Delhi High Court
Rajesh Chopra vs Income Tax Officer, Ward 62(1) Delhi on 28 May, 2025
Author: Vibhu Bakhru
Bench: Vibhu Bakhru
IN THE HIGH COURT OF DELHI AT NEW DELHI
% Judgment delivered on: 28.05.2025
+ W.P.(C) 12561/2022
RAJESH CHOPRA .... Petitioner
Versus
INCOME TAX OFFICER, WARD 62(1) DELHI.... Respondent
Advocates who appeared in this case:
For the Petitioner : Mr. Sumit Lalchandani, Mr. Shivam Yadav, Mr.
Utkarsh Kumar Gupta and Ms. Ananya Kapoor,
Advocates.
For the Respondent: Mr. Debesh Panda, Senior Standing Counsel with
Ms. Zehra Khan, Mr. Vikramaditya Singh and Ms.
Delphina, Advocates.
CORAM
HON'BLE MR JUSTICE VIBHU BAKHRU
HON'BLE MR JUSTICE TEJAS KARIA
JUDGMENT
VIBHU BAKHRU, J.
1. The petitioner has filed the present petition under Article 226 of
the Constitution of India impugning a notice dated 30.05.2022 issued
under Section 148A(b) of the Income Tax Act, 1961 [the Act]; an order
dated 22.07.2022 passed under Section 148A(d) of the Act [impugned
order]; and a notice dated 22.07.2022 [impugned notice] issued under
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Section 148 of the Act pursuant to the impugned order in respect of the
assessment year [AY] 2013-14.
2. The petitioner contends that the impugned notice has been issued
beyond the period of limitation as prescribed under Section 149(1) of
the Act and therefore, is liable to be set aside.
FACTUAL CONTEXT
3. The petitioner is an individual and is a resident of New Delhi.
The petitioner filed its return of income on 08.08.2013 for AY 2013-14
under Section 139(1) of the Act, declaring a total income of
₹20,59,151/-.
4. The petitioner received a notice dated 31.03.2021 under Section
148 of the Act. The petitioner complied with the said notice and
furnished its return of income on 07.04.2021, declaring the income as
was declared in the original return. Thereafter, the Assessing Officer
[AO] issued a notice dated 23.11.2021 under Section 143(2) read with
Section 147 of the Act. The petitioner furnished a reply to the said
notice and duly participated in the said proceedings. The AO issued
another notice dated 22.02.2022 under Section 142(1) of the Act and
the petitioner responded to the said notice as well. The said proceedings
did not culminate in an assessment order, as the AO did not pass any
such order at the material time.
5. The AO issued another notice dated 30.05.2022 under Section
148A(b) of the Act and called upon the petitioner to file a reply on or
before 13.06.2022.
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6. The said notice indicated that it was issued in view of the
judgment of the Supreme Court in Union of India and Ors. v. Ashish
Agarwal: 2022 SCC OnLine SC 543.
7. The petitioner responded to the said notice on 03.06.2022, inter
alia, claiming that the notice issued under Section 148A(b) of the Act
was invalid, as it was issued after the time for completing the
assessment had expired. The petitioner further contended that the
reference to the decision of the Supreme Court in Union of India and
Ors. v. Ashish Agarwal (supra) was misplaced, as it was applicable
only to notices that were issued under Section 148 of the Act during the
period from 01.04.2021 to 30.06.2021. Therefore, the said decision had
no application as the notice under Section 148 of the Act was issued on
31.03.2021 and the petitioner had participated in the re-assessment
proceedings that were commenced pursuant to the said notice.
8. The AO did not accept the petitioner’s objection as the notice
dated 31.03.2021 was digitally signed at 07:44 PM but was delivered to
the petitioner on 01.04.2021. The AO noted that the ITBA delivery
status through the email sent bears the timestamp of 01.04.2021 at
07:30:47 AM and the delivery timestamp as 01.04.2021 at 07.30:48
AM. In view of the above, the AO concluded that the notice was issued
on 01.04.2021 and not on 31.03.2021, that is, the date reflected on the
notice.
