# Union of India & Ors v. Rajeev Bansal

- **Citation:** 2024 INSC 754
- **Court:** Supreme Court of India
- **Decided:** 2024-10-03
- **Case number:** Civil Appeal No. 8629 of 2024
- **Bench:** Dr Dhananjaya Y Chandrachud
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/union-of-india-ors-v-rajeev-bansal-37258
- **Pages:** 76

## Headnote

Whether after 01 April 2021, the Income Tax Act, 1961 has to be
read along with the substituted provisions; whether Taxation and
Other Laws (Relaxation and Amendment of Certain Provisions)
Act 2020 (TOLA) will continue to apply to the Income Tax Act
after 01 April 2021; whether section 3(1) of TOLA overrides
section 149 of the Income Tax Act; whether TOLA will extend
the time limit for the grant of sanction by the authority specified
under section 151 of the Income Tax Act; whether the directions
in Ashish Agarwal will extend to all the reassessment notices
issued under old regime; what were the requirements for issuing
reassessment notice under section 148 of the new regime.
Headnotes†
Income Tax Act, 1961 - Finance Act 2021 - Whether after
01 April 2021, the Income Tax Act, 1961 has to be read along
with the substituted provisions:
Held: After 01 April 2021, the Income Tax Act has to be read along
with the substituted provisions. [Para 114(a)]
Income Tax Act, 1961 - Taxation and Other Laws (Relaxation
and Amendment of Certain Provisions) Act 2020 (TOLA) -
Finance Act 2021 - Whether TOLA will continue to apply to
the Income Tax Act after 01 April 2021:
Held: TOLA will continue to apply to the Income Tax Act after 01
April 2021 if any action or proceeding specified under the substituted
provisions of the Income Tax Act falls for completion between 20
March 2020 and 31 March 2021. [Para 114(b)]
* Author
1634
[2024] 10 S.C.R.
Digital Supreme Court Reports
Income Tax Act, 1961 - s.149 - Taxation and Other Laws
(Relaxation and Amendment of Certain Provisions) Act 2020 -
s.3(1) - Finance Act 2021 -Whether section 3(1) of TOLA
overrides section 149 of the Income Tax Act:
Held: Section 3(1) of TOLA overrides Section 149 of the Income
Tax only to the extent of relaxing the time limit for issuance of a
reassessment notice under Section 148. [Para 114(c)]
Income Tax Act, 1961 - Taxation and Other Laws (Relaxation
and Amendment of Certain Provisions) Act 2020 (TOLA) -
Finance Act 2021 - Whether TOLA will extend the time limit
for the grant of sanction by the authority specified under
section 151 of the Income Tax Act :
Held: TOLA will extend the time limit for the grant of sanction by
the authority specified under Section 151 - The test to determine
whether TOLA will apply to Section 151 of the new regime is this:
if the time limit of three years from the end of an assessment
year falls between 20 March 2020 and 31 March 2021, then
the specified authority under Section 151(i) has extended time
till 30 June 2021 to grant approval - In the case of Section 151
of the old regime, the test is: if the time limit of four years from
the end of an assessment year falls between 20 March 2020
and 31 March 2021, then the specified authority under Section
151(2) has extended time till 31 March 2021 to grant approval.
[Para 114(d), 114(e)]
Income Tax Act, 1961 - Taxation and Other Laws (Relaxation
and Amendment of Certain Provisions) Act, 2020 - Finance Act
2021 - Whether the directions in Ashish Agarwal will extend
to all the reassessment notices issued under old regime:
Held: The directions in Ashish Agarwal will extend to all the ninety
thousand reassessment notices issued under the old regime
during the period 01 April 2021 and 30 June 2021 - The time
during which the show cause notices were deemed to be stayed
is from the date of issuance of the deemed notice between 01
April 2021 and 30 June 2021 till the supply of relevant information
and material by the assessing officers to the assesses in terms
of the directions issued by this Court in Ashish Agarwal, and the
period of two weeks allowed to the assesses to respond to the
show cause notices. [Para 114(f), 114(g)]
[2024] 10 S.C.R.
1635
Union of India & Ors. v. Rajeev Bansal
Income Tax Act, 1961 - Taxation and Other Laws (Relaxation
and Amendment of Certain Provisions) Act, 2020 - Finance Act
2021 - What were the requirements for issuing reassessment
notice under section 148 of the new regime:

## Text

_Characters 0–38,656 of 187,628. This is a partial read: ask again with offset=38656 for what follows._

[2024] 10 S.C.R. 1633 : 2024 INSC 754
Union of India & Ors.
v.
Rajeev Bansal
(Civil Appeal No. 8629 of 2024)
03 October 2024
[Dr Dhananjaya Y Chandrachud,* CJI,
J.B. Pardiwala and Manoj Misra, JJ.]
