliament to grant relaxation in the time limit provided in the 'Specified Act' defined therein, one of which is the Income Tax Act' 1961. Sub-section (1) of Section 3 of the Act provide that the time limit specified or prescribed or notified under the Specified A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 021, but it was held that the notice to initiate reassessment proceedings after 01.04.2021 can be issued in accordance with the provisions of the I.T. Act as amended by Finance Act' 2021. It was argued that the notices issued on or after 01.04.2021 under Section 148 of the Income Tax Act, for reassessment were issued in accordance with the substituted laws and not as per the pre-existing laws and the Enabling Act (TOLA 2020) was only applied for extension in the timeline. The Enabling Act has overriding effect over the Specified Act namely the Income tax Act and has been enacted in the exigencies due to spread of Covid 19, it will extend the time limit for issuance of notice/action under the I.T. Act. The CBDT Instructions dated 11.05.2022 has only clarified the manner in which the implementation of the judgement of the Apex Court is to be made. The extension of time granted by TOLA 2020 uptil 31.03.2021 and the subsequent notifications issued under sub section (1) of Section 3 of the Enabling Act (TOLA 2020) to further extend the timeline upto 31.06.2021 would save all notices issued on or after 01.04.2021. 43. Sri Krishna Agarwal learned Advocate for the revenue adding to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the amended provisions by Finance Act 2021. The extension in time uptil 31.06.2021 as granted by the notifications dated 31.03.2021 and 27.04.2021 would, thus, apply to the timeline provided under the amended provisions brought by the Finance Act 2021. 45. It is submitted that when two Parliamentary Acts are on the statute book, one providing substantive provisions and procedure for initiating reassessment proceeding and the other granting extension of time for action/compliances/issuance of notices under the substantive and procedural provisions of the Act' 1961, a harmonious construction of both the provisions has to be made, as has been done by this Court in Ashok Kumar Agarwal (supra). The result would be that whatever time limit is provided under the Principal Act namely the Income Act' 1961 as on 01.04.2021, the same has to be extended uptil 31.06.2021 to enable the revenue to initiate and process the reassessment proceedings under Section 148 of the Act' 1961 amended by the Finance Act' 2021. 46. It was argued that in view of the decision of the Apex Court in saving all notices issued by the revenue PAN INDIA by treating them as notices under Section 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ely the Enabling Act and the Finance Act 2021, wherein it is provided in para 6.1 of the Instructions that the time extension provided by TOLA' 2020 will allow extended reassessment notices to travel back in time to their original date when such notices were to be issued and then the new Section 149 of the Act is to be applied at that point of time. 49. It was submitted that based on the said logic, the extended reassessment notices for the assessment year 2013-14, AY 2014-15 and AY 2015-16 are to be dealt with by issuance of fresh notice under amended Section 148, with the approval of the specified authority, in the cases which fall under clause (b) of sub-section (1) of Section 149 as amended by the Finance Act' 2021. It is further clarified in the CBDT instruction that the specified authority under Section 151 of the amended provisions shall be the authority prescribed under clause (ii) of that Section. Similarly, for AY 2016-147 and AY 2017-18, fresh notice under Section 148 can be issued with the approval of the specified authority under clause (a) of sub section (1) of amended Section 149 of the Act, as they are within the period of three years from the end of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it was held by the Delhi High Court that the time limit for initiating assessment proceeding for assessment year 2013-14 stood extended till 30.06.2021. Consequently, the reassessment notice dated 29.06.2021 issued therein being well within the extended period of limitation was not time barred. The challenge to paragraph 6.2 (i) of CBDT Instruction No.1/2022 dated 11.05.2022, was turned down therein holding that with the declaration by the Apex Court that the reassessment notice issued on or after 01.04.2021 shall be deemed to be the notice under Section 148-A of the Act, the revenue was permitted to complete the reassessment proceedings in accordance with the amended provisions of Section 149. The contention of the petitioner that the assessment for AY 2013-14 became time barred on 31.03.2020 was accordingly, repelled. 