VIKASH AGARWAL,KOLKATA V. ITO WARD-3(1), KOLKATA

ITA 1810/KOL/2025

AI Insights

The case involves an appeal by Vikash Agarwal against the order of the National Faceless Appeal Centre, Delhi, concerning the assessment year 2013-14. The primary contention was the validity of a notice issued under section 148 of the Income Tax Act, which the assessee argued was barred by limitation based on the Supreme Court's decision in Union of India vs. Rajeev Bansal and the provisions of TOLA. The Tribunal examined the timeline of notices and the application of TOLA, ultimately concluding that the notice was issued beyond the surviving period and thus invalid.

• Counselvise Citation: [2026] 140 COUNSELVISE.COM (IT) 831502 (ITAT-KOLKATA)
• Duration Of Justice: 5 month(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-01-2026
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Assessment Year: misc
• Appeal Filed On: 11-08-2025
• Other Referred Cases: Union of India and other Vs. Rajeev Bansal [2024] 469 ITR 46 (SC), Union of India vs. Ashish Agarwal [2022] 138 taxmann.com 64 (SC)
• Laws Referred To: Income Tax Act, Other laws (relaxation and amendment of certain provisions) Act, 2020
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S.B. CHAKRABORTHY
• Assessee Lawyers: V.K. SHAHOO
• Keywords: Set aside; Period of limitation; Time period of passing order
• Section: 148

