Facts of the Case

The petitioner, Jaswant Singh Juneja, is the proprietor of M/s JMK Enterprises, engaged in the business of electronic goods and components. For Assessment Year (AY) 2014-15, the petitioner filed his return of income on 29.11.2014, declaring total income of ₹23,05,560.

On 31.03.2021, the Assessing Officer issued a notice under Section 148 proposing reassessment. In response, the petitioner filed the return along with supporting financial statements. After considering the material placed on record, the Assessing Officer passed an assessment order under Section 147 dated 26.03.2022, accepting the petitioner’s explanation.

Subsequently, on 31.05.2022, the Revenue issued a fresh notice under Section 148A(b), purportedly in compliance with the Supreme Court decision in Union of India v. Ashish Agarwal. Based on the same information and material that had already been examined in the concluded reassessment, an order under Section 148A(d) and a notice under Section 148, both dated 20.07.2022, were issued.

Aggrieved, the petitioner approached the Delhi High Court challenging the second reassessment action.

 

Issues Involved

Whether reassessment proceedings that have already culminated in an order under Section 147 can be reopened by invoking Ashish Agarwal.

Whether Ashish Agarwal permits reopening of concluded assessments.

Whether reassessment on the same set of reasons and material is permissible in law.

 

Petitioner’s Arguments

The petitioner contended that:

The reassessment proceedings for AY 2014-15 had already culminated in a valid order under Section 147 dated 26.03.2022.

The Supreme Court decision in Ashish Agarwal applies only to cases where reassessment notices were pending or had been quashed, and not where proceedings had attained finality.

Issuance of a second reassessment notice on identical material amounts to an impermissible review.

The impugned proceedings were therefore without jurisdiction and liable to be quashed.

 

Respondent’s Arguments

The Revenue argued that:

The earlier notice under Section 148 was digitally signed on 31.03.2021 but uploaded on the portal on 03.04.2021, rendering it invalid.

In view of Ashish Agarwal, all notices issued between 01.04.2021 and 30.06.2022 were required to be treated as notices under Section 148A(b).

Consequently, the reassessment order passed on 26.03.2022 was void, justifying initiation of fresh proceedings.

 

Court Order / Findings

The Delhi High Court rejected the Revenue’s submissions and held that:

The directions issued in Ashish Agarwal are confined to cases where reassessment proceedings had not attained finality.

Ashish Agarwal does not mandate reopening or invalidation of assessments that were already completed on merits.

The Supreme Court invoked Article 142 to balance equities in cases where reassessment notices were quashed, not to rewind concluded proceedings.

Reliance was placed on the Court’s earlier decision in Anindita Sengupta v. ACIT, wherein it was categorically held that Ashish Agarwal cannot be construed as permitting reopening of completed assessments.

Since reassessment for AY 2014-15 had already concluded on 26.03.2022, initiation of fresh reassessment on identical material was wholly impermissible.

 

Important Clarification

The Court clarified that:

Ashish Agarwal was intended to salvage reassessment proceedings that were stalled at the notice stage due to procedural defects.

It does not confer power on the Revenue to reopen matters that have reached finality.

Reassessment provisions cannot be used as a tool for repeated or endless reopening on the same facts.

 

Final Outcome

Writ Petition Allowed
Order under Section 148A(d) dated 20.07.2022 Quashed
Notice under Section 148 dated 20.07.2022 Set Aside
Second Reassessment Proceedings Held Without Jurisdiction

Link to download the order - https://www.mytaxexpert.co.in/uploads/1770193527_JASWANTSINGHJUNEJAVsINCOMETAXOFFICERWARD631DELHI.pdf

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