Delhi High Court – Orders
Jayanti Real Estate Developers Private … vs Income Tax Officer Ward 13(3) New Delhi & … on 4 March, 2025
Author: Yashwant Varma
Bench: Yashwant Varma
$~55
* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ W.P.(C) 154/2023
JAYANTI REAL ESTATE DEVELOPERS PRIVATE
LIMITED .....Petitioner
Through: Ms. Kavita Jha, Mr. Vaibhav
Kulkarni and Mr. Himanshu
Aggarwal, Advs.
versus
INCOME TAX OFFICER WARD 13(3) NEW DELHI & ANR.
.....Respondents
Through: Mr. Abhishek Maratha, SSC
with Mr. Parth Semwal, JSC,
Mr. Apoorv Agarwal, JSC and
Ms. Nupur Sharma, Mr. Gaurav
Singh, Mr. Bhanukaran Singh
Jodha, Ms. Muskaan Goel and
Mr. Himanshu Gaur, Advs. for
Revenue.
CORAM:
HON'BLE MR. JUSTICE YASHWANT VARMA
HON'BLE MR. JUSTICE HARISH VAIDYANATHAN SH
ANKAR
ORDER
% 04.03.2025
1. This writ petition has been preferred seeking the following
reliefs:-
“a) Issue writ of certiorari or writ, order or direction in the nature
of certiorari, or any other appropriate writ, order or direction under
Article 226/227 of the Constitution of India, quashing notice dated
19.05.2022 issued under section 148A(b) of the Act;
b) Issue writ of certiorari or writ, order or direction in the nature of
certiorari, or any other appropriate writ, order or direction under
Article 226 / 227 of the Constitution of India quashing impugnedW.P.(C) 154/2023 Page 1 of 7
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order dated 26.07.2022 passed under section 148A(d) and
consequential notice of even date issued under section 148 of the
Act;
c) Issue writ of certiorari or writ, order or direction in the nature of
certiorari, or any other appropriate writ, order or direction under
Article 226 / 227 of the Constitution of India quashing impugned
the reassessment proceedings in the case of the Petitioner for
assessment year 2016-17, and all actions/proceedings
consequential thereto.
d) such other order or orders as this Hon’ble Court may deem fit
and proper in the facts and circumstances of the case.”
2. Before us, the solitary argument which is addressed today is
with respect to the validity of the sanction which was accorded to the
reassessment action by the Principal Commissioner of Income Tax1.
3. Learned counsel for the writ petitioner, draws our attention to
the provisions of Section 151 of the Income Tax Act, 19612 as they
stood at the relevant time and which read as follows:-
“151. Specified authority for the purposes of section 148 and
section 148A shall be,–
(i) Principal Commissioner or Principal Director or Commissioner
or Director, if three years or less than three years have elapsed
from the end of the relevant assessment year;
(ii) Principal Chief Commissioner or Principal Director General or
where there is no Principal Chief Commissioner or Principal
Director General, Chief Commissioner or Director General, if more
than three years have elapsed from the end of the relevant
assessment year.”
4. Undisputedly, we are in this writ petition concerned with
Assessment Year3 2016-17 and in respect of which the notice under
Section 148 of the Act ultimately came to be issued on 26 July 2022.
It is thus apparent that the action has come to be initiated after the
1
PCIT
2
Act
3
AY
W.P.(C) 154/2023 Page 2 of 7
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expiry of three years from the end of the relevant AY. It is in the
aforesaid context that the petitioner contends that the sanction
accorded by the PCIT would not sustain.
5. In cases where reassessment is sought to be commenced after
the lapse of three years from the end of the relevant AY, undisputedly,
it would be the Principal Chief Commissioner who would be liable to
be recognised as being the competent authority. Viewed in that light, it
is apparent that the reassessment action would not sustain.
