# Rajeev Bansal v. U.O.I. & Ors

- **Citation:** (2023) 3 ILRA 24
- **Court:** High Court of Judicature at Allahabad
- **Decided:** 2023-02-22
- **Case number:** Writ Tax No. 1086 of 2022
- **Bench:** Mrs. Sunita Agarwal, Vipin Chandra Dixit
- **Source:** https://unisonlegal.in/judgment/allahabad-high-court/rajeev-bansal-v-u-o-i-ors-49950
- **Pages:** 44

## Headnote

A.S.G.I., Sri Gaurav Mahajan, Ms. Manju
Ghildyal, Sri Sudarshan Singh, Sri Krishna,
Sri Ashish Agarwal, Sri Anant Kumar Tiwari,
Sri Gopal Verma, Sri N.C. Gupta, Sri
Praveen Kumar, Sri Shashi Agrawal

Civil Law - Income Tax Act, 1961-Section
148-A(d)-Impugned order-passed by assessing
authority
u/s
148-A(d)
-reassessment
proceedings issued between 01.04.2021 and
30.06.2021-cannot be conducted by giving
benefit of relaxation/extention under the TOLA,
2020 upto 30.03.2021-time limit u/s 149 (1)(b)
cannot be counted by giving such relaxation
from 30.03.2020 onwards to the revenue-Where
first proviso to sec.149(1) (b) is attracted-
benefit of TOLA, 2020 will not be available to
the revenue-Re-assessment notice issued on or
after 1.04.2021 for different Assessment years
are to be dealt by revenue.
W.P. disposed. (E-9)
List of Cases cited:

## Text

_Characters 0–39,878 of 148,621. This is a partial read: ask again with offset=39878 for what follows._

24 INDIAN LAW REPORTS ALLAHABAD SERIES
the provisions of Rule 142(1A) of the
Central Goods and Service Tax Rules, 2017
(hereinafter referred to as "the Rules) as
existing at the time of initiation of the
proceedings against the petitioner before it
was amended on October 15, 2020, before
passing any order under Section 74 of the
Act, a show cause notice in Part A of
FORM GST DRC-01A is required to be
issued. It is only thereafter that the
jurisdiction is vested with the Competent
Authority to pass order. In the case in hand,
notice in Part A of FORM GST DRC-01A
having not been issued, any subsequent
proceeding will be without jurisdiction as
the petitioner did not have fair opportunity
to respond.

3. In support of the argument, reliance
was placed on a Division Bench judgment
of Delhi High Court in Gulati Enterprises
v. Central Board of Indirect Taxes and
Customs & others, 2022 U.P.T.C. (Vol.
111) - 1271 and order dated January 2,
2023 passed by this Court in Writ Tax
No.1512 of 2022, titled as M/s Skyline
Automation Industries v. State of U.P.
and another.

4. On the other hand, learned counsel
for the respondents, while not disputing the
fact that notice in Part A of FORM GST
DRC-01A was not issued, submitted that
subsequent reminders had given fair
opportunity of hearing to the petitioner to
place
his
case
before
the
authority
concerned, which he failed to avail of. The
impugned order now passed is appealable
under Section 107 of the Act.

5. After hearing learned counsel for
the parties, in our opinion, present writ
petition deserves to be allowed, as
admittedly for initiation of proceedings
against the petitioner a notice as provided
for under Rule 142(1A) of the Rules in Part
A of FORM GST DRC-01A was not issued,
which provided for communication of
details of any tax, interest and penalties as
ascertained by the officer. Any subsequent
reminder will not cure inherent defect in
proceedings initiated against the petitioner.
Similar view has been expressed by the
Delhi High Court in Gulati Enterprises'
case (supra) and this Court in M/s Skyline
Automation Industries' cases (supra)
wherein also in identical facts pertaining to
a case prior to the amendment of Rule
142(1A) of the Rules with effect from
October 15, 2020, the impugned show
cause notice was set aside and the matter
was remitted back to authority concerned to
initiate fresh proceedings in accordance
with law.