54. Reliance has further been placed on the decisions of the Apex Court in Raymond Woolen Mills Ltd. Vs. Income Tax Officer [1999 (236 ITR 34 (SC)] , Commissioner in Income Tax others Vs. Chhabil Das Agarwal [2013 (217) Taxmann 143 (SC)] , Coca Cola India Inc. Vs. Additional Commissioner of Income Tax others [2011 (336) ITR 1 (SC)] , Gian Casting Pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ct' 2021). The unamended Section 149(1)(b) provided that no notice under Section 148 shall be issued, if 6 years have been elapsed from the end of the relevant assessment years, which has escaped the assessment amount to one lac rupees or more for that year. 56. The answer of the learned counsels for the revenue was that time limit of 6 years provided in clause (b) of sub section (1) of Section 149 stood extended by virtue of the Enabling Act uptil 31.03.2021, and further extensions in the time limit (of six years) are to be granted under the notifications issued by the Central Government in accordance with Section 3(1) of the Enabling Act uptil 31.06.2021. The result would be that the cases for the Assessment Year 2013-14, AY 2014-15 where the period of six years had expired on 31.03.2020 and 31.03.2021: respectively, would not be hit by the first proviso to sub-section (1) of Section 149 brought by the Finance Act' 2021. The cases for these assessment years have to be evaluated and the reassessment proceedings have to be conducted for them in accordance with clause (b) of sub section (1) of Section 149 as amended by the Finance Act 2021, being beyond the period of thre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (b) if four years, but not more than six years, have elapsed from the end of the relevant assessment year, unless the income chargeable to tax which has escaped assessment amounts to or is likely to amount to one lakh rupees or more for that year; (b) if three years, but not more than ten years, have elapsed from the end of the relevant assessment year unless the Assessing Officer has in his possession books of account or other documents or evidence which reveal that the income chargeable to tax, represented in the form of asset, which has escaped assessment amounts to or is likely to amount to fifty lakh rupees or more for that year: (c) if four years, but not more than sixteen years, have elapsed from the end of the relevant assessment year unless the income in relation to any asset (including financial interest in any entity) located outside India, chargeable to tax, has escaped assessment. Provided that no notice under section 148 shall be issued at any time in a case for the relevant assessment year beginning on or befo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is to be served is a person treated as the agent of a non-resident under section 163 and the assessment, reassessment or recomputation to be made in pursuance of the notice is to be made on him as the agent of such non- resident, the notice shall not be issued after the expiry of a period of six years from the end of the relevant assessment year. ........ Explanation- For the removal of doubts, it is hereby clarified that the provisions of sub-section (1) and (3), as amended by the Finance Act, 2012 shall also be applicable for any assessment year beginning on or before the 1.4.2012. ....... Explanation- 1. For the purpose of clause (b) of this sub-section, asset shall include Immovable Property, being land or building or both shares and securities, loans and advances, deposits in bank account. ............ 2. The provision of sub-section (1) as to the issue of notice shall be subject to the provisions of section 151 ................ 59. We are further required to go thr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... also does not speak of saving any proceeding from any law that may be enacted by the Parliament, in future. The non obstante clause of Section 3(1) of the Enabling Clause Act does not govern the entire scope of the said provision. It is confined to and may be employed only with reference to the second part of Section 3(1) of the Enabling Act, i.e to protect the proceedings already underway. The Act, thus, only protected certain proceedings that may have become time barred on 20.03.2021 upto the date 30.06.2021. Correspondingly, by delegated limitation incorporated by the Central Government (notifications), it may extend that time limit. That timeline alone stood extended upto 30.06.2021. (vii) Section 3(1) of the Enabling Act does not itself speak of reassessment proceeding or of Section 147 or Section 148 of the Act as it existed prior to 01.04.2021. It only provides a general relaxation of limitation granted on account of general hardship existing upon the spread of pandemic COVID-19. After enforcement of the Finance Act, 2021, it applies to the substituted provisions and not the pre-existing provisions. The reference to reassessment proceedings with respect to pre-existing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... isions of Section 148A of the I.T. Act (introduced by the Finance Act' 2021) and other provisions had been deferred. 