Facts of the Case

  • Multiple writ petitions were filed challenging reassessment notices issued after 1 April 2021.
  • Petitioners contended that notices were issued under the old provisions of Section 148, ignoring amendments introduced by the Finance Act, 2021.
  • The Revenue relied on TOLA (Relaxation Act, 2020) to justify extension of time limits and applicability of the old provisions.
  • The issue had also been considered in earlier similar writ petitions where interim protection was granted.

Issues Involved

  1. Whether reassessment notices issued after 01.04.2021 under old Section 148 are valid?
  2. Whether TOLA permits continuation of the old reassessment regime beyond the amendment date?
  3. Whether compliance with Section 148A procedure is mandatory for notices issued post amendment?

Petitioner’s Arguments

  • Notices are void ab initio as they were issued under repealed provisions.
  • After Finance Act, 2021, reassessment must follow Section 148A, including prior inquiry and opportunity of hearing.
  • TOLA only extends time limits, not substantive law or procedure.
  • Use of old provisions violates principles of natural justice and statutory mandate. 

Respondent’s Arguments

  • The Revenue argued that due to TOLA, time limits for issuing notices stood extended.
  • It was contended that the old provisions could still be invoked during the extended period.
  • Reliance was placed on Section 6 of the General Clauses Act, arguing continuity of proceedings.

Court’s Findings / Order

  • The Court observed prima facie that new provisions introduced by Finance Act, 2021 must be complied with.
  • It held that TOLA cannot override statutory amendments introducing a new reassessment framework.
  • The Court noted that:
    • Procedural safeguards under Section 148A are mandatory.
    • Old provisions cannot be used after 01.04.2021.
  • Interim Relief Granted:
    • Respondents restrained from proceeding further with reassessment based on impugned notices.
    • Notices issued; matter listed for further hearing.

 Important Clarifications by Court


  • TOLA extends limitation, not legal regime.
  • New reassessment procedure is mandatory and cannot be bypassed.
  • Section 6 of General Clauses Act does not save old reassessment procedure after legislative substitution.
  • Ensured adherence to principles of natural justice embedded in Section 148A.

Sections Involved

  • Section 147 – Income Escaping Assessment
  • Section 148 – Issue of Notice
  • Section 148A – New Procedure (Post Finance Act, 2021)
  • Section 149 – Time Limit for Notice
  • Section 151 – Sanction for Issue of Notice
  • Section 6 – General Clauses Act, 1897
  • Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020 (TOLA)

Link to download the order -https://delhihighcourt.nic.in/app/case_number_pdf/2021:DHC:4493-DB/MMH02092021CW93302021_163051.pdf

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