6. For the reasons mentioned above,
the writ petition is allowed. The impugned
order dated November 10, 2022 is quashed.
However, with liberty to the respondents to
initiate fresh proceedings against the
petitioner in accordance with law.
----------
(2023) 3 ILRA 24
ORIGINAL JURISDICTION
CIVIL SIDE
DATED: ALLAHABAD 22.02.2023

BEFORE

THE HON'BLE MRS. SUNITA AGARWAL, J.
THE HON'BLE VIPIN CHANDRA DIXIT, J.

Writ Tax No. 1086 of 2022

Rajeev Bansal ...Petitioner
Versus
U.O.I. & Ors. ...Respondents

Counsel for the Petitioner:
Sri Abhinav Mehrotra, Sri Satya Vrata
Mehrotra, Sri Rahul Agarwal, Sri Ashish
Bansal, Sri Shubham Agarwal, Sri Ankur
3 All. Rajeev Bansal Vs. U.O.I. & Ors.
25
Agarwal,
Sri
Suyash
Agarwal,
Sri
V.K.Sabarwal, Sri R.B. Gupta, and Sri
Krishna Vyas

Counsel for the Respondents:
A.S.G.I., Sri Gaurav Mahajan, Ms. Manju
Ghildyal, Sri Sudarshan Singh, Sri Krishna,
Sri Ashish Agarwal, Sri Anant Kumar Tiwari,
Sri Gopal Verma, Sri N.C. Gupta, Sri
Praveen Kumar, Sri Shashi Agrawal

Civil Law - Income Tax Act, 1961-Section
148-A(d)-Impugned order-passed by assessing
authority
u/s
148-A(d)
-reassessment
proceedings issued between 01.04.2021 and
30.06.2021-cannot be conducted by giving
benefit of relaxation/extention under the TOLA,
2020 upto 30.03.2021-time limit u/s 149 (1)(b)
cannot be counted by giving such relaxation
from 30.03.2020 onwards to the revenue-Where
first proviso to sec.149(1) (b) is attracted-
benefit of TOLA, 2020 will not be available to
the revenue-Re-assessment notice issued on or
after 1.04.2021 for different Assessment years
are to be dealt by revenue.
W.P. disposed. (E-9)
List of Cases cited:

1. Ashok Kumar Agarwal Vs U.O.I., 2021 ILR
ALL 816

2. U.O.I. Vs Ashish Agarwal, AIR 2022 SC 2781

3. Tata Communications Transformation Services
Ltd. Vs Assistant Commissioner of Income Tax,
2022 Online Bom 664

4. Touchstone Holdings Pvt. Ltd Vs Income Tax
Officer, Delhi & ors., Writ Petition No.13102 of
2022

5. Mon Mohan Vs Assistant Commissioner, 2021
133 taxmann.com 166

6. Raymond Woolen Mills Ltd. Vs Income Tax
Officer, 1999 (236 ITR 34 (SC)

7. Commissioner in Income Tax & ors. Vs
Chhabil Das Agarwal, 2013 (217) Taxmann 143
(SC)

8.
Coca
Cola
India
Inc.
Vs
Additional
Commissioner of Income Tax & ors., 2011 (336)
ITR 1 (SC)

9. Gian Casting Pvt. Ltd. Vs CBDT, Special Leave
to Appeal © No.10762/2022

10. Anshul Jain Vs Pr. Commissioner of Income
Tax, Special Leave to Appeal (C) No.14823/2022
11. Gulmuhar Silk Pvt. Ltd Vs Income Tax
Officer,
W.P.
(C)
5787/2022
&
CM
Appl.17297/2022

12. Gian Casting Pvt. Ltd. Vs Central Board of
Direct Taxes, CWP No.9142 of 2022

13. Anshul Jain Vs Pr. Commissioner of Income
Tax, CWP No.10219 of 2022

14. Midland Microfin Ltd. Vs U.O.I. & ors., CWP
No.10583 of 2022 (O&M)

15. Harinder Singh Bedi Vs U.O.I. & ors., Writ
Petition No.22734 of 2022

16. Assistant Commissioner (CT) LTU, Kakinada
& ors. Vs Glaxo Smith Kline Consumer Health
Care Ltd., AIR 2020 Supreme Court 2819