6. Dealing with an identical question, we had in Abhinav Jindal
HUF v. Commissioner of Income Tax and Ors4 held as under:-
“30. Tested on the principles which were enunciated in
Suman Jeet Agarwal v. ITO [(2022) 449 ITR 517 (Delhi);
2022 SCC OnLine Del 3141.], the petitioners would
appear to be correct in their submission of the date liable
to be ascribed to the impugned notices and those being
viewed as having been issued and dispatched after April 1,
2021. However, and in our considered opinion, the same
would be of little relevance or significance when one bears
in mind the indubitable fact that all the notices were
approved by the Joint Commissioner of Income-tax and
which was an authority recognised under the unamended
section 151. The answer to the argument based on the
provisions of the Taxation and Other Laws (Relaxation
and Amendment of Certain Provisions) Act would also
largely remain unimpacted by our finding on this score as
would become evident from the discussion which ensues.
xxxx xxxx xxxx
33. A plain reading of section 3 establishes that where the
time limit for the completion or compliance of any action
under a specified Act were to fall between March 20, 2020
to December 31, 2020, the period for completion and
compliance would stand extended up to March 31, 2021 or
such other date thereafter as may be specified by the
Union Government by way of a notification.
Undisputedly, the date of March 31, 2021 came to be
extended thereafter up to April 30, 2021 and lastly up to4
2024 SCC OnLine Del 6585W.P.(C) 154/2023 Page 3 of 7
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June 30, 2021.
34. Concededly, the Finance Act, 2021 was enacted
thereafter and came into effect from April 1, 2021. It is
admitted by the respondents that the terminal point for
initiation of reassessment for the assessment year 2015-
2016 in ordinary circumstances would have been March
31, 2020 and that date clearly fell within the period spoken
of in section 3 of the Taxation and Other Laws (Relaxation
and Amendment of Certain Provisions) Act. The period
for issuance of notice for the assessment year 2015-2016,
thus and principally speaking, stood extended up to June
30, 2021.
35. However, the key to answering the argument which
was canvassed on behalf of the respondents is contained in
section 3 itself and which purported to extend the period
for completion of proceedings, passing of an order,
issuance of a notice, intimation, notification, sanction or
approval. The provision extended the time limit for such
action, notwithstanding anything contained in the
specified Act, initially up to March 31, 2021 and which
date was extended subsequently to April 30, 2021 and
lastly up to June 31, 2021.
36. Section 3 thus essentially extended the time period
statutorily prescribed for initiation and compliance up to
the dates notified by the Union Government from time to
time. The extension of these timelines was intended to
apply to all statutes which were included in the expression
“specified Act” as defined in section 2(b) of the Taxation
and Other Laws (Relaxation and Amendment of Certain
Provisions) Act.
37. The Taxation and Other Laws (Relaxation and
Amendment of Certain Provisions) Act was thus
concerned with overcoming the statutory closure and
eclipse which would have otherwise descended upon the
authority to act and take action under the specified
statutes. It was essentially concerned with tiding over the
insurmountable hurdles which arose due to the pandemic
and the disruption that followed in its wake. The Taxation
and Other Laws (Relaxation and Amendment of Certain
Provisions) Act, viewed in that light, was neither aimed at
nor designed or intended to confer a new jurisdiction or
authority upon an officer under a specified enactment. On
a fundamental plane, it was a remedial measure aimed at
overcoming a position of irretrievable and irreversible
consequences which were likely to befall during theW.P.(C) 154/2023 Page 4 of 7
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nationwide lockdown. It was principally aimed at enabling
authorities to take and commence action within the
extended timelines that the Taxation and Other Laws
(Relaxation and Amendment of Certain Provisions) Act
introduced. However, it neither altered nor modified or
amended the distribution of functions, the command
structure or the distribution of powers under a specified
Act. It was in that light that we had spoken of the carving
or conferral of a new or altered jurisdiction.
38. It would therefore be wholly incorrect to read the
Taxation and Other Laws (Relaxation and Amendment of
Certain Provisions) Act as intending to amend the
distribution of power or the categorisation envisaged and
prescribed by section 151. The additional time that the
said statute provided to an authority cannot possibly be
construed as altering or modifying the hierarchy or the
structure set up by section 151 of the Act. The issue of
approval would still be liable to be answered based on
whether the reassessment was commenced after or within
a period of four years from the end of the relevant
assessment year or as per the amended regime dependent
upon whether action was being proposed within three
years of the end of the relevant assessment year or
thereafter. The bifurcation of those powers would continue
unaltered and unaffected by the Taxation and Other Laws
(Relaxation and Amendment of Certain Provisions) Act.
