Delhi High Court – Orders
Vrinda Farms Private Limited vs Deputy Commissioner Of Income Tax on 3 February, 2025
Author: Yashwant Varma
Bench: Yashwant Varma
$~33-36
* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ W.P.(C) 12502/2023
VRINDA FARMS PRIVATE LIMITED .....Petitioner
Through: Mr. Arvind Kumar, Adv.
versus
DEPUTY COMMISSIONER OF
INCOME TAX .....Respondent
Through: Mr. Sunil Agarwal, SSC with
Mr. Shivansh B. Pandya, Mr.
Viplav Acharya, Ms. Priya
Sarkar, JSCs & Mr. Utkarsh
Tiwari, Adv.
34
+ W.P.(C) 12506/2023
ANIMATE INFRASTRUCTURE AND
PROJECTS LIMITED .....Petitioner
Through: Mr. Arvind Kumar, Adv.
versus
DEPUTY COMMISSIONER OF
INCOME TAX .....Respondent
Through: Mr. Sunil Agarwal, SSC with
Mr. Shivansh B. Pandya, Mr.
Viplav Acharya, Ms. Priya
Sarkar, JSCs & Mr. Utkarsh
Tiwari, Adv.
35
+ W.P.(C) 12550/2023
NOUVELLE SECURITIES PRIVATE
LIMITED .....Petitioner
Through: Mr. Arvind Kumar, Adv.
versus
DEPUTY COMMISSIONER OF
W.P.(C) 12502/2023 & Connected Matters Page 1 of 6
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INCOME TAX .....Respondent
Through: Mr. Debesh Panda, SSC with
Mr. Vikramaditya Singh, Ms.
Zehra Khan, JSCs, Ms.
Anauntta Shankar & Ms.
Yashika Gupta, Advs.
36
+ W.P.(C) 12570/2023
HELIOS INFRASTRUCTURE A PROJECTS
LIMITE AND .....Petitioner
Through: Mr. Arvind Kumar, Adv.
versus
DEPUTY COMMISSIONER OF
INCOME TAX .....Respondent
Through: Mr. Sunil Agarwal, SSC with
Mr. Shivansh B. Pandya, Mr.
Viplav Acharya, Ms. Priya
Sarkar, JSCs & Mr. Utkarsh
Tiwari, Adv.
CORAM:
HON'BLE MR. JUSTICE YASHWANT VARMA
HON'BLE MR. JUSTICE HARISH VAIDYANATHAN
SHANKAR
ORDER
% 03.02.2025
1. This batch of writ petitions impugn the reassessment action
which has been initiated by the respondents with the issuance of
notices referable to Section 148 of the Income Tax Act, 1961 1 and
pertaining to Assessment Year 2 2012-13.
2. The reassessment action was itself trigerred by a search which
was undertaken upon Filatex Group on 01 September 2021. This led
to the issuance of the impugned notices with it being alleged by the
1
Act
2
AY
W.P.(C) 12502/2023 & Connected Matters Page 2 of 6
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respondents that the petitioners, who were the non-searched entities,
would be liable to be subjected to a reassessment action basis the
material which had been gathered in the course of that search.
3. It is in the aforesaid backdrop that learned counsel appearing in
support of the writ petitions draws our attention to the First Proviso to
Section 149(1) of the Act and which reads as follows:-
“149. (1) No notice under section 148 shall be issued for the
relevant assessment year,–
xxxx xxxx xxxx
Provided that no notice under section 148 shall be issued at any
time in a case for the relevant assessment year beginning on or
before 1st day of April, 2021, if [a notice under section 148 or
section 153A or section 153C could not have been issued at that
time on account of being beyond the time limit specified under the
provisions of clause (b) of sub-section (1) of this section or section
153A or section 153C, as the case may be], as they stood
immediately before the commencement of the Finance Act, 2021:”
4. Tested on the aforesaid provision and which would necessarily
entail us examining whether AY 2012-13 would fall within the block
of ten years, we take note of the following averments which appear in
Para 6 of the additional affidavit which has been filed in WP(C)
12502/2023:-
“6. That applying the ratio of the decisions of the Hon’ble High
Court as referred above, to the facts of the case of the Petitioner
herein, where both the satisfaction recorded by the Respondent &
the impugned Notice issued u/s 148 of the Act falls within the
period relevant to A.Y. 2023-24, the calculation of the period of
ten assessment years for which the impugned Notice for re-
assessment could have been issued on 31.03.2023 is as per the
tabular chart below:-
A.Y. 2023-24 1st Year
A.Y. 2022-23 2nd Year
A.Y. 2021-22 3rd Year
W.P.(C) 12502/2023 & Connected Matters Page 3 of 6
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A.Y. 2020-21 4th Year
A.Y. 2019-20 5th Year
A.Y. 2018-19 6th Year
A.Y. 2017-18 7th Year
A.Y. 2016-17 8th Year
A.Y. 2015-16 9th Year
A.Y. 2014-15 10th Year
5. It thus becomes apparent that the last year which could have
been reopened, if the provisions of Section 153C were kept in mind,
would be AY 2014-15.