17. Union Carbide Corporation & ors. Vs U.O.I. &
ors., (1991) 4 SCC 584

18. U.O.I. & ors. Ind-Swift Laboratories Ltd,
2011 (4) SCC 635

19. CIT Vs Modi Sugar Mills Ltd, AIR 1961 SC
1047

20. St. of W. B. Vs Kesoram Industries Ltd, 2004
(10) SCC 201
(Delivered by Hon'ble Mrs. Sunita
Agarwal, J.
&
Hon'ble Vipin Chandra Dixit, J.)
26 INDIAN LAW REPORTS ALLAHABAD SERIES

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 148A(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
between 01.04.2021 to 30.06.2021.

3. At the outset, learned counsels for
the parties had agreed to address the Court
on two questions framed and discussed
jointly, answer to which would decide the
fate of the individual notices under
challenge, on factual aspects.

4. We have, therefore, not entered into
the merits of the individual notices under
challenge and heard the learned counsels
for the parties on the following two legal
issues:-

(i) Whether 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, can be conducted by
giving benefit of relaxation/extension under
the Taxation and Other Laws (Relaxation &
Amendment of Certain Provisions) Act'
(TOLA)' 2020 upto 30.03.2021, and then
the time limit prescribed in Section 149
(1)(b) (as substituted w.e.f. 01.04.2021) is
to be counted by giving such relaxation,
benefit of TOLA from 30.03.2020 onwards
to the revenue.

(ii) Whether in respect of the
proceedings where the first proviso to
Section 149(1)(b) is attracted, benefit of
TOLA' 2020 will be available to the
revenue, or in other words the relaxation
law under TOLA' 2020 would govern the
time frame prescribed under the first
proviso to Section 149 as inserted by the
Finance Act' 2021, in such cases?

5. As noted above, the impugned
notices
have
been
issued
between
01.04.2021
and
30.06.2021.
For
the
assessment year 2013-14 and 2014-15, it
was argued by the learned counsels for the
assessees that the assessment for these
years cannot be reopened, in as much as,
maximum period of six years prescribed in
pre-amendment
provision
of
Section
149(1)(b) had expired on 31.03.2021. No
notice under Section 148 could be issued in
a case for the assessment year 2013-14 and
2014-15 on or after 01.04.2021 being time
barred, on account of being beyond the
time limit specified under the provisions of
Section
149(1)(b)
as
they
stood
immediately before the commencement of
the Finance Act' 2021. For the assessment
year 2015-16, 2016-17, 2017-18, the
contention is that the monetary threshold
and other requirements of the Income Tax
Act in the post-amendment regime, i.e. after
the commencement of the Finance Act'
2021 have to be followed. The validity of
3 All. Rajeev Bansal Vs. U.O.I. & Ors.
27
the jurisdictional notice under Section 148
is, thus, to be tested on the touchstone 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 preamended provisions) shall be treated as the
date of issuance of notice under Section 148A (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.

Legislative Scheme:-

7. To deal with the above noted issues,
at the outset, we are required to note the
legislative scheme of Section 148 of
reopening of assessment pre and post
amendment by the Finance Act 2021. The
relevant provisions of TOLA 2020 are also
to be noted herein:-

8. The pre-amendment Section 148 is
quoted as under:-

148.
Before
making
the
assessment,
reassessment
or
recomputation under section 147, and subject
to the provisions of section 148A, the
Assessing Officer shall serve on the
assessee a notice, along with a copy of the
order passed if required, under clause (d)
of section 148A, requiring him to furnish
within such period, as may be specified in
such notice, a return of his income or the
income of any other person in respect of
which he is assessable under this Act
during the previous year corresponding to
the relevant assessment year, in the
prescribed form and verified in the
prescribed manner and setting forth such
other be, apply accordingly as if such
return were a return required to be
furnished under section 139

Provided that no notice under this
section shall be issued unless there is
information with the Assessing Officer
which suggests that the income charge.
able to tax has escaped assessment in the
case of the assessee for the relevant
assessment year and the Assessing Officer
has obtained prior approval of the specified
authority to issue such notice.