Issue for Consideration
Whether after 01 April 2021, the Income Tax Act, 1961 has to be
read along with the substituted provisions; whether Taxation and
Other Laws (Relaxation and Amendment of Certain Provisions)
Act 2020 (TOLA) will continue to apply to the Income Tax Act
after 01 April 2021; whether section 3(1) of TOLA overrides
section 149 of the Income Tax Act; whether TOLA will extend
the time limit for the grant of sanction by the authority specified
under section 151 of the Income Tax Act; whether the directions
in Ashish Agarwal will extend to all the reassessment notices
issued under old regime; what were the requirements for issuing
reassessment notice under section 148 of the new regime.
Headnotes†
Income Tax Act, 1961 - Finance Act 2021 - Whether after
01 April 2021, the Income Tax Act, 1961 has to be read along
with the substituted provisions:
Held: After 01 April 2021, the Income Tax Act has to be read along
with the substituted provisions. [Para 114(a)]
Income Tax Act, 1961 - Taxation and Other Laws (Relaxation
and Amendment of Certain Provisions) Act 2020 (TOLA) -
Finance Act 2021 - Whether TOLA will continue to apply to
the Income Tax Act after 01 April 2021:
Held: TOLA will continue to apply to the Income Tax Act after 01
April 2021 if any action or proceeding specified under the substituted
provisions of the Income Tax Act falls for completion between 20
March 2020 and 31 March 2021. [Para 114(b)]
* Author
1634
[2024] 10 S.C.R.
Digital Supreme Court Reports
Income Tax Act, 1961 - s.149 - Taxation and Other Laws
(Relaxation and Amendment of Certain Provisions) Act 2020 -
s.3(1) - Finance Act 2021 -Whether section 3(1) of TOLA
overrides section 149 of the Income Tax Act:
Held: Section 3(1) of TOLA overrides Section 149 of the Income
Tax only to the extent of relaxing the time limit for issuance of a
reassessment notice under Section 148. [Para 114(c)]
Income Tax Act, 1961 - Taxation and Other Laws (Relaxation
and Amendment of Certain Provisions) Act 2020 (TOLA) -
Finance Act 2021 - Whether TOLA will extend the time limit
for the grant of sanction by the authority specified under
section 151 of the Income Tax Act :
Held: TOLA will extend the time limit for the grant of sanction by
the authority specified under Section 151 - The test to determine
whether TOLA will apply to Section 151 of the new regime is this:
if the time limit of three years from the end of an assessment
year falls between 20 March 2020 and 31 March 2021, then
the specified authority under Section 151(i) has extended time
till 30 June 2021 to grant approval - In the case of Section 151
of the old regime, the test is: if the time limit of four years from
the end of an assessment year falls between 20 March 2020
and 31 March 2021, then the specified authority under Section
151(2) has extended time till 31 March 2021 to grant approval.
[Para 114(d), 114(e)]
Income Tax Act, 1961 - Taxation and Other Laws (Relaxation
and Amendment of Certain Provisions) Act, 2020 - Finance Act
2021 - Whether the directions in Ashish Agarwal will extend
to all the reassessment notices issued under old regime:
Held: The directions in Ashish Agarwal will extend to all the ninety
thousand reassessment notices issued under the old regime
during the period 01 April 2021 and 30 June 2021 - The time
during which the show cause notices were deemed to be stayed
is from the date of issuance of the deemed notice between 01
April 2021 and 30 June 2021 till the supply of relevant information
and material by the assessing officers to the assesses in terms
of the directions issued by this Court in Ashish Agarwal, and the
period of two weeks allowed to the assesses to respond to the
show cause notices. [Para 114(f), 114(g)]
[2024] 10 S.C.R.
1635
Union of India & Ors. v. Rajeev Bansal
Income Tax Act, 1961 - Taxation and Other Laws (Relaxation
and Amendment of Certain Provisions) Act, 2020 - Finance Act
2021 - What were the requirements for issuing reassessment
notice under section 148 of the new regime:
Held: The assessing officers were required to issue the
reassessment notice under Section 148 of the new regime within
the time limit surviving under the Income Tax Act read with TOLA -
All notices issued beyond the surviving period are time barred and
liable to be set aside. [Para 114(h)]
Income Tax Act, 1961 - Assessment as a quasi-judicial
function:
Held: The assessing officers perform a quasi-judicial function
during reassessment, the powers vested in them are regulated
by law - The process of reassessment is generally preceded
by administrative proceedings, which require the assessing
officer to obtain the sanction of the specified authorities - The
taxing statutes generally lay down the procedure for issuance
of notice to the proposed assessee in respect of income or
property proposed to be taxed - It also prescribes the authority
and procedure for hearing any objections to the liability for
taxation. [Para 27]
Income Tax Act, 1961 - Assessment as an issue of jurisdiction:
Held: The Income Tax Act, 1961 also mandates assessing
officers to fulfil certain pre-conditions before issuing a notice of
reassessment - Section 149 requires assessing officers to issue
a notice of reassessment under Section 148 within the prescribed
time limits - Further, Section 151 requires assessing officers to
obtain sanction of the specified authority before issuing notice
under Section 148 - A statutory authority may lack jurisdiction if
it does not fulfil the preliminary conditions laid down under the
statute, which are necessary to the exercise of its jurisdiction -
There cannot be any waiver of a statutory requirement or provision
that goes to the root of the jurisdiction of assessment - An
order passed without jurisdiction is a nullity - Any consequential
order passed or action taken will also be invalid and without
jurisdiction - Thus, the power of assessing officers to reassess
is limited and based on the fulfilment of certain preconditions.
