Bombay High Court
Nacchattar Singh Dalbir Singh PaddaversusIncome Tax Officer Ward 2(2), Kalyan AND ORS
- Decided
- Disposal
- Rule Made Absolute
Holding
The Section 148 notice dated 13 July 2022 and all consequential orders are barred by limitation and are quashed.
Summary
The petitioner sought quashing of a Section 148 notice dated 13 July 2022, the subsequent reassessment order under Section 147, the Section 156 demand notice and related penalty orders for Assessment Year 2015-16. The court examined the Supreme Court’s concession in Union of India v. Rajeev Bansal that all Section 148 notices issued on or after 1 April 2021 for AY 2015-16 must be dropped as they fall outside the limitation period under the Taxation and Other Laws (Relaxation and Amendment) Act, 2020. Relying on that concession and its affirmation in Deepak Steel & Power Ltd. and Nehal Ashit Shah, the court held the notice was ultra vires. Consequently, the notice and all consequential orders were set aside. The petition was disposed without costs, and no comment was made on other grounds raised.
Issues considered
- Whether the Section 148 notice issued on 13 July 2022 for AY 2015-16 is barred by limitation under the Supreme Court’s concession in Rajeev Bansal.
- Whether the subsequent reassessment order, demand notice, penalty orders and recovery notices should be quashed as they stem from the barred notice.
Legislation cited
- Income Tax Act, 1961 — s. 144, 144B, 147, 148, 148A(d), 156
- Taxation and other laws (Relaxation and Amendment of Certain Provisions) Act, 2020
Subjects
- Section 148 notice
- limitation period
- Income Tax reassessment
- Taxation and Other Laws (Relaxation and Amendment) Act
- quash
- writ petition
- Assessment Year 2015-16
- penalty order
Judgment
2.wp.10541.2026.doc
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
CIVIL APPELLATE JURISDICTION
WRIT PETITION NO.10541 OF 2026
Nacchattar Singh Dalbir Singh .. Petitioner
Versus
Income Tax Officer,
Ward- 2(2), Kalyan & Ors. .. Respondents
UTKARSH Mr. Devendra Jain a/w Priya Jain i/b Shashank Mehta,
KAKASAHEB
BHALERAO Advocates for the Petitioner.
Digitally signed by
UTKARSH KAKASAHEB
BHALERAO
Date: 2026.08.31
16:08:16 +0530 Mr. Akhileshwar Sharma (through V.C.), Advocate for the
Respondents.
CORAM: B. P. COLABAWALLA &
FARHAN P. DUBASH, JJ.
DATE: AUGUST 29, 2026
P. C.
1. Rule. Respondents waive service. With the consent of
parties, Rule made returnable forthwith and heard finally.
2. The present Petition has been filed primarily with a prayer
to quash and set aside (i) the order passed under Section 148A(d), and
the Notice issued under Section 148, both dated 12 th July 2022 and 13th
July 2022 (Exhibit C1 and C2); (ii) the reassessment order dated 9 th May
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2023 passed under Section 147 read with Section 144 read with Section
144B of the Income Tax Act, 1961 (the Act); (iii) the Notice of demand
of even date under Section 156 of the Act (Exhibit D1 and D2); (iv) as
well as the consequential penalty orders. The Assessment Year in
question is A.Y.2015-16.
3. It is contended by Mr. Devendra Jain, the learned Counsel
for Petitioner that though several grounds have been raised in the
Petition, the Petition can be disposed on the solitary ground of the
Notice under Section 148 being barred by limitation. It is contended by
the Petitioner that the Notice issued under Section 148 for A.Y.2015-16
is dated 13th July 2022. Since it is issued after 1 st April 2021, it is without
jurisdiction and has to be withdrawn in light of the concession made by
the Income Tax Department before the Hon'ble Supreme Court in the
case of UOI v. Rajeev Bansal [2024] 167 taxmann.com 70.
Further, reliance is placed on the order dated 2 nd April 2025 passed by
the Hon'ble Supreme Court in case of Deepak Steel and Power Ltd.
v. Central Board of Direct Taxes [2025] 174 taxmann.com 144
and an order dated 4th April 2025 passed in the case of Asstt. CIT v.
Nehal Ashit Shah [SLP (CIVIL) Diary No (s) 57209 of 2024].
Further, our attention is also drawn to the decision of this Court in
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Verjinia Foods Limited v. The Income Tax Officer, Ward-1(1),
Kalyan [W.P.No. 1428 of 2023, decided on 6-10-2025]. Once
the Notice under Section 148 is bad in law, all the consequential
orders/notices would also not survive, is the submission.
4. The learned counsel for the Respondent does not dispute
the above factual position.