Explanation 1. For the purposes
of this section and section 148A, the
information with the Assessing Officer
which suggests that the income chargeable
to tax has escaped assessment means,-

(i) any information flagged in the
case of the assessee for the relevant
assessment year in accordance with the risk
management strategy formulated by the
Board from time to time;

(ii) any final objection raised by
the Comptroller and Auditor General of
India to the effect that the assessment in the
case of the assessee for the relevant
assessment year has not been made in
accordance with the provisions of this Act.
28 INDIAN LAW REPORTS ALLAHABAD SERIES

Explanation 2.-For the purposes
of this section, where,

(i) a search is initiated under
section 132 or books of account, other
documents or any assets are requisitioned
under section 1324, 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 sub-section (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 conducted in the case of the
assessee or money, bullion, jewellery or
other valuable article or thing or books of
account or documents are seized or
requisitioned in case of any other person.

Explanation 3.-For the purposes
of this section, specified authority means
the specified authority referred to in
Section 151.

9. Post Amendment Section 148 is
quoted as under:-

"148. Issue of notice where
income
has
escaped
assessment.--
Before
making
the
assessment,
reassessment or recomputation under
section 147, and subject to the provisions
of section 148A, the Assessing Officer
shall serve on the assessee a notice, along
with a copy of the order passed, if
required, under clause (d) of section
148A, requiring him to furnish within
such period, as may be specified in such
notice, a return of his income or the
income of any other person in respect of
which he is assessable under this Act
during the previous year corresponding to
the relevant assessment year, in the
prescribed form and verified in the
prescribed manner and setting forth such
other particulars as may be prescribed;
and the provisions of this Act shall, so far
as may be, apply accordingly as if such
return were a return required to be
furnished under section 139:

Provided that no notice under
this section shall be issued unless there is
information with the Assessing Officer
which suggests that the income chargeable
to tax has escaped assessment in the case of
the assessee for the relevant assessment
year and the Assessing Officer has obtained
prior approval of the specified authority to
issue such notice.

Explanation 1.-- For the purposes
of this section and section 148A, the
information with the Assessing Officer
which suggests that the income chargeable
to tax has escaped assessment means,--
3 All. Rajeev Bansal Vs. U.O.I. & Ors.
29

(i) any information flagged in the
case of the assessee for the relevant
assessment year in accordance with the risk
management strategy formulated by the
Board from time to time;

(ii) any final objection raised by
the Comptroller and Auditor General of
India to the effect that the assessment in the
case of the assessee for the relevant
assessment year has not been made in
accordance with the provisions of this Act.

Explanation 2.-- For the purposes
of this section, where,--

(i) a search is initiated under
section 132 or books of account, other
documents or any assets are requisitioned
under 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 sub-section (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 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 conducted in the
case of the assessee or money, bullion,
jewellery or other valuable article or thing
or books of account or documents are
seized or requisitioned in case of any other
person.

Explanation 3.-- For the purposes
of this section, specified authority means
the specified authority referred to in section
151."

10. Relevant extract of Section 3(1) of
TOLA 2020 is to be noted hereunder:-

3. (1) Where, any time limit has
been specified in, or prescribed or notified
under, the specified Act which falls during
the period from the 20th day of March,
2020 to the 31st day of December, 2020, or
such other date after the 31st day of
December,
2020,
as
the
Central
Government may, by notification, specify in
this
behalf,
for
the
completion
or
compliance of such action as--

(a) completion of any proceeding
or passing of any order or issuance of any
notice, intimation, notification, sanction or
approval, or such other action, by whatever
name called, by any authority, commission
or tribunal, by whatever name called,
under the provisions of the specified Act; or

(b) filing of any appeal, reply or
application or furnishing of any report,
document, return or statement or such
other record, by whatever name called,
under the provisions of the specified Act; or

(c) in case where the specified Act
is the Income-tax Act, 1961,--
30 INDIAN LAW REPORTS ALLAHABAD SERIES

(i) making of investment, deposit,
payment,
acquisition,
purchase,
construction or such other action, by
whatever name called, for the purposes of
claiming any deduction, exemption or
allowance under the provisions contained
in--

