SKF INDIA LIMITED ,MUMBAI V. DCIT, 4(3)(1), , MUMBAI

ITA 2518/MUM/2024

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The case involves SKF India Limited appealing against a final assessment order for the assessment year 2015-16, which was passed following re-assessment proceedings initiated under section 147 of the Income Tax Act, 1961. The primary contention was the validity of the notice issued under section 148, which the assessee argued was beyond the statutory limitation period. The Tribunal examined the procedural history, including the initial notice and subsequent communications, and considered relevant judicial precedents and concessions made by the Revenue before the Supreme Court. Ultimately, the Tribunal concluded that the notice was time-barred, leading to the quashing of the re-assessment proceedings and the final assessment order.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 315824 (ITAT-MUMBAI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-05-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: H
• Assessment Year: 2015-2016
• Other Referred Cases: Union of India vs. Ashish Agrawal, Union of India vs. Rajeev Bansal, Pratishtha Garg vs. ACIT, IBIBO Group Pvt. Ltd. vs. ACIT, ACIT vs. Manish Financials, ITO vs. Pushpak Realities Pvt. Ltd., ACIT vs. Nehal Ashit Shah
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: AJAY CHANDRA
• Assessee Lawyers: AJIT KUMAR JAIN
• Keywords: Set aside; Period of limitation; Time period of passing order
• Section: 147; 148; 143(3)

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL “H” BENCH, MUMBAI BEFORE SHRI SANDEEP SINGH KARHAIL, JUDICIAL MEMBER SHRI BIJAYANANDA PRUSETH, ACCOUNTANT MEMBER ITA No.2518/MUM/2024 (Assessment Year : 2015-16) SKF India Limited., 4th Floor, Mahatma Gandhi Memorial Building, Mumbai Maharashtra - 400002 PAN : AAACS0684H ............... Appellant v/s DCIT - 4(3)(1), Air India Building, 530, 4th Floor Nariman Point, Mumbai - 400021 ……………… Respondent Assessee by : Shri Ajit Kumar Jain Revenue by : Shri Ajay Chandra, CIT-DR Date of Hearing – 13/05/2025 Date of Order - 16/05/2025 O R D E R PER SANDEEP SINGH KARHAIL, J.M. The assessee has filed the present appeal against the final assessment order dated 26/03/2024, passed under section 147 read with section 144C(13) read with section 144B of the Income Tax Act, 1961 (\"the Act\"), pursuant to the directions dated 29/02/2024 issued by the learned Dispute Resolution Panel-2, Mumbai, [“learned DRP”] under section 144C(5) of the Act, for the assessment year 2015-16. ITA No.2518/Mum/2024 (A.Y. 2015-16) 2 2. In its appeal, the assessee has raised the ground, inter alia, challenging the initiation of re-assessment proceedings under section 147 of the Act. Since this is a jurisdictional issue, which goes to the root of the matter, we are considering the same at the outset. During the hearing, the learned Authorized Representative (“learned AR”) submitted that the notice issued under section 148 of the Act in the present case is beyond the limitation period specified under section 149(1) of the Act, and thus, the re-assessment order passed under section 147 read with section 144C(13) read with section 144B of the Act is void ab initio. 3. The brief facts of the case pertaining to this issue, as emanating from the record, are: The assessee is a part of the global AB SKF Group, and is engaged in providing automotive and industrial engineered solutions. For the year under consideration, the assessee filed its return of income on 29/11/2015, declaring a total income of Rs. 290,06,99,550. The return filed by the assessee was selected for scrutiny, and vide order dated 25/10/2019 passed under section 143(3) read with section 144C(13) of the Act, the total income of the assessee was assessed at Rs. 360,97,37,019. Subsequently, on the basis of the information in the possession of the Jurisdictional Assessing Officer, proceedings under section 147 of the Act were initiated in the case of the assessee and a notice under section 148 of the Act was issued on 12/04/2021. 