[Paras 31, 32]
1636
[2024] 10 S.C.R.
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Interpretation of Statutes - Taxing statutes - Principles of
strict interpretation and workability:
Held: Taxing statutes are interpreted by following the principles of
strict interpretation - While interpreting a taxing statute, there is
no room for any intendment - A taxing statute must be construed
by having regard to the strict letter of the law - In a taxing statute,
it is not possible to assume any intention or governing purpose
more than what is stated in the plain language - A taxing statute
can successfully impose liability on persons or property only if it
frames appropriate provisions to that end - The courts cannot
plug in a loophole in a taxing statute "by a strained construction in
reference to the supposed intention of the Legislature" - Further,
the considerations of equity or justice are not relevant in interpreting
a taxing statute - It is a well-accepted rule of construction that in
situations where the interpretation of taxing legislation is ambiguous
or leads to two possible interpretations, the interpretation most
beneficial to the subject of the tax should be adopted - It would
not be an unjust result if a taxpayer escapes the tax net on account
of the legislature's failure to express itself clearly - A statute is
designed to be workable - A statutory provision must be construed
in a manner to make it workable to achieve the purpose of the
legislation - A construction that fails to achieve the manifest purpose
of legislation or reduces the statutory provisions to futility should
be avoided. [Paras 35, 37]
Interpretation of statutes - Harmonious construction -
Discussed. [Paras 39-43]
Income Tax Act, 1961 - First proviso to Section 149(1) of the
new regime - Ingredients of the proviso:
Held: The ingredients of the proviso could be broken down for
analysis as follows: (i) no notice under Section 148 of the new
regime can be issued at any time for an assessment year beginning
on or before 1 April 2021; (ii) if it is barred at the time when the
notice is sought to be issued because of the "time limits specified
under the provisions of" 149(1)(b) of the old regime - Thus, a
notice could be issued under Section 148 of the new regime for
assessment year 2021-2022 and before only if the time limit for
issuance of such notice continued to exist under Section 149(1)(b)
of the old regime. [Para 46]
[2024] 10 S.C.R.
1637
Union of India & Ors. v. Rajeev Bansal
Income Tax Act, 1961 - s.149(1) of the new regime - Position
of law:
Held: (i) Section 149(1) of the new regime is not prospective - It
also applies to past assessment years; (ii) The time limit of four
years is now reduced to three years for all situations - The Revenue
can issue notices under Section 148 of the new regime only if
three years or less have elapsed from the end of the relevant
assessment year; (iii) the proviso to Section 149(1)(b) of the
new regime stipulates that the Revenue can issue reassessment
notices for past assessment years only if the time limit survives
according to Section 149(1)(b) of the old regime, that is, six
years from the end of the relevant assessment year; and (iv) all
notices issued invoking the time limit under Section 149(1)(b) of
the old regime will have to be dropped if the income chargeable
to tax which has escaped assessment is less than Rupees fifty
lakhs. [Para 53]
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DCIT [2023] 457 ITR 647 (High Court of Judicature at Bombay);
Geeta Agarwal v. ITO DB Civil Writ Petition No. 14794 of 2022
(High Court of Judicature at Rajasthan); Ambika Iron and Steel
Pvt Ltd v. PCIT WP(C) No. 20919 of 2021 (High Court of Orissa);
Twylight Infrastructure Pvt Ltd v. ITO WP(C) No. 16524/2022 (High
Court of Delhi); Ganesh Dass Khanna v. ITO [2024] 460 ITR 546
(High Court of Delhi) - referred to.
1642
[2024] 10 S.C.R.
Digital Supreme Court Reports
Books and Periodicals Cited
Thomas Cooley, The Law of Taxation (4th edn, 1924) 2116; G P
Singh, Principles of Statutory Interpretation (15th edn, 2023) 616;
Cary Coglianese and Neysun Mahboubi, 'Administrative Law in
a Time of Crisis: Comparing National Responses to COVID-19'
(2021) 73(1) Administrative Law Review 1, 10; Cebreiro Gomez,
et al, COVID-19: Revenue Administration Implications - Potential
Tax Administration and Customs Measures to Respond to the
Crisis, World Bank Group (2022) 19.