(I) sections 54 to 54GB, or under
any provisions of Chapter VI-A under the
heading "B.-Deductions in respect of
certain payments" thereof; or

(II) such other provisions of that
Act,
subject
to
fulfillment
of
such
conditions, as the Central Government
may, by notification, specify; or

(ii) beginning of manufacture or
production
of articles
or
things
or
providing any services referred to in
section 10AA of that Act, in a case where
the letter of approval, required to be issued
in accordance with the provisions of the
Special Economic Zones Act, 2005, has
been issued on or before the 31st day of
March, 2020, and where 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,
Extraordinary, Part II, Section 3, Subsection (ii), vide number S.O. 4805(E),
dated the 31st December, 2020, the Central
Government hereby specifies that-

(A) where the specified Act is the
Income-tax Act, 1961 (43 of 1961)
(hereinafter referred to as the Income-tax
Act) and, --

(a) the completion of any action
referred to in clause (a) of sub-section (1)
of section 3 of the Act relates to passing of
an order under sub-section (13) of section
144C or issuance of notice under section
148 as per time-limit specified in section
149 or sanction under section 151 of the
Income-tax Act, --

(i) the 31 day of March, 2021
shall be the end date of the period during
which the time- limit, specified in, or
prescribed or notified under, the Incometax Act falls for the completion of such
action; and

(ii) the 30th day of April, 2021
shall be the end date to which the timelimit for the completion of such action shall
stand extended..

Explanation.- For the removal of
doubts, it is hereby clarified that for the
purposes of issuance of notice under
3 All. Rajeev Bansal Vs. U.O.I. & Ors.
31
section 148 as per time-limit specified in
section 149 or sanction under section 151
of the Income-tax Act, under this subclause, the provisions of section 148,
section 149 and section -151 of the Incometax Act, as the case may be, as they stood
as on the 31st day of March 2021, before
the commencement of the Finance Act,
2021, shall apply.

(b) the compliance of any action
referred to in clause (b) of sub-section (1)
of section 3 of the said Act relates to
intimation of Aadhaar number to the
prescribed authority under sub-section (2)
of section 139AA of the Income-tax Act,
the time-limit for compliance of such
action shall stand extended to the 30th day
of June, 2021.

(B) where the specified Act is the
Chapter VIII of the Finance Act, 2016 (28
of 2016) (hereinafter referred to as the
Finance Act) and the completion of any
action referred to in clause (a) of subsection (1) of section 3 of the said Act
relates to sending an intimation under subsection (1) of section 168 of the Finance
Act.

(1) the 31 day of March, 2021
shall be the end date of the period during
which the time- limit, specified in, or
prescribed or notified under, the Finance
Act falls for the completion of such action;
and

(ii) the 30th day of April, 2021
shall be the end date to which the timelimit for the completion of such action shall
stand extended.

[Notification No. 20/2021/F. No.
370142/35/2020-TPL]

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, Subsection (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 vide number S.O.
1432(E) dated the 31" March, 2021,
respectively (hereinafter referred to as the
said notifications), the Central Government
hereby specifies for the purpose of subsection (1) of section 3 of the said Act that,

(A) where the specified Act is the
Income-tax Act, 1961 (43 of 1961)
(hereinafter referred to as the Income-tax
Act) and

(a) the completion of any action,
referred to in clause (a) of sub-section (1)
of section 3 of the said Act, relates to
passing of any order for assessment or
reassessment under the Income-tax Act,
and the time limit for completion of such
action under section 153 or section 153B
thereof, expires on the 30th day of April,
2021 due to its extension by the said
32 INDIAN LAW REPORTS ALLAHABAD SERIES
notifications, such time limit shall further
stand extended to the 30th day of June,
2021;

(b) the completion of any action,
referred to in clause (a) of sub-section (1)
of section 3 of the said Act, relates to
passing of an order under sub-section (13)
of section 144C of the Income-tax Act or
issuance of notice under section 148 as per
time-limit specified in section 149 or
sanction under section 151 of the Incometax Act, and the time limit for completion
of such action expires on the 30th day of
April, 2021 due to its extension by the said
notifications, such time limit shall further
stand extended to the 30th day of June,
2021.

