Facts of the Case

  • The petitioners challenged reassessment notices issued under Section 148A(b) and subsequent orders under Section 148A(d).
  • The notices, though dated 02.06.2022, were actually served via email on 08.06.2022, i.e., after the prescribed deadline.
  • As per CBDT Instruction No. 1/2022 (issued pursuant to Supreme Court judgment in Union of India vs Ashish Aggarwal), information/material had to be provided within 30 days i.e., by 02.06.2022.
  • The petitioners contended that delayed communication rendered the notices legally ineffective.

Issues Involved

  1. Whether notices under Section 148A(b) served after the prescribed timeline retain legal validity.
  2. Whether violation of CBDT Instruction No. 1/2022 invalidates reassessment proceedings.
  3. Whether absence of mandatory details (name/designation of issuing authority) violates Section 282A.

Petitioner’s Arguments

  • Notices issued under Section 148A(b) lost legal efficacy as they were served after 03.06.2022.
  • CBDT instructions mandated strict adherence to timelines; non-compliance vitiates proceedings.
  • The notices failed to comply with Section 282A as they did not mention the name/designation of the issuing authority.
  • Consequently, both notices and subsequent orders were liable to be quashed.

Respondent’s Arguments

  • The Revenue defended the reassessment proceedings and the issuance of notices.
  • It relied upon procedural compliance under the reassessment framework post the Supreme Court judgment in Union of India vs Ashish Aggarwal.
  • However, no satisfactory justification was provided for delay in service of notices.

Court Findings / Order

  • The Court held that service of notices after 03.06.2022 violated CBDT Instruction No. 1/2022, which mandated strict timelines.
  • Such delayed notices were held to be unsustainable in law.
  • The Court further observed violation of Section 282A due to absence of proper identification of the issuing authority.
  • Reliance was placed on a coordinate bench decision in LSR Medical Pvt. Ltd. vs DCIT.

Final Order

  • Notices under Section 148A(b) and orders under Section 148A(d) were set aside.
  • Writ petitions were allowed.
  • Liberty granted to Revenue to initiate fresh action in accordance with law.

Important Clarification

  • Compliance with CBDT instructions is mandatory, not directory.
  • Timelines in reassessment proceedings are strictly enforceable.
  • Procedural lapses such as delayed service or improper authentication can invalidate the entire reassessment process.

Link to download the order -  https://delhihighcourt.nic.in/app/showFileJudgment/60826072023CW62172023_153603.pdf

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