List of Acts
Income Tax Act 1922; Income Tax Act 1961; Taxation and Other
Laws (Relaxation and Amendment of Certain Provisions) Act 2020;
Finance Act, 2002; Finance Act, 2012; Finance Act 2015; Finance
Act 2021; Finance Act 2022; Arbitration and Conciliation Act, 1996;
Indian Stamp Act 1899; Preventive Detention Amendment Act 1950;
Haryana Amendment Act, 1995; Punjab Pre-emption Act, 1913;
Land Acquisition Act 1894; Code of Civil Procedure 1908; Bengal
Sales Tax Rules 1941; Constitution of India.
List of Keywords
Time limit; Relaxing of time limit; Section 3(1) of TOLA overrides
section 149 of the Income Tax Act; Reassessment notices issued
under old regime; Section 151 of the old regime; Assessment as
a quasi-judicial function; Assessment as an issue of jurisdiction;
Principles of strict interpretation and workability; Harmonious
construction; Section 148 of the new regime; Section 149 of the
new regime; First proviso to Section 149(1) of the new regime;
Taxing statute.
Case Arising From
CIVIL APPELLATE/ORIGINAL JURISDICTION: Civil Appeal No.
8629 of 2024
From the Judgment and Order dated 22.02.2023 of the High Court
of Judicature at Allahabad in WT No. 1086 of 2022
With
C.A. Nos. 8631, 9270, 8632, 10238, 8640, 10239, 10240, 8644,
8641, 8650, 8645, 8643, 8649, 8652, 8642, 8647, 8636, 8646, 8639,
8648, 8634, 8651, 8653, 8637, 8654, 8658, 8661, 8638, 8659, 8660,
[2024] 10 S.C.R.
1643
Union of India & Ors. v. Rajeev Bansal
8662, 8655 and 8664 of 2024, T.P.(C) No. 767 of 2023, C.A. Nos.
9253, 8702, 8667, 8666, 8843-8844, 8668, 8678, 8680, 8679, 8669,
8673, 8682, 10242, 8683, 8685, 8687, 10244, 8684, 8671, 9822,
8689, 10245, 8672, 10246, 8670, 8681, 10250, 8676, 8686, 8688,
10251, 10252, 8695, 8674, 8677, 8713, 8692, 8690, 8699, 8691,
8704, 10254, 8845, 8846, 8696, 8707, 8697, 8847, 8706, 8852,
8705, 8848, 8709, 8708, 8703, 8849, 8630, 8656 and 8665 of 2024,
T.P.(C) No. 2187-2194 of 2024, C.A. Nos. 8675, 8700, 8969, 8746,
8825, 8698, 8693, 8800, 9507, 8710, 8799, 10257, 8694, 8716,
8719, 8717, 8736, 8712, 8723, 8727, 8718, 8729, 8953, 8711, 8738,
8724, 8714, 8730, 8701, 8732, 8720, 8731, 8734, 8733, 8721, 8715,
8735, 8725, 8726, 8742, 8737, 8747, 8728, 8722, 8740 and 8942
of 2024, T.P.(C) No. 2127 of 2024, C.A. Nos. 8739, 8955, 8745,
8794, 8743, 8751, 8795, 9217, 8798, 8749, 8750, 8943, 8948, 8966,
8949, 8741, 8951, 8952, 8748, 8796, 8950, 8954, 8744 and 8797 of
2024, T.P.(C) No. 2714-2723 of 2023, C.A. Nos. 8802, 8956, 9056,
8826, 8958, 8957, 8827, 8959, 8962, 9044, 8967, 8963 of 2024,
T.P.(C) Nos. 2942 and 2937 of 2023, C.A. Nos. 9052, 9170, 9048,
9180, 9186, 9043, 9046, 8960, 9231, 8964, 9042, 9228, 8961, 9202,
9205, 9184, 9172, 9177, 8896, 9225, 9619, 9238, 9208, 9189, 9220,
8897, 8905, 8930, 9223, 8898, 8926, 8899, 9240, 8900, 8895, 8906,
8901, 9503, 8907, 8908, 8909, 8902, 8903, 8904, 9280, 8910, 9282,
9285, 9287, 9296, 9298, 9300, 9302, 9304, 8911, 9305, 9306, 9311,
9314, 9312, 8976, 8994, 8912, 8977, 8850, 8978, 8983, 8972, 8973,
8974, 8995, 8996, 8984, 8985, 8988, 8989, 8990, 8999, 8913, 8991,
10215, 8992, 9001, 9002, 8914, 9003, 8993, 9005, 9006, 8635,
10984, 9261, 9273, 9038, 8997, 9000, 9039, 9008, 9009, 9010,
9025, 9027, 9004, 9011, 8915, 9012, 9041, 9289, 8916, 9250,
9013, 9014, 9028, 9168, 9015, 9171, 8917, 9016, 9017, 9007,