REASONS AND CONCLUSION
9. The controversy involved in the present petition is in a narrow
compass. It is the petitioner’s case that the time for passing a re-
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assessment order in respect of AY 2013-14 had expired on 31.03.2022
being the period of twelve months from the date on which the notice
under Section 148 of the Act was initially issued. The Revenue
controverts the same and claims that the notice dated 31.03.2021 was,
in fact, issued on 01.04.2021 and therefore, is required to be treated as
a notice under Section 148A(b) of the Act in terms of the decision of
the Supreme Court in Union of India and Ors. v. Ashish Agarwal
(supra). There is no cavil that if the original notice dated 31.03.2021 is
construed as a notice served on 01.04.2021, the petitioner’s challenge
to the impugned notice and the impugned order is required to be
rejected.
10. At this stage, it is relevant to note that in Union of India and Ors.
v. Ashish Agarwal (supra), the Supreme Court had issued directions in
exercise of powers under Article 142 of the Constitution of India. The
relevant extract of the said judgment is set out below:
“7. Thus, the new provisions substituted by the Finance
Act, 2021 being remedial and benevolent in nature and
substituted with a specific aim and object to protect the
rights and interest of the assessee as well as and the
same being in public interest, the respective High
Courts have rightly held that the benefit of new
provisions shall be made available even in respect of the
proceedings relating to past assessment years, provided
section 148 notice has been issued on or after 1st April,
2021. We are in complete agreement with the view
taken by the various High Courts in holding so.
8. However, at the same time, the judgments of the several
High Courts would result in no reassessment
proceedings at all, even if the same are permissible
under the Finance Act, 2021 and as per substitutedSignature Not Verified
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sections 147 to 151 of the IT Act. The Revenue cannot
be made remediless and the object and purpose of
reassessment proceedings cannot be frustrated. It is true
that due to a Bonafide mistake and in view of
subsequent extension of time vide various notifications,
the Revenue issued the impugned notices under section
148 after the amendment was enforced w.e.f.
01.04.2021, under the unamended section 148. In our
view the same ought not to have been issued under the
unamended Act and ought to have been issued under the
substituted provisions of sections 147 to 151 of the IT
Act as per the Finance Act, 2021. There appears to be
genuine non-application of the amendments as the
officers of the Revenue may have been under a
Bonafide belief that the amendments may not yet have
been enforced. Therefore, we are of the opinion that
some leeway must be shown in that regard which the
High Courts could have done so. Therefore, instead of
quashing and setting aside the reassessment notices
issued under the unamended provision of IT Act, the
High Courts ought to have passed an order construing
the notices issued under unamended Act/ unamended
provision of the IT Act as those deemed to have been
issued under section 148A of the IT Act as per the new
provision section 148A and the Revenue ought to have
been permitted to proceed further with the reassessment
proceedings as per the substituted provisions of sections
14 7 to 151 of the IT Act as per the Finance Act, 2021,
subject to compliance of all the procedural requirements
and the defences, which may be available to the
assessee under the substituted provisions of sections 14
7 to 151 of the IT Act and which may be available under
the Finance Act, 2021 and in law. Therefore, we
propose to modify the judgments and orders passed by
the respective High Courts as under:
(i) The respective impugned section 148 notices
issued to the respective assessees shall be deemed
to have been issued under section 148A of the IT
Act as substituted by the Finance Act, 2021 and
treated to be show-cause notices in terms of
section 148A(b). The respective assessing officersSignature Not Verified
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shall within thirty days from today provide to the
assessees the information and material relied upon
by the Revenue so that the assessees can reply to
the notices within two weeks thereafter;
(ii) The requirement of conducting any enquiry with
the prior approval of the specified authority under
section 148A(a} be dispensed with as a one-time
measure vis-a-vis those notices which have been
issued under Section 148 of the unamended Act
from 01.04.2021 till date, including those which
have been quashed by the High Courts;
(iii) The assessing officers shall thereafter pass an order
in terms of section 148A(d) after following the due
procedure as required under section l 48A(b) in
respect of each of the concerned assessees;
(iv) All the defences which may be available to the
assessee under section 149 and/or which may be
available under the Finance Act, 2021 and in law
and whatever rights are available to the Assessing
Officer under the Finance Act, 2021 are kept open
and/ or shall continue to be available and;
(v) The present order shall substitute/modify respective
judgments and orders passed by the respective
High Courts quashing the similar notices issued
under unamended section 148 of the IT Act
irrespective of whether they have been assailed
before this Court or not.