39. The fallacy of the submission addressed by the
respondents becomes even more evident when we weigh
in consideration the fact that even if the reassessment
action were initiated, as per the extended Taxation and
Other Laws (Relaxation and Amendment of Certain
Provisions) Act timelines, and thus after the period of four
years, section 151 incorporated adequate measures to deal
with such a contingency and in unambiguous terms
identified the authority which was to be moved for the
purposes of sanction and approval. Section 151 distributed
the powers of approval amongst a set of specified
authorities based upon the lapse of time between the end
of the relevant assessment year and the date when
reassessment was proposed. Thus even if the reassessment
was proposed to be initiated with the aid of the Taxation
and Other Laws (Relaxation and Amendment of Certain
Provisions) Act after the expiry of four years from the end
of the relevant assessment year, the authority statutorily
empowered to confer approval would be the Principal
Chief Commissioner/Chief Commissioner/PrincipalW.P.(C) 154/2023 Page 5 of 7
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Commissioner/Commissioner. It would only be in a case
where the reassessment was proposed to be initiated
before the expiry of four years from the end of the relevant
assessment year that approval could have been accorded
by the Joint Commissioner of Income-tax. Similar would
be the position which would emerge if the actions were
tested on the basis of the amended section 151 and which
divides the power of sanction amongst two sets of
authorities based on whether reassessment is commenced
within three years or thereafter.
40. What we seek to emphasise is that the Taxation and
Other Laws (Relaxation and Amendment of Certain
Provisions) Act authorisation merely enables the
competent authority to take action within the extended
time period and irrespective of the closure which would
have ordinarily come about by virtue of the provisions
contained in the Act. It does not alter or amend the
structure for approval and sanction which stands erected
by virtue of section 151. The Taxation and Other Laws
(Relaxation and Amendment of Certain Provisions) Act
merely extended the period within which action could
have been initiated and which would have otherwise and
ordinarily been governed and regulated by sections 148
and 149 of the Act. If the contention of the respondents
were to be accepted it would amount to us virtually
ignoring the date when reassessment is proposed to be
initiated and the same being indelibly tied to the end of the
relevant assessment year. Once it is conceded that the
notice came to be issued four or three years after the end
of the relevant assessment year, the approval granted by
the Joint Commissioner of Income-tax would not be
compliant with the scheme of section 151. We thus find
ourselves unable to sustain the grant of approval by the
Joint Commissioner of Income-tax.
41. It is pertinent to note that the respondents had feebly
sought to urge that the use of the expression “sanction” in
section 3 of the Taxation and Other Laws (Relaxation and
Amendment of Certain Provisions) Act also merits due
consideration and is liable to be read as supportive of the
contentions that were addressed on their behalf. The
argument is however clearly meritless when one bears in
consideration the indisputable fact that the set of
provisions with which we are concerned nowhere
prescribe a timeframe within which sanction is liable to be
accorded. “Sanction” when used in section 3 of the
Taxation and Other Laws (Relaxation and Amendment ofW.P.(C) 154/2023 Page 6 of 7
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 08/03/2025 at 02:10:31
Certain Provisions) Act caters to those contingencies
where a specified Act may have prescribed a particular
time limit within which an action may be approved. That
is clearly not the position which obtains here. We thus find
ourselves unable to sustain the impugned action of
reassessment. The impugned notices which rest on a
sanction obtained from the Joint Commissioner of
Income-tax would thus be liable to be quashed.”
7. Consequently, and for the aforesaid reasons, we find ourselves
unable to sustain the reassessment action on this short score alone
8. Accordingly, the writ petition is allowed. The impugned order
referable to Section 148A(d) and notice under Section 148, both dated
26 July 2022 are quashed. However, the present order shall be without
prejudice to the right of the respondent to draw such other proceedings
as may be permissible in law.
YASHWANT VARMA, J
HARISH VAIDYANATHAN SHANKAR, J
MARCH 4, 2025/akc/er
W.P.(C) 154/2023 Page 7 of 7
This is a digitally signed order.
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