9018, 9019, 9759, 8918, 9020, 9021, 9248, 9030, 9031, 9023,
8919, 8920, 9032, 9173, 9175, 8946, 8921, 8922, 9024, 9262,
9247, 9033, 9178, 8923, 8924, 9181, 9183, 9187, 9191, 9194, 9195,
9760, 9037, 9196, 9221, 9198, 9266, 9224, 9201, 9203, 9226, 9230,
8998, 9053, 9207, 9210, 9055, 9232, 9233, 9236, 9212, 9239, 9215,
9243, 9245, 9252, 9216, 9295, 9057, 9269, 9254, 9058, 9271, 9272,
9255, 9256, 9258, 9275, 9260, 9806, 9188, 9192, 9211, 9200, 9213,
9218, 9222, 9229, 9234, 9824, 9825, 9235, 9241, 9364, 9602, 9330,
9204, 9206, 9246, 9331, 9257, 9259, 9263, 9332, 9333, 9264, 9265,
9334, 9267, 9335, 9365, 9336, 9268, 9288, 9290, 9291, 9292, 9293,
9337, 9801, 9803, 9294, 9338, 9348, 9799, 9321, 9322, 9366, 9349,
9351, 9323, 9374, 9324, 9375, 9376, 9378, 9805, 9325, 9329, 9352,
9488, 9573, 9576, 9574, 9354, 9380, 9473, 9581, 9474, 9586, 9496,
1644
[2024] 10 S.C.R.
Digital Supreme Court Reports
9497, 9381, 9359, 9360, 9499, 9489, 9495, 9363, 9575, 9502,
9583, 9342, 9341, 9411, 9297, 9277, 8851, 9529, 9483, 9484,
9800, 9431, 9485, 9567, 9432, 9804, 9802, 9556, 9487, 9490,
9379, 8807, 9433, 9584, 9634, 9578, 9585, 9557, 9494, 9558,
9498, 9501, 9491, 9340, 9449, 9492, 9463, 8803, 9353, 9377,
9391, 9350, 9450, 9370, 9452, 9530, 9373, 9390, 9399, 9367,
9356, 9453, 9531, 9532, 9389, 9368, 9345, 9347, 9386, 9533,
9454, 9412, 9414, 9387, 9461, 9925, 9493, 9395, 9534, 8809,
9392, 8804, 9396, 8805, 9437, 9328, 9447, 9455, 9535, 9346,
9465, 9451, 8810, 9398, 9388, 9517, 9559, 9430, 9394, 9459,
9560, 9358, 9536, 8808, 9456, 9384, 9383, 9371, 9457, 9393,
9561, 9518, 9568, 9519, 9520, 9537, 9562, 9538, 9563, 9407,
9397, 8814, 9564, 9408, 9539, 9436, 8811, 9446, 9460, 9540,
8806, 9541, 9542, 9543, 9544, 9521, 9400, 9545, 9522, 9438,
8836-8837, 9441, 9468, 9546, 9547, 9523, 9571, 9548, 9319,
9401, 9355, 9361, 9471, 9472, 9362, 9549, 9467, 9550, 9448,
9551, 9445, 9552, 9443, 8945, 8813, 9339, 9464, 9565, 8817,
9524, 9310, 9553, 9343, 8835, 9313, 9357, 9372, 8933, 9554,
8812, 9525, 8815, 9320, 9442, 9466, 9526, 9439, 9926, 9555,
9527, 8935, 9385, 9528, 8816, 8936, 8839, 9572, 9440, 9344,
9566, 9237, 9242, 8633, 8657, 9251, 9569, 9307, 9570, 9577,
10293, 9435, 9403, 8834, 9382, 9579, 9318, 9580, 9315, 9326,
9405, 9591, 9406, 9593, 9582, 9587, 9594, 9054, 10985, 9402,
9047, 9588, 8934, 9595, 9404, 9409, 9589, 8833, 9244, 9249,
9426, 9045, 9281, 10036, 9600, 8937, 9278, 9590, 9601, 9169,
10986, 9274, 9276, 9416, 9286, 9179, 9227, 9219, 9209, 9415,
9279, 9417, 8828, 8832, 9190, 9182, 9197, 9283, 9174, 10987,
9176, 10988, 9418, 9284, 9419, 8829, 9214, 9420, 9193, 8831,
9185, 9421, 9423, 9424, 8830 and 9425 of 2024
Appearances for Parties
N Venkatraman, A.S.G., Rupesh Kumar, V Sridharan, Percy
Pardiwala, Amar Dave, Tushar Hemani, Parsi Pardiwala, Saurabh
Soparkar, Raju K. Patel, K. Shivram, Dr. K. Shivaram, Suryanarayana
Singh, Sr. Advs., Amrish Kumar, Mahesh Agarwal, Alok Yadav,
Abhinabh Garg, E. C. Agrawala, Tushar Thareja, Rishabh Ostwal,
Bhakti Vardhan Singh, Ajay Kumar, Raj Bahadur Yadav, Shashank
Bajpai, Venkatraman Chandrashekhara Bharathi, Ishaan Sharma,
Annirudh Sharma Ii, Alka Aggarwal, Praneet Pranab, Mrs. Anamika
Aggarwal, Santosh Kumar, Mrs. A Deepa, Rajesh Kumar Singh,
Sonal Jain, Atit Jain, Ankur Aggarwal, Ms. Shradhanjali Patra,
Pravesh Nirwal, Uday Ram Bokadia, Pankaj Agarwal, Ruchesh
[2024] 10 S.C.R.
