Ashok Kumar Agarwal & Ors v. UOI (2021 ) 439 ITR 1/ 206 DTR 229 / 322 CTR 873/ 131 taxmann.com 22 ( All ) ( HC) .www.itatonline .org . Ashok Kumar Agarwal & Ors v. UOI ( All ) ( HC) .www.itatonline .org .Editorial: SLP filed by the revenue , Notice issued returnable on 15-3 -2022 UOI v. Ashish Agarwal ( SLP ( C ) 1767/2022 dt. 11-2 -2022

S. 148 : Reassessment – Notice – Constitutional validity – The delegation authorized being only for the purpose of enlarging limitation under a valid law, such delegation could not be exercised to resurrect the provision of law that stood omitted from the statute book by virtue of its substitution made by the Finance Act, 2021, w.e.f. 01.04.2021.- Interpretation of Taxing Statutes — Legislative Substitution- Interpretation of Taxing Statutes — Legislative Substitution- Cassus omisus cannot be supplied, either by the delegated legislation or by Courts – The Enabling Act only extended the limitation up to 31.03.2021 to do certain things only. Thereafter, it delegated the power to cause such further extensions to do those things beyond the date 31.12.2020, upto 30.06.2021 – delegate to do colourably, that which it cannot directly do after the Parliament enforced Sections 2 to 88 of the Finance Act 2021, w.e.f. 01.04.2021. once the principal legislation enacted the law as has been done in the present case, its delegate was denuded of its powers, in the field occupied by the principal legislature- Reassessment notices issued under section 148 of the Act are quashed . [ S. 147, 148A, 149, 151 , 151A , 153,292 Relaxation of Certain Provisions) Act, 2020 , S.3(1) of the Act 38 of 2020, Art , 226 ]

The petitioners have challenged the validity of the re-assessment notices issued to them, under Section 148 of the Act. Another challenge has been raised to the validity of the Explanation appended to clause (A)(a) of CBDT Notification No. 20 of 2021, dated 31.03.2021 and Explanation to clause (A)(b) of CBDT Notification No. 38 of 2021, dated 27.04.2021. Those notifications have been issued under the powers vested under Section 3(1) of the Act 38 of 2020 namely, the Taxation and Other Laws (Relaxation of Certain Provisions) Act, 2020 (hereinafter referred to as the ‘Enabling Act’).   A delegated legislation can never overreach any Act of the principal legislature. Second, it would be over simplistic to ignore the provisions of, either the Enabling Act or the Finance Act, 2021 and to read and interpret the provisions of Finance Act, 2021 as inoperative in view of the fact circumstances arising from the spread of the pandemic COVID-19. Practicality of life de hors statutory provisions, may never be a good guiding principle to interpret any taxation law. In absence of any specific clause in Finance Act, 2021, either to save the provisions of the Enabling Act or the Notifications issued thereunder, by no interpretative process can those Notifications be given an extended run of life, beyond 31 March 2020. They may also not infuse any life into a provision that stood obliterated from the statute with effect from 31.03.2021. Inasmuch as the Finance Act, 2021 does not enable the Central Government to issue any notification to reactivate the pre-existing law (which that principal legislature had substituted), the exercise made by the delegate/Central Government would be de hors any statutory basis. In absence of any express saving of the pre-existing laws, the presumption drawn in favour of that saving, is plainly impermissible. Also, no presumption exists that by Notification issued under the Enabling Act, the operation of the pre-existing provision of the Act had been extended and thereby provisions of Section 148A of the Act (introduced by Finance Act 2021) and other provisions had been deferred. Such Notifications did not insulate or save, the pre-existing provisions pertaining to reassessment under the Act. In view of the above the Court held that  all the writ petitions must succeed and are allowed. It is declared that the Ordinance, the Enabling Act and Sections 2 to 88 of the Finance Act 2021, as enforced w.e.f. 01.04.2021, are not conflicted. Insofar as the Explanation appended to Clause A(a), A(b), and the impugned Notifications dated 31.03.2021 and 27.04.2021 (respectively) are concerned,  Court declared  that the said Explanations must be read, as applicable to reassessment proceedings as may have been in existence on 31.03.2021 i.e. before the substitution of Sections 147, 148, 148A, 149, 151 & 151A of the Act. Consequently, the reassessment notices in all the writ petitions are quashed. It is left open to the respective assessing authorities to initiate reassessment proceedings in accordance with the provisions of the Act as amended by Finance Act, 2021, after making all compliances, as required by law.  ( WTNo. 524 o 2021 dt .30 -9 -2021

Editorial Note: It was held that the decision of the learned Single Judge of the Chhattisgarh High Court in W.P. (T) No. 149 of 2021 Palak Khatuja Vs Union of India & Ors. , decided on 23.08.2021 does not lay down the correct law.

 

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  1. […] in law, and null and void. The revenue is permitted to take further steps as per law.  Followed  Ashok Kumar Agarwal & Ors. v. UOI (All.)(HC), Bpip Infra Pvt. Ltd. and Ors. vs. ACIT and Ors; and dissented from Palak Khatuja Vs Union of […]

  2. […] Followed, Ashok Kumar Agarwal & Ors. v. UOI (All.)(HC), Bpip Infra Pvt. Ltd. and Ors. vs. ACIT and Ors (Raj (HC); and Mon Mohan Kohli v. ACIT (Delhi) (HC). (WPA No.11950 of 2021 dated January 17, 2022) […]

  3. […] Followed, Ashok Kumar Agarwal & Ors. v. UOI (All.)(HC), Bpip Infra Pvt. Ltd. and Ors. vs. ACIT and Ors (Raj (HC); and Mon Mohan Kohli v. ACIT (Delhi) (HC) and Bagaria Properties and Investments Pvt. Ltd. Vs. Union of India (WPO No.244/2021) decided on January 17, 2022 ( D.B. Civil Writ Petition No. 969 of 2022 dated January 27, 2022 ) […]

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