Facts of the Case

  • The petitioner challenged a notice dated 30.06.2021 issued under Section 148 for AY 2013–14.
  • The notice was received via email on 16.07.2021, i.e., after the limitation period.
  • Subsequently, an order under Section 148A(d) dated 29.06.2022 was passed.
  • The petitioner argued that the notice was not served within the permissible period and was therefore barred by limitation.

 Issues Involved

  1. Whether a reassessment notice under Section 148, though dated within limitation, but served after the limitation period, is valid in law?
  2. Whether such notice complies with the reassessment regime introduced by the Finance Act, 2021?
  3. Applicability of the Supreme Court judgment in Union of India v. Ashish Agarwal to delayed service cases.

 Petitioner’s Arguments

  • The limitation period for issuing notice under the old Section 148 expired on 30.06.2021.
  • Service of notice on 16.07.2021 makes it time-barred, regardless of the date mentioned on the notice.
  • Relied on:
    • Suman Jeet Agarwal v. ITO
    • Vinayak Services Pvt. Ltd. v. ITO
  • Argued that Ashish Agarwal judgment does not apply since it only validates notices issued within the prescribed window (01.04.2021 to 30.06.2021).

Respondent’s Arguments

  • The notice bore a Document Identification Number (DIN), indicating it was generated on 30.06.2021.
  • Delay in service was due to a technical glitch.
  • However, the respondent conceded that the issue is covered by earlier Delhi High Court judgments holding such notices invalid.

Court’s Findings / Order

  • The Court observed that:
    • The actual service of notice occurred on 16.07.2021, as evidenced by email records.
    • No proof of service prior to that date was produced.
  • Held:
    • Service beyond limitation renders the notice invalid, even if dated earlier.
    • The case is covered by:
      • Suman Jeet Agarwal v. ITO
      • Vinayak Services Pvt. Ltd. v. ITO
  • Impugned notice under Section 148 was set aside as time-barred.

Important Clarification

  • Mere generation or dating of notice within limitation is insufficient.
  • Valid service within limitation is mandatory under reassessment proceedings.
  • Technical glitches cannot cure jurisdictional defects like limitation.
  • Reinforces strict compliance under the Finance Act, 2021 reassessment regime.

Link to download the order -https://delhihighcourt.nic.in/app/showFileJudgment/RAS14022023CW127572022_224213.pdf

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