9. There is a broad consensus on the aforesaid aspects
amongst the learned ASG appearing on behalf of the
Revenue and the learned Senior Advocates/learned
counsel appearing on behalf of the respective asessees.
We are also of the opinion that if the aforesaid order is
passed, it will strike a balance between the rights of the
Revenue as well as the respective assesses as because of
a bonafide belief of the officers of the Revenue in
issuing approximately 90000 such notices, the Revenue
may not suffer as ultimately it is the public exchequer
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which would suffer. Therefore, we have proposed to
pass the present order with a view avoiding filing of
further appeals before this Court and burden this Court
with approximately 9000 appeals against the similar
judgments and orders passed by the various High
Courts, the particulars of some of which are referred to
hereinabove. We have also proposed to pass the
aforesaid order in exercise of our powers under Article
142 of the Constitution of India by holding that the
present order shall govern, not only the impugned
judgments and orders passed by the High Court of
Judicature at Allahabad, but shall also be made
applicable in respect of the similar judgments and
orders passed by various High Courts across the country
and therefore the present order shall be applicable to
PAN INDIA.
10. In view of the above and for the reasons stated above,
the present Appeals are ALLOWED IN PART. The
impugned common judgments and orders passed by the
High Court of Judicature at Allahabad in W.T. No.
524/2021 and other allied tax appeals/petitions, is/are
hereby modified and substituted as under: –
(i) The impugned section 148 notices issued to the
respective assessees which were issued under
unamended section 148 of the IT Act, which were
the subject matter of writ petitions before the
various respective High Courts shall be deemed to
have been issued under section 148A of the IT Act
as substituted by the Finance Act, 2021 and
construed or treated to be show-cause notices in
terms of section 148A(b). The assessing officer
shall, within thirty days from today provide to the
respective assessees information and material
relied upon by the Revenue, so that the assesees
can reply to the show-cause notices within two
weeks thereafter;
(ii) The requirement of conducting any enquiry, if
required, with the prior approval of specified
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dispensed with as a one-time measure vis-a-vis
those notices which have been issued under
section 148 of the unamended Act from
01.04.2021 till date, including those which have
been quashed by the High Courts. Even otherwise
as observed hereinabove holding any enquiry with
the prior approval of specified authority is not
mandatory but it is for the concerned Assessing
Officers to hold any enquiry, if required;
(iii) The assessing officers shall thereafter pass orders
in terms of section 148A(d) in respect of each of
the concerned assessees; Thereafter after
following the procedure as required under section
148A may issue notice under section 148 (as
substituted);
(iv) All defences which may be available to the assesses
including those available under section 149 of the
IT Act and all rights and contentions which may
be available to the concerned assessees and
Revenue under the Finance Act, 2021 and in law
shall continue to be available.
11. The present order shall be applicable PAN INDIA and
all judgments and orders passed by different High
Courts on the issue and under which similar notices
which were issued after 01.04.2021 issued under section
148 of the Act are set aside and shall be governed by the
present order and shall stand modified to the aforesaid
extent. The present order is passed in exercise of powers
under Article 142 of the Constitution of India so as to
avoid any further appeals by the Revenue on the very
issue by challenging similar judgments and orders, with
a view not to burden this Court with approximately
9000 appeals. We also observe that present order shall
also govern the pending writ petitions, pending before
various High Courts in which similar notices under
Section 148 of the Act issued after 01.04.2021 are under
challenge.
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12. The impugned common judgments and orders passed by
the High Court of Allahabad and the similar judgments
and orders passed by various High Courts. More
particularly, the respective judgments and orders passed
by the various High Courts particulars of which are
mentioned hereinabove, shall stand modified/
substituted to the aforesaid extent only.”
11. In view of the PAN INDIA directions issued by the Supreme
Court in Union of India and Ors. v. Ashish Agarwal (supra), there is
no cavil that all notices issued under Section 148 of the Act after
01.04.2021 in consonance with the provisions regarding re-assessment
[Section 147 to 151 of the Act] as were in force prior to 01.04.2021,
were required to be construed as notices under Section 148A(b) of the
Act.