Judgement Text

" 18THE INCOME TAX APPELLATE TRIBUNAL “D” BENCH, KOLKATA BEFORE SHRI RAJESH KUMAR, AM AND SHRI PRADIP KUMAR CHOUBEY, JM ITA No. 1810/KOL/2025 (Assessment Year: 2013-14) Vikash Agarwal 1, Park Lane, park Street, Kolkata-700016, West Bengal Vs. ITO, Ward 3(1) 8/2, Esplanade East Kolkata-700069, West Bengal (Appellant) (Respondent) PAN No. AFIPA8080P Assessee by : Shri V.K. Shahoo, AR Revenue by : Shri S.B. Chakraborthy, DR Date of hearing: 14.01.2026 Date of pronouncement: 20.01.2026 O R D E R Per Rajesh Kumar, AM: This is an appeal preferred by the assessee against the order of the National Faceless Appeal Centre, Delhi (hereinafter referred to as the “Ld. CIT(A)”] dated 11.06.2025 for the AY 2013-14. 2. In ground no.1 the assessee has challenged the notice issued u/s 148 of the Act and re-assessment proceedings to be barred by limitation in view of the decision of Hon'ble Apex Court in the case of Union of India and other Vs. Rajeev Bansal [2024] 469 ITR 46 (SC), dated 03.10.2024 and therefore, the notice u/s 148 of the Act as well as the assessment framed by the ld. AO are nullity and bad in law. 3. The facts in brief are that the notice u/s 148 of the Act was issued on 19.06.2021. The assessee requested the ld. AO/JAO on 06.01.2022 Printed from counselvise.com Page | 2 ITA No. 1810/KOL/2025 Vikash Agarwal A.Y. 2013-14 vide written communication for supplying the reasons filed with JAO on 07.01.2022. On 03.02.2022, the reasons were supplied by the JAO to the assessee. Thereafter the ld. AO issued show cause notice u/s 148A(b) of the Act on 23.05.2022, calling upon the assessee to reply by 08.06.2022. The assessee replied the notice dated 23.05.2022, by uploading the reply on 08.06.2022. Again another notice was issued u/s 148A(b) of the Act by the ld. AO calling upon the assessee to make compliance by 20th June, 2022. The assessee filed the online reply on 20.06.2022. Thereafter, the ld. AO passed order u/s 148A(d) of the Act and noted that this is a fit case for issue or notice. Thereafter, the notice was issued u/s 148 of the Act by JAO, ITO ward 3(1), Kolkata on 30.07.2022. 4. The ld. AR vehemently argued that the notice u/s 148 of the Act was issued beyond surviving period i.e. 01.07.2022 and therefore in terms of Para no.114 of the Hon'ble Apex Court decision in Union of India Vs. Rajeev Bansal (supra), the notice is barred by limitations and accordingly, the assessment framed by the ld. AO is also nullity and bad in law and may kindly be quashed. 5. The ld. DR on the other hand, vehemently submitted that the notice is not barred by limitation and it was validly issued on 30.07.2022. 6. After hearing the rival contentions and perusing the materials available on record, we find that in this case the assessment year is 2013-14 and the last day for issue of notice in terms of Provisions of Section 149(1)(b) of the Act on 31.03.2020. We note that the notice was issued on 19.06.2021. We further note that due to covid pandemic Other laws (relaxation and amendment of certain provisions) Act, 2020 (TOLA) was brought out, which overrides the Income Tax Act to the extent of relaxing time limit for issuance of reassessment notices, Printed from counselvise.com Page | 3 ITA No. 1810/KOL/2025 Vikash Agarwal A.Y. 2013-14 which fall for completion from 20.03.2020 to 31.03.2021 till 30th June, 2021. In the case of the assessee, the TOLA is applicable and therefore, notice issued on 19.06.2021, is deemed to be issued within time prescribed under the Act and the same would be deemed to be a show cause notice u/s 148A(b) of the Act in terms of Hon'ble Apex Court decision in the case of Union of India vs. Ashish Agarwal [2022] 138 taxmann.com 64 (SC)/[2022] 286 Taxman 183 (SC)/[2022] 444 ITR 1 (SC)[04-05-2022]. Thereafter, Hon'ble Apex court has passed another order in the case of Union of India Vs. Rajeev Bansal (supra), wherein as to how the limitation period is to be computed was explained in detail in terms Para no.114 of the said order , which read as under:- “114. In view of the above discussion, we conclude that: a. After 1 April 2021, the Income-tax Act has to be read along with the substituted provisions; b. TOLA will continue to apply to the Income-tax Act after 1 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; c. Section 3(1) of TOLA overrides Section 149 of the Income-tax Act only to the extent of relaxing the time limit for issuance of a reassessment notice under section 148; d. 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; e. 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; f. The directions in Ashish Agarwal (supra) will extend to all the ninety thousand reassessment notices issued under the old regime during the period 1 April 2021 and 30 June 2021; Printed from counselvise.com Page | 4 ITA No. 1810/KOL/2025 Vikash Agarwal A.Y. 2013-14 g. The time during which the show cause notices were deemed to be stayed is from the date of issuance of the deemed notice between 1 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 (supra), and the period of two weeks allowed to the assesses to respond to the show cause notices; and h. 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;” 6.1. The Hon'ble High Court concluded that the TOLA will continue apply to the income tax Act after 01.04.2021 read with the substituted provisions, if action or any proceedings specified fall for completion between 20.03.2020 and 31.03.2021. It was provided that Section3(1) of TOLA would override Section 149(1) of the Act to the extent of relaxing the time limit for issuance of reassessment unit u/s 148 of the Act. It was also provided that the time/period during which the show cause notice was deemed to be stayed on the date of issuance of deemed notice between 1st April 2021 to 31st April, 2021 till supply of the relevant information/ material by the ld. AO to assesses in terms of direction issued by this court in Ashish Agarwal (supra) and the period of two weeks allowed to the assesses to respond to the show cause notices. The Hon'ble Court also concluded the ld. AO was required to issue the reassessment notice under section 148 of the Act of the new regime within the surviving time limit under the Income- tax Act read with TOLA and all notices issued beyond the surviving period are time barred and liable to be set aside. In the present case, we note that the assessee was issued a show cause notice on 15.06.2022 u/s 148A(b) of the Act requiring the assessee to file reply by 20th Jun3, 2022, which was duly filed on online portal. Thereafter, the order u/s 148A(d) of the Act was passed by the JAO on 28.07.2022 and finally, the notice u/s 148 of the Act was issued by JAO, ITO ward Printed from counselvise.com Page | 5 ITA No. 1810/KOL/2025 Vikash Agarwal A.Y. 2013-14 3(1), Kolkata on 20.07.2022. Thus, we find merit in the contention of the assessee that the last date for issuing notice u/s 148 of the Act expired on 01.07.2022 as if the surviving period of 11 days, which is computed on the basis of notice issued u/s 148 of the Act on 19.06.2021 and the last date for supplying such material on 30.06.2021, then if we consider the online reply filed by the assessee on 20.06.2022 and by adding 11 days to the same, the last day falls on 01.07.2022. Therefore, notice is barred by limitation and the assessment framed by the ld. AO is invalid and bad in law. Consequently, we quash the assessment framed by the ld. AO as barred by limitation. 7. In the result, the appeal of the assessee is allowed. Order pronounced in the open court on 20.01.2026. Sd/- Sd/- (PRADIP KUMAR CHOUBEY) (RAJESH KUMAR) (JUDICIAL MEMBER) (ACCOUNTANT MEMBER) Kolkata, Dated: 20.01.2026 Sudip Sarkar, Sr.PS Copy of the Order forwarded to: BY ORDER, True Copy// Sr. Private Secretary/ Asst. Registrar Income Tax Appellate Tribunal, Kolkata 1. The Appellant 2. The Respondent 3. CIT 4. DR, ITAT, 5. Guard file. Printed from counselvise.com "