61. It was, thus, declared that the Explanations appended to Clauses A(a), A(b) of the impugned notifications dated 31.03.2021, and 27.4.2021; respectively, must be read applicable to reassessment proceedings as may have been in existence on 31.03.2021 or had been initiated till that date, i.e. before the substitution of Sections 147 to 151A of the Act. The Notifications have no applicability to the reassessment proceedings initiated from 01.04.2021 onwards. 62. With the above observations, all reassessment notices, subject matter of challenge therein were quashed. It was, however, left open to the respective assessing authorities to initiate reassessment proceedings in accordance with the provisions of the Act as amended by the Finance Act, 2021 after making all compliances, as required by law. 63. In the challenge to the aforesaid decision of the Division Bench in Ashok Kumar Agarwal, the Apex Court in Ashish Agarwal (supra) has observed that:- (I) By substitution of Sections 147 to 151 of the Income Tax by the Finance Act, 2021, radical and reforma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... even if the same are permissible under the Finance Act, 2021 as per substituted Sections 147 to 151 of the Income Tax Act. To remedy the situation where revenue became remediless, in order to achieve the object and purpose of reassessment proceedings, it was observed that the notices under Section 148 after the amendment was enforced w.e.f 01.04.2021, were issued under the unamended Section 148, due to bonafide mistake in view of the subsequent extension of time by various notifications under the Enabling Act (TOLA 2020). (II) The notices ought not to have been issued under the unamended Act and ought to have been issued under the substituted provisions of Sections 147 to 151 of the Income Tax Act as per the Finance Act, 2021. (III) There appears to be a genuine non application of the amendments as the officers of the revenue may have been under a bonafide belief that the amendments may not yet have been enforced. 67. It was, thus, concluded that:- 68. Instead of quashing and setting aside the reassessment notices issued under the unamended provisions of IT Act, the High Courts ought to have passed order construing the notices issued under the unamended Act/unamende ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s by the notifications dated 31.03.2021 and 27.04.2021 issued under TOLA, in the timeline provided under the amended Section 149 of the Finance Act, 2021. The arguments of the learned counsels for the revenue is that the Enabling Act (TOLA' 2020) granted extension in the time limit provided in the pre-existing provisions of the Income Tax Act. The period of four years and six years provided in Clause (a) and (b) of the unamended Section 149 of the IT Act stood extended uptil 31.03.2021 by the extensions granted under TOLA 2020, as the reassessment notices, could have been issued, within the extended period of time uptil 31.03.2021. The amendment by the Finance Act, 2021 though have substituted the substantive and procedural amendment in the Income Tax Act 1961 and old provisions have been recasted and made applicable w.e.f 01.04.2021, but extensions already granted by the Enabling Act in the limitation prescribed under the unamended provisions of the Income Tax Act have not been curtailed. Further extensions in the limitation for issuance of reassessment notices have been made by the notifications dated 31.03.2021 and 27.04.2021 issued by the Central Government, in exercise of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ce Act, 2021 as inoperative in view of the facts and circumstances arising from the spread of the pandemic COVID-19. Practicality of life dehors statutory provisions, may never be a good guiding principle to interpret any taxation law. It was, thus, held that in absence of any specific clause in the Finance Act, 2021 either to save the provisions of the Enabling Act or the Notifications issued thereunder, by no interpretative process, the notifications can be said to infuse life into a provision that stood obliterated from the Statute book w.e.f 31.03.2021. It was held that the Finance Act, 2021 does not enable the Central Government to issue any notification to reactivate the pre-existing law, the exercises made by the delegate/Central Government would be dehors any statutory basis. It was, thus, categorically held by the Division Bench that the notifications did not insulate or save the pre-existing provisions pertaining to reassessment under the Act or the operation of the pre-existing provisions of the Act cannot be extended. 