4. Thereafter, in view of the decision of the Hon’ble Supreme Court in Union of India vs. Ashish Agrawal, reported in [2022] 444 ITR 1 (SC), the original notice issued under section 148 on 12/04/2021 was deemed to be issued ITA No.2518/Mum/2024 (A.Y. 2015-16) 3 under section 148A(b) of the Act. Vide show cause notice dated 30/05/2022, the information and material relied upon by the Revenue was provided to the assessee and time was granted to the assessee to respond within two weeks in terms of the provisions of section 148A(b) of the Act. 5. After rejecting the objections filed by the assessee, an order under section 148A(d) of the Act was passed on 29/07/2022, declaring that it is a fit case for the issuance of a notice under section 148 of the Act. On the very same date, i.e. on 29/07/2022, a notice under section 148 of the Act was issued by the Jurisdictional Assessing Officer. The draft assessment order was passed under section 144C(1) of the Act, assessing the total income of the assessee at Rs. 342,36,42,560. In compliance with the directions issued by the learned DRP under section 144C(5) of the Act, the final assessment order, under section 147 read with section 144C(13) read with section 144B of the Act, was passed on 26/03/2024. Being aggrieved, the assessee is in appeal before us. 6. During the hearing, the learned AR submitted that the year under consideration is assessment year 2015-16, and therefore, the limitation period available with the Assessing Officer under section 149 of the Act for issuance of notice under section 148 of the Act was till 31/03/2022, and therefore, the notice issued under section 148 of the Act on 29/07/2022 is barred by limitation. Hence, it was submitted that the entire re-assessment proceedings culminating in the order passed under section 147 read with section 144C(13) read with section 144B of the Act are void ab initio. The learned AR by placing reliance upon various judicial pronouncements, ITA No.2518/Mum/2024 (A.Y. 2015-16) 4 submitted that a similar challenge in respect of the assessment year 2015-16 has been considered by the Hon’ble Delhi High Court and the Co-ordinate Bench of the Tribunal, and the issue was decided in favour of the taxpayer, inter alia, by considering the submission of the Revenue before the Hon’ble Supreme Court in Union of India vs. Rajeev Bansal, reported in (2024) 469 ITR 46 (SC). 7. On the other hand, the learned Departmental Representative (“learned DR”) vehemently relied upon the order passed by the lower authorities. 8. We have considered the submissions of both sides and perused the material available on record. We, at the outset, find that similar issue pertaining to the challenge against notices issued under section 148 of the Act for the assessment year 2015-16 on the basis that same are beyond the limitation period prescribed under section 149 of the Act has been decided in favour of the taxpayers after noting the submission of the Revenue before the Hon’ble Supreme Court in Rajeev Bansal (supra), wherein it was conceded by the Revenue that for the assessment year 2015-16, all notices issued on or after 1st April, 2021 will have to be dropped as they will not fall for completion during the period prescribed under the Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020 (“the TOLA”). We find that the Hon’ble Delhi High Court in Pratishtha Garg vs. ACIT, reported in (2015) 171 taxmann.com 264 (Delhi), allowed the writ petition filed by the taxpayer and set aside the notice issued under section 148 of the Act for the assessment year 2015-16, by observing as follows: - ITA No.2518/Mum/2024 (A.Y. 2015-16) 5 “2. Learned counsel for the Revenue fairly states that the prayers made by the petitioner are required to be allowed as the same are covered by the concession made by the Revenue before the Supreme Court in Union of India and Others v. Rajeev Bansal: 2024 SCC OnLine SC 2693, 2024 INSC 754, as recorded in paragraph 19 (f) of the said decision. He also submits that the Coordinate Bench of this Court had, after not ing the aforesaid concession, allowed a similar petition - Ibibo Group Pvt. Ltd. v. Assistant Commissioner of Income Tax Circle: W.P.(C) 17639/2022 by order dated 13.12.2024. 