Reassessment Notice Beyond 10 Years Limit: Delhi HC Quashes Notice u/s 149 of Income Tax Act [Read Order]
The Delhi HC quashed the reassessment notice, which was issued beyond the limitation prescribed under Section 149 of the Income Tax Act
![Reassessment Notice Beyond 10 Years Limit: Delhi HC Quashes Notice u/s 149 of Income Tax Act [Read Order]](https://www.taxscan.in/wp-content/uploads/2025/04/Reassessment-1.jpg "Reassessment Notice Beyond 10 Years Limit: Delhi HC Quashes Notice u/s 149 of Income Tax Act [Read Order]")
In a recent ruling, the Delhi High Court quashed a reassessment notice issued under Section 148 of the Income Tax Act, 1961, as it was issued beyond the permissible 10-year limit under the amended Section 149 of the Income Tax Act. Janus Infrastructure Projects Pvt. Ltd. had filed a writ petition challenging the said notice and an earlier notice dated 13 March 2023, as well as an order...
In a recent ruling, the Delhi High Court quashed a reassessment notice issued under Section 148 of the Income Tax Act, 1961, as it was issued beyond the permissible 10-year limit under the amended Section 149 of the Income Tax Act.
Janus Infrastructure Projects Pvt. Ltd. had filed a writ petition challenging the said notice and an earlier notice dated 13 March 2023, as well as an order dated 18 May 2023 that had dismissed their objections. The reassessment attempt followed a search and seizure operation carried out on a third party on 02 March 2022.
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Based on that operation, the Department claimed to have uncovered material justifying reassessment of the petitioner’s income. A notice under Section 148 was served to the petitioner on 06 October 2023, and later again on 06 February 2024 for AY 2014–15.
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The petitioner’s counsel argued that the reassessment notice was time-barred even under the amended reassessment regime introduced by the Finance Act, 2021. The petitioner argued that the first proviso to Section 149(1) limits reassessment to a maximum of ten years from the end of the relevant AY, and that AY 2014–15 clearly fell outside that window.
The petitioner relied on earlier decisions of the same court, including Filatex India Ltd. v. DCIT, Flowmore Ltd. v. DCIT, and Ojjus Medicare Pvt. Ltd. v. PCIT, which clarified the computation of the limitation period in reassessment cases based on searches involving third parties.
The department counsel argued that the reassessment was justified as the escaped income exceeded Rs. 50 lakhs and was discovered through valid search proceedings, and explained that the amendment allowed for reopening assessments up to ten years if substantial undisclosed income in the form of assets or expenditures was found.
The bench comprising Justice Yashwant Varma and Justice Harish Vaidyanathan Shankar observed that the relevant AY in this case, 2014–15, fell outside the 10-year limit applicable under Section 149(1)(b) read with Section 153C of the Income Tax Act.
The court clarified that for non-searched persons, the ten-year period is to be computed from the date the seized materials are handed over to the jurisdictional Assessing Officer, not the date of the search itself. As the notice dated 06 February 2024 attempted to reassess AY 2014–15, the court found it clearly beyond the statutory timeframe. The court allowed the writ petition.
To Read the full text of the Order CLICK HERE
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