1645
Union of India & Ors. v. Rajeev Bansal
Sinha, Amjid Maqbool, Ms. Prachi Pratap, Ms. Yashvi Aswani,
Dr. Prashant Pratap, Ms. Kinjal Agarwal, Vishavjeet Chaudhary,
Ms. Pallavi Pratap, Harish Pandey, Ved Jain, Nischay Kantoor,
Ms. Soniya Dodeja, Subodh S. Patil, Ms. Kavita Jha, Rohit Jain,
Vaibhav Kulkarni, Udit Naresh, Himanshu Aggarwal, Samarth
Chaudhari, Aditeya Bali, Akash Shukla, Mrs. Vanita Bhargava, Ajay
Bhargava, Ms. Nandita Chauhan, Ms. Tijil Thakur, M/s. Khaitan &
Co., Rahul Krishna, Hardik Vora, Ms. Palak Kshatriya, Daivat Bhatt,
Pranaya Sahoo, Ms. Hetu Arora Sethi, Madhur Agrawal, Kunal
Cheema, Raghav Deshpande, Shubham Chandankhede, Rohit K.
Singh, Akhilesh Kumar, Vipin Garg, Prakhar Srivastav, Abhishek
Aggarwal, Vandana Kothari, Rahul Narula, Ms. Aishwarya Bhatia,
Dr. Rakesh Gupta, Somil Agarwal, Ambhoj Kumar Sinha,
Kishore Kunal, Ravi Sawana, S Sriram, Karanjot Singh Khurana,
S Vasudevan, Ms. Neha Sharma, Devashish Jain, Sridattha Charan,
Romil Hotwani, Ms. Charanya Lakshmikumaran, Muhammad Ali
Khan, Omar Hoda, Ms. Eesha Bakshi, Uday Bhatia, Kamran Khan,
Arjun Sharma, Abishek Jebaraj, Ms. A Reyna Shruti, Nishant
Thakkar, Ms. Jasmin Amalsvaada, Ms. Jasmin Amalsadvala, Hiten
C Thakkar, Hitten Thakkar, Ranjan Nikhil Dharnidhar, Sidharth
Ranka, A. Karthik, Gursharan H. Virk, Ms. Aastha Mehta, Ms.
Deepanwita Priyanka, Simranjit H. Virk, Ms. Prerana Mohapatra,
Prashanth Undurti, Saswat Kumar Acharya, Dhananjay Bhaskar
Ray, Abhijeet Agarwal, Kumar Kale, Devendra Jain, Dharan
Gandhi, Ms. Gunjan Kakad, Rajat Mittal, Suprateek Neogi, Mridul
Agnihotri, Prince Kumar, Jasdeep Singh Dhillon, Ms. Amanat Kaur
Chahal, Yutangar Singh Chauhan, Hds Bains, R. K. Batra, Abhay
Singh Mann, Jas Sanghavi, Sandeep Yadav, Shubhranshu Padhi,
Jay Nirupam, D. Girish Kumar, Pranav Giri, Ekansh Sisodia, Sanjay
Prakash Goyatan, Dhiraj Kumar Sammi, Dr. Chandrakant S.
Sarkar, Sourabh Saini, Asutosh Sharma, Kapil Goel, Sougat Sinha,
Sandeep Goel, Dhananjay Garg, Abhishek Garg, Tanuj Gulati,
Ms. Gayathri R. Manasa, Gaurav Choudhary, Ms. Anu Kushwaha,
Ghanshyam Choudhary, R.P. Bansal, Sukhsagar Syal, C. George
Thomas, P. S. Sudheer, Rishi Maheshwari, Ms. Anne Mathew,
Bharat Sood, Ms. Miranda Solaman, Ms. Nivedita Sudheer, Purvish
Jitendra Malkan, Alok Kumar, Kush Goel, Suraj Pandey, Ms. Neha
Ambashtha, Ryan Singh, Abhinav Mehrotra, Kalrav Mehrotra, Ms.