Explanation. For the removal of
doubts, it is hereby clarified that for the
purposes of issuance of notice under
section 148 as per time-limit specified in
section 149 or sanction under section 151
of the Income-tax Act, under this subclause, the provisions of section 148,
section 149 and section 151 of the Incometax Act, as the case may be, as they stood
as on the 31" day of March 2021, before
the commencement of the Finance Act,
2021, shall apply.

(B) where the specified Act is the
Chapter VIII of the Finance Act, 2016 (28
of 2016) (hereinafter referred to as the
Finance Act) and the completion of any
action, referred to in clause (a) of subsection (1) of section 3 of the said Act,
relates to sending an intimation under subsection (1) of section 168 of the Finance
Act, and the time limit for completion of
such action expires on the 30th day of
April, 2021 due to its extension by the said
notifications, such time limit shall further
stand extended to the 30th day of June,
2021.

[Notification No. 38 /2021/ F. No.
370142/35/2020-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, Subsection (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
India1, 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
Agarwal2.

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 up for consideration
before this Court in Ashok Kumar
Agarwal (Supra). The provisions of the
Income Tax Act' 1961, as they existed prior
to the amendment by Finance Act' 2021,
read
with
the
provisions
of
TOLA/Relaxation Act No.38 of 2020 were
applied in the reassessment proceedings
initiated against the assessees while issuing
notices under Section 148 of the Income
3 All. Rajeev Bansal Vs. U.O.I. & Ors.
33
Tax Act on or after 01.04.2021. The
challenge to the notices therein was made
on the ground that the pre-existing Sections
147 to 151 of the Act' 1961 stood repealed
and replaced by the Finance Act 2021 and
upon enforcement of the amendment, the
entire statutory scheme of conducting
reassessment proceedings underwent a sea
change. With the substitution of old
provisions,
pre-existing
provisions
pertaining to reassessment under the Act
could not be applied to conduct the
proceedings after enforcement of the
Finance Act' 2021.

15.
The
Relaxation Act/Enabling
Act/TOLA, 2020 was enacted in March
2020
on
account
of
unforeseen
circumstances faced by the country due to
onset of the pandemic Covid 19 which has
led to enforcement of intermittent lock
downs.
Normal
functioning
of
the
government and its institutions had been
put to halt. Because of the obstructions due
to spread of the Pandemic Covid-19, the
Enabling Act' 2020 was enacted solely to
extend the limitation under the provisions
of the IT Act' 1961.

16. It was argued therein that the
Finance Act 2021, which is a latter Act
does not contain any saving clause as may
allow
the
pre-existing
provisions
an
extended life. After the enforcement of the
amendment, the pre-existing provisions,
thus, could not be pressed into service by
the revenue. The Enabling Act does not and
could not save the pre-existing Sections
147, 148 to 151 of the IT Act, pertaining to
reassessment nor overriding effect can arise
or be given to the pre-existing reassessment
legislative regime by the Enabling Act,
since on the date of enactment of the
Enabling Act, the Finance Act 2021 was
not born. In absence of any saving clause in
the Finance Act' 2021, there exists no
power either under Section 3(1) of the
Enabling Act or any other law as may
validate the issuance of the impugned
notification by the Central Government to
apply
pre-existing
provisions
in
the
reassessment proceeding initiated on or
after
01.04.2021. The
Enabling Act,
therefore, became 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 year. Therefore, on
1st April every year, it is the Act as
amended by the Finance Act, for that year
which is applied. In the present case, it is
the Act as amended by the Finance Act
34 INDIAN LAW REPORTS ALLAHABAD SERIES
2021, that confronted the Enabling Act as
was pre-existing. In absence of any
legislative intent expressed either under the
Finance Act, 2021 or under the Enabling
Act, to preserve any part of the pre-existing
Act, plainly, reference to provisions of
Sections 147 and 148 of the Act and the
words
'assessment'
and
'reassessment'
appearing in the Notifications issued under
the Enabling Act may be read to be
indicating only at proceedings already
commenced prior to 01.04.2021, under the
Act (before amendment by the Finance Act,
2021). The delegated action performed
under the Enabling Act cannot, itself create
an overriding effect in favour of the
Enabling Act.