76. Adopting the above reasoning given by the Coordinate Bench of this Court, which is binding on us, we may further note that the contention of the re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... so been changed substantially. A heavy burden is cast upon the revenue to meet the requirements of clause (b) of sub-section (1) of Section 149 for initiation of reassessment proceedings after lapse of three years. Further four provisos have been inserted to sub-section (1) of Section 149. 80. The first proviso to sub-section (1) of Section 149 is relevant for our purposes, which provides that notice under Section 148, in a case for the relevant assessment year beginning on or before 1.4.2021, cannot be issued, if such notice could not have been issued at the relevant point of time, on account of being beyond the time limit specified under the unamended provisions of clause (b) of subsection (1) of Section 149, i.e., pre-amended Section 149 prior to the commencement of Finance Act, 2021. The time limit in clause (b) of sub-section (1) of unamended Section 149 of six years, thus, cannot be extended upto ten years under clause (b) of sub-section (1) of amended Section 149, to initiate reassessment proceeding in view of the first proviso to Section (1) of Section 149. In other words, the case for the relevant assessment year where six years period has elapsed as per unamended claus ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion 149 (amended by the Finance Act, 2021). 82. In case the arguments of the learned counsels for the revenue are accepted, the benefits provided to the assessee in the substantive provisions of clause (b) of sub-section (1) of Section 149 and the first proviso to Section 149 have to be ignored or deferred. The defences which may be available to the assessee under Section 149 and/or which may be available under Finance Act, 2021 have to be denied. The crux of the submission of the learned counsels for the revenue is that the applicability of the amended provisions of Finance Act, 2021 will have to be postponed uptill 31.6.2021 because of the extensions granted by the Enabling Act, 2020 upto 31.3.2021 and further extensions in the time limit by the Notifications dated 31.3.2021 and 27.4.2021 thereunder. 83. The submission is that the extensions in the time limit provided under the unamended Section 149(1)(b) upto 31.3.2021, will be applicable even in those cases where reassessment notices were issued under the amended Section 148 on or after 1.4.2021, by extending the time limit provided in the unamended Section 149 by plain and simple application of the Enabling Act (TOLA) 2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... xtensions in the time limit under the unamended Sections of the Income Tax Act prior to the amendment by the Finance Act, 2021, would still be applicable to the reassessment proceedings as may have been in existence on 31.3.2021. By harmonious construction of two parliamentary legislation, the Enabling Act, 2020 and Finance Act, 2021, the Coordinate Bench has explained the scope and limit of the Enabling Act, the Finance Act, 2021 and the Notifications issued under the Enabling Act. We are bound by the decision of the Coordinate Bench as affirmed by the Apex Court in Ashish Agarwal (supra). 88. As noted above, the view taken by the Coordinate Bench in Ashok Kumar Agarwal (supra) of this Court has been upheld by the Apex Court with the only modification that the notices issued on or after 1.4.2021 under Section 148 shall be treated as notices under Section 148-A of the Income Tax Act as substituted by the Finance Act, 2021, treating them to be show cause notices in terms of Section 148(A)(b) of the Income Tax Act. 89. At the cost of repetition, it may be noted here that the Apex Court has permitted the revenue to proceed further with the reassessment proceedings under the subs ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nce Act, 2021) is not attracted for the assessment year 2013-14, with all due respect to the Judges holding the Bench, suffice it to say that the said view is in direct conflict with the view taken by this Court in Ashok Kumar Agarwal (supra) affirmed by the Apex Court in Ashish Agarwal (supra). In fact, the observation in Mon Mohan Kohli (supra) by the Delhi High Court in paragraph 98 that the power of reassessment that existed prior to 31.3.2021 continue to exist till the extended period, i.e. till 30.6.2021, and the Finance Act, 2021 has merely changed the procedure to be followed prior to issuance of notice w.e.f. 1.4.2021, has been misread and misapplied in Touchstone (supra) by the Division Bench of the Delhi High Court. 