Bhavna Mehrotra, S.V. Mehrotra, Piyush Kaushik, Anil Kumar, Asish
Bansal, Akarsh Garg, Kaushik Choudhury, Ms. Rupali Sharma,
Ms. Abhipsha Anamika, Yudhishthir Bharadwaj, Rachit Aggarwal,
Vikas Jain, Neelakash Gogoi, Subhan Shankar Gogoi, Kunal
Verma, Jeet Kamdar, Ritik Gupta, Shivraj Pawar, Rakesh
1646
[2024] 10 S.C.R.
Digital Supreme Court Reports
Wadhwa, Ms. Priyanshi Agrawal, Ms. Monika Sharma, Subhash
Chandra, Mohinder Singh, Sandeep Saxena, K. R. Anand,
Deepak Chopra, Dr. Vikas Pahal, Chand Qureshi, B.K. Satija,
Ms. Vaibhavi Parikh, Ms. Anushree Prashit Kapadia, Nitin
Mehta, Ms. Ekta Kundu, Shrey Lodha, Akshat Vachher, Ms.
Abhiti Vachher, Ms. Nandni Sharma, Parvesh Bansal, Rahul
Bansal, Jasvinder Choudhary, M/s. Vachher And Agrud, Salil
Kapoor, Ms. Ananya Kapoor, Sumeet Lalchandani, Sanat
Kapoor, Sumit Lalchandani, Dr. Shashwat Bajpai, Tarun
Chanana, Shivam Yadav, Ravi Kumar, Praveen Swarup, Arvind
Kumar, Aditya Singh, Venketesh Chaurasia, Ms. Rano Jain,
Dr. Parbodh Malhotra, Mrs. Renu Kamra Arora, Ms. Sakshi Rustagi,
Ms. Shakshi Srivastava, Jay Kishor Singh, Kedar Nath Tripathy,
Ms. Praveena Gautam, Pawan Shukla, Ms. Kanika Kalyan,
Ms. Akanksha Tyagi, Vishal Kalra, Saumyendra Singh Tomar,
Ankit Sahni, Ms. Snigdha Gautam, Anil Kumar Gautam, Manish
Shah, Dillip Kumar Nayak, Ms. Disha Ray, Mrs. Sumita Ray,
Aneesh Mittal, Rahul Kaushik, Arjun Garg, Aakash Nandolia,
Ms. Sagun Srivastava, Ms. Kriti Gupta, Bandish Soparkar,
Malak Manish Bhatt, Darshan Patel, Ms. Sukanya Joshi,
Merusagar Samantaray, Ruturaj Satapathy, Abinash Barik, Ms.
Lhingneivah, Ms. Ayushi Upadhaya, Deepak Prakash, Rahul
Hakani, Ms. Bhuvneshwari Pathak, Ms. Shilpi Satyapriya Satyam,
Dhanesh Kumar, Mohit Balani, Pulkit Agarwal, Mohd Anas
Chaudhary, Sudhanshu Kaushesh, Mohd Sharyab Ali, Avnish
Chaturvedi, Rovin Singh Solanki, Zahid Ali, Vibhu Tandon, Ms.
Manya Pundhir, Shreyans Raniwala, Rajeev Jadhav, Priyanshu
Chauhan, Manoj Kumar, Manish Paliwal, Shashi Bekal, Ms. Niyati
Mankad, Ms. Neelam Jadhav, Ms. Megha Yadav, Mrs. Trupti
Das, Dr. Avinash Poddar, Ms. Diva Singh, Ms. Anchal Poddar,
Ms. Rudrani Mishra, Awadhesh Sharma, Soumitra Chatterjee,
Devendra Singh, Sudhir Mehta, Ms. Shailee Mehta, Ankit
Anandraj Shah, Shubham Chopra, Tarun Arora, S. K. Verma, Ms.
Rutuja N Pawar, Ms. Hetal Laghave, Ms. Sneha More, Saurabh
Upadhyay, Ms. Hardikaa Kalia, Ms. Tavishi Jain, Vikas Verma,
Ms. Pragati Neekhra, Aditya Bhanu Neekhra, Atul Dong, Aniket
Patel, Rohit Singh, Ashok Anand, Ajay Gupta, Vinod Mehta, Ms.
Astha Tyagi, Mahesh Aaarwal, Ms. Fereshte D Sethna, Sachit
Jolly, Ms. Anuradha Dutt, Ms. Soumya Singh, Ms. Disha Jham,
Mrunal Parekh, Devansh Jain, Vivek Agarwal, Raghav Dutt, Ms.