5. We have heard the learned counsel for the parties. It is not
in dispute that the present Petition relates to A.Y.2015-16. Further, it is
also undisputed that the Notice under Section 148 has been issued on
13th July 2022 which is at page 74 of the paper book. Once these are the
facts, paragraphs 19 (e) and (f) of the judgment of the Hon'ble Supreme
Court in the case of Rajeev Bansal (supra) become relevant. They read
as under:-
"19. Mr. N Venkataraman, learned Additional
Solicitor General of India, made the following
submissions on behalf of the Revenue:-
a. ….
e. The Finance Act 2021 substituted the old regime
for reassessment with a new regime. The first
proviso to Section 149 does not expressly bar the
application of TOLA. Section 3 of TOLA 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 TOLA, then all the
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notices issued between 1 April 2021 and 30 June
2021 pertaining to 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:
Assessment Within 3 Expiry of Limitation Within six Expiry of Limitation
Year Years read with TOLA for Years read with TOLA for
(2) (4)
(1) (2) (3) (4) (5)
2013-2014 31-3-2017 TOLA not applicable 31-3-2020 30-6-2021
2014-2015 31-3-2018 TOLA not applicable 31-3-2021 30-6-2021
2015-2016 31-3-2019 TOLA not applicable 31-3-2022 TOLA not applicable
2016-2017 31-3-2020 30-6-2021 31-3-2023 TOLA not applicable
2017-2018 31-3-2021 30-6-2021 31-3-2024 TOLA not applicable
f. The Revenue concedes that for the assessment
year 2015-16, all notices issued on or after 1 April
2021 will have to be dropped as they will not fall
for completion during the period prescribed under
TOLA;"
(emphasis supplied)
6. From the above it is clear that the Department has
conceded before the Hon'ble Supreme Court that all the Notices issued
under Section 148 on/or after 1st April 2021 for A.Y.2015-16 have to be
dropped. In the present case, the Assessment Year is A.Y. 2015-2016,
and the Notice under Section 148 is dated 13 th July 2022. Therefore, the
said Notice would have to be dropped as per the concession recorded by
the Hon'ble Supreme Court in Rajeev Bansal (supra).
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7. The decision in Rajeev Bansal (supra) has been
subsequently followed by the Hon'ble Supreme Court in Deepak Steel
and Power Ltd. (supra). Paragraphs 4 and 5 of the said order is
reproduced hereunder:-
"4. The learned counsel appearing for the revenue
with his usual fairness invited the attention of this
Court to a three judge bench decision of this Court
in Union of India and Ors. v. Rajeev Bansal,
reported in 2024 SCC OnLine SC 2693, more
particularly, paragraph 19(f) which reads thus:-
"19.(f) The Revenue concedes that for the
assessment year 2015-2016, 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."
5. As the revenue made a concession in the
aforesaid decision that is for the assessment year
2015-2016, all notices issued on or after 1st April,
2021 will have to be dropped as they would not
fall for completion during the period prescribed
under the taxation and other laws (Relaxation and
Amendment of certain Provisions Act, 2020).
Nothing further is required to be adjudicated in
this matter as the notices so far as the present
litigation is concerned is dated 25.6.2021.”
(emphasis supplied)
8. Similarly, even in the matter of Nehal Ashit Shah (supra),
the Hon'ble Supreme Court, relying upon paragraphs 19 (e) and (f) of
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the decision in case of Rajeev Bansal (supra), dismissed the SLP filed
by the Revenue. Paragraph 5 of the said order is reproduced hereunder:-
"5. In this regard, reference could also be made to paragraph 19(e)
and (f) in the case of Union of India v. Rajeev Bansal, Civil Appeal
No. 8629 of 2024 on 03.10.2024 (2024 SCC ONLINE 754) under
which the Learned Additional Solicitor General for India has
made a concession insofar as the Assessment Year 2015-16 is
concerned."
9. Lastly, this very Court, on 6th October 2025, in the matter of
Verjinia Foods Limited (supra), has allowed the Petition filed by the
Petitioner therein by noting that since the Notice under Section 148 was
issued after 1st April 2021, the same was required to be set aside in light
of the concession made by the Revenue before the Hon'ble Supreme
Court in the case of Rajeev Bansal (supra).
10. In light of the above discussion, we find merit in the
submissions as canvassed by the Petitioner. The Revenue has
categorically made a concession that for A.Y.2015-16 they would drop all
notices issued under Section 148 on or after 1 st April 2021. Once this is
the position, it is appropriate that the Notice under Section 148 dated
13th July 2022, and the consequential Assessment Order, Notice of
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demand, penalty notices/orders as well as the recovery notices be
quashed and set aside. It is accordingly so ordered.
11. Rule is made absolute in the above terms and the Writ
Petition is also disposed of in terms thereof. However, there shall be no
order as to costs. We also make it clear that we have not expressed any
opinion on the other grounds raised in the Petition.
12. This order will be digitally signed by the Private Secretary/
Personal Assistant of this Court. All concerned will act on production by
fax or email of a digitally signed copy of this order.
[FARHAN P. DUBASH, J.] [B. P. COLABAWALLA, J.]
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