12. The present petition was listed on 12.02.2024 before the
Coordinate Bench of this court and this court had passed the following
order:
“1. The proceedings initiated by the respondent which are
impugned herein pertain to Sections 148A(b) and (d) of the
Income Tax Act, 1961 [“Act”].
2. Undisputedly, the notice under Section 148 of the Act
bears the date of 31 March 2021. According to Mr.
Lalchandani, a copy of the screenshot of the Income Tax
Business Application [“ITBA”] portal would indicate that it
was duly uploaded and was available on the portal of the
Department on 31 March 2021 itself. This is so contended in
light of what appears at pdf page 80 of our digital record. In
addition to the above, Mr. Lalchandani also refers to the
recitals appearing in the notice dated 23 November 2021
[Annexure P-5] and which too refers to the date of issuance
of the notice under Section 148 of the Act as 31 March 2021.
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3. However, the respondent in the counter affidavit which has
been filed before us has taken the categorical stand that
although the notice was digitally signed on 31 March 2021,
it was sent and delivered to the petitioner on 01 April 2021.
Paragraph 11 of the counter affidavit reads as under: –
“11. That the assessee’s case is also covered with
the decision of Hon’ble High Court of Delhi in the
case of Suman Jeet Aggarwal and that the case
pertains to category ‘C’, as the notice u/s 148 of
the Act in the assessee’s case for the year under
consideration was digitally signed on 31.03.2021
but the notice was sent and delivered to the
assessee on 01.04.2021 [ITBA delivery status
through email sent time stamp 01.04.2021 at
07:30:47 AM and delivered time stamp
01.04.2021 at 07:30:48 AM].”
4. The aforesaid issues are addressed in the backdrop of the
judgment of the Supreme Court rendered in Union of India
& Ors vs. Ashish Aggarwal [(2023) 1 SCC 617] as well as
the decision of the Division Bench of this Court in Suman
Jeet Agarwal vs. Income-tax Officer & Ors. [2022 SCC
OnLine Del 3141].
5. Insofar as the notice bearing a date of 31 March 2021 and
digitally signed on the same date is concerned, the Division
Bench in Suman Jeet Agarwal had held that subject to
verification, determinative would be the date and time of the
dispatch as recorded on the ITBA portal and that the action
of the respondent would be liable to be adjudged accordingly.
It was further pertinently observed that if the date and time
of the dispatch recorded is found to be 01 April 2021 or
thereafter, the notices would be governed by the decision
rendered in Ashish Aggarwal.
6. In view of the aforesaid, we call upon the respondent to
file an additional affidavit categorically making a disclosure
therein of the date and the time when the notice in question
was uploaded on the ITBA portal. The said affidavit be filed
within a period of three weeks from today.”
13. In compliance with the said order, the Revenue has filed an
affidavit, inter alia, affirming as under:
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“5. That in the assessee’s case, the notice u/s 148 of the Act
was issued to the assessee on 31.03.2021for the
assessment year 2013-14 which was sent and delivered
to the assessee on 01.04.2021 i.e. “sent time stamp” is
01.04.2021 at 07:30:47 AM and “delivered time stamp”
is 01.04.2021 at 07:30:48 AM. Further, the notice u/s
148 of the Act issued on 31.03.2021 in assessee’s case
was sent through speed post on 01.04.2021 to the
assessee.”
14. The Revenue had also filed an additional affidavit further
affirming as under:
“7. That it is stated in compliance of the orders dated
12.02.2024 and 28.03.2025 that the notice under Section
148 in question was not generated manually, so as to give
rise to a situation where it would then have to be
manually “uploaded” on ITBA by the Respondent. It is
stated that the notice was digitally generated and was
digitally signed on 31.03.2021 at 07:44 PM and it must
have thereafter been uploaded on the ITBA portal
automatically, as per the information system
programmed which operates automatically, over which
the Respondent has no control at all whatsoever. As the
Respondent does not have access to the records on the
ITBA server, a request for the said information was made
to the concerned authorities. The said information is also
being tendered under cover of this affidavit as
ANNEXURE-1.”
15. It is clear from the above that the notice had been signed digitally
on the system on 31.03.2021 and was, thus, placed on the portal.