6. We note that an identical question had arisen for our
consideration in Dinesh Jindal vs. Assistant Commissioner of
Income Tax 3 and where we had, on consideration of the relevant
statutory scheme, held as follows:-
“8. Undisputedly, and in terms of Section 153C(3) of the Act, any
search if conducted after 01 April 2021, would cease to be
regulated by that provision. Sub-section (3), in that sense,
embodies a sunset clause insofar as the applicability of Section
153C is concerned. The First Proviso to Section 149(1), however,
bids us to go back in a point of time, and to examine whether a
reopening would sustain bearing in mind the timeframes as they
stood embodied in Section 149(1)(b) or Section 153A and 153C, as
the case may be. The First Proviso essentially requires us to
undertake that consideration bearing in mind the timeframes which
stood specified in Sections 149, 153A and 153C as they stood prior
to the commencement of Finance Act, 2021.
9. Thus, an action of reassessment which comes to be initiated in
relation to a search undertaken on or after 01 April 2021 would
have to meet the foundational tests as specified in the First Proviso
to Section 149(1). A reassessment action would thus have to not
only satisfy the time frames constructed in terms of Section 149,
but in a relevant case and which is concerned with a search, also
those which would be applicable by virtue of the provisions of
Section 153A and 153C.
3
2024 SCC OnLine Del 4230
W.P.(C) 12502/2023 & Connected Matters Page 4 of 6
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10. Undisputedly, and if the validity of the reassessment were to be
tested on the anvil of Section 153C, the petitioner would be entitled
to succeed for the following reasons. It is an undisputed fact that
the proceedings under Section 148 commenced on the basis of the
impugned notice dated 30 March 2023. This date would be of
seminal importance since the period of six AYs’ or the “relevant
assessment year” would have to be reckoned from the date when
action was initiated to reopen the assessment pertaining to AY
2013-2014.
11. The computation of the six or the block of ten AYs’ was
explained by us in Ojjus Medicare Private Limited in the following
terms:
“D. The First Proviso to Section 153C introduces a legal
fiction on the basis of which the commencement date for
computation of the six year or the ten year block is
deemed to be the date of receipt of books of accounts by
the jurisdictional AO. The identification of the starting
block for the purposes of computation of the six and the
ten year period is governed by the First Proviso to Section
153C, which significantly shifts the reference point spoken
of in Section 153A(1), while defining the point from
which the period of the “relevant assessment year” is to be
calculated, to the date of receipt of the books of accounts,
documents or assets seized by the jurisdictional AO of the
non-searched person. The shift of the relevant date in the
case of a non-searched person being regulated by the First
Proviso of Section 153C(1) is an issue which is no longer
res integra and stands authoritatively settled by virtue of
the decisions of this Court in SSP Aviation and RRJ
Securities as well as the decision of the Supreme Court
in Jasjit Singh. The aforesaid legal position also stood
reiterated by the Supreme Court in Vikram Sujitkumar
Bhatia. The submission of the respondents, therefore, that
the block periods would have to be reckoned with
reference to the date of search can neither be countenanced
nor accepted.
E. The reckoning of the six AYs’ would require one to
firstly identify the FY in which the search was undertaken
and which would lead to the ascertainment of the AY
relevant to the previous year of search. The block of six
AYs’ would consequently be those which immediately
precede the AY relevant to the year of search. In the case
of a search assessment undertaken in terms of Section
153C, the solitary distinction would be that the previous
year of search would stand substituted by the date or the
year in which the books of accounts or documents andW.P.(C) 12502/2023 & Connected Matters Page 5 of 6
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assets seized are handed over to the jurisdictional AO as
opposed to the year of search which constitutes the basis
for an assessment under Section 153A.
F. While the identification and computation of the six
AYs’ hinges upon the phrase “immediately preceding the
assessment year relevant to the previous year” of search,
the ten year period would have to be reckoned from the
31st day of March of the AY relevant to the year of search.
This, since undisputedly, Explanation 1 of Section 153A
requires us to reckon it “from the end of the assessment
year”. This distinction would have to necessarily be
acknowledged in light of the statute having consciously
adopted the phraseology “immediately preceding” when it
be in relation to the six year period and employing the
expression “from the end of the assessment year” while
speaking of the ten year block.”
7. Accordingly, and for the reasons assigned in Dinesh Jindal, we
find ourselves unable to sustain the reassessment action. This since,
undisputedly, AY 2012-13 falls outside the maximum block of ten
years.
8. We, accordingly, allow the instant writ petitions and quash the
impugned notices dated 31 March 2023 issued under Section 148 of
the Act.
YASHWANT VARMA, J
HARISH VAIDYANATHAN SHANKAR, J
FEBRUARY 3, 2025/kk
W.P.(C) 12502/2023 & Connected Matters Page 6 of 6
This is a digitally signed order.
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The Order is downloaded from the DHC Server on 10/02/2025 at 21:15:45
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