94. Relevant is to note that even in Mon Mohan Kohli (supra), the Delhi High Court had quashed the reassessment notices issued on or after 1.4.2021 on the ground that the Relaxation Act (Enabling Act) does not give power to the Central Government to extend the erstwhile Sections 147 to 151 beyond 31.3.2021 and/or differ the operation of substituted provisions enacted by the Finance Act, 2021. The Delhi High Court therein concurring with the view of this ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessee under the amended provision open, while rights available to the assessing officer/revenue under the Finance Act, 2021 have been kept alive. The defect in the reassessment notices issued on or after 1.4.2021 had, thus, been removed. The directions issued by the Apex Court under Article 142 of the Constitution of India having a binding force PAN INDIA, will be violated if the extension in time for issuance of reassessment notices under Section 149 of the pre and post amended Income Tax Act, is not granted with the aid of the Enabling Act (TOLA 2020). 97. To deal with the said submission, we may note the decision of the Apex Court in Assistant Commissioner (CT) LTU, Kakinada others vs. Glaxo Smith Kline Consumer Health Care Limited [AIR 2020 Supreme Court 2819] , wherein the Apex Court was confronted with the exercise of writ jurisdiction under Article 226 of the Constitution of India in a case where the statutory remedy of appeal stood foreclosed by the law of limitation. While making comparison of the powers of the High Court under Article 226 of the Constitution and that of the Apex Court under Article 142, it was observed that though the powers of the High Court un ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... annot be read to me that extensions in time under the unamended Section 149 has been granted by the Apex court by applying TOLA, 2020 to the reassessment notices in respect of the proceedings relating to the past assessment years, where such notices were not issued uptill 31.3.2021 and they can be treated as extended reassessment notices and allowed to travel back in time to their original date when such notices were to be issued and then to apply amended Section 149 as interpreted by the revenue in Para 6.1 of the CBDT Instructions dated 11.5.2022. 100. In case, this argument of the learned counsels for the revenue is accepted it will result in permitting the revenue to initiate reassessment proceedings in a manner which cannot otherwise be done under the Statute. 101. The last submission of the learned counsels for the revenue is based on the observations of the Division Bench in Ashok Kumar Agarwal (supra) in paragraph 71 as under:- 71. Here, it may also be clarified, Section 3(1) of the Enabling Act does not itself speak of reassessment proceeding or of Section 147 or Section 148 of the Act as it existed prior to 01.04.2021. It only provides a general relaxation ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g unjust in the taxpayer escaping if the letter of the law fails to catch him on account of the legislature's failure to express itself clearly. (Reference Union of India others Ind-Swift Laboratories Ltd [2011 (4) SCC 635] ; CIT Vs. Modi Sugar Mills Ltd [AIR 1961 SC 1047] ; State of West Bengal Vs. Kesoram Industries Ltd [2004 (10) SCC 201] . Conclusions:- 105. Our answer to the two questions posed to us are, thus, as under:- (i) The reassessment proceedings initiated with the notice under Section 148 (deemed to be notice under Section 148-A), issued between 01.04.2021 and 30.06.2021, cannot be conducted by giving benefit of relaxation/extension under the Taxation and Other Laws (Relaxation And Amendment of Certain Provisions) Act' (TOLA) 2020 upto 30.03.2021, and the time limit prescribed in Section 149 (1)(b) (as substituted w.e.f. 01.04.2021) cannot be counted by giving such relaxation from 30.03.2020 onwards to the revenue. (ii) In respect of the proceedings where the first proviso to Section 149(1)(b) is attracted, benefit of TOLA' 2020 will not be available to the revenue, or in other words, the relaxation law under TOLA' 2020 would not ..... X X X X Extracts X X X X X X X X Extracts X X X X
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