INSUBCONTINENT EXCLUSIVE:
MUMBAI: Responding to a bunch of writ petitions, for the financial years 2015-16 and 2016-17, the Delhi high court has recently held that
the extended period of ten years, for re-opening of Income-tax (I-T) assessments should be applicable only in cases involving serious tax
evasion where evidence of concealing income is above Rs
This judgement is expected to help thousands of taxpayers.The Delhi high court had to decide the validity of the notices issued to the
petitioners under section 148, keeping in view the period of limitation (period within which notices for re-opening of cases can be
issued).The petitioners submitted that in cases where the alleged escaped income is below Rs
50 lakh, the period of limitation of three years as stipulated in clause (a) of section 149(1) should apply
The extended limitation period of ten years would apply only if the escaped income was more than Rs 50 lakh.On the other hand, the I-T
and a circular that was subsequently issued by the Central Board of Direct Taxes (CBDT).The I-T authorities relied on the provisions of
justify that those notices issued at a later stage, were deemed to have been issued back in time.The Delhi high court observed that
re-opening assessments was reduced from six to three years to facilitate ease of doing business
Only in cases, where the escaped income was Rs
50 lakh or more, the I-T authorities were given the leeway to enquire into cases up to ten years
Thus, the new regime would apply even to past years, provided notices under section 148 were issued on or after April 1, 2021.Deepak Joshi,
This is a welcome decision, which will help taxpayers who are facing belated reassessment proceedings involving escaped income of less than