(iii) The Enabling Act read with
its Notifications does not validate the
initiation of any proceeding that may
otherwise be incompetent under the law.
That law only affects the time limitation to
conduct or conclude any proceeding that
may have been or may be validly instituted
under the Act, whether prior to or after its
amendment by Finance Act, 2021. Insofar
as, Section 1(2)(a) unequivocally enforced
Sections 2 to 88 of the Finance Act, 2021,
w.e.f. 01.04.2021, there can be no dispute if
any valid proceeding could be initiated
under the pre-existing Section 148 read
with Section 147, after 01.04.2021. In
support thereof other submission also
appear to exist - based upon the enactment
of Section 148A (w.e.f. 01.04.2021).

(iv) The delegation made could
be exercised within the four corners of the
principal legislation and not to overreach
it. Insofar as the Enabling Act does not
delegate any power to legislate - with
respect to enforceability of any provision of
the Finance Act, 2021 and those provisions
(Sections 2 to 88) had come into force, on
their own, on 01.04.2021, any exercise of
the delegate under the Enabling Act, to
defeat the plain enforcement of that law
would be wholly unconstitutional.

(v) It also appears to be the
submission of learned counsel for the
petitioners that the Parliament being aware
of all realities, both as to the fact situation
and the laws that were existing, it had
consciously enacted the Enabling Act, to
extend certain time limitations and to
enforce only a partial 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 of Sections 147, 148,
149, 151 (as they existed upto 31.03.2021),
stood substituted and a new provision by
way of Section 148-A was inserted. In
absence of any saving clause, to save the
3 All. Rajeev Bansal Vs. U.O.I. & Ors.
35
pre-existing
(and
now
substituted)
provisions, the revenue authority could
only initiate reassessment proceeding on or
after 01.04.2021, in accordance with the
substituted law and not the pre-existing
laws. It was noted that the Enabling
provisions, that was pre-existing, is an
enactment to extend timelines only. In
absence of any express provisions in the
latter statute the Finance Act' 2021, to save
applicability of the provisions of Section
147
to
151,
as
they
existed
upto
31.03.2021, all references to issuance of
notice contained in the Enabling Act must
be read as reference to the substituted
provisions only, from 01.04.2021 onwards.
However, there is no difficulty in applying
the pre-existing provisions to pending
proceeding.

19. The submission of the revenue that
the provision of Section 3(1) of the
Enabling Act gave overriding effect to that
Act and, therefore, saved the provisions as
existed under the unamended law has been
turned down with the finding that the
saving could arise only if jurisdiction had
been validly assumed before 01.04.2021. It
was observed that reassessment proceeding
can be said to be pending before the
Assessing Authority only upon jurisdiction
being validly assumed by the Assessing
Authority. All reassessment notices issued
on or after 01.04.2021 cannot be dealt with
by applying the pre-existing provisions, as
applicable to pending proceedings. No time
extension could be given under Section
3(1) of the Enabling Act, read with the
Notifications issued thereunder.

20. It was held that the Section 3(1) of
the Enabling Act only speaks of saving or
protecting certain proceedings from being
hit by the rule of limitation. The Enabling
Act and the notifications issued thereunder
only protected certain proceedings that may
have become time barred on 20.03.2020,
upto the date 30.06.2021 or till 31.03.2022,
in
accordance
with
the
Notification
No.3814 dated 17.09.2021 issued under
Section 3(1) of the Enabling Act. But to
allow the Central Government to extend
such
limitation
by
virtue
of
the
notifications after 31.03.2021 indefinitely,
would be to allow the validity of an enacted
law i.e. Finance Act' 2021 to be defeated by
a purely colourable 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/preexisting 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 unless that burden had
been discharged by the respondents, we are
36 INDIAN LAW REPORTS ALLAHABAD SERIES
unable to accept the further submission
advanced
by
the
learned
Additional
Solicitor General of India that practicality
dictates that the reassessment proceedings
be protected. Practicality, if any, may lead
to legislation.