3. It is relevant to note paragraph 19 (e) and (f) of the decision of the Supreme Court in Union of India and Others v. Rajeev Bansal; 2024 SCC OnLine SC 2693. The same are set out as under: \"(e) The Finance Act, 2021 (2021) ((2021) 432 ITR (Stat) 52) substituted the fold regime for reassessment with a new regime. The first proviso to section 149 does not expressly bar the application of Taxation and other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020, Section 3 of the Taxation and other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020 applies to the entire Income-tax Act, including sections 149 and 151 of the new regime. Once the first proviso to section 149(1)(b) is read with Taxation and other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020, then all the notices issued between April 1, 2021 and June 30, 2021 pertaining to the assessment years 2013-2014, 2014-2015, 2015-2016, 2016-2017, and 2017-2018 will be within the period of limitation as explained in the tabulation below: Assessme nt Year Within Years Expiry of Limitation read with TOLA for (2) (3) Within Six Years (4) Expiry of Limitation read with TOLA for (4) (5) 2013-2014 31.03.2017 TOLA not applicable. 31.03.2020 30.06.2021 2014-2015 31.03.2018 TOLA not applicable. 31.03.2021 30.06.2021 2015-2016 31.03.2019 TOLA not applicable. 31.03.2022 TOLA not applicable. 2016-2017 31.03.2020 TOLA not applicable. 31.03.2023 TOLA not applicable. 2017-2018 31.03.2021 TOLA not applicable. 31.03.2024 TOLA not applicable. (f) The Revenue concedes that for the assessment year 20152016, all notices issued on or after April 1, 2021 will have to be dropped as they will not fall for completion during the period prescribed under the Taxation and other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020.\" 4. In view of the aforesaid, the impugned order dated 19.07.2022 issued under Section 148(A)(d) of the Income Tax Act,1961 (hereafter the Act) as well as the notice dated 19.07.2022 issued under Section 148 of the Act in respect of AY 2015-16 are liable to be set aside. It is so directed.” 9. We further find that similar findings were rendered by the Hon’ble Delhi High Court in IBIBO Group Pvt. Ltd. vs. ACIT, in W.P .(C) No.17639 of 2022, vide order dated 13/12/2024. We find that in the following decisions of the ITA No.2518/Mum/2024 (A.Y. 2015-16) 6 Co-ordinate Bench of the Tribunal, on similar lines, re-assessment notices issued under section 148 of the Act for the assessment year 2015-16 were quashed: -  ACIT vs. Manish Financials, ITA No.5050 and 5055/Mum/2024 order dated 02/12/2024.  ITO vs. Pushpak Realities Pvt. Ltd., ITA No.4812/mum/2024, order dated 07/09/2024. 10. We further find that vide a recent order dated 04/04/2025, the Hon’ble Supreme Court in ACIT vs. Nehal Ashit Shah, in SLP (C) Diary No.57209 of 2024, upheld the quashing of the re-assessment proceedings initiated for the assessment year 2015-16 considering the submissions of the Revenue as recorded in paragraph 19(e) and 19(f) of the decision in Rajeev Bansal (supra). 11. Therefore, it is evident that the Hon’ble Courts, consistently considering the submissions made by the Revenue before the Hon’ble Supreme Court in Rajeev Bansal (supra), have held that the re-assessment notice issued under section 148 of the Act for the assessment year 2015-16 is barred by limitation. Thus, on this limited basis alone, the notice dated 29/07/2022, issued under section 148 of the Act in the present case, is liable to be quashed, being time- barred under the provisions of the Act. We order accordingly. Consequently, the entire re-assessment proceedings and final assessment order passed under section 147 read with section 144C(13) read with section 144B of the Act are also quashed. ITA No.2518/Mum/2024 (A.Y. 2015-16) 7 12. Since the relief has been granted to the assessee on the afore-noted jurisdictional aspect, the other grounds raised by the assessee in its appeal are rendered academic and, therefore, are left open. 13. In the result, the appeal by the assessee is allowed. Order pronounced in the open Court on 16/05/2025 Sd/- BIJAYANANDA PRUSETH ACCOUNTANT MEMBER Sd/- SANDEEP SINGH KARHAIL JUDICIAL MEMBER MUMBAI, DATED: 16/05/2025 Prabhat Copy of the order forwarded to: (1) The Assessee; (2) The Revenue; (3) The PCIT / CIT (Judicial); (4) The DR, ITAT, Mumbai; and (5) Guard file. By Order Assistant Registrar ITAT, Mumbai "