However, the email was despatched to the petitioner on the morning of
01.04.2021 at 07:30:47 AM and was delivered at 7:30:48 AM. The
notice was also despatched to the petitioner by speed post on
01.04.2021.
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16. It is material to note that it is not the petitioner’s case that he had,
in fact, received the notice on 31.03.2021.
17. Section 149(1) of the Act proscribes issuance of notice beyond
the period as stipulated in the said section. In Suman Jeet Agarwal v.
Income Tax Officer and Ors.: (2022) 449 ITR 517, the Coordinate
Bench of this Court had considered the question regarding as to the date
of issue of a notice under Section 148 of the Act for ascertaining the
period of limitation for issuance of such a notice. We consider it
apposite to refer to the following extracts of the said decision:
“25. Question No. (I) : Whether the jurisdictional Assessing Officer’s
act of generating notice in the Income Tax Business Application portal
on March 31, 2021, without despatching the notice meets the test of the
expression “shall be issued” in section 149 of the Act of 1961, and saves
the notices from being time barred?
25.1. It has emerged as an admitted position on facts, that the e-mails
attaching the impugned notices dated March 31, 2021, were despatched
by the Income Tax Business Application servers on April 1, 2021, or
thereafter.
25.2. Faced with the aforesaid factual position, it has been contended by
the Department that since generation of impugned notices on the Income
Tax Business Application portal on March 31, 2021, is undisputed, the
singular act of generation of notice by the jurisdictional Assessing
Officer satisfies the requirement of “issued” for the purpose of section
149 of the Act of 1961 and despatch of the notice on March 31, 2021 is
not a mandatory requirement.
*****
25.12. The review of the aforesaid judgments of the Supreme Court and
the several High Courts shows that all courts have consistently held that
the expression “issue” in its common parlance and its legal interpretation
means that the issuer of the notice must after drawing up the notice and
signing the notice, make an overt act to ensure due despatch of the noticeSignature Not Verified
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to the addressee. It is only upon due despatch, that the notice can be said
to have been “issued”.
25.13. Further, a perusal of the compliance affidavit reveals that while
the function of generation of notice on Income Tax Business Application
portal and digital signing of the notice is executed by the jurisdictional
Assessing Officer, the function of drafting of the e-mail to which the
notice is attached and triggering the e-mail to the assessee is performed
by the Income Tax Business Application e-mail software system. Thus,
mere generation of notice on the Income Tax Business Application
screen cannot in fact or in law constitute issue of notice, whether the
notice is issued in paper form or electronic form. In case of paper form,
the notice must be despatched by post on or before March 31, 2021 and
for communication in electronic form the e-mail should have been
despatched on or before March 31, 2021. In the present writ petitions,
the despatch by post and e- mail was carried out on or after April 1, 2021
and therefore, we hold that, the impugned notices were not issued on
March 31, 2021.
*****
25.18. Additionally, the contention of the counsel for the Department
that generation of section 148 notice on the Income Tax Business
Application screen amounts to “issued” within the meaning of section
149 of the Act of 1961 is not borne out from the instructions issued by
the Directorate of Income-tax (Systems). On the contrary, the said
circulars duly recognize that after generation of notice the concerned
Income-tax authority is required to take overt steps for issuing the said
notice to the assessee. The circulars use the words “generation” and
“issuance” distinctively. In this regard reference may be made
illustratively to the following instructions :
(a) The Income Tax Business Application Assessment Instruction No. 2
(F. No. System/Income Tax Business
Application/Instruction/Assessment/ 16-17/177, dated August 1, 2016)
issued by the Directorate of Income-tax (System) mentions that :
“the Assessing Officer Staff/Assessing Officer Inspector will not be
able to generate the notice but will be able to view the notices already
generated by the Assessing Officer for taking a printout of the same,
for issue to the assessee.”
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(b) The Income Tax Business Application Assessment Instruction No. 3
(F No. System/Income Tax Business
Application/Instruction/Assessment/ 177/16-17/), dated February 3,
2017, also illustrates the same distinction :
“Details of the Authority/party from whom information is
requisitioned can be entered along with date for compliance and the
notice can then be generated and issued.”
