WYZAX SURROGACY CONSULTANTS V. ACIT, CEN CIR-28, NEW DELHI

W.P.(C)/14867/2024

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The case involves WYZAX Surrogacy Consultants, the petitioner, who challenged a notice issued by the ACIT, CEN CIR-28, New Delhi, under Section 148 of the Income Tax Act, 1961, for the assessment year 2016-17. The notice was contested on the grounds that it was issued after the expiration of the statutory time limit for reopening assessments, which is six years from the end of the relevant assessment year, as per the old regime of Section 149(1)(b). The petitioner argued that the notice was barred by limitation, referencing decisions from the Delhi High Court and the Supreme Court that supported their position. The court found that the notice was indeed issued beyond the permissible period, leading to the setting aside of the notice and the allowance of the petition.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 746378 (HC-DELHI)
• Appeal Type: Others
• Pronouncement Date: 23-10-2024
• Assessment Year: misc
• Other Referred Cases: Manju Somani v. Income Tax Officer Ward-70(1) & Ors, Union of India & Others v. Rajeev Bansal
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: SIDDHARTH SINHA
• Assessee Lawyers: RANO JAIN; VENKETESH CHAURASIA; SAKSHI SRIVASTAVA; SAKSHIRUSTAGI
• Keywords: Assessment Year; Barred by limitation; Impugning notice
• Section: 148; 148A(b); 148A(d); 149(1)(b)

Judgement Text

"$~99 * IN THE HIGH COURT OF DELHI AT NEW DELHI + W.P.(C) 14867/2024 & CM APPL. 62417-18/2024 WYZAX SURROGACY CONSULTANTS .....Petitioner Through: Ms Rano Jain, Mr Venketesh Chaurasia, Ms Sakshi Srivastava, Ms Sakshi Rustagi, Advocates. versus ACIT, CEN CIR-28, NEW DELHI .....Respondent Through: Mr Siddharth Sinha, SSC. CORAM: HON'BLE MR. JUSTICE VIBHU BAKHRU HON'BLE MS. JUSTICE SWARANA KANTA SHARMA O R D E R % 23.10.2024 1. The petitioner has filed the present petition, inter alia, impugning a notice dated 31.03.2024 (hereafter the impugned notice) issued under Section 148 of the Income Tax Act, 1961 (hereafter the Act) for the assessment year 2016-17. 2. The petitioner also impugns the notice issued under Section 148A(b) of the Act, and the order passed under Section 148A(d) of the Act prior to the issuance of the impugned notice. 3. The learned counsel appearing for the petitioner submits that the issue stands covered by the decision of this Court in Manju Somani v. Income Tax Officer Ward-70(1) & Ors: Neutral Citation: 2024:DHC:5411-DB. This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 29/10/2024 at 12:07:15 4. Ms Jain, also referred to the decision of the Supreme Court in Union of India & Others v. Rajeev Bansal : 2024 SCC OnLine SC 2693 and drew the attention of this Court to the following passages from the said judgment: “46. 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. *** *** *** 49. The first proviso to Section 149(1)(b) requires the determination of whether the time limit prescribed under Section 149(1)(b) of the old regime continues to exist for the assessment year 2021-2022 and before. Resultantly, a notice under Section 148 of the new regime cannot be issued if the period of six years from the end of the relevant assessment year has expired at the time of issuance of the notice. This also ensures that the new time limit of ten years prescribed under Section 149(1)(b) of the new regime applies prospectively. For example, for the assessment year 2012-2013, the ten year period would have expired on 31 March 2023, while the six year period expired on 31 March 2019. Without the proviso to Section 149(1)(b) of the new regime, the Revenue could have had the power to reopen assessments for the year 2012-2013 if the escaped assessment amounted to Rupees fifty lakhs or more. The proviso limits the retrospective operation of Section 149(1)(b) to protect the interests of the This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 29/10/2024 at 12:07:15 assesses.” 5. In the present case, the period of six years for the relevant assessment year 2016-17 expired on 31.03.2023. The impugned notice has been issued thereafter, and the same is, thus, barred by limitation. 6. The learned counsel for the respondent is unable to counter the said submissions. 7. In view of the above, the impugned notice is set aside. 8. The petition is allowed in the aforesaid terms. Pending applications also stand disposed of. VIBHU BAKHRU, J SWARANA KANTA SHARMA, J OCTOBER 23, 2024 M Click here to check corrigendum, if any This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 29/10/2024 at 12:07:15 "