Calcutta HC dismisses Writ Petition Challenging Order passed u/s 148A(d) of Income Tax Act on limitation, citing Availability of Alternative Remedy [Read Order]

Manoj Kumar Bagree, the petitioner, challenged the order passed under Section 147 read with Section 144 and 144B of the Income Tax Act, 1961, dated 16th January 2025.. At the very outset, Ms. Roychowdhury, Senior Advocate appearing for the petitioner, submitted that though the writ petition seeks to raise a jurisdictional issue on the ground that the notice under Section 148 of the said Act being issued by the jurisdictional assessing officer is bad, however, the petitioner has participated in the said proceeding, and an assessment order has been passed thereon.

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The aforesaid participation should not be construed as the petitioner submitting to the jurisdiction or the authority of the assessing officer to issue a notice under Section 148 of the said Act, subsequent to the Scheme being notified under Section 151A of the said Act.

he submits that the order passed under Section 148A(d) of the said Act for the relevant assessment year is beyond the statutory period and is barred by limitation.

Mr. Dhudoria, advocate appearing for the respondents at the very outset submitted that the instant writ petition has been filed as and by way of an afterthought. Admittedly, the petitioner has participated in the said proceeding without raising the above issues. Today, after the re-assessment order has been passed, though such order is an appellable order, the instant writ petition has been filed to somehow bypass the statutory remedy. According to him, the court ought not to entertain this writ petition having regard to the alternative remedy provided for in the Scheme of the said Act.

It would transpire from the records that a notice under Section 148A(b) of the said Act dated 2nd March 2023 had been issued for the assessment year 2019-20 providing therein that the response to the same shall be filed on or before the 13th March 2023. Admittedly, time to file response had been extended till 27th March 2023 and as such, having regard to the submissions made by Ms. Roychowdhury with regard to the forth proviso of Section 149(1) of said Act (substituted by Finance Act 2021 w.e.f. 01.04.2021) since the order under Section 148A(d) was not passed within a period of 7 days from the extended period, the order is barred by limitation.

To appropriately appreciate the scope and effect of third and fourth proviso of Section 149(1) of the said Act as amended by the Finance Act 2021 for the purpose of excluding the period of limitation in issuance of a notice under Section 148 or for an order under Section 148A(d) of the said Act, as the case may be, as provided for in Section 149(1) of the said Act,

In addition to the above, having regard to the forth proviso, if after excluding the period provided for in the third proviso it transpires that the period of limitation available to the assessing officer for passing the order under clause (d) of Section 148A is less than 7 days, such remaining period shall stand extended to a further period of 7 days and the period of limitation under the sub-Section shall be deemed to be extended accordingly.

In terms of the notice issued under Section 148A(b) of the said Act, the original period for filing the response was till 13th March 2023 which stood extended till 27th March 2023. Having regard to the third proviso contained in Section 149(1) of the said Act the assessing officer is entitled to the exclusion of the time provided for seeking response, including the extended time therefor. Having regard thereto, in my view, the assessing officer was entitled to exclusion of 25 days. Admittedly, the order impugned has been passed on 6th April 2023 and as such, there was no application of the fourth proviso at all.

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A single bench of Justice Raja Basu Chowdhury viewed that the contention raised by Ms. Roychowdhury that the order passed under Section 148A(d) of the said Act is beyond the period of limitation, cannot be sustained. Since, the petitioner otherwise has an alternative remedy to challenge the order passed under Section 147 read with Section 144 and Section 144B of the said Act,the petitioner shall be at liberty to pursue his remedy before the statutory authority.

Further held that “in the event, the petitioner files an appeal within a period of 4 weeks from the date of receipt of the downloaded copy of this order from the official website of this Court, upon compliance of all formalities by the petitioner, the appellate authority shall hear out and dispose of the appeal on merit.”

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