25.19. The counsel for the Department have also sought to argue that
generation of a notice with document identification number on Income
Tax Business Application screen conclusively indicates that the notice
has been irrevocably issued. The submission of the respondent is not
borne out from the applicable circular regarding document identification
number issued by Central Board of Direct Taxes and is therefore a mere
ipse dixit of the counsel.
25.20. As per Circular No. 19 of 2019 (F. No. 225/95/2019-ITA.II),
dated August 14, 2019 ([2019] 416 ITR (St.) 140 ) issued by the Central
Board of Direct Taxes, the document identification number was
introduced to maintain a proper audit of trail of communications issued
by the Income-tax authority. The said circular does not state that the
generation of document identification number would automatically
constitute issuance of the notice. Relevant extract from the
aforementioned circular is reproduced as under (page 140 of 416 ITR
(St.) :
“.. . However, it has been brought to the notice of the Central Board of
Direct Taxes (the Board) that there have been some instances in which
the notice, order, summons, letter and any correspondence (hereinafter
referred to as ‘communication’) were found to have been issued
manually, without maintaining a proper audit trail of such
communication.
2. In order to prevent such instances and to maintain proper audit trail
of all communication, the Board in exercise of power under section
119 of the Income-tax Act, 1961 (hereinafter referred to as ‘the Act’),
has decided that no communication shall be issued by any Income-tax
authority relating to assessment, appeals, orders, statutory or
otherwise, exemptions, enquiry, investigation, verification of
information, penalty, prosecution, rectification, approval etc. to the
assessee or any other person, on or after October 1, 2019 unless aSignature Not Verified
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computer-generated document identification number (DIN) has been
allotted and is duly quoted in the body of’ such communication.”
(emphasis supplied)
In fact, in several cases, we take judicial notice that even as on date
the jurisdictional Assessing Officers issue notices which do not have
document identification number and in those cases the Department
contends that the absence of the document identification number does
not make those notices invalid.”
18. Clearly, the date of notice is vital for determining the rights of
the parties and there can be no uncertainty regarding the date of issuance
of notice. It is, thus necessary that the date of issue of notice be
ascertained on completion of the precise steps for issuance of the notice.
In terms of the decision of this Court in Suman Jeet Agarwal v. Income
Tax Officer and Ors. (supra), as noted above, where the notice is sent
electronically, the date of dispatch of the e-mail is to be considered as
the date of issue of the notice. Thus, in this case the date of issue of
notice would have to be taken as 01.04.2021.
19. As stated at the outset, if there is no dispute that the date of
issuance of notice is considered as 01.04.2021, then the said notice was
required to be treated as a notice under Section 148A(b) of the Act in
terms of the decision of the Supreme Court in Union of India and Ors.
v. Ashish Agarwal (supra).
20. It is material to note that a notice under Section 148 of the Act is
a jurisdictional notice and issuance of such notice is necessary for the
AO to assume jurisdiction to assess/re-assess the income under Section
147 of the Act. If the notice under Section 148 is found to be invalid, it
would vitiate the proceedings commenced pursuant thereto. Thus,
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merely because the parties had laboured under a misconception at the
initial stage that the initial notice issued under Section 148 of the Act
was valid, would not invalidate the subsequent steps taken by the
Revenue in conformity with the decision of the Supreme Court in Union
of India and Ors. v. Ashish Agarwal (supra) as well as the decision of
this Court in Suman Jeet Agarwal v. Income Tax Officer and Ors.
(supra).
21. Viewed from another perspective, if an adverse re-assessment
order was passed pursuant to the notice dated 31.03.2021 (issued on
01.04.2021), the same would be vulnerable to a challenge by the
Assessee on the ground that the proceedings were not in compliance
with the directions issued by the Supreme Court in Union of India and
Ors. v. Ashish Agarwal (supra).
22. In view of the above, we find it difficult to sustain the petitioner’s
challenge in the present petition. The petition is, accordingly,
dismissed.
VIBHU BAKHRU, J
TEJAS KARIA, J
MAY 28, 2025
RK
Signature Not Verified
Digitally Signed
By:TARUN RANA W.P,(C) 12561/2022 Page 16 of 16
Signing Date:29.05.2025
15:43:13