TOLA cannot Revive Reassessment Bar After 6 Years: ITAT Sets Aside ₹1.09 Cr Demand [Read Order]
The Tribunal held that extended timelines under TOLA cannot override the time bar applicable to reopening completed assessments.
![TOLA cannot Revive Reassessment Bar After 6 Years: ITAT Sets Aside ₹1.09 Cr Demand [Read Order]](https://images.taxscan.in/h-upload/2026/01/12/2118405-tola-cannot-revive-reassessment-bar-taxscan.webp "TOLA cannot Revive Reassessment Bar After 6 Years: ITAT Sets Aside ₹1.09 Cr Demand [Read Order]")
The Mumbai Bench of the Income Tax Appellate Tribunal (ITAT) held that the Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020 (TOLA) cannot revive reassessment proceedings initiated after the expiry of the six-year statutory limitation period, and consequently set aside a tax demand of ₹1.09 crore raised through reassessment proceedings under the...
The Mumbai Bench of the Income Tax Appellate Tribunal (ITAT) held that the Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020 (TOLA) cannot revive reassessment proceedings initiated after the expiry of the six-year statutory limitation period, and consequently set aside a tax demand of ₹1.09 crore raised through reassessment proceedings under the Income Tax Act, 1961.
The appellant, Swami Vivekanand College, challenged the validity of reassessment proceedings initiated for the Assessment Year 2015-16. The Assessing Officer (AO) reopened the assessment on the ground that the assessee had allegedly not filed a return of income under Section 139 of the Income Tax Act, 1961, and had undertaken cash deposit transactions during the relevant year, as reflected on the INSIGHT portal.
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Based on this information, a notice under Section 148 of the Income Tax Act, 1961 was issued on 13 April 2022, followed by completion of assessment determining total income at ₹1,09,65,970. The assessee’s appeal before the National Faceless Appeal Centre was dismissed, prompting the present appeal before the Tribunal, primarily challenging the reassessment as being barred by limitation.
The Bench of Saktijit Dey, Vice President, and Jagadish, Accountant Member, held that the reassessment proceedings were barred by limitation and therefore invalid. The Tribunal observed that the notice under Section 148 of the Income Tax Act, 1961 had been issued on 13.04.2022, which was beyond six years from the end of Assessment Year 2015-16.
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Relying on the Supreme Court’s decision in Union of India v. Rajeev Bansal, the Tribunal held that the TOLA could not be applied to extend the limitation period for reassessment for Assessment Year 2015-16. Since the notice itself was barred by limitation, the Tribunal ruled that the notice, the reassessment proceedings, and the consequential assessment order were void ab initio.
Accordingly, the Tribunal quashed the reassessment proceedings and set aside the ₹1.09 crore demand, allowing the appeal on the issue of limitation.
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