B. Vijayalakshmi Menon, Suhrith Parthasarathy, Ms. Amritha
Sathyajith, Ms. Rashmi Nandakumar, Ms. Yashmita Pandey,
Advs. for the appearing parties.
[2024] 10 S.C.R.
1647
Union of India & Ors. v. Rajeev Bansal
Judgment / Order of the Supreme Court
Judgment
Dr Dhananjaya Y Chandrachud, CJI
Table of Contents*
A.
Background ......................................................................
35
i.
Income Tax Act ..........................................................
35
ii.
TOLA ..........................................................................
39
iii.
Finance Act 2021 .......................................................
41
B.
Issues ................................................................................
50
C.
Submissions .....................................................................
51
D.
Legal Background ............................................................
55
i.
Assessment as a quasi-judicial function ..................
55
ii.
Assessment as an issue of jurisdiction .....................
59
iii.
Principles of strict interpretation and workability ........
63
iv.
Principle of harmonious construction .......................
66
E.
Reading TOLA into the Income Tax Act ..............................
70
i.
First proviso to Section 149(1) of the new regime ........
70
ii.
TOLA can extend the time limit till 31 June 2021 .........
75
a.
Finance Act 2021 substituted the old regime .........
75
b.
Reading TOLA into Section 149 ...............................
82
iii.
Sanction of the specified authority ............................
86
F.
Section 148 notices issued in June-September 2022 .......
91
i.
Scope of Article 142 .................................................
91
ii.
The scope of Ashish Agarwal extended to all the
reassessment notices issued between 1 April 2021
and 30 June 2021 under the old regime ...............
96
iii.
Effect of the legal fiction ..........................................
99
a.
Third proviso to Section 149 ................................. 100
b.
Interplay of Ashish Agarwal with TOLA ................... 107
G.
Conclusions .................................................................... 110
* Ed. Note: Pagination as per the original Judgment.
1648
[2024] 10 S.C.R.
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1.
The present batch of appeals involves the interplay of three
Parliamentary statutes: the Income Tax Act 1961,1 the Taxation and
Other Laws (Relaxation and Amendment of Certain Provisions) Act
2020,2 and the Finance Act 2021. The Income Tax Act was enacted
to levy and collect tax on the income of assesses.3 Sections 147 to
151 of the Income Tax Act deal with the procedure of reassessment
of income chargeable to tax which has escaped assessment. The
TOLA was enacted in the backdrop of the COVID-19 pandemic to
provide relaxation of time limits specified under the provisions of the
Income Tax Act and certain other legislations as defined under Section
2(1)(b) of TOLA. The Finance Act 2021 amended the provisions
dealing with the reassessment procedure under the Income Tax Act
with effect from 1 April 2021.
A.
Background
i.
Income Tax Act
2.
Sections 147 to 151 deal with the procedure of reassessment. The
scheme of reassessment under Sections 147 to 151 was substantially
overhauled by the Finance Act 2021 with effect from 1 April 2021.
Under the old regime, Section 147 empowered the assessing officer4
to reopen assessment proceedings if they had "reason to believe"
that any income chargeable to tax has escaped assessment for the
relevant assessment year.5 Section 148 mandated the assessing
1
"Income Tax Act"
2
"TOLA"
3
Section 2(7), Income Tax Act. [It defines an "assessee" to mean "a person by whom any tax or any other
sum of money is payable under this Act, and includes -
(a)
every person in respect of whom any proceeding under this Act has been taken for the assessment
of his income or assessment of fringe benefits or of the income of any other person in respect of
which he is assessable, or of the loss sustained by him or by such other person, or of the amount
of refund due to him or to such other person;
(b)
every person who is deemed to be an assessee under any provisions of this Act;
(c)
every person who is deemed to be an assessee in default under any provision of this Act;"]
4
Section 2(7A), Income Tax Act. [It defines an "assessing officer" to mean "the Assistant Commissioner or
Deputy Commissioner or Assistant Director or Deputy Director or the Income-tax Officer who is vested
with the relevant jurisdiction by virtue of directions or orders issued under sub-section (1) or sub-section
(2) of section 120 or any other provision of this Act, and the Additional Commissioner or Additional
Director or Joint Commissioner or Joint Director who is directed under clause (b) of sub-section (4) of
that section to exercise or perform all or any of the powers or functions conferred on, or assigned to, an
Assessing Officer under this Act."]
5
Section 147, Income Tax Act
[2024] 10 S.C.R.
1649
Union of India & Ors. v. Rajeev Bansal
officer to serve a notice on the assessee requiring them to submit
a return of their income.6
3.
Section 1497 prescribed the following time limits for issuing a notice
under Section 148 for an assessment year:
6
Section 148, Income Tax Act.